Social Security

Debate between Alison McGovern and Margaret Greenwood

Monday 4th March 2019 Commons Chamber

[Margaret Greenwood]

I thank the hon. Lady for making the point so powerfully.

The benefit freeze increases poverty. According to the Joseph Rowntree Foundation, the freeze is set to drive almost 500,000 more people into poverty by 2020. In 2018, a couple with children claiming universal credit were up to £500 worse off, and a lone parent with children was up to £400 worse off, due to the benefit freeze. The JRF says that the freeze is the single biggest policy driver behind rising poverty levels. Before the freeze was introduced in the Welfare Reform and Work Act, working-age benefits were capped at 1%, yet living costs are rising. In the 12 months to September last year, prices grew by 2.4%, according to the CPI inflation measure. The Joseph Rowntree Foundation says that between the introduction of the benefits freeze in April 2016 and November 2018, the annual cost of living for people on low incomes rose by £900.

Rising living costs and frozen social security mean that the value of benefits is increasingly inadequate to protect people from poverty. A recent report by the National Audit Office shows how the real value of the basic rate of jobseeker’s allowance and income support has fallen nearly every year since 2012-13, and it is now below its value in 2009-10. Overall, the real cut to many benefits from the four-year freeze is over 6%. According to the Resolution Foundation, child benefit is now already worth less than it was in April 1999. Beyond a family’s first child, child benefit in April 2019 will be worth 14% less than it was when it was fully introduced in April 1979. This is compounded by the Conservatives’ broken economy: low wage growth and the rise of insecure and zero-hours contracts mean that incomes are failing to meet the rising cost of living.

[Alison McGovern]

Simply, child benefit is easy to claim and has wide support in society, so are not the statistics my hon. Friend has laid out absolutely terrible for working families?

[Margaret Greenwood]

My hon. Friend makes an absolutely pertinent point, and I thank her for it.