Researchers reveal the extent to which the poor have been punished by UK Tory welfare reforms which will rob Scottish households of more than £2 billion a year.
A bombshell report shows not just that deprived areas will be hit hardest but the shocking extent to which they are being punished.
In a report to the Scottish Parliament’s Social Security Committee, Sheffield Hallam University showed that by 2020 Scotland can expect to lose over £1,000 million a year as a result of welfare reforms introduced by the UK government since 2015. Researchers estimated that pre-2015 reforms already cost Scottish claimants over £1,100 million annually. This brings the cumulative loss from all the post-2010 welfare reforms to more than £2,000 million a year.
The biggest losers from the latest UK Government cuts are again the poorest. The most deprived local authorities in Scotland are worst affected. The research shows that the loss from the post-2015 reforms is expected to average £380 a year per working age adult in North Ayrshire, draining millions of pounds each year in spending power from the local economy. By contrast, Aberdeen will lose less than £200 a year per working age adult.
The four-year freeze in the value of most working-age benefits and reductions in work allowances within universal credit, which are replacing tax credits, will have the greatest impact. The new, lower benefit cap of £20,000 a year per household is likely to affect 11,000 Scottish households, losing an average of more than £2,000 a year. The pre-2016 cap affected 900 Scottish households.
John Dickie, director of the Child Poverty Action Group, said Tory welfare reforms are having a devastating impact on a whole generation:
“Families with children have already borne the brunt of massive cuts since 2010, and child poverty is forecast to rise by 50% by the end of the decade. With families in and out of work already making impossible choices between paying the rent, meeting energy bills and putting food on the table it’s frightening to imagine the impact of further cuts.
North Ayrshire & Arran MP Patricia Gibson added:
“If the Prime Minister is serious about supporting families who are just about managing, she must reverse the freeze on benefits, make sure support for families rises in line with inflation and abandon cuts to work allowances within universal credit.
“Whilst Scotland will take control of 15% of welfare spending thousands of families with children will continue to suffer due to the UK Government’s approach to welfare. I hope this research acts as a wake-up call to the Tories that their welfare reforms just aren’t working.”
Although much of the welfare system will remain reserved to Westminster, important elements will be devolved to Holyrood as part of the post-independence referendum Smith settlement. A consultation on what the new Scottish system should look like recently closed, with charities calling for the creation of a more humane system.