cover image: Options for universal credit reform beyond the £20 uplift

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Options for universal credit reform beyond the £20 uplift

7 Oct 2021

The UK safety net is already one of the weakest among advanced economies and in the UK’s own post-war history.4 Yet this is about to be compounded by the largest overnight cut to welfare in 70 years, hitting families disproportionately in the North East, West Midlands, and Yorkshire and the Humber.5 Assessing the UC cut The best way to understand the impact of the UC cut is to view it from the poi. [...] Even before the effects of energy price increases, the UC cut will leave the average single adult that is below the MIS with only 54% of the income they need to stay afloat, while the average couple with two children will have just 63% of the income they need (differences occur both because different household types have different median levels of income, but also different levels of need).8 This. [...] Alongside a scenario where the £20 uplift remains in place, we modelled the following non- exhaustive list of example reforms: ● Providing a £27 uplift to the amount of support a household receives for each child ● Removing the caps on support which limit the amount households can receive (the benefit cap and two-child limit), and providing a £12 per week uplift to the main adult element of suppor. [...] The results show that despite all the packages having similar price tags, investing in either the child elements of UC, or else combining a smaller increase in the adult element with the removal of the two-child limit and the benefit cap, has the biggest impact in terms of the overall number of people coming out of poverty. [...] Table 1: A comparison of alternatives of reform to different elements of UC compared to the £20 uplift Cost and impact on household, adult, child and total people poverty (relative poverty at 60% of median income after housing costs) for a range of reforms to UC compared to UC without the £20 uplift, for a range of working and non-working households with and without children, 2026/27 £27 uplift £1.
Pages
9
Published in
United Kingdom