The freeze in benefit payments is to come to an end in April next year, the government has confirmed. Working-age benefits such as universal credit and jobseekers allowance will rise by the rate of inflation, the Department for Work and Pensions said.
The 1.7% hike would reverse the freeze brought in by former Tory chancellor George Osborne from April 2016. Labour called it a “cynically-timed” announcement ahead of the general election on 12 December.
BBC political correspondent Nick Eardley said the move will be seen by some as an election pitch to poorer Leave-backing areas. Our correspondent additional it follows a raft of different defrayal commitments created by Boris Johnson since he became prime minister, together with funding for the NHS, faculties and police.
The benefits freeze – proclaimed within the 2015 Budget – was meant to last till the tip of this year however thus far there had been no confirmation it’d be ending.
Rather than increasing annually in line with inflation – to replicate the rising price of living – most working-age advantages and tax credits are unbroken at an equivalent price for quite four years, having last up in Gregorian calendar month 2015.
Groups like the Joseph Rowntree Foundation have argued that this has been among the most important factors in intensifying impoverishment levels among operating families with youngsters.
Other advantages that are frozen however ar currently set to rise by inflation are: Employment and support allowance, financial gain support, housing profit, kid tax credits, operating tax credits and kid profit.
Some of these ar gift advantages, that ar being replaced by universal credit.
The government conjointly aforementioned the state pension – that has not been frozen thanks to the supposed triple lock – can increase by three.9%.
Disability advantages and carers allowance, that haven’t been subject to the freeze, also will increase by one.7% next year.
The increase in advantages is predicted to price £5bn and ministers say the choice to finish the freeze can facilitate ten million individuals.
Work and Pensions Secretary Therese Coffey said: “We’re clear the most effective method for individuals to boost their lives is thru work however we all know some individuals need extra support.
“Our balanced business approach has engineered a powerful economy, with 3.6 million additional individuals in work since 2010. And it’s that robust economy that permits the United States of America to bolster the welfare safety web by increasing profit payments for working-age claimants currently.”
Labour, that is promising to scrap universal credit in an exceedingly revamp of the advantages system, known the freeze would stay in situ for variety of months nonetheless.
Adam Corlett from the Resolution Foundation think-tank described the announcement as a “missed opportunity”, adding the “confirmation that working-age benefits will only keep pace with rising prices means there will be no increase in living standards”.