Our response to the Budget: Some of the Chancellor’s plans are welcome but some are worrying. Many of the childcare changes announced are a big step forward but the stringent job-search requirements for parents on universal credit (UC) are concerning and overall the package is far short of what struggling families needed from the Chancellor as they face another year of high inflation.
Just over a third (34%) of people on universal credit who are subject to the benefit cap – which the Government claims incentivises work – are assessed by the DWP as not required to look for a job because they are caring for very young children, new FOI data for Child Poverty Action Group (CPAG) shows. A further 18% are already in work but don’t earn enough to reach the threshold for the cap to be lifted.
This report focuses on some of the problems UC claimants are experiencing both making a claim for UC and receiving accurate payments, which appear to be caused by the digitalisation and automation of the UC system. Claimants who have specific life circumstances are experiencing similar problems because the UC computer system seems unable to calculate their UC payment correctly and in accordance with the law.
Universal credit (UC) is now the main working-age benefit in the UK. Since its inception, UC has been plagued with administrative issues and budget cuts and, as a result, its early promise to reduce poverty has yet to be realised. When the pandemic hit, swift changes were needed to make UC fit for purpose including an increase in the amount of financial support provided and a relaxation of some of its most punitive rules. However, the vast majority of these positive changes have already been reversed, or are due to be reversed in the coming months.
In August, Child Poverty Action Group and the Church of England published a report, Poverty in the Pandemic, which offered a glimpse into the lives of low-income families trying to survive the impact of the coronavirus pandemic. This report provides an update on how families with children are managing financially, based on an additional 393 online survey responses received in the period since the last report was published, up to the end of November 2020.
The year 2020 has put unprecedented pressures on families bringing up children. Parents across the world have taken on new challenges due to the coronavirus pandemic in keeping their children healthy and safe as well as properly fed, educated and entertained at a time when they have been required to stay at home, and when many families’ livelihoods have been threatened. Our cost of a child report looks at what items families need to provide a minimum socially acceptable standard of living for their children in 2020.
Our annual Cost of a Child report this year finds that the overall cost of a child up to age 18 (including rent and childcare) is £185,000 for lone parents (up 19% since 2012) and £151,000 for couples (up 5.5% since 2012). The gap between lone parents’ actual income and what they need to meet family needs has grown sharply: lone parents working full time for the so-called national living wage ('NLW') are 21% (£80 a week) short of what they need – after paying for rent, childcare and council tax - a gap that has more than doubled from 10% since 2012.
Financial support to low income families to pay for childcare through working tax credits is being replaced by the childcare element of universal credit. This Early Warning System report examines the impact of this change on parents and childcare providers.
In the second in this series, our report looks at problems with understanding decisions, challenging errors and protecting the rights of people claiming universal credit (UC). It outlines some of the problems claimants experience when they try to challenge a decision about their UC award. These problems have been identified by analysing case studies received via CPAG’s Early Warning System (EWS).