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9 February, 2021 Open access

Design of universal credit creates risks for women’s financial independence which have been heightened by Covid pandemic, MPs warn

Women and Equalities Committee calls for immediate DWP action to understand impact of features including the wait for first payment, joint eligibility assessments and the single earnings disregard

The Women and Equalities Committee has warned that the design of universal credit creates risks for women’s financial independence, which have been heightened by the Covid-19 pandemic.

In its third sub-inquiry on the unequal impact of coronavirus - that follows inquiries into the impact on Black, Asian and minority ethnic groups and people with a disability - the Committee considers how the government’s policies during the pandemic, including changes to the benefits and social security system, have impacted on women and affected pre-existing trends or inequalities in the labour market.

Highly critical of how the government has failed to assess the impact of its policy responses to the pandemic on women, the report highlights that many policies are exacerbating pre-existing inequalities - in particular in relation to the impacts on women of the Coronavirus Job Retention Scheme - and identifies that, in relation to the government's approach to social security, there are long-standing systemic issues with the universal credit system -

‘The design of universal credit creates risks for women’s financial independence, which can have severe consequences for women in abusive relationships. These risks have been heightened over the pandemic as other opportunities for economic support have been limited. They now also affect many more households given the rise in claimant numbers.’

NB - noting broad support for the temporary £20 weekly increase in universal credit in 2020/2021, and calling for it to continue beyond its current end date of April 2021, the Committee also rejects the DWP’s explanation for why the increase cannot be extended to claimants in receipt of legacy benefits -

‘We find it implausible that it is operationally impossible to increase the rates of legacy benefits by the equivalent amount of the increase in universal credit. We recommend the government immediately increase legacy benefit rates by the equivalent amount.’

In addition, among the Committee's other social security-related recommendations, it calls on the DWP -

Committee Chair Caroline Nokes said today -

'As the pandemic struck, the Government had to act quickly to protect jobs and adapt welfare benefits. These have provided a vital safety net for millions of people. But it overlooked the labour market and caring inequalities faced by women. These are not a mystery, they are specific and well understood. And yet the Government has repeatedly failed to consider them.

This passive approach to gender equality is not enough. And for many women it has made existing equality problems worse: in the support to self-employed people, to pregnant women and new mothers, to the professional childcare sector, and for women claiming benefits....

Our report sets out a package of twenty recommendations for change and a timescale. Taken together, these will go a long way towards tackling the problems and creating the more equal future that so many women - and men - want to see.

The government should seize this opportunity.’

For more information, see Government must assess equality impact of every policy from parliament.uk