Here’s how much money DWP claimants lost under austerity

The DWP logo and hands begging
Steve Topple

Households reliant on Department for Work and Pensions (DWP) benefits and HMRC tax credits have been hit hardest by austerity. This is the finding of a new report. But so far, the establishment media hasn’t picked up on this damning fact. The report shows that some mothers on benefits will have been hit with the equivalent of £5,500 worth of cuts a year.

The DWP: under fire again

As the Guardian reported, the Equality and Human Rights Commission (EHRC) has released an analysis of the effects of public spending cuts. It takes into account past and future cuts up until the tax year 2021/22. The EHRC looked at all areas of public spending cuts and how they hit different types of households, measured in cash terms. Guardian social policy editor Patrick Butler noted that:

Cuts to public services and benefits that disproportionately affect the least well-off, single parents and disabled people put the government in breach of its human rights obligations

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Digging deeper

Butler also reported that the study found:

  • “Lone-parent households lost out most from tax and spending changes, on average. In England, their losses amount to 19% of income, compared with 10.5% in Wales and 7.6% in Scotland”.
  • “Big families lose out more than smaller ones. Average losses for families with three or more children were 13% of final income…”
  • “Households containing people with a disability, younger households with an average adult age of 18-24, and black households were disproportionately affected by austerity cuts”.

This is correct. But what Butler fails to mention is that the group hardest hit by spending cuts was people who claim benefits. So it’s welfare and tax credit recipients that have lost the most.

Claimants hit hardest

Buried in the EHRC report is its analysis of multiple benefit unit households (MBUs). These are households where there is more than one benefit claimant. The EHRC found that, in England, the biggest losers were:

  • Women-only MBU households with children, losing £5,500 worth of public services each year.
  • Men-only MBU households with children, losing £4,700.
  • Mixed-sex MBU households with children were fourth, losing £4,350.

The EHRC said that cuts to school spending and social housing were driving the losses:

England effects of austerity

The EHRC said that the Scottish government had put in place policies to stop some of the most negative effects of spending cuts. But Scottish benefit claimants were still the biggest losers:

  • MBU households with children, losing £2,600:

Scotland austerity effects

The picture was similar in Wales, with MBU households with children being the biggest losers at £2,100:

Wales austerity effects

The picture in England

Looking at England in more detail, the EHRC found that the more children a household had, the more it lost out. It said this was because of:

cuts to schools spending and social housing. Households with three or more children have larger numbers of children in state schools… and are more likely to be in social housing…

Number of children and austerity effects

Meanwhile, the more impairments a disabled person had (the “disability score”), the worse off they were. The report said households with the most severely disabled people lost £2,900 due to cuts to social care, housing services and schools:

Disability austerity effects

People aged 35-44 were the biggest losers by age group in England; pensioners were least hit:

Austerity effects by age group

But overall in England, including projections to 2022, changes to tax and welfare don’t impact the poorest people as a percentage of their final income the hardest. They hit the second poorest the most:

Overall income efgfect of austerity

This is possibly due to changes to tax credits like the two-child limit and the benefit cap. But yet again, looking at the types of household in England, it’s MBUs that have lost the most as a percentage of their final income; and again, women-only MBUs were hit very hard:

Final income changes

Misogyny

And overall, female lone parents (regardless of MBU status) lost out the most as a percentage of their final income. As the EHRC noted:

The results… show that female lone parents are at a particularly severe disadvantage; they are the largest average losers from the tax and welfare reforms, and from the other public spending changes. Average total losses for female lone parent households amount to over 19% of final income – by far the largest losses of any demographic group. For male lone parents, average losses are smaller (although still substantial) at just under 14% of final income… Lone parent households overall lose 18.7%. MBU households with children where all the adults in the household are female are the second-largest losers from the combined set of reforms, with losses averaging 16% of final income

The government says…

It’s little surprise that the government rejects the EHRC’s findings. A spokesperson told the Guardian:

We reject this analysis, which doesn’t include recent announcements such as… the increase in universal credit work allowances. The report also predicts future spending but the spending review next year will set out government plans beyond 2019-20.

The Treasury, and other government departments, always considers how our policies will affect people of different incomes and those with protected characteristics such as race, religion and disabilities.

But this final part is not entirely true.

Covering its tracks

As The Canary previously reported, a UN Committee on the Rights of Persons with Disabilities (UNCRPD) report accused successive governments of “grave” and “systematic” violations of disabled people’s human rights. But the report specifically criticised the government for not doing a cumulative impact assessment of all its welfare changes on disabled people; a “protected” group, as the government refers to them in its Guardian statement.

The government hit back, saying it couldn’t do this because it couldn’t be “reliably modelled”. But again, this is not entirely true. The Policy in Practice thinktank did a cumulative impact assessment on welfare reform. You can read it here. It found that, from a baseline amount in November 2016, by 2020 households hit by welfare reforms would be on average £40.62 a week worse off.

Callous denial

The EHRC report shows a number of things. Firstly, that women and children have been hit the hardest by the Conservatives’ ideological cuts, framed as austerity. Secondly, that disabled people are also once again hit very hard. But what the report also shows is a government in callous denial; the exact same attitude shown to UN special rapporteur Philip Alston. We have a government that’s out of control, targeting people via the DWP. The EHRC report just compounds the fact that, surely now, enough is enough?

Featured image via StockSnap – pixabay and UK government – Wikimedia 

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