How the Chancellor can ensure the Spring Statement delivers for low-income households
Here are 2 key changes we want to see
The introduction of Universal Credit is one of the biggest welfare changes. Seven million households will receive the benefit once roll-out is complete.
At Citizens Advice, we have been campaigning for changes to Universal Credit so that it provides people with enough money to live on, and is paid in a way that reflects the reality of people’s lives.
Next week the Chancellor is scheduled to make his annual Spring Statement, where he’ll provide an update on government spending. This is a vital opportunity to help deliver a welfare benefits system that provides people with the support they need at different points in their life.
Below we outline 2 key areas where the government should focus spending — ending the benefit freeze and reviewing the 5-week wait for Universal Credit.
End the benefit freeze
The value of most working-age benefits has been frozen since 2016. Yet since then, the cost of living has continued to rise.
This has made it harder for people to cover the day-to-day costs they face, and we are seeing this first hand — almost a quarter of the people we help on Universal Credit are also seeking debt advice.
The current benefits freeze is due to come to an end next April. But we’re calling on the government to bring this change forward to this year.
This would provide a much-needed boost to the incomes of those struggling to make ends meet.
Review the 5-week wait
Currently under Universal Credit, claimants have to wait 5 weeks for their first payment. But for many this is simply too long.
Half of the people we help waiting for their initial payment are unable to keep up with bills or rent. And people who take out an advance on their first payment are struggling more than those who don’t, often due to financial difficulties they face before moving on to Universal Credit.
The government can improve this by getting money to people quicker as they move on to the benefit by:
- Moving the start date of the claim to the point a Universal Credit account is registered.
- Bringing forward the 2-week run-on of further legacy benefits, which include Jobseeker’s Allowance and Employment and Support Allowance, to meet the needs of current claimants.
- Reviewing how and if advance payments are repaid to ensure these are an affordable option that claimants can use.
We’ll be watching closely to see what next week’s Spring Statement means for people accessing support from benefits.
Our welfare benefits system needs to work everyone. To do that, we need to ensure people have enough to live on and be financially secure. The government can work towards just that by adopting the changes outlined above.
