Millions more risk falling into poverty without urgent government action, report warns

Charity says that poverty levels will increase if the UK Government removes financial support systems in April as planned, with 1 in 5 people already found to be in poverty before the pandemic began.

13/01/21

Millions more risk falling into poverty without urgent government action, report warns

More people will fall into poverty if financial support systems put in place by the UK Government over the course of the pandemic are removed in April as planned, a new report by the Joseph Rowntree Foundation (JRF) has found.

In its annual assessment of poverty levels in the UK, the JRF found that families who were already struggling would also find it even harder to recover from the latest lockdown announced by the Prime Minister at the start of January, as many were now running extremely low on resources.

The report indicates that around 14.5 million people were found to be living in poverty before March 2020, amounting to over 20% of the total population, and that those figures will only have been worsened by rising unemployment and national lockdowns.

With the job market down nearly 70% on this time last year, many who fall into poverty over the coming months may find it even harder to escape, the foundation found.

According to the research, part-time and low-income workers were among the hardest hit by coronavirus restrictions, as many worked in sectors that were most affected by the national lockdowns such as retail and hospitality.

Black, Asian, and ethnic minority groups were also found to have been disproportionality affected by poverty increases, as well as single parents and those renting either private or social housing.

The foundation discovered that even before the start of the pandemic, millions in the UK had lived through a “decade of deprivation” due to the Conservative government’s continuation of austerity policies and failing to increase benefits in line with rising inflation.

The report called for the Government to instigate a comprehensive training scheme to help those unemployed to retrain into new roles, improve earnings and employment protections for those in low-income or part-time work, and continue to strengthen the benefits system.

The JRF uncovered that by August 2020, Universal Credit claims were up 90% from the start of the year and warned that poverty levels would rise further when the furlough scheme ends in April – as areas with high levels of furlough were also areas with high levels of new Universal Credit claims.

The system for accessing Universal Credit was criticised in the report for being too slow to initiate payments to claimants, finding that the initial five-week wait contributed towards people being unable to pay for rent and bills in the interim and ultimately ending up in more debt.

The Government needed to ensure that the temporary £20 a week increase in Universal Credit was made permanent rather than removed and extending those increases to other benefits systems such as Jobseeker’s Allowance and Employment and Support Allowance, the report concluded.

In response to the report, BASW UK Chief Executive Dr Ruth Allen called the findings “alarming” and called on the Government to invest more into welfare rather than continue austerity measures.

“There is the threat – despite this government’s election promises – of a return to austerity measures as the Treasury seeks to recoup the funds it has paid out during the height of the pandemic. This must be resisted. It makes no social or economic sense,” said Dr Allen.

“What we need to see is a proper strategy to tackle out of work poverty, properly funded local authorities and a vision for the future of social care all of which will support real economic and civil society recovery. We cannot cut out our way out of poverty. People need support and investment in their communities and their lives.”

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