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Universal Credit cut will leave 1.5 million workers in hardship, warns Citizens Advice

Cost of living crisis as rising energy bills compounded by loss of £20 a week 

Citizens Advice has warned that 1.5 million working people on Universal Credit could be pushed into hardship this winter if their benefits are cut by £20 a week. 

The charity is anticipating a surge in families seeking its support as rising energy prices and higher living costs are compounded by the cut to Universal Credit.

Its latest research shows two thirds (67%) of working claimants say they’ll face hardship if the cut goes ahead. This includes struggling to pay their bills, getting into debt or being forced to sell belongings to make up for the shortfall in their income.

Around one in four working claimants - equivalent to 600,000 people - are worried they might not be able to afford food or other basic necessities like toiletries. 

Citizens Advice says shop workers, nursery assistants and security guards are among those seeking its help because they’re worried about how they’ll manage over the winter. 

Many will struggle to make up for the loss of £20 a week 

Around 2.3 million Universal Credit claimants are already in work. A further 1.7 million are unable to work due to health or caring responsibilities.

Frontline staff at Citizens Advice say many people they’re supporting would struggle to make up the lost money by finding work or increasing their hours.

The taper rate - a reduction to your Universal Credit based on your earnings - means someone paying National Insurance and tax could have to work nine hours at the National Living Wage to make up for the cut.

“It’s our children that would suffer”

Oliver lives in Weymouth with his partner. He works three days a week in a restaurant and alternates working days with his partner so one of them can look after their school and nursery-aged children. Due to the cost of childcare, it would be a struggle for Oliver or his partner to increase their hours. 

“If we lost that extra £20 a week it’s our children that would suffer. We’d really struggle to pay for their school clothes, equipment and swimming lessons. 

“There's been a rise in the cost of things. Our food bill has gone up but our wages haven't gone up. I just don't understand why they’re taking away the money when things are already so hard.”

Dame Clare Moriarty, Chief Executive of Citizens Advice, said:

“With energy bills set to rise and family finances already stretched to the limit, this cut is coming at the worst possible time.

“Shop workers, nursery assistants and security guards are just some of the people on Universal Credit seeking our help because they’re already struggling to make ends meet. 

“The government has shown in this pandemic that it’s willing to support people through hard times. With a cost of living crisis underway, it must reverse the disastrous decision to cut this lifeline.”

Notes to editors

  1. ICM Unlimited polling for Citizens Advice, sample of 2,183 adults receiving Universal Credit. Fieldwork conducted between 15 July and 2 August 2021.
    “Hardship” determined as people who selected any of the following in response to the question: “What impact, if any, would receiving £20 less per week in Universal Credit have on you financially?”: “I may not be able to afford food”,“I may not be able to afford other basic necessities”, “I may not be able to pay my household bills”, “I may not be able to pay my rent or mortgage”, “I may have to run down savings”, “I may fall into debt”, “I may have to borrow money from friends or family to make ends meet”,“I may have to borrow money from a commercial lender to make ends meet”, “I may have to sell my possessions to make ends meet”, “I may not be able to afford my transport costs to work”

  2. Figures from the survey were extrapolated to the population level using the DWP’s data on the total number of working Universal Credit claimants.

  3. Citizens Advice includes the national charity; the network of independent local Citizens Advice charities across England and Wales; the Citizens Advice consumer service; and the Witness Service.
  4. Citizens Advice is the statutory consumer advocate for energy and post. We provide supplier performance information to consumers and policy analysis to decision makers.
  5. The Citizens Advice Witness Service provides free, independent support for prosecution and defence witnesses in every criminal court in England and Wales.
  6. Citizens Advice offers Pension Wise services at 500 locations in England and Wales.
  7. Citizens Advice’s services are free, independent, confidential and impartial, and available to all regardless of race, gender, disability, sexual orientation, religion, age or nationality.
  8. To get advice online or find your local Citizens Advice, visit citizensadvice.org.uk
  9. For consumer advice, call the Citizens Advice consumer service on 0808 223 1133 or 0808 223 1144 to talk in Welsh.
  10. We helped 2.6 million people face to face, by phone, email and webchat in 2017-18. For service statistics see our monthly publication Advice trends.
  11. Citizens Advice staff are supported by over 23,000 trained volunteers, working at over 2,500 locations in England and Wales.
Original article link: https://www.citizensadvice.org.uk/about-us/about-us1/media/press-releases/universal-credit-cut-will-leave-15-million-workers-in-hardship-warns-citizens-advice/

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