Tax· Welfare Happy new tax year 2025 Tax, utility bill and social security changes in April 2025 3 April 2025 by Adam Corlett and Lalitha Try April brings with it a series of tax, benefit and bill rises. We examine what these changes will mean for households and the overall outlook for disposable incomes in 2025-26. READ MORE
Living standards· Budgets & fiscal events· Welfare Unsung Britain bears the brunt Putting the 2025 Spring Statement in context 27 March 2025 by Camron Aref-Adib and Mike Brewer and Molly Broome and Alex Clegg and Nye Cominetti and Adam Corlett and Ruth Curtice and Emily Fry and Zachary Leather and Jonathan Marshall and Cara Pacitti and Simon Pittaway and Hannah Slaughter and James Smith and Imogen Stone and Greg Thwaites and Lalitha Try This briefing note analyses the choices the Government has made in the context of an awkward backdrop to the 2025 Spring Statement. READ MORE
Wellbeing and mental health· Welfare Delivering the undeliverable Five principles to guide policy makers through reforming incapacity and disability benefits 6 March 2025 by Louise Murphy The Government is set to announce a “radical” Green Paper on health-related benefit reform this Spring, and more immediate benefit cuts are expected ahead of the Spring Statement on 26 March. The backdrop is fast-rising spending on working-age health-related benefits: spending is set to rise by £32bn between 2019-20 and 2029-30, from 1.3% to 2.2% … Continued READ MORE
Childcare· Welfare Hard lessons Childcare support for parents in education 9 November 2024 by Lalitha Try England’s childcare system has often been subject to criticism, but government funding has been increased in recent years, especially for parents who work[1]. At the same time, there has been no such increase in support for parents that wish to boost their living standards longer term by undertaking education or training. The childcare system in … Continued READ MORE
Welfare Cutbacks ahead Considering the impact of proposed changes to disability benefits on living standards and the public finances 13 October 2024 by Mike Brewer and Louise Murphy The Chancellor has already come under pressure for making one welfare cut to help her address the challenging fiscal outlook in the run up to her first Budget – but there are more in store due to spending commitments inherited from the previous Government. Specifically, if the Government goes ahead with changes to the Work … Continued READ MORE
Inequality & poverty· Welfare Cold comfort Mitigating the Winter Fuel Payment cut 1 October 2024 by Alex Clegg and Jonathan Marshall The announcement that Winter Fuel Payments are to be restricted to recipients of Pension Credit or similar means-tested benefits has sparked controversy[1]. The Government and its defenders point to the lack of sense, in these straitened times, of making fuel payments to all pensioners when the majority do not need them. Opponents, however, highlight the … Continued READ MORE
Welfare Growing pressures Exploring trends in children’s disability benefits 17 August 2024 by Louise Murphy Over the last decade, the number of under-16s in receipt of Disability Living Allowance (DLA) in England and Wales has doubled, reaching 682,000 in 2023, equivalent to one-in-sixteen children. This growing caseload has been driven almost entirely by awards made to children whose main condition is either a learning difficulty, behavioural disorder or attention deficit … Continued READ MORE
General Election 2024· Public spending· Welfare Under strain Investigating trends in working-age disability and incapacity benefits 20 June 2024 by Lindsay Judge and Louise Murphy The benefits bill is frequently the subject of intense political debate. But since the pandemic, working-age health-related benefits have moved centre-stage in these discussions, as policy makers aim to understand what sits behind the historical rise in claims, and to contain future pressures too. In this briefing note – part of our Election 2024 work … Continued READ MORE
General Election 2024· Tax· Welfare· Political parties and elections Growing for gold? Analysing the tax and spend package of the 2024 Labour Manifesto 14 June 2024 by Molly Broome and Nye Cominetti and Emily Fry and Tara Goatley and Charlie McCurdy and Simon Pittaway and Hannah Slaughter and James Smith and Lalitha Try In launching its manifesto, the Labour Party put the emphasis on efforts to boost growth. But more eye-catching were promises of some of the biggest changes to the labour market in a generation, with the aim of improving the quality of work. Proposals here included new employment rights, tougher labour-market enforcement, and an innovative approach … Continued READ MORE
Universal Credit· General Election 2024· Welfare Ratchets, retrenchment and reform The social security system since 2010 13 June 2024 by Mike Brewer and Alex Clegg Spending on social security as a share of GDP has risen slightly since the financial crisis, but the system in Great Britain has undergone profound change over the same time. Large-scale structural reforms have fundamentally altered the system’s rules for working-age families, while working-age benefits have been both cut back and then not fully indexed … Continued READ MORE
General Election 2024· Tax· Welfare· Political parties and elections The narrow path to NICs cuts Analysing the tax and spend package of the 2024 Conservative Manifesto 12 June 2024 by Camron Aref-Adib and Emma Beale and Molly Broome and Lindsay Judge and Charlie McCurdy and Louise Murphy and Felicia Odamtten and Simon Pittaway and James Smith and Lalitha Try The launch of the Conservative manifesto is a big moment in this election campaign. The strategy here was clear: treble down on National Insurance (NI) rate cuts. The continued focus on NI is welcome, at least compared to the alternatives, and delivers significant cuts in tax for some, with the proposed 2p reduction delivering a … Continued READ MORE
Universal Credit· Welfare In credit? Assessing where Universal Credit’s long roll-out has left the benefit system and the country 15 April 2024 by Alex Clegg With neither of the main parties wanting to scrap Universal Credit, whoever wins the election will be governing a ‘Universal Credit Britain’, as the final stage of what has been the biggest benefit reform in a generation is due to end with a system covering 7 million families by 2029. But it is nearly 14 years … Continued READ MORE
Economy and public finances· Tax· Welfare Happy new tax year Six big changes to pay, tax and benefit policy – and how they affect households across Britain 28 March 2024 by Torsten Bell and Adam Corlett and Alex Clegg The beginning of April brings a new tax year, and a flurry of tax, benefit and pay policy changes coming into effect. Benefit levels are finally returning to their pre-pandemic levels after a difficult few years. Threshold freezes will continue to pull more people into paying tax, but the tax they pay on every extra … Continued READ MORE
Tax· Welfare Pensioner progress The impact of personal tax and benefit changes since 2010 on pensioner families 12 March 2024 by Mike Brewer and Alex Clegg and Lalitha Try Tax-paying pensioners did not gain anything from the Chancellor’s Budget last week, and policies announced since 2019, including the six-year freeze to tax thresholds, will cut the incomes of pensioners by an average of £900 a year, with the largest losses felt by pensioners on the highest incomes. This has prompted accusations that the Government … Continued READ MORE
Housing· Welfare A temporary thaw An analysis of Local Housing Allowance uprating over time 9 December 2023 by Alex Clegg In the 2023 Autumn Statement, the Chancellor announced that the Local Housing Allowance (LHA) will be re-pegged to the 30th percentile of local rents in April 2024. This will be the first increase to the LHA in four years, good news for the 1.3 million private renter households in receipt of Universal Credit or Housing … Continued READ MORE
Universal Credit· Welfare Rates of change The impact of a below-inflation uprating on working-age benefits 14 October 2023 by Lindsay Judge and Louise Murphy NB – this briefing has been updated following the publication of the ONS prices data for September 2023. The CPI inflation figure for September (6.7 per cent) is the basis on which key working-age benefits are normally uprated in the following April. But with the public finances under real pressure, and prices expected to … Continued READ MORE
Living standards· Inequality & poverty· Welfare Half time The UK’s commitment to halve poverty by 2030 18 September 2023 by Adam Corlett On 18-19 September, representatives from around the world – including the Deputy Prime Minister Oliver Dowden and the Foreign Secretary James Cleverly – will meet for a UN summit on the Sustainable Development Goals (SDGs). These goals are not just about development in poorer countries: the targets and the discussions around this summit have relevance … Continued READ MORE
Welfare Reassessing the Work Capability Assessment What might the proposed changes to the Work Capability Assessment mean for low-to-middle income families? 6 September 2023 by Louise Murphy Yesterday, the Government announced that it is consulting on changes to the Work Capability Assessment, the assessment used to determine how people with health conditions are treated within the benefits system. Coming shortly after the Health and Disability White Paper, this underlines that we are going to be talking a lot more about health- and … Continued READ MORE
Tax· Welfare Happy new tax year, 2023! Tax and benefit changes coming in 2023-24 1 April 2023 by Adam Corlett 2022-23 featured an array of tax and benefit changes, including the introduction then cancellation of a major tax rate rise, and three big cash payment schemes to help cover living costs. Tax and benefit policy in the financial year 2023-24 may prove to be less fickle, and in this spotlight we set out what is … Continued READ MORE
Universal Credit· Childcare· Welfare Inconsistent Incentives How the overlap between Universal Credit and the High Income Child Benefit Charge limits work incentives 28 December 2022 by Mike Brewer and Karl Handscomb and Gavin Kelly It is well known that some groups in the UK face high effective tax rates, but the most punitive rates of personal tax arise in a situation that has been almost completely overlooked. Families with an earner on £50,000 to £60,000, whose Child Benefit is withdrawn and who are also eligible for Universal Credit (UC), … Continued READ MORE
Welfare Sticking plasters An assessment of discretionary welfare support 28 October 2022 by Karl Handscomb This briefing note looks at discretionary welfare support in recent years, including crisis provision, Discretionary Housing Payments, and more recently the Household Support Fund. Our analysis shows that discretionary support is increasingly being used as a sticking plaster for broader benefits cuts. READ MORE
Universal Credit· Welfare The Long Squeeze Benefit uprating policy for April 2023 13 October 2022 by Adam Corlett and Lalitha Try To offset the impact of tax cuts on the public finances, the Government is considering how it might cut spending. One option that has been discussed is the possibility of raising some benefits in line with earnings rather than inflation next April. This paper explores what this might entail, the potential savings and impacts, and … Continued READ MORE
Universal Credit· Budgets & fiscal events· Living standards· Public spending· Economy and public finances· Welfare Back on target Analysis of the Government’s additional cost of living support 27 May 2022 by Torsten Bell and Mike Brewer and Karl Handscomb and Jonathan Marshall and Lalitha Try The Chancellor yesterday announced a big and well-targeted package of energy bill support. Of the £15 billion of new measures, almost double that announced earlier in the year, twice as much will go to households in the bottom half of the income distribution as the top half. This fills the gaping hole left by the … Continued READ MORE
Economy 2030· Welfare Social Insecurity Assessing trends in social security to prepare for the decade of change ahead 19 January 2022 by Mike Brewer and Karl Handscomb and Gavin Kelly and James Smith and Lalitha Try The UK is facing a decade of unprecedented economic change as we adjust to a post-Covid-19 economy, a new economic context outside the European Union (EU), and the decarbonisation of the economy. And the social security system has a key role to play in the years ahead: it is part of the policy toolkit for … Continued READ MORE
Universal Credit· Living standards· Welfare Taper cut Analysis of the Autumn Budget changes to Universal Credit 6 November 2021 by Mike Brewer and Karl Handscomb and Lalitha Try This briefing note looks at the changes to Universal Credit (UC) – the main benefit for low-income families – made by the Chancellor in the Autumn 2021 Budget. The reduction in the taper rate from 63 to 55 percent, and increase in the work allowance by £500 a year, represent a significant, permanent increase in … Continued READ MORE
