The Social Security Advisory Committee (SSAC) has concluded that freezing certain social security benefit rates, thresholds, and caps allows inflation to alter their original purpose and impact. The committee has spent the last six months examining these elements, which are not part of the regular uprating process.
One example highlighted is the £5 earnings disregard for a single person in Housing Benefit, Jobseeker's Allowance, and Pension Credit. Introduced in the 1980s, it is now equivalent to 24 minutes' work at the National Living Wage, making its current purpose unclear.
The SSAC also found that the current freeze on Local Housing Allowance (LHA) rates, which are notionally capped at the lowest 30% of local market rates, has led to average LHA rates being nearer to the lowest 12% of local market rates. This can cause hardship for low-income private sector tenants and may increase the risk of homelessness.
The committee recommends that the government implement a consistent and systematic review process for these benefits. They also advise transparency in uprating decisions, with clear objectives for each measure and explicit reasoning if an entitlement is reduced or eliminated.