A better future?

Universal credit cuts, benefit rate freeze and rising rents are hitting low-income households. Even after promising no more cuts the cumulative impact of the £12bn of welfare changes either already in place or due to come into force will be far harsher than that experienced by low-income households under the first wave of austerity-driven welfare cuts during David Cameron’s leadership.

The combined impact of welfare cuts will leave struggling working families - the “just about managing” households Theresa May has vowed to help – worse off by more than £2,500 a year by 2020, according to research by the consultancy Policy in Practice

Cuts to universal credit and the four-year benefit rate freeze, coupled with rising rents and higher inflation, would see low-income working families typically lose £48.90 a week by the end of the decade.

The findings have alarmed councils and charities worried that the growing financial burden on low-income families will raise poverty and homelessness levels.

6 million low-income working families, defined by the Resolution Foundation thinktank as having a net income of £12,000 to £34,000 a year, many regularly between employment and unemployment in an insecure job market have seen their incomes remain largely flat for a decade.

Alison Garnham, chief executive of Child Poverty Action Group, said: “The huge cuts hitting, or about to hit, families under previously announced policies will be devastating to these families, communities and local authorities, as child poverty rises and huge amounts of money gets sucked out of local shops and businesses….”