Benefit payments ‘too low’ to keep people out of homelessness as energy bills soar

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Millions of people face destitution this year as skyrocketing energy and food prices mean jobless benefit payments may not be enough to cover basics, experts have warned.

The Joseph Rowntree Foundation (JRF) said unemployment benefit levels may soon fall below the amount required to stave off destitution, meaning recipients would not have enough money to pay for necessities such as heating, clothing and adequate nutrition.

Trussell Trust, a provider of food banks, reported growing demand for its emergency food packages this winter and warned that it was “inevitable” that more people would be left destitute without urgent government action.

The Institute for Public Policy Research (IPPR) think tank expects millions of people will be unable to afford essentials and “face impossible choices between heating and eating” unless ministers increase payments to lower-income households.

After years of cuts in real terms, the jobseeker’s allowance and universal credit base level are now just £74.60 a week for someone over 25. When inflation is factored in, the pay is its lowest level in three decades.

Research by JRF and Heriot Watt University in 2018 found that a single person living alone needs £70 a week to cover essentials.

With inflation now running at an annual rate of 5.4 percent and expected to hit 7 percent this year, the minimum income needed to escape destitution is sure to rise, and increases in benefits are not keeping pace. .

“If the level of income needed to avoid homelessness exceeds our basic unemployment benefit rate for a single adult, we can expect to see a large increase in homelessness, which is very concerning,” said Peter Matejic, deputy director of evidence and impact. at JRF.

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JRF said this point could be reached soon, with power bills expected to rise 50 percent in April before rising again in October. The organization is asking for immediate emergency payments of £500 per family for everyone receiving Universal Credit, the equivalent legacy benefits or Pension Credit.

“This must go hand-in-hand with actions to permanently strengthen our benefits system, which was woefully inadequate even before the costs of living began to rise,” Mr. Matejic added.

The UK’s poorest families are expected to see a big hit to their income as the value of benefit payments fall this year. This April, Social Security rates are expected to rise 3.1 percent, well below the increase in living costs faced by low-income households.

“That’s a recipe for disaster for families in distress,” said Alison Garnham, executive director of the Child Poverty Action Group.

“Unless the government acts, more families will not have enough money for basic items, with dire consequences for the children in those households.

“Faced with skyrocketing costs, families need help; the priority must be to increase social security by 6 percent in April.”

The impact of skyrocketing fuel bills on low-income households would be “frightening,” said Garry Lemon, director of policy and research at the Trussell Trust.

“People referred to food banks have often gone through a difficult life event like losing a job or a family breakup.

“But the main factor is the inadequacy of our benefits system that has seen a decade of cuts, caps and freezes. It’s not lifting people out of poverty.”

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In October, the government withdrew a £20-a-week increase in universal credit seen as a lifeline for many families. Food bank managers are seeing the impact of the policy “right now,” Lemon said.

“These families are being crushed from different directions. It has the elimination of the elevation to universal credit and has benefits that are not updated as quickly as inflation increases.

“The cost of absolute essentials (heat, power) is skyrocketing. The people caught in the middle of that will suffer the most.”

Even before the pandemic, more than a million people did not have enough income to cover basic needs, after the number of destitute people increased sharply between 2017 and 2019, according to JRF research.

That figure is likely to rise further unless the government acts, said Henry Parkes, a senior economist at IPPR.

“Starting in April, millions of low-income households will be hit particularly hard by rising energy bills, with the poorest families spending more than 10 pence in every pound to heat their home,” Parkes said.

“At the same time, universal credit recipients will see their benefits increase by as little as £2 a week, a fraction of the rising costs they face.

“Without action, we expect to see millions of people facing destitution, meaning they will be forced to go without essentials and face impossible choices between heating and eating.”

Jonathan Ashworth, the shadow work and pensions secretary, said the rise in the number of children growing up poor and destitute under the Conservatives is “a badge of shame” for ministers.

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“Struggling families will be hit even harder by the Conservative cost-of-living crisis as heating bills rise, weekly purchases get more expensive and universal credit cuts hit,” he said.

Labor is calling for the warm housing discount to be extended and for VAT on energy bills to be temporarily removed.

Rishi Sunak is under increasing pressure to announce measures to help soften the blow of the cost of living crisis. Conservative MPs have called for a U-turn in a planned rise in national insurance, while energy providers and anti-poverty campaigners have demanded intervention to cut gas and electricity bills.

The Department for Work and Pensions has been contacted for comment.

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George Holan

George Holan is chief editor at Plainsmen Post and has articles published in many notable publications in the last decade.

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