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Impact of Welfare Reform on Poverty and Inequalities Harriet Eadie Co-chair PITG Volunteer Centre Edinburgh April 2014

With thanks to Prof Adrian Sinfield – Edinburgh University Chris Adams – CEC Business Intelligence Staff and volunteers at VCE

‘The future is not what it used to be’ (Paul Valery, ). ‘The Plan for Social Security … is to abolish want by ensuring that every citizen willing to serve according to his powers has at all times an income sufficient to meet his responsibilities ’ (Beveridge Report, 1942). ‘Abolition of want just before this war was easily within the economic resources of the community; want was a needless scandal due to not taking the trouble to prevent it’ (Beveridge report, 1942). Despite faults, significant change - but insecure. credit: Prof Adrian Sinfield

More changes in ‘welfare reform’ Contributory ESA, once unlimited, ends at 1 year. Personal Independence Payment (PIP) cuts 20% Disability Living Allowance spending to those of working age. ALL within context of £22bn public spending cuts in benefits & services, + more cuts to come. Make work pay (MWP): create new culture to ensure people recognise this & their responsibilities. ‘Active’, not ‘passive’, so tighter ‘conditionality’ & tougher sanctions - doubled. credit: Prof Adrian Sinfield

Universal Credit: Welfare that works Impact of new Welfare Reform Act to come ‘to radically simplify the system to make work pay and combat worklessness & poverty’. Merge 6 main means-tested benefits into one - Income Support, income-based Jobseeker’s Allowance, Employment & Support Allowance, Housing Benefit, Child & Working Tax Credits. Single taper withdrawal at 65p per £1 and other tidying-up, but … poverty predicted to rise (IFS 2013 and 2014). credit: Prof Adrian Sinfield

DECENT ‘work first’ ‘Work the best route out of poverty’ - but two- thirds children in poverty have a parent in work. Growth of ‘churning’ & zero-hours. Low pay a major cause of poverty: most back to wage 28% lower. NMinW nos up 30% in 5 yrs. ‘Decent jobs…fair wages, of such a kind, and so located that the unemployed can reasonably be expected to take them’ (Beveridge, 1944). Importance of work reward, conditions and support available in preventing poverty - training and progression. Cannot leave it to the market. credit: Prof Adrian Sinfield

Scottish poverty 17% (20% ch) will rise In part, as adequacy & simplicity sabotaged: - “Bedroom tax” - more later. - Benefit cap at median income - £26, Council tax benefit devolved or localised. - More sanctions with longer penalties. -Problems of Work Capability Assessments. Not just ATOS -Now cap on total of most benefit spending -And UC depends on fast, accurate DWP & HMRC reformed computer systems - with online applications too … ? Way behind schedule. credit: Prof Adrian Sinfield

22% of all Edinburgh households live below the poverty threshold analysis from business intelligence 48,400 households c. 105,000 individuals

18% of all Edinburgh households live in material deprivation analysis from business intelligence 39,600 Households

18% of children in Edinburgh in poverty Cost to tax payers = £156M per year Source: CEC Business Intelligence

Income inequality in Edinburgh – the “dual city” analysis from business intelligence

I have a friend who has AIDS and is a wheelchair user, his benefits have been cut by about £40 a week and he is struggling more now. As well as bad mobility he also does not have much energy at times, is very weak in his muscles and limbs, hands are getting worse too and basically has been told many times he can't work, yet he is still being asked to go for assessment Impact

We run a volunteering service – I didn’t expect to have to deliver suicide awareness training to my colleagues – As a result of several volunteers facing extreme distress at Atos (WCA) assessment process Impact

Experience from young people is fear: Three young people went to initial JCP appointments and then did not return as they were requested to evidence 30 hours of job search a week and had no access to internet and poor communication skills as well as no experience in applying for jobs. Consequence is that they live in poverty and do not receive jobseekers allowance which causes friction in the home - parents say if they do not sign on or receive benefits then they cannot live in their childhood home and then become homeless! Sad situation Impact

One client passed out his CV around a few industrial estates, because he did not name each business individually he was sanctioned Impact

My volunteer did the ‘right thing’ – got work in a hotel – came off benefits. Then after working a 60 hour week for two weeks quit because had not been paid. Sat in the dark all weekend because no money for electric - and bank holiday weekend so application for Crisis Grant could not be processed Impact

Discussion How do we in Third Sector help: Mitigate ) Prevent ) Poverty and Inequalities? Undo )

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