THE UK Government has announced a fresh set of welfare reforms set to plunge hundreds of thousands of people into poverty.
In her Spring Statement to Parliament on Wednesday, Chancellor Rachel Reeves revealed that a package of reforms announced last week would not save as much money as anticipated and said the Government would go further to cut welfare spending.
Reeves gave extra detail on cuts to Universal Credit, which come on top of already-announced changes to Personal Independence Payments (PIP).
Universal Credit
The Chancellor has squeezed people on Universal Credit further than anticipated. The standard rate of Universal Credit will increase to £106 per week by 2030, down from expectations it would rise to £107.
The health element of Universal Credit will be cut by 50% and then frozen for new claimants, Reeves (below) announced.
Accounting for £1 billion of these savings being earmarked for job seeker schemes, the changes are expected to save around £3.4bn over the next five years.
Another already-announced measure for Universal Credit is the Government’s plan to consult on banning people under the age of 22 from accessing the health element of the benefit.
PIP changes
There were no new measures on PIP announced at the Spring Statement – but they are where much of the money from the cuts is expected to come.
The Government will make it harder to claim the benefit, which is not linked to work but instead intended to provide support for people who face extra living costs associated with their disability.
It will be made tougher to qualify for payments by raising the eligibility requirement to a minimum score of four on at least one of the daily living activities to receive the daily living element of the benefit, according to the Department for Work and Pensions.
It is important to note that PIP is being phased out in Scotland in favour of Adult Disability Payments (ADP), which are controlled by Social Security Scotland.
What does this mean for people on benefits?
According to the UK Government’s own impact assessment, the reforms will plunge 250,000 more people into poverty.
Of that, 50,000 more children are expected to be in poverty by 2030 because of the changes.
Further information can be found by contacting Citizens’ Advice Scotland on 0800 028 1456 or by clicking here.
