Our analysis at the Women's Budget Group shows that scrapping the limit will lift more than half a million children out of poverty by the end of the decade – restoring their dignity, hope, and opportunity. The impact will be particularly stark among single parents, who make up half of the families affected by the policy and are overwhelmingly women. Many have been pushed into debt or skipped meals to absorb the shortfalls created by the limit. Ending it also removes an abhorrent bureaucratic cruelty: the so-called 'rape clause', which required survivors to prove their trauma to access support.
Yet even this historic step comes with a caveat. For some families, relief will be short-lived as they will face the benefit cap, which restricts the total amount of social security a household can receive unless it earns the equivalent of 16 hours at minimum wage. For single parents – again, mostly women – the balancing act between unpaid and paid work is harder than for dual-parent households; many struggle to work 16 hours while juggling childcare. It is no surprise that single parents make up nearly 70% of families whose benefits are capped.
Another missing piece was housing support. Reeves chose not to unfreeze Local Housing Allowance, despite housing benefits not keeping pace with soaring rents. Our analysis revealed that private rent now absorbs an average of 58% of women's income, compared with 42% of men's. Unfreezing and permanently re-linking Local Housing Allowance to local rents would have been an obvious intervention to match social security to actual living conditions, and would have protected the most vulnerable from poverty and homelessness. Single mums already make up the majority of statutory homeless families.
On taxation, the budget has been described as a smorgasbord, and not without reason. Some glimmers of ambition include a targeted surcharge on properties valued over £2m, higher taxes on gambling, and modest increases on investment income from dividends, savings and property. These steps acknowledge that unearned wealth and socially harmful activities can and should be taxed more fairly. Yet they stop short of the structural reform that was needed.
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