Photo: Penny Whitehouse
Photo: Penny Whitehouse

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Five benefits cuts are being introduced today: how do they affect you?

The government is introducing a series of benefits cuts this month. They’ll affect millions of people, especially the most vulnerable among us. Frances Ryan reports

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By Frances Ryan on

This week, the government is bringing in a series of new cuts to the benefit system. Here’s a guide to what five of the key changes mean and why they matter.

Housing benefit stopped for young people  

What does it mean?

From this month, single people aged 18 to 21 will no longer be entitled to housing benefit. It applies to all those on Universal Credit (the government’s new benefit system being rolled out nationally) but there are exceptions, such as for young people with children or who would be at serious risk by continuing to live with their parents. 

Why does it matter?

It’s feared it will be almost impossible for vulnerable young people – such as LBGTQ teenagers – to prove such potential harm to councils, or feel able to disclose abuse happening at home. Homelessness charities like Centrepoint warn the policy could lead to 9,000 young people being at risk of homelessness. It’s also unlikely to save much money (one study put the maximum possible at £3.3m a year) and could actually add to the housing bill as cash-strapped councils are forced to pay for expensive emergency accommodation to stop young people sleeping on the street.   

Tax credit child two-child limit

What is it?

From Thursday, Child Tax Credits – worth up to £2,780 per child per year – will only be paid for the first two children in any family (before this, there was no limit on the number of children who could receive the benefit). On top of this, there will also be no housing benefit supplement for any third child born after April 6. Controversially, the government has made an exception for children conceived through rape as well as for twins and other multiple births.  

Why does it matter?

There’s no information as yet to what women will have to do to prove they’ve been raped. With only around 15 per cent of rape survivors choosing to report abuse to the police, there’s a risk mothers will go without tax credits in order to avoid disclosing their ordeal. The wider policy could also create worrying pressure on women experiencing unplanned pregnancies, with some campaigners warning low-income women may have to have an abortion they don’t want, just to avoid the "third child penalty".       

The policy could create worrying pressure on women experiencing unplanned pregnancies, with some campaigners warning low-income women may have to have an abortion

“The family element” ending  

What is it?

An extra payment in Child Tax Credit called the "family element", worth £545 a year, is ending. It means that anyone having a child after April 2017 will no longer be eligible for the Family Element in tax credits.

Why does it matter?

As we’re still more likely to be the primary caregiver, any reduction of any child benefit will inevitably fall hardest on women. Analysis of the impact of the child tax credit cuts suggests more than a quarter of a million children will be in poverty by 2020 simply as a result of these changes. 

Bereavement benefit cuts

What is it?

The widowed parents allowance – the benefit paid to loved one essentially in lieu of the pension their husband or wife would have received if they had lived – is to be cut. From now on, there will be monthly payments of £350 for only 18 months for widows or widowers with children, as well as a one off sum of £3,500 (£100 for 18 months and a one off payment of £2,500 if no children).  

Why does it matter?

It’s thought the change will leave 91 per cent of newly widowed parents with dependent children worse off than the current system, in rare cases up to £100,000. Like many of this month’s changes, it’s also arbitrary: families with young children who lose a parent on Thursday, when the cuts take effect, rather than on Wednesday, when the old system still applies, will be disadvantaged by thousands of pounds.

Out-of-work disability benefit cuts

What does it mean?

From this week, disabled people claiming the out of work sickness benefit, Employment and Support Allowance (ESA), and classed as “WRAG” – so judged by the government as able to prepare for work but too ill to take a job – will see their benefit reduced by £30 a week. This means for the first time many disabled people unable to work will be on the same benefit rate as healthy jobseekers (that’s £73 a week).  

Why does it matter?

While ministers argue the cut will give disabled people an “incentive” to get a job, analysis predicts it will actually reduce their ability to even “think about work”. It will also cause widespread hardship: long term, the cut will see half a million disabled people lose an average £1,400 a year.  Those affected are likely to already have lost income from existing disability cuts. As it stands, many disabled people in the UK are struggling to afford food.

@DrFrancesRyan

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