JRF responds to the Chancellor's Spring 2021 Budget

JRF responds to the Chancellor's Budget, with comments from Director Helen Barnard, and from our partners, Caroline and Lola, about how the decision on Universal Credit will affect them.

Helen Barnard said: “It is unacceptable that the Chancellor has decided to cut the incomes of millions of families by £1040-a-year in six months’ time. He said this Budget would “meet the moment” but this decision creates a perfect storm for the end of this year, with the main rate of unemployment support cut to its lowest level in real terms since 1990 just as furlough ends and job losses are expected to peak. This makes no sense and will pull hundreds of thousands more people into poverty as we head into winter.

“Even before Coronavirus, incomes were falling fastest for people with the lowest incomes due in large part to benefit cuts. Ministers know this short extension offers little relief or reassurance to the millions of families, both in and out-of-work, for whom this £20-a-week is helping to stay afloat. This cut to Universal Credit will increase hardship when the economic crisis is far from over and undermine our national road to recovery.

“It is not too late for the Chancellor to do the right thing: announce an extension of the £20 uplift to Universal Credit for at least the next year. It is also totally indefensible that people who are sick, disabled or carers claiming legacy benefits continue to be excluded from this vital support. The Government must urgently right this injustice.”

On housing, Helen added:

“With billions going into propping up already high house prices through the Stamp Duty Holiday and the Mortgage Guarantee Scheme, it’s galling to see the government choose to ignore millions of renters who are already worried about mounting arrears. Many will be left struggling to keep a roof over their heads at the same time as financial support is pulled away.”

Caroline is a childminder from Northern Ireland who had to claim Universal Credit when the pandemic hit and is part of the Covid Realities project exploring the impact of the pandemic on parents and carers on low incomes. In response to the Budget she said:

This decision is another cliff edge to dread. It leaves us facing the winter months with uncertainty again. We don't know how the economy will recover, yet we face more insecurities for those on low income and on Universal Credit. Through Covid Realities, I know that so many families face this insecurity, and it’s just making our daily life – which is already so difficult – only harder still. I wish things could be different. I wish the government would listen to us.

Lola is a parent of two from the south-east who receives Universal Credit and is also part of Covid Realities. She said:

This short-term decision on Universal Credit just feels like it’s prolonging the inevitable. It fails to give us the clarity and the security that we need. It brings back all the same worries and anxieties that millions of families have been experiencing in the run up to this announcement; and that we’ll have again when this extension comes to an end this winter.