Universal Credit claimants with children could lose £1,000 a year in benefits, a think tank has warned.
The Department for Work and Pensions (DWP) is being warned low-income families with children will be worse off if the Government chooses to increase benefits in line with earnings instead of inflation. A decision on benefit increases has yet to be made, but new Chancellor Jeremy Hunt has so far refused to rule out uprating on earnings, or other economic figures.
The Resolution Foundation has said the decision would amount to a real-terms cut of £1,000 a year for families on Universal Credit.
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A working single parent with one child would lose £478, and a working couple with three children would lose £978. A couple with one child only receiving Child Benefit would lose £52 a year, while a single disabled adult on Universal Credit would lose £380.
Adam Corlett, principal economist at the Resolution Foundation, said: “These cuts would come at a time when families are already set to struggle with rising prices, soaring mortgages, and the end of temporary support schemes.
“With benefits having repeatedly failed to keep pace with inflation over the past decade, this would see real income levels for Britain’s poorest families fall to levels not seen since the turn of the century.”
Ministers have said pensions will rise in line with inflation.
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