Today’s cut to Universal Credit will have a significant impact on many of the people our charity serves who are among the 5.8 million people affected by the loss of £86.67 to their monthly incomes in England, Wales, and Scotland. Individuals and families living with or affected by HIV, disabled people, and those who experience enduring mental health issues include those who live on low incomes that are set to become even lower with this cut alongside rising energy and food costs.
As an equality and diversity charity we are concerned about the disproportionate impact this will have on the people we support who are already facing health and economic inequalities, such as Black women living with HIV as lone parents, individuals living with HIV who have no family support or partner, the disabled population of Greenwich whom we assist with Personal Independence Payment applications and appeals, and many of the regular members of our LGBTQ+ Mental Health Drop-In who struggle to make ends meet. They all represent groups we have referred to local foodbanks in south London and Essex, and who have been referred for emergency payments from METRO’s own Hardship Fund. This Fund has issued over £23,000 in emergency £50 payments between March 2019 and October 2021 to those in dire financial straits.
Helpful as one-off payments might be in a crisis, they are a sticking plaster for a financial situation in which a reliable regular income, even if it is low, can at least enable and empower individuals to plan around their income and expenditure themselves, and to reduce their risk of getting into debt or facing financial crises. Given the cut to Universal Credit payments we also foresee an associated increase in mental health issues, including anxiety, stress and depression.
We echo the concerns of the Joseph Rowntree Foundation about the Government’s new Household Support Fund to be administered by local authorities as an inadequate solution to providing crisis payments in the context of the impending low-income crisis in the broader economic climate. The Universal Credit income uplift during the pandemic was so significant for many of our service users in making ends meet, and they are now understandably reliant on this additional payment for necessities including food, utility bills, rent, internet connection and items for children such as clothes, books, and toys.
We know about financial hardship because of the quantity of referrals to our own Hardship Fund. Our frontline staff support those most in need to apply for £50 one-off payments to ease particular financial issues, such as not being able to afford the cost of bedding. As our HIV domain Family Support and Advocacy Manager Edith Ntabyera explains, there are various issues and needs:
- Financial crises due to benefit cuts and the impact of changes in benefits policy
- People who are ill and need extra money for healthy food or for transport to hospital
- Clothing for those who are facing eviction from their homes
- Those who are in debt and are struggling to meet their utility bills, even before price rises
- Providing sufficient food for children and other necessities
The service users who apply for METRO’s Hardship Fund include people who live in overcrowded housing or who have had problems securing affordable social housing, people who have been on zero-hour contracts and have had little notice of terminated contracts or who have not been paid during illness. They have had little control over these circumstances.
Universal Credit cuts also comes at a time when the conclusion of the furlough scheme, the increase in the cost of food, and escalating gas prices will only add to the economic pressures for those already on low incomes. As a diversity and equality charity that provides health and wellbeing services we strive to empower people, for example with support in improving their mental health through participating in weekly peer support groups. Investment in these sessions and the personal change processes this can enable are gradual and require long-term personal, sustained investment to achieve just as finding ways out of a cycle of poverty can take time. Income certainty is surely one way for people who need social welfare support to be able to gradually realise their own routes out of a very limited income and to lift their heads above the parapet of poverty. Pulling the plug on a significant annual income addition of over £1,000 that individuals and families have become dependent on will do little to help those people move beyond the issues that have caused them to be living on very low incomes. Some of those issues they may be able to change gradually, with support, not by plunging people deeper into a cycle of poverty.
Support from The National Lottery Community Fund during 2020 enabled us to provide services to over 300 people who were struggling with issues such as food poverty and debt. This funding ensured that we could advise and signpost these individuals to critical support that they might have not have known how to access otherwise, or which they felt stigmatised accessing such as their local foodbanks. Funding from the London Community Response Fund enabled us to provide computer tablets and internet connection to 60 service users for up to six months who would have been digitally excluded during the COVID-19 pandemic.
Such funding has been transformative but only in the short term. METRO is looking strategically at how we can raise funds in the long term that can enable us to support people to transform their lives, their health and their wellbeing sustainably rather than having to stop and start our support services based on funding cycles. We also want to ensure that we can continue to engage the communities in which we are based in shaping our services and informing our approach to empowering people and communities to move out of poverty.
If you are affected by the Universal Credit cut visit the Citizen’s Advice website for some suggestions on alternative support and reducing your monthly outgoings.