Impact of UK welfare cuts revealed

Thousands of families are being pushed into poverty – with UK Government welfare changes set to reduce spending on social security in Scotland by £500 million a year, Social Security Secretary Shirley-Anne Somerville said.

The 2019 Annual Report on Welfare Reform shows the largest welfare cuts since 2015 are as a result of the benefit freeze, two-child cap, and changes to the work allowance.

Other findings include:

• 8,500 Scottish families have already had their income cut by the Universal Credit (UC) two-child limit – and  that figure will reach 40,000 at full rollout, bringing up to 20,000 children into poverty

• 86% of UC claimants have seen a fall in the amount they can earn before losing UC entitlement

• 91% of Scottish households affected by the Benefit Cap contain children – and the cap has impacted on more than 3,000 households which are losing an average of more than £3,000 per year

• around 5,600 Scottish couples could lose up to £7,000 per year by 2023/2024 because of changes to Pension Credit eligibility

Social Security Secretary Shirley-Anne Somerville said:

“The UK Government is still refusing to listen to the overwhelming evidence that Universal Credit, the benefit cap and the benefit freeze have caused significant hardship and misery to thousands of people and families.

“Yet this report – the seventh we have produced - lays bare the evidence that households are having to cope with a reduction in their income of thousands of pounds – many of them with children.

“The Scottish Government will not stand by and let people who are already struggling continue to face a reliance on food banks and the stress of debt and rent arrears.

“We will continue to spend at least £100 million each year to mitigate the worst effects of the UK government welfare cuts – part of the £1.4 billion we spent last year to support low income households. This is money we should be able to invest elsewhere to help pull people out of poverty but we instead we need to use to protect the poorest and most vulnerable in our country.

“And we are introducing the Scottish Child Payment to tackle child poverty head on. But there is no doubt that without the cuts inflicted on families this could go so much further.

“It is clear that by entirely devolving social security to Scotland we could create a system with the people of Scotland for the people of Scotland.”

Background 

Annual Welfare Reform Report