Cliff edges and precipitous inclines: exploring the interaction between universal credit and passported support for working claimants in the UK

Passported benefits and other sources of means-tested help are income-based forms of financial and in-kind support with essential living costs that sit outside Universal Credit (UC), the UK’s main working-age benefit. Typically provided in the form of reductions, concessions or discounts in charges, or in-kind help, the support is delivered by a range of national government departments, devolved administrations, local authorities and utility providers, which low-income people may be entitled to apply for, depending on their circumstances. Better-known examples include council tax reduction (CTR) schemes, free school meals and free prescriptions. Reliance on this help has grown as wages and social security payments have failed to keep pace with the rising cost of living. However, it is the effects these schemes can have on work incentives and employment behaviour, and Universal Credit’s pledge to ‘make work pay,’ that has stimulated recent policy interest. Drawing on qualitative longitudinal research with low-earning working people, this article presents new empirical insights into the interaction between Universal Credit, earnings and entitlement for other sources of means-tested help, exploring the ways in which changes in reported earnings can affect household incomes and decisions around work. Suggestions for improving work incentives and reducing ‘cliff edges’ – where the value of entitlements lost can be more than the gains from additional net earnings - are explored.