A leading charity has warned that the UK’s poorest families are in acute need and urged ministers to provide immediate extra financial support.
Gwen Hines, the chief executive of Save the Children, told the Guardian that severe financial hardship would really begin to bite in January, with many families already unable to afford basic goods.
The grave message came as a poll by YouGov carried out for the Resolution Foundation found that 31% of households in the bottom fifth of earners said they were significantly reducing the amount they spend on presents, festive food and other seasonal treats. That compared with 16% among the highest fifth of earners.
Hines said: “Many families in the UK are living in dire circumstances right now and we know Christmas and the new year is going to be particularly difficult. We are concerned January will be the time financial hardship really begins to bite.”
The chancellor, Jeremy Hunt, has announced that benefits will be uprated by 10.1%, in line with inflation, in April, and low-income families are due to receive cost of living payments worth £900, in addition to the £650 paid in October and November.
However, Save the Children called on the government to provide more support now, to help families through a harsh winter.
Hines said the benefits paid to low-income parents should have an urgent £20-a-week uplift, which would provide “a significant impact to children’s wellbeing right now that can be sustained long into the future”.
Better known for its work in developing countries, Save the Children has handed out 2,344 direct grants to low-income families in the UK over the past year.
The charity said these “early years” grants, first introduced during the Covid pandemic, have been used by parents – some of whom are in work – to buy food, warm clothes and even beds for their children. The charity has spent more than £1m on the payments, which typically amount to £400, over the past year.
With rocketing fuel bills expected to make the next three months particularly difficult, Save the Children recently raised the budget for the programme by 25%.
Hines said: “The UK government must do much more to support those on the lowest incomes, as our grants programme continues to reveal acute need for parents both in and out of work. Waiting until April 2023 for new cost of living payments is not acceptable.”
Save the Children staff administering the grants reported that families were struggling to afford fruit and vegetables, or warm winter coats for children. One recent recipient had moved into social housing but had been unable to furnish the home, leaving the downstairs uncarpeted.
The Resolution Foundation poll, carried out by YouGov among working families, showed that the UK’s lowest earners are not alone in tightening their belts. In total, 64% of all workers surveyed said they would be trying to rein in the cost of Christmas this year, amid widespread predictions that the economy is sliding into recession.
Emily Fry, an economist at the thinktank, told the Guardian: “Low-income families have faced the toughest cost-of-living pressures this year from soaring food prices to energy bills, and it is taking its toll this Christmas.
“The government has provided significant targeted support to vulnerable families and must continue to do so, as they will continue to find themselves at the heart of the crisis next year, too.”
She added that family finances had already been stretched thin by the Covid pandemic, leaving poorer families little room for manoeuvre. “People who already entered the pandemic with lower savings, less of a buffer to be able to deal with unexpected shocks, are now facing a second crisis.”
Bridget Phillipson, the shadow education secretary, said: “Families have struggled through 12 years of Conservative mismanagement of the economy. This shows just how far families are now being plunged into hardship because they crashed the economy in 12 weeks of chaos.”
The government is expecting to spend an extraordinary £58bn on cost of living support, including the energy price guarantee, in the current financial year, and another £24bn in 2023.
That exceeds the £70bn cost of the Covid furlough scheme, which paid millions of workers’ wages during the pandemic, but charities and thinktanks have repeatedly warned that it is still insufficient to protect the poorest families from considerable hardship.
In 2020, Rishi Sunak, the then chancellor, increased universal credit by £20 a week across the board during the pandemic, but the uplift was withdrawn in October 2021 in the face of protests from thinktanks and charities.
Inflation in the UK declined slightly in November, but remains close to 40-year highs, at 10.7% on the consumer prices index measure.
Citizens Advice recently reported that they had referred the equivalent of 3.5 people every minute to a food bank in the first week of December – more than in any other week on record.
A government spokesperson said: “Our priority will always be to support the most vulnerable and we recognise that people are struggling with rising prices, which is why we are protecting millions of those most in need with at least £1,200 of direct help this year, including £400 towards energy costs.
“Our immediate support also includes our energy price guarantee, saving around £900 for a typical household over winter, and our household support fund is helping people with essential costs.”
