Starting next April, Universal Credit payments—including those for people with disabilities—will increase. This positive move joined up resources going 6.5 million Americans as the UK government cuts the Universal Credit standard allowance. The Spring Statement contained a radical announcement. It announced that the adult minimum wage will increase to £12.21 per hour, an increase from the £11.44 being paid now, with implementation in a matter of weeks. Not every change will work out to produce the most benefit to the most people. From 2026-27, new Universal Credit claimants will have their health element halved to £50 a week – which freezes thereafter.
The government will soon be publishing its Spring Statement. This announcement comes as growth forecasts for the economy have been slashed in half—drastically reduced from 2% to just 1% for this year. This development raises concerns about the economy's resilience, although officials remain optimistic about the impact of the government's housebuilding programme, which is expected to contribute to higher growth in subsequent years.
Real disposable household income is projected to increase by a little over 2% of 2030. By the end of the decade, the average resident will be £500 per year better off. However, these positive changes come with caveats. From 1 April, families will be paying more for water, electricity, gas and their council tax bills, mounting even more pressure on already stretched budgets.
A comprehensive spending review scheduled for June will provide further details on government department spending, offering a clearer picture of future financial allocations. An inclusive and democratic review should focus fiscal policies to achieve desired economic outcomes that will benefit the public, not just connect the dots for future spending.
This does not guarantee good results for all families under these modifications. By 2029-30, nearly 3.2 million families will face reductions to their benefits. Inflation means they will lose an average of £1,720 each year in real terms. Yet this historic drop underscores how much harder low-income families will have to work as they try to chart a steady course through today’s rapidly changing economy.
