Universal Credit Cuts Expected as Further Benefits Set to Fall in Spring Statement
Chancellor Rachel Reeves is anticipated to announce additional cuts to universal credit in the upcoming spring statement on Wednesday. Reports suggest that claimants of universal credit will face two significant changes to the benefits they receive. The announcement is expected to bring further concern to those reliant on benefits in the UK.
Last week, Department for Work and Pensions (DWP) minister Liz Kendall revealed plans for substantial changes to benefits, including universal credit and the Personal Independence Payment (PIP). The proposed reforms aimed to save £5 billion; however, an independent review conducted by the Office of Budget Responsibility (OBR) indicated that the savings would amount to around £3.4 billion instead.
The revisions include stricter assessments for PIP payments, impacting a considerable number of beneficiaries. Despite the initial expectations, it was assessed that many individuals at risk of losing health-related benefits would instead qualify for support due to more severe conditions. Consequently, an extra £500 million in reductions is reportedly on the horizon through two key measures.
Firstly, there is a proposal to freeze universal credit incapacity benefits for new claimants until 2030, instead of adjusting them for inflation. Secondly, a reduction in the basic rate of universal credit is planned for 2029 following a £7 per week increase by Ms. Kendall. These adjustments are forecasted to save approximately £500 million, leaving a shortfall of £1.6 billion between the initial projections and the revised figures.
To cover the remaining deficit, other aspects of public spending are likely to be cut, with further details to be disclosed in the spending review scheduled for June. The Times, which first reported on these developments, highlighted concerns that the poorest individuals will be disproportionately affected by the changes. Senior public health experts have cautioned that the reductions in disability benefits may have dire consequences, potentially leading to loss of life among vulnerable individuals.
The potential impact of the upcoming cuts has raised alarm among advocates and welfare groups, who fear the repercussions on the most vulnerable members of society. The changes are anticipated to come into effect gradually over the next few years, significantly reshaping the landscape of welfare support in the UK.
As the nation awaits the spring statement, stakeholders and policymakers are bracing for the implications of the proposed cuts. With the economic outlook remaining uncertain and the cost of living on the rise, the decisions made by the government in the spring statement are poised to have far-reaching consequences for those reliant on benefits.
In the midst of these anticipated changes, voices advocating for the protection of vulnerable individuals are growing louder. The debate surrounding welfare support and social security is likely to intensify as the government unveils its plans for the future in the upcoming statement. Stay tuned for updates on the evolving situation and its impact on households across the UK.