The inequality hit

Submitted by AWL on 8 December, 2020 - 2:48 Author: Rhodri Evans
Inequality

Pandemic and lockdown (and Tory policies) have increased income inequality. A new report from the Fabian Society shows inequality set to increase even more in the coming months.

Universal Credit was increased by £20 at the start of the spring lockdown. That increase is due to be withdrawn on 1 April 2021, at a time when more and more people are likely to be unemployed or on meagre part-time pay.

The report estimates 1.1 million more in poverty (including 400,000 children) even on the most optimistic guesses about 2021 unemployment, and 3.2 million (850,000 children) on more pessimistic guesses.

Of that estimated 1.1 million, nearly half (480,000) would be in households where someone is disabled.

Two other Tory measures will hit hard. Claimants who started on Universal Credit in March or April had a nine-month “grace period” from the benefit cap (which cuts their benefits if the household total rises above a certain level). That expires in December for tens of thousands who started on Universal Credit in March, and in January for tens of thousands more who started in April.

The Local Housing Allowance, a ceiling for housing benefit, was raised in March to the still-meagre level of the 30th-highest rent out of 100 for comparable homes in each area. The government plans to freeze it as from the 2021-22 financial year, meaning claimants will have to cover more and more rent out of the income allocated for food, utilities, etc.

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