MP’s on the The Treasury Committee today reveals that the Government is unable to make more frequent cost of living support payments due to constraints with its welfare payment system.
In December, the cross-party Committee of MPs called for the Government’s cost of living support payments to be spread across the winter of 2023-24, with a payment each month for six months.
The MPs argued that smaller, more frequent support payments would smooth the ‘cliff-edges’ which arise when an individual who earns just one pound too much, or becomes eligible for a benefit a day too late, receives no support. Households face missing out on the support altogether if they increase their income through additional work.
In the response, published today, the Government does not disagree with the Committee’s policy conclusions, but states it cannot make more frequent payments due to limitations with its systems. Doing so would compromise the delivery of “core benefits”.
The Government outlines that eligibility periods are announced after they have passed in an effort to reduce work disincentives and the risk of fraud.
The Treasury also reveals the Government has collected limited data on the effectiveness of the Household Support Fund and the number of low-income households outside of the benefit system.
Commenting on the Government’s response, Harriett Baldwin MP, Chair of the Treasury Committee, said:
“The £900 cost of living Payment will make a huge difference to households on the lowest incomes next winter. While it’s encouraging to see the Government agrees with our recommendations, it’s disappointing to hear that clunky systems will prevent the delivery of six regular support payments next winter.
The lack of analysis on the effectiveness of the Household Support Fund is surprising, and I strongly encourage the Treasury to step-up its data collection, particularly looking at whether these billions of pounds of extra help have supported those struggling the most.
The Chancellor rightly aspires to support the most vulnerable while making work pay. Outdated systems and a lack of statistics on how these important schemes are working make his job harder. We thank the Government for such a considered response and look forward to further work in this area in the near future.”
