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Social Justice

1 in 8 people won’t be able to afford food when universal credit is cut

The end of support schemes including the universal credit increase will “throw millions of families into crisis” at the end of September, analysts said

Around one in eight people will struggle to afford food when Covid-19 support schemes including the £20-per-week increase to universal credit and the furlough scheme, end in a matter of weeks, according to new research.

The study follows explosive reports that government officials expect a “real disaster” when the benefit is cut by £1,040 per year, which is expected to push families into homelessness and force people to rely on food banks.

“The internal modelling of ending the uplift is catastrophic,” a Whitehall source reportedly told the Financial Times.

“Homelessness and poverty are likely to rise, and food banks usage will soar. It could be the real disaster of the autumn.”

An unnamed Conservative minister allegedly said the universal credit cut would “eclipse social care as a political problem” and that many within Westminster were worried about “major backlash from the public”.

The government will lower payments, close the furlough scheme and end the requirement for landlords to give tenants six months’ notice on evictions all in the same week.

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It will mean one in seven (15 per cent) people struggle to pay their bills, according to Turn2us research.

The charity surveyed more than 4,000 people and found 17 per cent – equivalent to 8.9 million people in the population – think it is likely they will lose their job within six months, rising to 26 per cent of people between 18 and 24 years old.

One in 13 people – equivalent to 4.6 million in the population – think it is likely they will lose their home in the next six months.

“Millions of families could be thrown into crisis and be at risk of going hungry or losing the roof over their heads” at the end of the month, said Thomas Lawson, chief executive at Turn2us.

“After a decade of caps, cuts and freezes, working age benefits will be at a historically low level. There are no assurances that payments will be enough to pay for rent, put food on our tables and cover essential costs.”

Anti-poverty campaigners, opposition MPs, six former Tory welfare ministers, landlords and trade unions are among those who have pleaded with the government to make the £20 universal credit increase permanent.

Half of the population wants ministers to scrap plans to cut the payments too, the Turn2us study showed.

But the prime minister and chancellor have ignored the calls, despite announcing plans for a national insurance rise to fund the NHS which Keir Starmer said would “hit young and low-paid workers while leaving the wealthy untouched”.

Campaigners and universal credit claimants gave evidence to the All Party Parliamentary Group on Universal Credit this week. MPs heard that the cut will essentially nullify Boris Johnson’s “levelling up” plans for deprived areas in England.

Even if “every penny” of the £4bn fund promised goes to the areas identified as most in need, the committee was told, they would still be out of pocket as the communities lost £1.80 through the universal credit cut for every £1 invested through the levelling up fund.

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“We know that for many people now claiming universal credit as a result of the Covid pandemic, this is their first experience of claiming social security support,” said Debbie Abrahams, chair of the group. “They have only ever known universal credit at pre-pandemic levels and have already been struggling.

“It will be incredibly difficult, often impossible, for people to budget for the essentials such as food and bills at an already financially uncertain time for many, without people going into debt or juggling, for example, eating or heating.

“To cut this now would plunge hundreds of thousands of people into poverty overnight, it would be devastating.”

A Department for Work and Pensions spokesperson said: “The uplift to universal credit was always temporary. It was designed to help claimants through the economic shock and financial disruption of the toughest stages of the pandemic, and it has done so.

“Universal credit will continue to provide vital support for those both in and out of work and it’s right that the government should focus on our Plan for Jobs, supporting people back into work and supporting those already employed to progress and earn more.”

Research published by the Joseph Rowntree Foundation in July showed universal credit was failing to help people afford rent, food and other essentials even if they had jobs.

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