Pulling away all the safety nets: The end of the Universal Credit uplift and COVID-19 protections – single parent families this autumn

A Gingerbread Briefing 

  • With the end of the Universal Credit uplift, a safety net worth more than £1 billion in total, over the next 12 months, will be pulled away from 1.1 million eligible single parent families [1]. The removal of this uplift will have a huge impact on single parents and their children.
  • Over a quarter (27%) of single parents reported the uplift having a positive impact on their finances[2]. The uplift has also tended to benefit those most in need – 31% of those earning less than £28,000 report the uplift having a positive impact on their finances, compared to 19% of those earning more than £28,000[3].
  • The end of furlough puts the livelihoods of single parents in jeopardy with single parents having been more likely to be furloughed (30%) than coupled parents (21%) [4]. Many single parents feel, perhaps justifiably, that being furloughed increases the likelihood of job loss. This is because single parents are more likely to be found in shut-down sectors that will not have the same job availability that existed prior to the pandemic.
  • The Plan for Jobs offers little hope to the half (50.4%) of single parents needing to work part-time (ONS 2019) -due to caring responsibilities with only 8 per cent of jobs now advertised as part-time and rates of part time work falling to their lowest levels since 2010[5].
  • For the third of single parents stuck on low pay, the end of the Track and Trace Self-Isolating Grant means those who receive a positive test will have to choose between self-isolating or being able to put food on the table. We are also concerned that the grant will no longer be open to parents who need to be home when their children self-isolate.
  • As rises in household energy costs loom, a quarter of single parent families (450,000) report having difficulties making ends meet [6] and the average single parent family debt has risen by £600 per household since the start of the pandemic[7]. The end of the the Self-Employment Income Support Scheme could also place single parents under further financial strain.

The overall picture for single parent families

Before the pandemic, single parents were less financially secure and were on lower incomes compared with other family types, (mothers in couple households earned almost twice as much per week as single mothers)[8]; were concentrated in part-time and low paid routine jobs; were more likely to be in poverty; were more likely to be headed by a woman of Black or Mixed heritage[9] and so were exposed to discrimination in the labour market; and were more likely to be in severe problem debt (13% of single parents compared to 5% of couple parents and 4% of single adults).

COVID-19 has exacerbated single parent families’ low income and disadvantage and now, within a brief period, the government plans to terminate a range of safety nets that single parents have relied on during the pandemic including the Universal Credit uplift, furlough payments, the Self-Employment Income Support Scheme (SEISS), and Test and Trace Support Payments, amongst other measures.

Furthermore, the Government’s Plan for Jobs does not offer hope. If they are still working, single parents continue to have the highest in work poverty rate, while a couple without children have the lowest. And single parents are looking particularly exposed to redundancy and unemployment at the end of furlough: vacancies for the part-time roles on which single parents have depended for combining a livelihood, with managing family life, are at an all-time low, while the sectors in which they have traditionally worked – High Street retail, hospitality, leisure, administration, and support – are still struggling to recover from the pandemic.

Single parents’ return to the labour market will also be hindered by the long ongoing structural factors affecting them– childcare continues to be a major issue with  the continuing underinvestment in the childcare sector resulting in a shortage of flexible, affordable childcare, and the paying of childcare support,  in arrears under Universal Credit making it extremely difficult for single parents to pay for childcare. This is only compounded by the fact that the costs of childcare are calculated on the basis of costings dating back to 2003 and have not been increased or amended to recognises the rise in costs since that date. Employment is also an issue with the absence of a legal right to work flexibly, (having to work 6 months in a job before being able to apply to work flexibly) and insufficiently tailored employment support programmes to assist single parents back into the workforce.

Termination of Universal Credit uplift on 6 October

A quarter of all Universal Credit claimants are single parents (1.27 million) and 60 per cent of single parent families will experience the overnight cut to their incomes from withdrawal of the £20 a week uplift[10] to Universal Credit that was provided by the Government at the beginning of the pandemic

Single parent families continue to face more disadvantage and poverty than their couple parent counterparts and their low incomes are reflected in the fact that more than 60% of single parents are on Universal Credit, compared to around 10% of couple parents.  Data provided by a Gingerbread survey also suggests that over a quarter (27%) of single parents believe the uplift has had a positive impact on their finances, compared to a fifth (19%) of couple parents[11].

Many single parents who didn’t receive the uplift didn’t do so because they were benefit capped, with the highest proportion of  benefit capped households being single parents[12]. We estimate therefore that around 1.1 million single parents,  who are already on a low income because of unemployment or low paid work, will be £20 a week worse off because of the end of the uplift.

The Plan for Jobs cannot mitigate for loss of the uplift. Recent research shows that a single parent family with two children is £140 a week short of a minimum income if unemployed, but still £46 short if the parent is in full-time work, and this will increase to £66 if Universal Credit is cut[13].

Withdrawal of the uplift means that single parent families on Universal Credit will be a total of £1040 a year worse off per year. Between them the 1.1 million single parents who are benefiting from the £20 Universal Credit uplift will be worse off by one billion one hundred and forty-four million pounds over the course of the next 12 months (£1,144,000,000).

With 47%[14] of children in single parent families already living below the poverty line before the pandemic, removal of the uplifts is likely to plunge more children in single parent families under the poverty line with serious repercussions for their life chances.

Termination of furlough payments

Between March and December 2020, one in three single parents were furloughed compared with one in four coupled parents[15]. Prior to the pandemic, nearly half (46 per cent) of single parents worked in routine occupations, compared with just over a quarter of couple parents (26 per cent)[16]. Such routine jobs in retail, hotels and restaurants were to be particularly impacted by cuts to hours and job losses due to COVID-19. Jobs in many of these sectors have not returned to pre-pandemic levels, likely having a disproportionate impact on single parents. The Labour Force Survey, August 2021, found that the retail subsector remains 10,000 vacancies below its pre-pandemic level of 85,000[17].

Half of all single parents work in part-time jobs. Part-timers were more likely to be furloughed and to return from furlough at a slower rate than those working full-time. Part-time vacancies are also at an all-time low compared to pre-pandemic levels, again placing single parents at higher risk of redundancy at the end of furlough and unlikely to secure part-time work

The Timewise Flexible Jobs Index[18] concludes that there is a fractured job market, with part-time roles concentrated amongst the lowest paid jobs, while homeworking and other flexible working options are disproportionately offered at higher salary levels and rarely available for those in low paid jobs. Consequently, single parents experience workplace inequality and this will continue if homeworking is seen as the only answer to flexibility. It would therefore benefit single parents if lower paid jobs were to offer home working and flexible working as well.

End of test and trace support scheme.

The test and trace support scheme, due to terminate on 30th September, is an important safety net for the 60 per cent of single parents who are in low-income households. It has been worth £500 to low-income single parents who are employed or self-employed, where either they or their child must self-isolate, they cannot work from home, and will lose income as a result.

In practice there have been difficulties with claiming the payment in some parts of the country. Nevertheless, the payment has been an important safety net for many single parents on low-income for whom furlough has not been an option.

The end of the test and trace grants comes at a time when the likely winter transmission rates for the Delta variant, the long term efficacy of the vaccines, the impact of long covid and the likelihood of new variants of covid  are unclear,. There is some correlation between typical characteristics of single parents with majority care and those living with long COVID, and we need to keep an eye on this. .

Many single parents are very aware that when it comes to assuring the welfare of their children that responsibility lies solely with them. With Test and Trace Support Payments, furlough payments and the Self-Employment Income Support Scheme ending, low-income single parents will be less able to protect themselves financially from having to self-isolate in the case of a positive test.

This means asking single parents to choose between self-isolating when either themselves or their children receive a positive test or being able to put food on the table. This is a decision that no parent should have to make. Financial support is likely to increase self-isolation rates and therefore protect the remaining population. More simply put, “provision of targeted support is likely to increase rates of self-isolation, particularly amongst those with fewest financial, social and other resources[19].”

Self Employed Income Support Scheme

The self-employment income support scheme is worth between £2850 and £7500 per grant which will have provided some safety net to single parents who can evidence self-employment, which also ends on 30th September[20].

Impact of inflation and rising energy prices

The Bank of England has forecast that consumer prices growth will rise to 4 per cent this October, resulting in a challenge to the already delicately balanced household budgets of low-income single parent families. This October the energy price cap will rise by £96 meaning those on standard tariffs could see an increase of £139, from £1,138 to £1,277 . Low-income single parent families are also over-represented among the 4 million UK households on pre-payment meters who could see an increase of £153, from £1,156 to £1,309[21].

These price rises are likely to have a devastating impact on the budgets of the 60 per cent of single parent households who are on low incomes. According to a survey carried out for Gingerbread in the last year, 29 per cent of single parents have struggled with ‘having enough income to cover food and bills’ whilst 28 per cent have had difficulties with ‘debt’. In plainer terms, this means that more than 1 in 4 single parents has had difficulties relating to having enough income to cover food and bills or relating to debt in April 2021[22]. Once again, no parent should have to be concerned over whether they can afford to put food on the table for themselves and their children..

Further to this, 37 per cent of single parents have reported having less leftover in their monthly budget since the beginning of the COVID-19 outbreak[23].  Research from both Child Poverty Action Group and the Joseph Roundtree Foundation found that debt had increased for the majority of families during the pandemic, but more so for low income households (CPAG, 2020; JRF, 2020). Gingerbread research published earlier  this year found 9 per cent of single parents reported taking on more debt since the start of the pandemic with the average amount of debt held by single parents increasing by around 15 per cent during the pandemic – an average of more than £600 in additional debt per household)[24].

Ongoing structural issues impacting single parents

The Plan for Jobs[25] cannot mitigate for the above impacts because of severe ongoing structural issues impacting single parents’ entry to or staying in the labour market:

1) A lack of affordable childcare prevents many single parents from entering and staying in employment[26]. This was the case even before the pandemic. The COVID-19 pandemic has had an impact on the supply and costs of childcare. While many providers have taken advantage of short-term government support for the childcare sector through, for instance, the furlough scheme, there remains a risk that, when the support ends, many providers could close, creating shortages in childcare availability. In London the position is particularly stark with recent research by the Greater London Authority showing 64 per cent of non-domestic childcare providers (nurseries, preschools, maintained nursery schools) and 56 per cent of childminders indicating that for financial reasons they were at immediate risk of closure or concerned they will not be operating in 12 months’ time[27].

Additionally, ongoing difficulties with childcare support within Universal Childcare will hamper single parents seeking full-time roles, particularly the failure of Universal Credit to meet the upfront costs of childcare and childcare caps set in 2003 which do not deliver the promised 85 per cent rate of support under Universal Credit.

2) So as to combine caring, commuting and work, single parents need the option to work part-time and flexibly. However currently there is no legal right to work flexibly; a worker with 26 consecutive weeks employment can request flexible working and the employer must respond but does not have to agree with the request. Combined with the sharply falling number of part-time roles the lack of a legal right to work flexibly is likely to seriously impede the prospects of single parents made redundant who try to re-enter the labour market.

3) Single parents trying to enter the labour market also experience poor help  from employment support schemes because of insufficiently targeted programmes. Single parents  interviewed by Gingerbread have complained of work coaches who have given conflicting information about entitlements, requirements and support; insufficiently signposted training opportunities; paid little attention to their caring responsibilities and work aspirations and have piled on the pressure to take any job. Generally before the pandemic single parents were in work at an all time high rate of 69 per cent but were more likely to be in low-paid low quality jobs with limited prospects of promotion.

What Gingerbread is calling for?

For the Plan for Jobs to work for single parents, the Government must address these ongoing structural barriers to single parents entering work. The Government should

  • invest in the recovery of the childcare sector and address the barriers to childcare under Universal Credit;
  • guarantee single parents the right to work flexibly through new employment legislation and provide high quality employment support tailored for single parents both through Jobcentre Plus and the new back to work schemes to help single parents move into good quality work. Thousands of single parents will have worked in sectors that will not exist in the same way following the COVID-19 pandemic.

In the meantime, low-income single parents and their children need the vital and continued protection of safety nets such as the Univeral Credit uplift, furlough and the test and trace support grants.

The full effects of the end of furlough are not yet known and we know that single parents were disproportionately likely to be furloughed. A major concern here would be surroudning the risk of redundancies; the end of furlough is likely to mean millions of jobs at risk[28]. A furhter concern for single parents would also be in the subsector figures – vacancies in the retail sector are down considerably, for example – and on the whole single parents are disproportionately found in such sectors. Where there are vacancies,  single parents will not necessarily be able to  fill those roles because of their caring responsibilities.

About Gingerbread

We are the leading national charity working with single parent families. Since 1918, we have been at the forefront of shaping policy and services that support single parent families.

Today, there are nearly two million single parent families with dependent children in the country. We champion their voices and keep their needs at the heart of everything we do.

[1]  Gingerbread calculations based off 1.1 million single parents having the weekly £20 uplift removed over a period of 12 months

[2] Gingerbread (2021) The Single Parent Debt Trap

[3] Ibid

[4] Gingerbread (2021), Caring without sharing: Single parents’ journey through the COVID-19 pandemic

[5] Timewise (2021) Warning that part-time workers will suffer proportionately more job losses when furlough ends

[6] Gingerbread calculations based off Opinium survey carried out on behalf of Gingerbread that found that 1 in 4 single parents have had difficulties relating to having enough income to cover food and bills or relating to debt in April 2021

[7] Gingerbread (2021) The Single Parent Debt Trap

[8] Gingerbread (2021), Caring without sharing: Single parents’ journey through the COVID-19 pandemic

[9] Families and households – GOV.UK Ethnicity facts and figures (ethnicity-facts-figures.service.gov.uk)

[10] Gingerbread (2021) What Freedom Day means for single parents

[11] Gingerbread (2021) The Single Parent Debt Trap

[12] Gingerbread (2021) What Freedom Day means for single parents

[13] Joseph Rowntree Foundation (2021) Planned cuts to Universal Credit will hit incomes of millions of households unable to afford a minimum living standard

[14] RCPCH (2021) State of Child Poverty

[15] Gingerbread (2021), Caring without sharing: Single parents’ journey through the COVID-19 pandemic

[16] Gingerbread (2021), Caring without sharing: Single parents’ journey through the COVID-19 pandemic

[17] Office for National Statistics (2021) Vacancies and Jobs in the UK: August 2021

[18] Timewise (2021) Warning that part-time workers will suffer proportionately more job losses when furlough ends

[19] SAGE (2020) The impact of financial and other targeted support on rates of self-isolation or quarantine [SPI-B: 16 September 2020]

[20] House of Commons Library (2021) Coronavirus: Self-Employment Income Support Scheme

[21] BBC News (2021) Energy price cap: What is it and how does it affect my bills?

[22] Opinium (2021) Gingerbread, Single Parent Families

[23] Gingerbread (2021) The Single Parent Debt Trap

[24] Gingerbread (2021) The Single Parent Debt Trap

[25] Gov.UK (2021) Plan for Jobs

[26] Gingerbread (2021), Caring without sharing: Single parents’ journey through the COVID-19 pandemic

[27] Gingerbread (2021), Caring without sharing: Single parents’ journey through the COVID-19 pandemic

[28] BBC News (2020) ‘Millions of jobs’ at risk as furlough lifeline nears end

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