This briefing looks at how the living standards of ordinary working families are being eroded.
The November 2017 Budget must ensure the incomes of the least well-off keep pace with the cost of essentials by removing the freeze and uprating income-related benefits with CPI from April 2018, and the local housing allowance with local rents.
- Almost half a million additional people are likely to be in poverty by 2020/21 as a result of the four year freeze on benefits that began in 2016/17. It is the biggest policy driver behind the expected rise in poverty.
- Higher than forecast inflation means the hit to low-income families – and gain to the Treasury - will be an estimated £0.9bn more than the £4bn originally expected from this cut in 2020/21.
- JRF recommends removing the freeze on income-related benefits and uprating them with CPI inflation from 2018/19. This would result in 380,000 fewer people in poverty in 2020/21; some 9 in 10 would be in families with children and 17 in 20 would be working families. It would cost an estimated £2.8bn in 2020/21