Benefits and tax credits - Hilary Hoynes Robert Joyce Tom Waters

Describing the legacy system remains a good starting point for understanding the basics of what kind of support the UK offers to low-income households, since the key elements of support – the out-of-work safety net, the extras for housing and children, and so on – all remain in place under the UC system, and largely at the same rates. [...] This is a corollary of having a targeted system that is clearly trying to siphon support to those it deems most in need, though it also opens the door to some of the pitfalls of welfare policymaking when it comes to the well-being of those trying to navigate the system and the reliability with which the intended recipients of support actually get it. [...] How has the role of the system changed over time? In this section, we examine how the role and design of the cash transfer system have shifted over time, thanks to both policy reforms and wider changes in the UK’s economy and society. [...] (2023), ‘Benefits and tax credits’, IFS Deaton Review of Inequalities The net effect of the changes in the system and the wider economy is summarised by Figure 8, which decomposes real per-capita working-age benefit spending according to its ‘purpose’.9 We plot the cost of housing programmes as well as the cost of programmes to support claimants with disabilities. [...] 11 This means that the figure overstates the regressivity of the change in household earnings (that is, the figure does not show the fact that a segment of the full distribution of households went from zero earnings to positive earnings).