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Exeter workers to be among hardest hit by £20 cut in universal credit

Analysis shows proportion of benefit claimants in Exeter in work is among highest in country.

Universal credit   Low pay   Coronavirus pandemic  

Analysis by the TUC has found that workers in Exeter will be among the worst affected in England when the £20 per week universal credit top-up ends on October 6.

The uplift, worth just over £1000 per year, was introduced as a temporary measure in March 2020 to help claimants cope with the financial disruption caused by the pandemic.

According to analysis published by the TUC, 42.1% of universal credit claimants in the South West were in work in May 2021, but earning low incomes which qualify them for the benefit.

In Exeter the figure was higher still, at 43.4%.

Job Centre Plus entrance Photo: J.J.Ellison under Creative Commons license

The analysis has highlighted the culture of low pay in the region. Even before the pandemic, the area with the lowest average wages in the UK was North Devon.

The South West is heavily reliant on retail, hospitality and tourism for employment, sectors in which employees often have low-paid, insecure jobs which were significantly affected by the pandemic.

Emma Congreve of the University of Strathclyde’s Fraser of Allander Institute said the TUC’s findings revealed “a long-standing issue of low pay in sectors that have been particularly affected, meaning they are more likely to tip over the threshold into being able to claim universal credit.

“The pandemic has exposed a number of underlying inequalities in the labour market.”

Katie Schmuecker of Joseph Rowntree Foundation called the end of the uplift “the biggest overnight cut to the basic rate of social security since the Second World War”.

There have been renewed calls to make the £20 uplift permanent as its abolition approaches.

Analysis by Joseph Rowntree Foundation shows more than a third of working-age families in 413 parliamentary constituencies would be hit by the cut, 191 of which are represented by Conservatives.

Conservative MPs Peter Aldous and John Stevenson wrote to Boris Johnson last month, describing universal credit as “a system that can better protect families when they face hardship” and asking him to reconsider the cut.

In response, the Prime Minister said that the government’s preference would be for a “jobs-led recovery”, echoing Work and Pensions Minister Therese Coffey’s comments to MPs in July that the focus of support should be “strongly [on] getting people into work and jobs”.

Last week one hundred organisations, including charities, public health experts, paediatricians and Bright Blue, a Conservative thinktank, signed a letter calling on Boris Johnson to abandon the planned cut, saying the reduction would push half a million people, of which 200,000 are children, into poverty.

This week footballer Marcus Rashford, who led a successful campaign last year against government plans to cut free school meals during the summer holidays, and who has previously challenged the chancellor on the universal credit cut, urged the government to end threats to social security payments and instead end what he called a pandemic of child hunger.

Yesterday work and pensions minister Baroness Stedman-Scott told the House of Lords that her department had not carried out a formal assessment of the impact of cutting the universal credit uplift, which has been in place for 19 months, as it was “introduced as a temporary measure” and “we have no obligation to conduct an impact assessment as we’re returning to business as usual”.

2.3 million workers in the UK are currently receiving universal credit, while 38% of all universal credit claimants are in work.


 is a court reporter and NCTJ Diploma student who is doing portfolio work experience with Exeter Observer.

 


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