Friday 1 January 2021 / 10:30 PM Anneliese Dodds / Coronavirus / Economy

Insecure Britain: Chancellor’s Covid cliff edges push UK households to the brink 

Insecure Britain: Chancellor’s Covid cliff edges push UK households to the brink 

Labour is urging the Chancellor Rishi Sunak not to abandon struggling families, warning that many UK households are teetering on the brink of financial ruin as several Covid support cliff edges loom.

Whether employed, self-employed, relying on social security or a combination of all three, Britain’s beleaguered households face several cliff edges in the first few months of 2021, including:

  • 11 January: End of eviction ban
  • 29 January: Deadline for applications for the third grant under the Self-Employed Income Support Scheme
  • 31 January: deadline for mortgage holidays; end of ban on home repossessions
  • 31 March: applications close for government-backed loan schemes;
  • 6 April: Government cuts £20 a week from Universal Credit
  • 30 April: End of furlough scheme

The warning comes as Labour reveals the UK entered the pandemic with one of the lowest savings rates in the developed world.

Analysis shows that UK households saved £3,055 less than the average across other economies in the G7 group of nations in 2019.

The figures lay bare the impact of over a decade of squeezed incomes, rising insecure work and growing poverty pay across the UK, with a quarter of UK families having less than £100 in savings when we entered the Coronavirus crisis.

Over 1.3 million jobs have been lost since, with record redundancies in the three months to October last year – a period that coincides with the Chancellor’s disastrous first attempt to wind down the furlough scheme and other forms of wage support before he was forced into a last-minute u-turn.

Millions of self-employed people have also been excluded from support since the crisis began.

Labour is calling on the government to keep the UC uplift in place and fix the holes in the UK’s safety net, and to use some of the £2 billion handed back to government by supermarkets in business rates relief to help hard-hit businesses like those in the hospitality sector as well as people who have been excluded from support altogether.

Anneliese Dodds, Labour’ Shadow Chancellor, said:

“The irresponsible decisions taken by the Conservatives over the last decade left many UK households without a penny in the bank going into this crisis. When Covid hit, they had nothing to fall back on – and now some are teetering on the brink of financial ruin as several Covid support cliff edges loom.

“The Chancellor’s chaotic, last-minute approach to this crisis plunged the UK into the worst downturn of any major economy, but it seems he hasn’t learned any lessons.

“Families up and down the country will continue to suffer if he doesn’t fix Britain’s broken safety net and tackle the root causes of income insecurity across our country.”