The UK had a poverty problem long before 2020. It was exacerbated by a decade of austerity measures and then turbocharged by the Covid-19 crisis.
Redundancies, income cuts and rising prices meant 700,000 people fell into poverty as a result of the pandemic, according to analysis by the Legatum Institute. That takes the total number of UK people living below the poverty line to more than 15 million – 23 per cent of the population.
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We asked the experts what they will be focusing on to help end poverty in 2021.
Joseph Rowntree Foundation: ‘Strengthen our social security system’
At the beginning of lockdown in March, the Government temporarily increased weekly Universal Credit payments by £20 to support those facing hardship. That, as well as an increase in housing allowance, has been “a lifeline for millions of families”, Joseph Rowntree Foundation director Helen Barnard said.
She also pointed to the furlough scheme as a valuable intervention that protected millions of jobs that would otherwise have been lost. It showed the Government can “take bold action when required to make sure we can support each other through difficult times.”
What must be done now?
The steps taken in 2020 are far outweighed by the action needed to end UK poverty, Barnard warned.
“There have been significant gaps,” she said. “The 1.6 million families receiving legacy benefits, largely people who are sick, disabled or caring for others, have received no equivalent boost to their income despite often facing higher costs.
“The £20 uplift to Universal Credit is due to be taken away in April, which could sweep half a million more people into poverty. And even with the uplift in Universal Credit, we have seen rising debt and hardship as people living in high-cost areas and those affected by the benefit cap will not have seen a boost to their income.”
Campaigners have been united in their calls for the Universal Credit increase to be made permanent.
The Government plans to freeze local housing allowance from April, Barnard pointed out, meaning over time it will stop being enough to cover the lower 30 per cent of rent prices – even though millions of tenants are already worried about paying the rent and many risk eviction.
“Alongside strengthening our social security system, we need to see bold action to invest in social housing and free people on low incomes from the trap of high housing costs that so often leads to homelessness.”
Child Poverty Action Group: ‘Reinvest in social protection’
There were 4.2 million UK children living in poverty in 2019, according to Government figures. That is estimated to be 30 per cent of kids in the country, or nine for every class of 30 pupils. But of the 700,000 people newly pushed into poverty in 2020 through the pandemic, an estimated 120,000 of them were children.
This was an awful year for millions of families who have lost livelihoods or earnings and who start 2021 not knowing whether they will make ends meet in the recession ahead. “There are many, many anxious parents thinking about how they will protect their children from hardship”, Child Poverty Action Group chief executive Alison Garnham said.
But there have been positives, she added. After a year which saw Manchester United star Marcus Rashford galvanise the public into getting behind a campaign to stop disadvantaged kids going hungry during school holidays, “it became clear that the public do not want child poverty to be ignored any longer,” Garnham added.
We are calling for the removal of the benefit cap – to pull 50,000 children out of poverty, a further 100,000 children out of deep poverty (below 50 per cent of median income) and 150,000 out of very deep poverty (below 40 per cent of median income https://t.co/EQSlCMyjzz
— Child Poverty Action Group (@CPAGUK) December 22, 2020
What must be done now?
There is now a “wider understanding that we have allowed our social security net to be run down too far,” Garnham said, “to the point that it can no longer give people the protection they need in a crisis.
“People see all too clearly in the current emergency that anyone can need social security support – after all, no family could have planned for a pandemic.”
CPAG has its sights on two major goals for the year ahead that should see the Government reinvest in social protection. Firstly, the charity wants ministers to commit to retaining the £20 Universal Credit increase and ensure thousands of vulnerable households don’t face an income cut when the policy is set to end in April.
Secondly, the charity wants child benefit to increase by £10 a week and ease the pressure on already struggling families.
Turn2us: ‘Remove the five-week wait for Universal Credit’
Anti-poverty charity Turn2us also recognised the £20 increase for Universal Credit and tax credits as the main positive to take from 2020, while highlighting that the unprecedented effort required to support people through the pandemic saw charities form new partnerships that could provide more meaningful support.
The charity was also able to give out £4 million in cash grants to people in financial hardship, it said, and helped millions more claim the benefits they were entitled to and access other grants they were eligible for.
What must be done now?
Turn2us also wants the £20 increase to be maintained and, crucially, extended to so-called legacy benefits like Job Seekers and Employment allowance which is mostly claimed by disabled people.
The DWP should finally remove the five-week wait for a first Universal Credit, the charity said, and scrap the two-child limit and benefit cap as policies which only push disadvantaged people further into poverty.
Finally, the charity wants to see charities and institutions involve people with lived experience to a much greater extent when forming policy.
We have created a complete guide to financial support during #COVID2019 and we will be updating it regularly. In addition, we have also updated our Benefits Calculator to reflect the latest @DWP policy.https://t.co/66oevt3xKt
— Turn2us (@turn2us_org) March 18, 2020
End Fuel Poverty Coalition: ‘Urgent fuel poverty debt relief is needed’
The Covid-19 crisis has pushed more than half a million people into debt on their fuel bills, Citizens Advice research showed, and more than two million are behind on payments.
Stay at home advice during the pandemic is of particular concern to those struggling to cover household bills while fuel poverty rises as people keep warm.
The Government did take some “welcome steps” to combat this, End Fuel Poverty Coalition coordinator Simon Francis said. That included extending the Warm Home Discount and introducing financial support to improve energy efficiency across the country.
What must be done now?
In the new year, the Coalition will campaign for help for renters to cover fuel costs as well as a new long-term strategy to end fuel poverty in England.
“For the small steps forward, we have also seen huge challenges caused by the combination of redundancies and the economic slowdown cutting wages while lockdown and stay at home rules have increased energy consumption,” Francis said. “This perfect storm is going to result in many more people in fuel poverty and having to make choices between heating and eating this winter.
“Urgent support in the form of fuel poverty debt relief is needed while we wait longer term measures to end fuel poverty to be agreed.”