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Low income families will be pushed to the 'brink of survival' if benefits don't rise with inflation

Families Policy & Politics Research
Parents in low-paid positions, including nursery practitioners, will gain less from the National Insurance cut and see the biggest loss to their income if benefits increase with earnings, not inflation, warns new research.
The analysis finds that low-income families will see little benefit from the cut in National Insurance, PHOTO Adobe Stock
The analysis finds that low-income families will see little benefit from the cut in National Insurance, PHOTO Adobe Stock

Analysis by the Child Poverty Action Group (CPAG) and Action for Children reveals the scale of income cuts workers in different jobs face if benefits are uprated by wages rather than the inflation rate, which is now at 10.1 per cent.

It finds that if benefits increase by earnings (5.5 per cent) instead of inflation (10.1 per cent), a low-earning couple with two children stand to lose £752 in 2023/24. Only a fraction of this will be offset by lowering National Insurance (NI) – one element of the former Chancellor’s mini-budget that remains in place. NI is to be lowered to 12 per cent instead of 13.25 per cent.

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