Food vs Bills: How the end of the Universal Credit uplift will impact young people
The Universal Credit £20-per-week uplift is due to be phased out at the end of September 2021. Tom Bradley, Programme Officer at Settle, leads on our advocacy work and has explored how this will impact the young people we support.
“The previous allowance is not enough for a person to live off of and stay healthy. You will have to resort to a lower quality of life on the whole.”
At Settle we are extremely concerned about the government’s plans to withdraw the Universal Credit uplift at the end of this month. Working with young people who will be directly impacted by this, we feel we have a responsibility to ensure their opinions are heard. Over the last few weeks we have been speaking to the young people we work with about this withdrawal. Through this blog, we hope to amplify their voices and demonstrate why this uplift needs to be made permanent.
With the absence of any assessment for the devastating impact this withdrawal will have, this decision is sadly consistent with how young people are often treated by policymakers. Young people, and especially those who are care experienced, are rarely afforded the opportunity to engage in discussions regarding issues that directly impact them.
This cut will also occur concurrently with the introduction of a maximum price increase by many energy companies on October 1st, with a rise in National Insurance contributions on the horizon too.
The imprudent withdrawal of this uplift is symptomatic of this fundamental problem. In discussing this, one young person stated:
“I feel that young people aren’t told about the support they are given or entitled to, but are told of the support that is taken away.”
This statement is indicative of a deep rooted issue as young people are so often not consulted or informed of decisions that will cause great disruption to their lives.
The positive impact of the uplift:
The introduction of an extra £20-a-week at the start of the pandemic indicated an acknowledgement that social security payment levels were insufficient. For under 25’s living independently, to be able to afford even the most basic essential items on £59.38 a week is often impossible.
In speaking to the young people that we work with, many mentioned that this weekly increase helped them to afford essential items such as food and bills, whilst also being able to pay off any arrears or debts they may have accrued. Overwhelmingly, many mentioned how far £20-a-week can go on food specifically and the positive impact this had in freeing up money elsewhere.
“The increase has helped me to budget a lot better as £257 [per month] is not a lot to live on and get essential items. Even though it's only £20, it does a lot in terms of helping me to pay for my bills.”
This rise has been a lifeline for so many young people. In 2020/21, we saw young people’s rent arrears soar from an average of £1194 compared to £583 reported in 2019/20. With deductions from Universal Credit for debts, arrears or advanced payments being even more common, many of the young people we work with can see their pay cut by as much as 25% each month. However, in reality, deductions can amount to much more with many young people having debts independent from these losses. In situations such as these, the uplift is barely serving to keep young people above the poverty line. Reflecting on this, one care-experienced young person said:
“Yeah, I have had utility and phone debts that the uplift has helped me with. It [the uplift] has helped me to maintain buying essentials such as food whilst paying off my debts. Without it I would have had to make further cuts to what I buy each month.”
Having to choose between buying food, contributing to debts or paying bills is a decision that no one should ever be forced to make. The removal of this uplift will make these impossible decisions commonplace, pushing young people to damage their health to simply keep their head above water. This is a cruel paradox that will become a reality for so many and why the £20 increase must be retained.
Whilst this uplift provided some much needed breathing space for some, for many it was still not enough. In spite of the £20 boost, since the start of the pandemic we have issued around £14,000 in vouchers to support young people to access essential items such as food, sim cards and smartphones. If this represents the reality now, it is impossible to see how young people will be able to navigate life in an economy devastated by COVID-19 with £1040 less to their names every year. This withdrawal will have a long legacy of damage for young people across the UK.
The real impact of this withdrawal:
The vast majority of the young people we work with at Settle simply cannot make cuts to their already stringent budgets. Speaking with one young person about how they think the withdrawal will impact them, they said:
“I will have to save money by not going out with my friends and not buying tea with them.”
This is the stark reality of this withdrawal; the further dehumanisation of young people already facing multiple systemic disadvantages. A return to £59.38 a week, an insufficient amount even without the impact of COVID-19, will be detrimental to the mental health of young people. In claiming state support, claimants under the age of 25 are condemned to live on a financial knife-edge. Being unable to connect with friends and family due to financial limitations will become a normality for the young people we work with and will cause untold damage to the mental wellbeing of so many.
Another care experienced young person stated:
“The previous allowance is not enough for a person to live off of and stay healthy. You will have to resort to a lower quality of life on the whole”.
Those under the age of 25 will be hit the hardest by this withdrawal as well. Under 25’s will experience a cut of more than 25% to their weekly standard allowance, whilst those over 25 will face a 21% reduction. Capping Universal Credit based on age is illogical and only serves to increase hardship amongst an age group already hit the hardest by this pandemic.
Despite restrictions being lifted, COVID-19 is most definitely not over. The deeper impacts of the pandemic on young people’s health and wellbeing, support networks and their ability to enter the labour market are still unfolding. Removing this vital lifeline at a time when people, and especially the under 25’s, need it the most, is irresponsible.
Data from the Office for National Statistics shows that one in five unemployed young people have been out of work for over a year. The withdrawal of COVID-19 economic support will only serve to exacerbate this crisis. Simply stating that the aim is to ‘support people back into work’ is woefully inadequate when £80 a month is being taken from those already struggling. The government must make the £20 uplift permanent whilst also supporting young people to access the labour market.
We would like to thank the young people who have shared their reflections on the withdrawal of this uplift. Please share this blog to bring awareness to these experiences and together we can urge the government to #KeepTheLifeline.