The Scottish Government’s announcement this week of increased funding for discretionary housing payments (DHPs) to mitigate the benefit cap as fully as possible is hugely welcome. It is vital now that people affected by the benefit cap apply to their local authority as soon as possible and ask for a backdate to the beginning of this year.
We welcome the commitment from the Scottish government that tackling child poverty is a top priority. Scottish government policies are working. However, soaring inflation and real terms UK benefit cuts in 2022 mean the gap between family incomes and the minimum cost of raising a child is widening horribly. It is more important than ever that all budget decisions are developed through a child poverty lens to understand the direct and indirect impacts on low-income families.
An estimated 1.8 million households on universal credit (UC) are having to live on significantly less than they are entitled to because the DWP is deducting debt repayments from their benefits at an unaffordable rate, according to new CPAG estimates. There are an estimated 2 million children in these households.
New data released today shows that 4.1 million households were claiming universal credit (UC) in February 2022. Benefits were recently increased by less than half the rate of inflation, meaning these families saw the real value of their UC fall by £660 a year on average. And while benefit levels sit at historic lows, an estimated 1.8 million households are receiving an average of £61 less each month than they are entitled to because of automatic deductions from their UC payment.
Prior to COVID-19, there were more than four million children living in poverty in the UK – that’s nine children in a classroom of 30. In London, that number rises to 11. While the full economic impact of the pandemic is yet to be seen, we know that low-income households are bearing the brunt, and for families living in the capital things are likely to get worse before they get better. Even prior to COVID-19, the high cost of rent, childcare and travel made it very difficult for London families on low incomes to cover basic costs. In addition, families with children have been hit the hardest by cuts to the social security system, squeezing family budgets even further. In the face of this, our public services have a crucial role to play in tackling child poverty and ensuring children and families recover from the pandemic.