Universal credit cut will leave ‘long-term scars’ on health of poorest people

The £20-per-week cut to universal credit will increase sickness in areas where people already have the poorest health, according to new analysis.

The government must not ignore the “inextricable link” between health and poverty, the Health Foundation said as it called for ministers to scrap the cut scheduled for October 6 or risk intensifying the mental health difficulties of people already struggling with rising debts, reduced income and soaring living costs.

The “unequal impact” of the pandemic on the poorest, both in terms of a higher Covid-19 death rate and slashed family finances, reflects a “failure to prioritise support for the most vulnerable in our society”, said Jo Bibby, director of health at the Health Foundation. 

Blackpool is one of the areas worst affected, where people can expect to have good health until they are just 55 years old and where households will lose an average £282.69 from their annual incomes in a few weeks time.

“Without a very serious attempt to improve the health of the nation, damaged not just by the pandemic but also by response to the 2008 financial crisis and structural economic change, ‘levelling up’ will remain little more than a slogan. 

“A cut to universal credit would be a step backwards and an indication that the government has not learned from mistakes of the recovery from the financial crisis.

“The pandemic is not yet over,” she said, adding that keeping the increase – introduced at the start of the pandemic – is vital to “avoid long-term scars”. 

Analysts studied the number of benefit claimants and health state life expectancy data, which measures the average age health starts to deteriorate, in each local authority. The figures revealed a strong link between high universal credit uptake – signalling a lower average income – and poor health overall.

Council areas in England with more universal credit claimants are also more likely to have significantly worse health, the report showed. People living in the 10 per cent of council areas with the highest share of universal credit claimants can expect to live an average 7.8 fewer years in good health compared to those in areas where the fewest people claim the benefit.

This means people in more deprived areas are likely to see their health taper off when they are nearly 60 years old, compared to nearly 68 years old in more affluent local authorities.

The areas with the poorest health are the same parts of the country where the universal credit cut will have the most devastating impact, the report said, shrinking average family incomes by nearly twice as much compared to better-off council areas.

As well as Blackpool, areas including Middlesbrough, Oldham, Birmingham, Hartlepool and Newham are among those where health is poorest and the universal credit cut will take the most from family finances.

“The chancellor must seriously consider the inextricable link between people’s income and their health in making this decision,” Bibby said, urging ministers to invest in health as well as housing, skills and education to improve wellbeing across the country.

The proportion of working-age people claiming universal credit doubled during the Covid-19 crisis, from seven per cent in February 2020 to 14 per cent by May of this year.

Boris Johnson’s government is going ahead with the cut despite unified calls from campaigners, trade unions and former Tory welfare ministers, and despite mounting criticism of its plans to increase national insurance payments to fund the NHS which could hit low-paid workers in deprived areas the hardest.

There is also strong public support for keeping the universal credit rise introduced at the start of the pandemic, new polling by the Health Foundation showed. More than half of respondents supported the increase, which amounts to £1,040 a year, compared to 22 per cent who oppose it. 

A government spokesperson said: “As announced by the chancellor at the budget, 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. 

“In addition, the new Office for Health Improvement and Disparities will lead national efforts to improve and level up the health of the nation by tackling obesity, improving mental health and promoting physical activity.”