Should social security reach further? Ineligibility for benefits at the start of COVID-19

The benefits system has played a major role in Britain’s COVID-19 response. However, there is a political question about whether more people should be eligible for benefits. In this report, we present the findings of exploratory research funded by the Health Foundation focusing on people who are ineligible for benefits but who may be in financial need.PEOPLE INELIGIBLE FOR UC: Among people who may have been financially struggling, we estimate that in July–August 2020 there were: 200,000 people ineligible for UC solely due to their partner’s earnings; 200,000 people ineligible for UC solely due to their savings; and at least 50,000 people ineligible for UC solely due to migration status. In total, among people who may have been financially struggling, there were 470,000-480,000 people ineligible for UC for a single reason.More broadly, we estimate that there were about half a million (480,000–540,000) people who had lost 10% or more of their income during the pandemic and may have been financially struggling, but were ineligible for both UC and contributory benefits (new style JSA). Half of this group overlaps with the three previous groups, but half of this group were ineligible for UC for more than one reason.UNSUCCESSFUL UC/JSA/ESA CLAIMANTS:We estimate that 290,000 people unsuccessfully tried to claim UC, JSA or ESA during the start of the COVID-19 pandemic (and a further 350,000 people considered making a claim without beginning an application).Some of those who had tried and failed to claim were confused about their eligibility, were worried about the ‘hassle’ of claiming, or had experienced problems in claiming. But it was rare for this to stop them claiming (only 43,000 people). The most common reasons people reported for their claims being rejected were that they/their partner were still earning too much money (45.4%) or had too much in savings (23.9%). Often these were because of people’s partner rather than the respondent themselves, again raising issues around the household means test. There were also those who never understood why their claim was rejected (12.4%), showing the confusion that some people faced in navigating the benefits system.CONCLUSIONS:We have shown that among people who may have been financially struggling, there is significant financial strain amongst those who are ineligible for benefits (UC and new style JSA); much more than amongst the general public, although usually not quite as high as among successful claimants. This was particularly amongst those who were ineligible for UC due to partner earnings, and amongst those experiencing income shocks who were ineligible for both UC and contributory benefits. Many (though not all) also felt it was unfair that they were not eligible.