LONDON (Reuters) - Poor working mothers will suffer under the British government’s welfare reform plan, a children’s charity said on Tuesday, piling pressure on the coalition to protect state benefits in next week’s budget.
The impact of the planned overhaul to state benefits is politically sensitive because the government needs to be seen to be evenly spreading the pain of deep public spending cuts designed to reduce the budget deficit.
Campaign group Save the Children said its research showed that universal credit, a streamlined benefit that will start replacing four separate welfare payments from 2013, would make more than 1 million families with children poorer.
“Universal credit will help some families, but mums working hard to stay above the breadline are its big blind spot,” Save the Children CEO Justin Forsyth said in a statement.
Universal credit is part of the Conservative-led government’s plan to “make work pay” by ending the so-called benefits trap in which people who take low-paid jobs, or increase their working hours, actually lose more in benefits than they gain in pay.
Save the Children said 150,000 of Britain’s poorest single mothers could lose up to 68 pounds ($110) a week under universal credit.
The welfare ministry disputed the charge, saying that most people moving to universal credit would be better off and no one would lose out because benefits claimants would get “transitional support” until their circumstances changed.
“Save the Children are being disingenuous because they are cherry-picking unrealistic examples to demonstrate where families could lose,” the Department for Work and Pensions said.
The ministry said the loss of 68 pounds a week would only apply to single mothers with three children all under five years old, using childcare for 40 hours a week and receiving existing housing benefit and tax credits.
A spokeswoman said the ministry did not know how many women were in that situation, but it was an “extreme case”, and in any event such women would be protected by the transitional support.
One aim of the welfare reform is to reduce the number of families in which no one is in paid employment. But Save the Children said that by tweaking the incentives to make it more worthwhile for at least one parent to go out to work, the government would make it less worthwhile for low-income second earners to find employment.
“The flagship welfare reforms will also hurt second earners, most of whom are women, with some families losing up to 1,800 pounds a year,” the charity said.
The welfare ministry said it was removing the current requirement that parents work at least 16 hours to qualify for state support for childcare. This meant that such support would be available to all parents, whether single or in couples, regardless of whether one or both were in jobs and how many hours they worked.
Reporting by Estelle Shirbon; Editing by Ben Harding