Cost of living crisis: we cannot ignore the human cost of living in poverty

Rising prices. Tax increases. Energy price hikes. Social security cuts. Stagnating wages. Together, it makes for an incredibly difficult environment, especially for families already struggling to get by. The start of 2022 has rightly seen much attention on the cost of living crisis, which will place real and sustained budgetary pressures on millions of households.

There is never a good time for a crisis, but this one feels almost cruelly ill timed, coming as it does when the nation continues to feel the economic, social, and political impacts of the covid-19 pandemic. In times of crisis, there is an especially important role for social security systems, which can provide protection from poverty, even out income shocks, and—importantly—provide a degree of security, in an uncertain time.

Sadly, however, our social security system is currently unfit for purpose.1 This was clear even before the pandemic began, with successive cuts to support and the failure to increase benefits in line with inflation, leaving inadequate benefit levels that regularly fail to meet essential needs.2

Through the Covid Realities research programme, we have documented the human cost of poverty, and the negative impacts that flow from a social security system that demands that households somehow manage on inadequate incomes.3 This shows how aspects of the benefits system—the five-week wait for a first Universal Credit payment, high levels of debt deductions, restrictions on benefit entitlement (the Benefit Cap and two-child limit)—are poverty producing, perversely doing the very opposite of what a social security system should.

As families struggle to get by, this almost inevitably negatively impacts on people’s mental health and there is growing evidence of links between the social security system and mental ill-health.45 Many Covid Realities participants describe their poverty, and social security receipt, as causing them anxiety, stress, and low mood. As prices rise yet further, millions of families are simply beyond breaking point: they do not have anywhere or anything left to cut.

After the Government’s refusal to provide adequate support to families on a low income in the Chancellor’s Spring Statement, there are rightly fears for how families will manage. Families living on a low income have struggled to navigate the pandemic, and now face a punishing round of budgetary pressures, which come on top of the recent ending of the £20 uplift to Universal Credit and the failure to uprate benefits in line with current rates of inflation. The collision of immediate hardship and the fear and threat of even more hardship to come adds to existing stress, with potential for short and longer term negative health impacts.

As prices rise yet further, millions of families are simply beyond breaking point: they do not have anywhere or anything left to cut.

Even before the pandemic, concerns had been raised by mental healthcare providers that changes to the benefits system, as well as wider deprivation, were contributing to increased demand on services, a situation that seems only likely to worsen unless we act to properly support families now, and in the future.6

Yet, at a time when there is an opportunity to tackle (and perhaps even prevent) entrenched links between mental ill health and poverty by improving support for families, policy makers have instead recently responded with an intensification of benefit sanctions, themselves harmful to mental health, on top of the cuts already in place.7

What we need instead is urgent intervention to shore up our beleaguered social security system, increasing levels of support, and stripping away the design features that do the opposite of what they should. The social security system is failing us all of the time (not just in these times of national crisis), and investment in it is long overdue.

Until that happens, families will continue to struggle. We can and must do better.