Universal credit cut will hit 200,000 working families

The TUC has warned that 200,000 working families – and many key worker households – will be worse off in the East of England as a result of the government’s planned cut to universal credit.

New analysis published by the union body reveals the regional and local impact cutting universal credit will have on low-paid workers.

Majority of those hit by autumn cuts are working families 

200,000 workers in the region are currently receiving universal credit – the equivalent of 2 in 5 (40%) of all universal credit recipients. They will all be hit by the £20pw cut. 

The working tax credit is also being cut in October, having also been raised by £20pw in early 2020. 

So the majority of those affected by the £20pw cut to benefits this autumn will be families who are working, according to the Joseph Rowntree Foundation (JRF).

The TUC says low-paid key workers will be among those worst affected. 

TUC research published last week showed that one million children in key worker households are currently growing up poverty – with many currently receiving in-work benefits like universal credit.

Constituency breakdown

Today’s analysis breaks down the number of people receiving universal credit by region and local constituency across England.

It shows that even in wealthier parts of the country the cut to universal credit will impact heavily on low-paid workers.

For example, in the Chancellor Rishi Sunak’s constituency (Richmond) nearly half (48%) of people currently receiving universal credit are in work – with 3,025 workers in the constituency depending on it. This number will only grow as more families transfer over from the working tax credit.

And in Prime Minister Boris Johnson’s constituency (Uxbridge) around two-fifths (38%) of Universal Credit recipients are currently in work – with 3,665 workers in his constituency depending on it. This number will grow as more families transfer over from the Working Tax Credit.

Vital lifeline

The TUC says the £20 increase in universal credit has been a “vital lifeline” for low-paid workers – and that reducing a crucial in-work support will push more families below the breadline.  

The TUC says a decent social security system is also essential for helping those who lose their jobs get back on their feet and back into work.

In addition to stopping the planned £20pw cut to universal credit, the government must increase the minimum wage to £10 an hour and urgently bring forward an employment bill to tackle insecure work, says the union body.

TUC Regional Secretary Sam Gurney said:

“Everyone should have enough money to live on.

“But if the universal credit cut goes ahead many working families – and key workers – in the region will be forced to get by on much less every week. It is levelling down – not levelling up.  

“Ministers should abandon this cruel cut that will hit low-income working families. We need a social security system that helps people get back on their feet – not one that locks them in poverty.

“And we need decent jobs on decent pay for every worker in the East of England. 

“That means increasing the minimum wage, investing to create good green jobs and tackling the scourge of insecure work. Cutting universal credit isn’t the way to achieve decent work.”

For more information visit the TUC website