Thousands of working-age disabled people are set to lose up to £2,800 a year under the full rollout of Universal Credit (UC), according to a report by the Resolution Foundation. The think tank warns that single individuals with long-term disabilities preventing them from working will be significantly worse off when the benefit system is fully implemented by 2030.
The report, titled 'In Credit?', highlights that over 7 million people will be covered by the six-into-one benefit change by the end of the next parliament. It notes that funding cuts introduced after the 2015 general election have exacerbated concerns about poverty among claimants. By 2028, UC entitlements will total around £86bn a year, but this is £14bn less than if the pre-2013 system had been retained.
While some groups have benefited from recent funding boosts—such as renting single parents working 30 hours a week on the national living wage, who are nearly £3,800 better off per year—the overall picture is bleak for many. The Resolution Foundation states that seven in ten working-age families eligible for means-tested support will be worse off under UC compared to the old system.
Alex Clegg, an economist at the Resolution Foundation, said UC was designed in an era of high unemployment and is ill-suited for a post-pandemic age with over 2 million claimants suffering from long-term illnesses or disabilities. He called for changes to address Britain's new challenge of long-term sickness.
A Department for Work and Pensions spokesperson defended the system, noting that benefits were boosted by 6.7% this month, worth £470 for 5.5 million households on UC. They emphasised that work remains the best path to financial security and highlighted a £2.5bn back-to-work plan to support people, including those with long-term health conditions.
