The triple jeopardy: the impact of benefit cuts on women
Women rely more on benefits and tax credits than men, in particular due to their caring responsibilities and their relative economic inequality and poverty. In fact, on average, one-fifth of women’s income is made up of welfare payments and tax credits compared to one-tenth for men. Put another way, benefits make up twice as much of women’s income than men’s.
To date, a total of £14.9 billion worth of cuts per year have been made to benefits, tax credits, pay and pensions, with 74% of this taken from women’s incomes. The 2012 Budget also announced that a further £10 billion of welfare cuts will be made by 2016/17.
Women will be hit particularly hard by cuts many benefits, these include:
Child benefit was a universal benefit paid to the main carer – in 94% of cases the mother – in recognition of the fact that people who have children need more money than people who do not, regardless of income. Recent research shows that in the vast majority of cases, child benefit is spent directly on meeting the needs of children.
The 2010 budget froze the rate of child benefit for three years, until April 2014. With inflation and the cost of living rising steeply, this means that the value of child benefit will be cut by over 10% by 2014.
By 2014, a family with one child will be around £130 a year worse off than if child benefit had been increased each year in line with inflation. A family with three children will be £285 a year worse off. This will hit vulnerable low-income families, particularly single parents, disproportionately hard as the cut to child benefit represents a larger proportion of their overall income.
Women make big sacrifices in lifetime earnings when they become mothers and the child benefit freeze will increase this financial sacrifice. Recent research shows that mothers in low-income households are prepared to go without food, clothing and warmth in order to protect their children (and partners) from the full impact of an inadequate income. A recent survey conducted by Netmums of 2,000 of their members found that, as a result of reduced incomes, one in five mums are missing meals so their children can eat.
Benefits for childcare
The 2010 budget reduced the amount of childcare costs the state will cover for low-income families from 80% to 70% (through cutting the childcare element of the Working Tax Credit). A survey conducted by Working Mums found that 24% of mothers have had to give up work as a result of the changes. The government itself has recognized that “the reduction in support through the childcare element of tax credits…will particularly affect women in lone parent households” as 60% of the recipients of the childcare element of the WTC are single parents.
The government has also increased the number of hours that a couple must work to be eligible from 16 to 24: each family will need to find an extra 8 hours work a week – the equivalent of one day’s work. This will affect a total of 212,000 couples and their children. A recent survey showed that 78% of parents say they cannot find the extra hours.
|“It’s the extras like school trips which will have to go, extra-curricular activities that require payment. Very concerned that although these are considered luxuries, it is the basics that will suffer too. We are in debt now so it will only get worse.” [Child Poverty Action Group, 2012]
The 2010 budget and Comprehensive Spending Review introduced a wide array of cuts and caps to housing benefit. Given that single women, many of whom are single parents, make up 50% of recipients of housing benefit (with couples making up around 20% and single males 30%) these cuts will hit women harder. In fact, 1 million more women than men claim housing benefit than men. Due to changes introduced in the Welfare Reform Bill, 50,000 households stand to lose an average of £93 a week.
Shelter analysis of official rent data has found that median rents are already unaffordable in 55% of English local authorities. In particular, the caps to Local Housing Allowance will mean that many single mothers to be priced out of their locality, a group for whom local social networks are particularly vital.
|“I already pay £80 a month rent and I can’t afford anymore than that. I have 4 daughters so I need a three bedroom. I’ve moved about so much and my kids are finally settled, they have lots of friends and go mad when I suggest moving. There’s no chance I’ll be able to get a house in the same area so they can go to the same school and I know my landlord won’t reduce the rent. I’m gutted.” Netmums forum, 2012
Find out about our current inquiry into the impact of recent changes to Jobseekers Allowance on women
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