Charities have said that plans outlined by the government yesterday do not go far enough to tackle the cost-of-living crisis, with one charity calling it “bitterly disappointing”.
Rishi Sunak, chancellor of the exchequer, delivered a spring statement to parliament yesterday.
The chancellor announced that fuel duty would be cut by 5p until March next year, VAT is set to be scrapped on green home measures like solar panels, and that the the Household Support Fund will be doubled.
Sunak also rose the National Insurance threshold so no workers earning below £12,750 will pay the tax, saving them £330 a year.
This has disappointed some aid charities that were calling on the government to increase the international aid budget back to 0.7% of the UK's Gross National Income (GNI) after it was cut to 0.5% two years ago.
Anti-poverty charities were also angered by the chancellor's spring statement, which did not make any commitments to increasing universal credit. Last month, over 30 anti-poverty organisations called on the government to increase benefits by 6% in line with rising inflation costs, but Sunak did not mention any increase to the benefits system.
While charities welcomed some aspects of the mini-budget, many felt more could have been done to help people on the lowest incomes who are most likely to be impacted by the cost-of-living crisis.
Infrastructure bodies and think tanks
Charity Finance Group: Charities face an increase in demand and costs
Caron Bradshaw OBE, CEO of Charity Finance Group, said: “At the very time the government is rightly working to level up, those on the lowest incomes face a significant cut to their living standards and the rise in inflation is set to outstrip increases in universal credit which was not raised. Many are likely be plunged into poverty in 2022.
“As ever, charities and social change organisations will support their communities, but they too face the daunting prospect of another 12 months of juggling increasing demands on services with an increase in operating costs.”
New Philanthropy Capital (NPC): 'Today Britain needed something big, but so far we’ve yet to see it'
Leah Davis, head of policy and external affairs at NPC, said: “The OBR has today said that this year is set to see the biggest fall in living standards since before many of us were born. Those already struggling will be hit hardest, as they spend a greater part of their income on food and energy for which prices are rising the fastest. People will therefore need the help of charities more than ever, at the same time as charities find it harder to support them as inflation increases their costs and chips away at the value of their reserves and pre-pledged donations.
“If there was ever a time to invest in people, skills, and social infrastructure, today was it. So where was the detail on the UK Shared Prosperity Fund?
“Today Britain needed something big, but so far we’ve yet to see it.”
Charities Aid Foundation (CAF): ‘More action is needed’
Neil Heslop OBE, chief executive of CAF, said: “We’re all acutely aware of the cost-of-living crisis and the strain it places on people everywhere. Charities are the first line of defence when families fall on hard times, and they stand ready to work with partners to meet the likely increase in demand on their services.
“It is positive that the chancellor has announced some measures to help tackle this in today’s spring statement, but realistically more action is needed if we are to avoid the worst effects of this crisis.”
Locality: Make government funding more accessible
Tony Armstrong, chief executive of Locality, said: “Community organisations are concentrated in the places most in need of ‘levelling up’, and our recent research showed their extraordinary resilience during the pandemic. They are our country’s vital first responders, but they could do so much more if the government just trusted them to act.
“That means making the money the government is spending on its levelling up agenda more accessible to community organisations. Recent funding streams have been too centralised and bureaucratic. By making future funds more flexible and decentralised, the government can truly put communities in charge.”
Child Poverty Action Group (CPAG): Leaves 'millions without enough to live on'
Sara Ogilvie, policy director of Child Poverty Action Group, said the “chancellor should have increased benefits to match inflation – the most efficient way to help hard-pressed households. But on current plans he will impose a real terms cut of £663 on families on universal credit at the worst possible time. That will leave millions without enough to live on.”
Joseph Rowntree Foundation (JRF): The chancellor has ‘abandoned many to the threat of destitution'
Dave Innes, head of economics at Joseph Rowntree Foundation, said: “Security is only real if it’s for everyone – the choices the chancellor has made today won’t deliver any security for those at the sharpest end of this crisis, instead he has abandoned many to the threat of destitution.”
Turn2Us: 'Falls far short’
Michael Clarke, head of information programmes at Turn2us, said the announcement “falls far short of delivering measures that keep people on the lowest incomes afloat during this unprecedented cost of living crisis”.
He added: “We’re already hearing how many household budgets simply can’t stretch anymore. We must not underestimate the scale of the crisis we are facing, especially as the next 12 months will result in thousands of people facing impossible choices between keeping a roof over their heads or feeding their children to survive.”
Oxfam: ‘No help to people out of work or the lowest paid’
Dr Silvia Galandini, Oxfam domestic poverty lead, said: “While the measures announced today are welcome, they don’t do enough to support the most vulnerable people in our country. Today’s headline measures of cutting income tax and increasing the National Insurance threshold will be of no help to people out of work or the lowest paid. And with inflation set to rise further, life for the poorest families will only get harder – including for unpaid carers, many of whom are women.
“The UK’s social security safety net is not fit for purpose in the face of runaway inflation. If we are to level up and build an economy that works for everyone, the government must strengthen investment in the system, so it does the job it is intended to do and protects the most vulnerable.”
Barnardo’s: Needed more targeted support for vulnerable people
Barnardo’s chief executive Lynn Perry said: “Whilst we welcome the government’s attempts to support families, including by increasing the threshold for National Insurance and the Household Support Fund we would have liked to see more extensive and targeted financial support that better recognises the help vulnerable families, children and young people need to relieve the challenges they currently face.”
Social care charities
Access Social Care: ‘Social care sector needed more targeted support’
Kari Gerstheimer, CEO and founder of Access Social Care, said: “The social care workforce crisis is so bad that there are parts of the country where it is impossible to recruit, social care services are operating with dangerously low staffing levels and families with loved ones are telling us they are close to collapse. All this is happening at a time when there is more demand for social care than ever before.
“The social care sector needed more targeted support. We expect to see an increase in safeguarding issues and hospital admissions as a direct result of the failure to address these pressures in this spring statement.”
Revitalise: 'Only cover[s] the cracks'
Rebecca Young, head of external affairs at Revitalise, said measures “will sadly only cover the cracks of what will soon be a financial epidemic for many”.
This means that disabled people and their carers may face more barriers to taking breaks and holidays and “thousands of people will forgo the much-needed respite they deserve to instead heat their homes or put food on the table”.
Mencap: ‘Bitterly disappointing’
Edel Harris OBE, chief executive of the learning disability charity Mencap, said: “Despite promises to fix social care, despite years of underfunding, and an increasing crisis in the workforce, it is bitterly disappointing not to see any additional funding going into the sector.
“We need to see an urgent cash injection for social care and longer-term funding targeted at supporting decent pay rises for social care workers – many of who are paid far too little and will be hit hardest by the ever-increasing cost of living.”
Bond: Our support for Ukraine should not come at the 'expense of other communities'
Simon Starling, director of policy, advocacy and research at Bond, said: “The UK government’s allocation of £220m to the Ukraine crisis is welcome and mirrors the generosity of the UK public, but it would be ill-judged and morally wrong if our support came at the expense of other communities affected by extreme poverty, conflict and inequality.
“The money we give to Ukraine – and all future crises – should be additional to the already-reduced UK aid budget, not taken from it, until the government meets its 0.7% commitment.
“The government must recognise the vital role UK aid plays in responding to today’s multiple crises and helping to prevent future ones by restoring the budget to 0.7% of GNI as soon as possible.”
Christian Aid: ‘Budget fails the worlds poorest’
Sophie Powell, UK advocacy and policy lead at Christian Aid, said: “Failing to restore the aid budget is short sighted and does not reflect the public's own generosity towards those in need from Ukraine to Afghanistan and beyond.
“If the UK is serious about tackling global poverty, the chancellor should have restored the UK aid budget. Instead, this budget fails the world’s poorest.”
Shelter: No mention of helping the homeless
Polly Neate, chief executive of Shelter, said: struggling renters were “left struggling renters out in the cold”.
She added: “Bills are skyrocketing and rents are higher than ever. Housing is at the root of the cost-of-living crisis, but the chancellor hasn’t noticed.
“Giving councils a bit more cash to help those struggling pay for eating and heating is something, but people still need somewhere to sleep if they can’t pay their rent. Housing benefit is still frozen at 2020 levels, even as rents have shot up, and discretionary housing support was slashed last week.
“If we're going to prevent rising homelessness this year, housing benefit has to be fit for purpose. Long term, to insulate more people against cost-of-living shocks we need investment in social homes with affordable rents pegged to local incomes.”
Centrepoint: ‘missed opportunity’
In a statement, Centrepoint said: “Today’s statement was a missed opportunity for the chancellor to start reversing the impact of the last year's UC [universal credit] cut. And despite additional announcements around the rise in the National Insurance threshold, this means nothing for those young people already struggling to find work or in part-time and insecure employment.”