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How the Government have continued to prop up a two-tier welfare state by ignoring 2 million people during this pandemic

Ella Abraham

Z2K’s Policy and Campaigns Officer, and Disability Benefits Consortium’s Campaigns Co-Chair

Throughout this pandemic those on legacy benefits have been denied the vital £20 per week financial lifeline that those on Universal Credit (and Working Tax Credit) have seen. The Government have refused to engage with the evidence that the almost 2 million people on legacy benefits, who are predominantly disabled, sick, or careers, need an increase in their income. This refusal means that too many legacy benefit claimants are left to choose between heating their homes, buying medication or putting warm food on the table. In a talk on Universal Credit hosted by the Resolution Foundation earlier this year, Neil Couling, Director of Universal Credit, explained the Government’s reason for ‘uplifting’ the rate of Universal Credit by £20 a week. Mr Couling said: “I wanted to help people affected by the pandemic and what I said was that meant I couldn’t create a new class of benefit claimants pre-covid and post-covid on Universal Credit, so for want of a better phrase, there was a kind of windfall gain for existing Universal Credit claimants.”

What Mr Couling is saying here is two-fold. The first is that those ‘people affected’ by the pandemic that the Government intended to help financially are the ‘new class’ of people who’ve lost their jobs. This in turn implies that the Government do not acknowledge that the almost 2 million people on legacy benefits are also ‘people affected’ financially by the pandemic as shown in a survey of 224 legacy benefit claimants by the Disability Benefits Consortium.

Yet, despite huge pressure from campaigners and cross party MPs to increase legacy benefits, the Government have resorted to repeating the same excuse that those 2 million people could move to Universal Credit to benefit from the £20 per week uplift. But the reality is, that large numbers of the 1.5 million people in the support group in Employment and Support Allowance, would lose out if they moved to Universal Credit and in turn the increase would lift a further 200,000 people out of poverty. There is also significant evidence as to the financial and emotional hardship that moving to Universal Credit causes many people, including increased foodbank usage and accumulation of rent arrears.

When we ask why legacy benefits can’t be boosted as Universal Credit has been, we’re told that changes cannot be made because the legacy benefit IT software is too difficult to change. Yet the Department for Work and Pensions (DWP) had the perfect opportunity last month to include an uplift as part of the annual benefit uprating. Instead, DWP chose to maintain what has become in essence a two-tier benefit system and apply to basic legacy benefits only a derisory 37p per week increase. This comes in the face of a rise in unemployment expected to be the sharpest for at least 50 years soaring to 2.6 million in 2021 and a disability employment gap of 28.4%.

Now, amidst a public health crisis, when poverty rates and the costs of essentials are rising and there is uncertainty around employment. This is not the time to be pushing people onto Universal Credit by the back door, particularly given the long-term implications of doing so. Ministers have recognised the need for an increase in benefits for those ‘people affected’ by this pandemic, now they must now do so for the 2 million left behind. No more excuses.

Join over 119,000 people, over 100 disability organisations and cross party MPs in our campaign to end this discrimination – write to your MP today.