Kiri: On Wednesday 26 March, Rachel Reeves, the Chancellor, announced her Spring Statement. Now, this was originally dubbed ‘the spring forecast’ and was only meant to be a bit of a forecast about what’s going to be happening in the economy in the coming months and years.
However, because of Rachel Reeves’ reduction in her fiscal headroom, it meant that she had less to spend than she wanted, and therefore she was faced with two choices: she could either raise taxes, which she ruled out, or she could cut Government spending, which is what she ended up doing.
Now, on the Spring Statement day, she announced a range of different measures that she was going to take to cut Government spending. But the one that we at Christians Against Poverty are most interested in was the cuts to welfare spending.
Now, some of these were already announced ahead of the Spring Statement, in what is called the Health and Disability Green Paper. Now, this green paper, it’s worth noting, is just in consultation stage at the moment which means we, as CAP, can feed in but also that it is up for discussion and input.
Some of these announcements in the green paper, were things like restricting the eligibility to Personal Independence Payment or PIP. You might have heard about this in the news but, for people who are disabled, there is a benefit that they are able to access. It’s not means tested and it comes in two components: daily living and mobility. And it’s designed to help with the extra costs that disabled people face because of their disability. The cuts here come from restricting the eligibility criteria, so they, they reckon around 800,000 people going forward won’t be able to access this benefit.
The other announcements that were made in the Spring Statement, which would impact people, was the cut to the Universal Credit health element. Now, this is an additional element to the benefit Universal Credit that is helping people who have, maybe, a limited capability to work because of their health. What Rachel Reeves announced was that for new claimants going forward, they were only going to receive half of the entitlement that people currently receive. And this benefit is going to be frozen for the years up until 2030. That means it’s not going to rise with the cost of inflation.
Both of these and a number of other smaller policy announcements mean that people in receipt of health related benefits are going to be disproportionately impacted, and their incomes are going to reduce. Now, the thing to note here is that, this cohort of people tend to find it hard to get into work or to increase their hours. And therefore it’s some of the UK’s most vulnerable people who have had their incomes reduced.
Going forward, we at Christians Against Poverty will continue to speak to our clients and to amplify their voices to policy makers and to Government and we will continue to feed in at those consultation stages where it’s really key.
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Thanks.
