Benefits freeze must end with above-inflation rise, says Citizens Advice

The benefits freeze is set to end in April – with MPs agreeing a rise in line with inflation today – but charities and campaigners are warning that it will do little to improve life for Britain’s poorest.

Benefits and tax credits will rise by 1.7 per cent, bringing an end to the four-year freeze, which was brought in as part of ex-Chancellor George Osborne’s austerity measures.

The hated policy has left claimants experiencing real-terms decreases every year and Citizens Advice has called the end of the freeze a “welcome step in the right direction”.

But their “Making Ends Meet: The impact of the benefits freeze on people in debt” report has revealed that four in 10 households that receive benefits that have been frozen would still not have enough money to cover their costs by 2024 if rises continued every year.

The freeze has already meant that more people are finding themselves battling to make ends meet too. In the first five months of the current financial year, 40 per cent of the claimants that Citizens Advice helped were in that position. That is an increase of 25 per cent since the freeze began.

Part-time worker and Universal Credit claimant Sheila, 64, struggles to cover her monthly costs with benefits payments that can change on a monthly basis. She is now trapped in both council tax and rent arrears that mean she is forced to rely on help from a foodbank.

Later today MPs will debate uprating working-age benefits next year, following the end of the four-year freeze. But, while the freeze has ended, the erosion of our social security safety net will continue to erode – unless government rethinks its approach https://t.co/iYimv0IRN6pic.twitter.com/eaYSwr0HlP

— Resolution Foundation (@resfoundation) February 10, 2020

She said: “Quite often I don’t have any electric, so I’m very cold. I can’t even make a hot water bottle to keep warm, or make a hot drink. I have to stay under the duvet.

“Even in the months when I am paid my full Universal Credit and wages it’s still really hard to afford everything, including food.

“It’s all swings and roundabouts, I just don’t have enough money coming in to pay the council tax and rent arrears, the actual council tax, buy food and top up my gas and electric.”

Citizens Advice are demanding that the government increase income-related benefits by two per cent above inflation for four years as well as recalculating Local Housing Allowance to help those who have been left behind to catch up.

They are also asking for tweaks to the amount of money retained by working claimants under Universal Credit as well as deductions for those dealing with debts or repaying advance payments.

“Our evidence shows that increasing numbers of people simply don’t have enough money to make ends meet. While a step in the right direction, increasing benefits by inflation will not go far enough to help solve this problem,” said Dame Gillian Guy, chief executive of Citizens Advice.

“The benefits system was created to support people in times of need. The government should show it’s serious about meeting this ambition by properly investing in working-age benefits, and making sure fewer families are left in a downward spiral with no way to pay their bills.”

The report comes just days after the National Audit Office revealed that the Department of Work and Pensions had investigated 69 suicides linked to their handling of benefits claims in the last six years.

Following my request, the NAO have looked into the DWP’s processes around vulnerable claimants who commit suicide. Their report, published today, presents a catastrophic situation.

— Frank Field (@frankfieldteam) February 7, 2020

The NAO investigation revealed the department had investigated 21 deaths between April 1 2019 and November 13 2019, compared with 13 in the whole of the 2018-19 financial year, and two in the 2017-18 financial year.

And they concluded that it was “highly unlikely” that the figure represents the total number of investigations that the DWP could have done.

The department has insisted that it is committed to improving processes as a “key priority”.

A DWP spokesperson said: “We are urgently working to drive forward improvements and learn the lessons from these tragic cases. We will now carefully consider the NAO’s findings as part of our ongoing work.”