Half a million people could be plunged into “deep poverty” without extra support because of the ongoing “economic storm” they face, a new report warns.
Many families have already cut back on food and other essentials or fallen behind on rent and other bills, said the Joseph Rowntree Foundation (JRF).
Ministers are being urged to make a temporary £20-a-week increase to Universal Credit and Working Tax Credit permanent, as well as extending this support to those excluded on legacy benefits.
The foundation said its analysis suggested that if this lifeline is removed as planned in April 2021, it will cause a “significant shock” to the incomes of those who are newly unemployed and families who are already struggling.
Around 16 million people are at risk of experiencing a drop of £1,040 a year in their support, and 700,000 are likely to be pulled into poverty in the spring unless action is taken, JRF warned.
As families try to cope with additional challenges accessing childcare and transport, managing health risks, and when services like breakfast clubs and informal childcare arrangements are not available, many will be unable to cope if the uplift is reversed, JRF added.
Without this support, half a million people are likely to be plunged into deep poverty, its report said.
JRF acting director Helen Barnard said: “The additional £20 per week is a vital lifeline for many people on low incomes who are struggling to get by.
“As we all adjust to living and working alongside Covid-19, we know many families have been hit by extra costs and barriers to earning as a result. Too many households are at risk of being pulled into poverty as unemployment rises.
“We cannot afford to whip this lifeline away at precisely the time when it’s needed most. Now is the moment to help families stay afloat, not cut them adrift.
“The Autumn Budget offers an opportunity to strengthen social security by making the increase to Universal Credit permanent and extending it to those on legacy benefits who are largely sick or disabled people and carers, who have wrongly been left out.”
A spokesman for the Department for Work and Pensions said: “Government policies, in particular those related to the pandemic, are under constant review.
“We have provided £9.3 billion extra welfare support to help those most in need, including increasing Universal Credit by up to £20 a week, as well as introducing income protection schemes, mortgage holidays and additional support for renters.
“Claimants on legacy benefits can make a claim for Universal Credit if they believe that they will be better off but should check their eligibility before applying.”
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