An influential anti-poverty charity has dismissed Chancellor Rachel Reeves’ claims that Labour’s economic growth agenda will significantly improve living standards, arguing that targeted policy interventions are necessary to tackle rising poverty.
The Joseph Rowntree Foundation (JRF) has urged the government to strengthen Universal Credit rather than chip away at benefits, warning that economic expansion alone will not address deep-rooted social issues.
Reeves has repeatedly stated that growing the economy is Labour’s primary objective, but a new JRF report argued that this approach “alone” will not alleviate financial struggles for millions of people.
The charity warned that without direct government action, child poverty will continue to rise, with one in three children projected to live in poverty by 2029.
The JRF’s latest findings paint a bleak picture of poverty in the UK. The report revealed that more than one in five people — approximately 14.3 million individuals — were living in poverty in 2022-23.
While this figure has remained relatively stable compared to the previous year, the charity stated that poverty levels have not seen meaningful reductions in two decades.
Paul Kissack, chief executive of the JRF, acknowledged that economic stability is “almost certain” to be a key factor in reducing poverty but insisted that relying solely on growth would be “deeply unjust.”
“A government promising change and vowing to fix the foundations cannot walk past this grim and deteriorating picture. Economic growth on its own won’t reduce poverty, and it is deeply unjust to force families to wait for economic growth before they feel their situation improve.”
Paul Kissack
The report urged Labour to take bolder steps to address poverty, including scrapping the controversial two-child benefit cap, which prevents parents from claiming Universal Credit or tax credits for more than two children. The measure, introduced by the Conservatives in 2017, has been widely criticized for exacerbating child poverty, yet Labour has resisted calls to remove it.
Labour’s Growth Plan Under Scrutiny
Reeves is set to deliver a speech outlining Labour’s economic strategy, which is expected to include changes to planning laws to accelerate building projects, backing airport expansions, and potentially introducing further welfare spending cuts. Addressing MPs earlier this week, she emphasized the need for urgent action.
“Have we done enough? No. We must go further and faster because the cost of living pressures are still very real for working people across Britain, and the only way we can turn this around is through economic growth.”
Rachel Reeves
However, Kissack remains skeptical that Labour’s current proposals will be sufficient. While he acknowledged that policies such as reducing benefit deductions, increasing the minimum wage, and investing in social housing are “welcome steps,” he warned they fall short of “what is required to deliver the scale of change needed.”
The JRF’s report also calls for a permanent re-linking of Local Housing Allowance to local rents and introducing a basic Universal Credit rate that benefit caps cannot reduce. The charity argued that ensuring every recipient receives “at least enough to afford life’s essentials” is crucial to preventing further hardship.
Responding to the report, Liberal Democrat Treasury spokesperson Daisy Cooper MP criticized Labour’s reluctance to scrap restrictive welfare policies, accusing the government of failing to address the “growing poverty pandemic.”
“From their refusal to scrap the two-child benefit cap and their heartless decision to cut the Winter Fuel Payments, this government has done next to nothing to tackle the growing poverty pandemic in this country.”
Daisy Cooper
A government spokesperson defended its approach, stating that ministers are actively working to improve living standards.
“No child should be in poverty – that’s why our Ministerial Taskforce is exploring all levers available across government to give children across the United Kingdom the best start in life.
“As we fix the foundations of the economy, we’re increasing the Living Wage, uprating benefits, and supporting 700,000 of the poorest families with children by introducing a Fair Repayment Rate on Universal Credit deductions to help low-income families and make everyone better off.”
Government spokesperson
Despite these assurances, the JRF remains firm in its stance that without targeted interventions, poverty levels will continue to rise. As Labour moves forward with its economic agenda, pressure is mounting for the government to prioritize direct action rather than relying solely on growth to address the UK’s deepening poverty crisis.
READ ALSO: Stephen Opuni, Seidu Agongo Acquitted and Discharged of All Charges
