‘Levelling up at risk due to increase in UC claimants in poorest areas’

A new report suggests the poorest areas are seeing the biggest increases in Universal Credit claimants.

woman with empty purses

 

The Covid-19 pandemic is exacerbating geographical inequality in England, with London boroughs and the most deprived local authorities of the country experiencing the biggest rise in Universal Credit claimants, undermining the Government’s levelling up agenda, according to a new report from a right-wing think tank.

The  Widening chasms analysis by Bright Blue compares the increase in the working-age population who are claiming UC between February and October 2020 in each English local authority with each local authority’s ranking in both the 2019 Index of Multiple Deprivation and 2019 Index of Education, Skills and Training.

Bright Blue says the data is current as of the end of October and includes both those who have become unemployed but also those still in work who have lost hours or income and now need to claim UC. The analysis finds that the most deprived English local authorities have seen on average an 8.5%-point increase in working age population claiming UC in the first eight months of the pandemic, as opposed to an average 4.8%-point increase for the least deprived English local authorities.

It also finds that London boroughs have seen an average 8.3%-point increase in the working age population claiming UC during the first eight months of the pandemic as opposed to an average 6.3%-point increase in all other English local authorities. Twelve of the 20 English local authorities with the highest increases in UC claimants in the first eight months of the pandemic were in London.

The English local authorities in the top 20 that have seen the greater increases in UC claimants in the first eight months of the pandemic outside of London include coastal towns and post-industrial communities such as Blackpool, Middlesbrough and Hull. The figures also show that  the most educationally deprived local authorities saw higher than average rates of increase in UC claimants. Bright Blue says this indicates that those English local authorities experiencing higher rates of UC claimants are also those less likely to be able to bounce back quickly with increased employment outcomes.

Anvar Sarygulov, Senior Research Fellow at Bright Blue and analysis author, said: “English local authorities that already faced higher deprivation are more likely to have experienced larger increases in the proportion of their working-aged population claiming Universal Credit during Covid-19, widening existing geographic inequalities. The pandemic really has made ‘levelling up’ a lot harder.

“There is also a clear relationship between local authorities experiencing higher rates of UC claimants and having lower levels of education and skills among their population. These English local authorities are therefore less likely to be able to bounce back quickly with increased employment outcomes. This really does threaten to undermine government attempts to ‘level-up’ so-called left-behind areas of the country over the long-term.”

The research came ahead of a Parliamentary debate  in which Labour called for the extension of the £20 a week increase in universal credit (UC) and working tax credits (WTC) announced by the Government and due to expire in April 2021. The non-binding motion stated: “This House believes that the Government should stop the planned cut in Universal Credit and Working Tax Credit in April and give certainty today to the six million families for whom it is worth an extra £1,000 a year.” It was carried by 278 to zero, with most of the Conservatives abstaining.

A Resolution Foundation report estimates that the withdrawal of the £20 a week payment and projected rises in unemployment when the furlough scheme ends will lead to a fall of 0.4% in average non-pensioner household incomes in 2021-22.

Another report by the Royal Society for Arts, Manufactures and Commerce [RSA] called for the uplift to become permanent among other measures to address the number of workers who have been working after testing positive for Covid. RSA research in January found around one-in-25 (4%) of workers has worked within 10 days of a positive test, rising to one-in-ten (10%) of those in insecure work such as a zero-hours contract, agency work or the gig economy; 6% of British workers have worked with Covid-19 symptoms, rising to 8% of insecure workers and 13% of the self-employed; 12% have been ordered into work when they could have easily and more safely worked from home; and only 16% think Statutory Sick Pay is sufficient to meet their needs. In addition to the retention of the UC uplift, the RSA called on the Government to allow workers who have to self isolate to be furloughed and to introduce a ‘basic income’ style scheme for the self employed, paid to all those registered with HMRC.

Safety checks

Meanwhile, a rep0rt in The Observer claims thousands of workers are being forced into work when they could work from home and says little action is being taken to enforce Covid safety. The Health and Safety Executive has been contacted 3,934 times about workplace safety issues between January 6th and January 14th and says it has taken enforcement action in 81 cases (60 involved giving verbal advice, 20 giving written correspondence and just one case resulted in an improvement or prohibition notice). Employees are advised to contact their HR team in the first instance if they have safety concerns before referring to the HSE.

Since the beginning of the pandemic, the HSE has conducted 33,088 site visits and taken enforcement action in 7,416 cases (5,908 verbal advice, 1,316 written correspondence and 192 cases resulted in improvement or prohibition notices). No prosecution action has taken place since the beginning of the pandemic.

An HSE spokesperson said: “Inspectors continue to be out and about, putting employers on the spot and checking that they are complying with health and safety law. Our role in contributing to the national response to reduce COVID-19 transmissions and support economic recovery has been widely recognised.

“We introduced proactive telephone-based spot checks earlier on in the pandemic and have since implemented the same process for spot check visits to workplaces which are undertaken by Spot Check Support Officers.”

He said this has allowed the HSE to scale up their proactive work, focus more on complex investigations and respond rapidly to local outbreaks.

Asked about the lack of prosecutions, the HSE said: “This is largely due to the vast majority of employers want to make their workplaces secure and are doing everything they can to keep people and their business safe and healthy.

“The action we take includes telling people what they need to take to address issues immediately, letters, improvement or prohibition notices, and only in the most serious cases, prosecution. Given the extreme circumstances we are dealing with, we are not expecting prosecutions to be common as we want issues addressed immediately.

“Investigation and prosecution process can take time. Court proceedings are not swift in any area and HSE investigations must go through due process and rigorous examination of evidence to ensure the likelihood of success at court.”



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