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Report: Universal credit changes increasing child poverty

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Digest: About one million more children will be in poverty by the end of the decade as a result of changes to universal credit since it was first introduced four years ago, a new report claims.

Analysis of cuts and changes to the tax credits and benefits system has been carried out by Child Poverty Action Group and the Institute for Public Policy Research (IPPR).

They found a single parent with a two- and a five-year-old working 16 hours a week for the national living wage and renting in an average cost area would be £1,658 worse off in 2020 than if the government had retained the original policy. Instead, they will have to work an extra 14 hours a week – two whole days – just to recoup the difference, almost doubling their weekly hours.

The analysis also showed a couple with two children aged two and five, working for the national living wage (one full-time and one at 16 hours per week) and renting privately in an average-cost area would be £1,283 worse off a year in 2020. This means they would have to work an additional nine hours a week to make up the difference.

Carys Roberts, IPPR research fellow, said: “Universal Credit has the potential to reduce child poverty and ensure work always pays. But our modelling for Child Poverty Action Group shows that consecutive cuts to UC have changed the policy beyond recognition.

“Changes to the design of UC since 2013-14 mean that one million more children are likely to be in poverty in 2020 than if government had retained the policy as originally legislated. Furthermore, this is in addition to the issues with implementation and waiting times that are reportedly forcing even more people into arrears and poverty.”

She urged chancellor Philip Hammond to use the Budget to “reinstate the original purpose” of universal credit “by reversing the cuts that have been made over the past three years”.

Read the full report here.

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