Labour is calling for the roll out of Universal Credit to be halted
as new data shows that while wages are failing to keep up with
inflation, cuts to in-work social security support have meant most
net incomes of recipients have flat-lined in real terms
and in some cases worsened, with women and people from ethnic
minority communities worst affected.
Analysis from the House of Commons Library, shows real wages
stagnating and in-work support contracting for both private and
public sector workers.
The analysis looked at different types of households and income
groups all working full time. It shows single parents with
dependent children being particularly badly affected, with up to
£3,100 a year less than they received with Tax Credits.
The analysis also shows that nurses and teachers will be hit
particularly hard by the combination of stagnating wages and cuts
to social security.
A single parent of two working full-time as a teacher who is a
new claimant to Universal Credit will be around £3,700 a year
worse off in 2018/19 compared to 2011/12. A single parent of two
working in the NHS on average full time earnings for the public
sector who is a new tax credit claimant will be over £2,000 a
year worse off in real-terms in 2018/19 compared to 2011/12.
Equality analysis published in response to a Freedom of
Information request submitted by Labour, predicts cuts to
Universal Credit will fall most heavily on women and ethnic
minorities. This analysis shows that households with a woman or
member of an ethnic minority are more likely to be adversely
affected by cuts to Universal Credit work allowances.
MP, Labour’s Shadow
Secretary of State for Work and
Pensions, commenting on the newly-published
analyses, said:
“It is shocking that most people on low and middle incomes are no
better off than they were five years ago, and in some cases they
are worse off. The Government’s cuts to in-work support of both
tax credits and Universal Credit are having a dramatic effect on
people’s lives, on top of stagnating wages and rising
prices.
“It’s no wonder we are seeing record levels of in-work poverty,
now standing at a shocking 7.4 million
people.
“These analyses make clear that the Government’s abject failure
on living standards will get dramatically worse if Universal
Credit is rolled out in its current form.
“That’s why Labour is calling for the roll out to be stopped
while urgent reform and redesign of Universal Credit is
undertaken, making sure work always pays and that hardworking
families are supported, creating a fair society for the many, not
the few.”
Ends
Notes to editors:
- House of Commons Library analysis including real
terms adjustments is attached
- FOI report on equality analysis of impacts of UC roll out
is attached
