Latest Public Sector News


Struggling families set to be hit hardest by highest benefit cuts in five years

Families that are “just about managing” will be hit by the biggest year of benefit cuts since 2012, the Resolution Foundation has warned.

Research by the foundation found that benefit changes set to save around £2.5bn will “significantly squeeze” incomes of these families.

The changes, which come into effect from 9 April, will affect 11 million families, including five million “just about managing” families.

A 3% real-terms cut in working age benefits this year will save £1.9bn in the third and biggest year of the four-year benefit freeze, according to the foundation, and will affect almost 11 million families.

The two-child limit for benefit claims will cost up to £2,780 for a family having a third child, affecting 150,000 families and saving £400m.

The withdrawal of the family element of support for new tax credit and Universal Credit claims from families with children will save £200m, but will cost around 400,000 families up to £545.

Around £200m is expected to be saved by through the rollout of Universal Credit by reducing the entitlements for long term sick and working families in particular.

This April’s cuts are the second biggest annual cuts since the financial crisis, with the squeeze “set to fall squarely on lower income families,” according to the foundation.

“Just about managing” families will see an average loss of £190 this year, but some families will be thousands of pounds worse off.

David Finch, chief analyst at the Resolution Foundation said that whilst the expected borrowing boost from the Office for Budget Responsibility is welcome news, it will not change the fact that families across Britain face “a huge living standards crunch” - some of which he said is a direct result of government policy.

“The government is doing the right thing on pay with another big rise in the National Living Wage and ending the cap on public sector pay.

“But for many families the extra pay will be outweighed by the £2.5bn worth of benefit cuts being rolled out,” he explained.

“With an average loss of £190, low and middle-income families are set for the second biggest welfare squeeze since the crisis, at a time when pay growth remains muted and household incomes are already under strain.

“The Chancellor is keen to stick to his brief of a short speech with no new policies.

“But given the financial challenges facing families across Britain, a quick change of his predecessor’s policies on benefit cuts would go a long way towards showing that he is on the side of hard-pressed working families,” Finch concluded.

Top image: Imgorthand

Have you got a story to tell? Would you like to become a PSE columnist? If so, click here


There are no comments. Why not be the first?

Add your comment



public sector executive tv

more videos >

last word

The importance of openness after Grenfell

The importance of openness after Grenfell

Following the recent Grenfell Tower tragedy, Lord Porter, chairman of the LGA, argues that if the public are going to have faith in the safety testing process then everything must be out in the open more > more last word articles >

public sector focus

View all News


Council mergers: taking local government by storm

17/12/2018Council mergers: taking local government by storm

It’s no secret that councils up and down the country are scrambling t... more >
National Social Value Conference 2018: Going upstream

17/12/2018National Social Value Conference 2018: Going upstream

PSE’s Daniel Broadley reflects on the key messages to take away from ... more >


Digital innovation in the public sector: The future is now

17/12/2018Digital innovation in the public sector: The future is now

One of the public sector’s key technology partners has recently welco... more >

the raven's daily blog

Don’t let a culture of resistance take hold of your organisation

17/12/2018Don’t let a culture of resistance take hold of your organisation

If we want to introduce change throughout local government, then we have to encourage our people to buy-in, writes Danny Longbottom, director of local government and health at... more >
read more blog posts from 'the raven' >

editor's comment

25/10/2017Take a moment to celebrate

Devolution, restructuring and widespread service reform: from a journalist’s perspective, it’s never been a more exciting time to report on the public sector. That’s why I could not be more thrilled to be taking over the reins at PSE at this key juncture. There could not be a feature that more perfectly encapsulates this feeling of imminent change than the article James Palmer, mayor of Cambridgeshire and Peterborough, has penned for us on p28. In it, he highlights... read more >