Low-paid people on family credit top 500,000: Claims reflect growth in part-time work

THE NUMBER of people claiming family credit, the benefit for those in low-paid work, has passed 500,000. As a result, more than 2 per cent of the workforce is having its wages directly supplemented by it for the first time.

More than one in seven employees in catering, cleaning and hairdressing may now be on family credit, and nearly 40 per cent of its recipients are employed in one of these groups, figures from the Department of Social Security show.

The rise in family credit claims - up 70,000 over the year to July 1993, and up 200,000 in three years - follows rule changes in April 1992 which meant that those working between 16 and 24 hours a week were eligible. The increase to 504,000 claimants thus reflects the growth in low-paid, part-time work - which critics say the benefit is helping to encourage by making it easier for employers to pay low wages but still recruit staff. Average earnings for those on family credit were just under pounds 105 a week; average benefit payment was pounds 44.45.

Numbers are also rising sharply because since April 1992 lone parents have been allowed to keep the first pounds 15 of any maintenance payment without having it knocked off their family credit - a move which saw the number of single-parent claimants jump by 20 per cent between July 1992 and July 1993, compared with 10 per cent for two-parent families.

Another boost to the pounds 1bn-a-year bill is expected in October when a new pounds 28 allowance for childcare costs is expected to help about 50,000 lone mothers.

Frank Field, the Labour MP who is chairman of the Commons Select Committee on Social Security, said the benefit was 'in many ways a success, certainly much more successful than the family income supplement which it replaced'.

It was, however, 'the logical outcome' of the Government's drive to cut wages at the bottom end of the labour market and it contained a dilemma. 'It is a way of getting help to people in low-paid work, but you have all the time to be vigilant to ensure employers are not using it to pass on their legitimate costs to the taxpayer. Some of these people on family credit will be paying tax to subsidise their own employers' low- wage policies.'

He said family credit should be linked to targeted training so people could lift themselves off it. 'Without that, the Government does stand open to the charge that it is using taxpayers' money to subsidise low-paid employment'.

Equally, if the Government was going to continue to 'American- ise' the labour market in this way, the benefit should also be available to those without children.

The sharp increase in family credit numbers came before the abolition last August of the wages councils, a move which is expected further to increase claims if employers cut wages.

Mr Field said: 'If you don't get a rise in family credit numbers after weakening and then abolishing wages councils then I don't know what will produce one.'

Suggested Topics
Start your day with The Independent, sign up for daily news emails
Arts and Entertainment
The Doctor and Clara have their first real heart to heart since he regenerated in 'Deep Breath'
TV
Life and Style
Apple showed no sign of losing its talent for product launches with the new, slightly larger iPhone 6 making headlines
techSecurity breaches and overhyped start-ups dominated a year in which very little changed (save the size of your phone)
Arts and Entertainment
Jamie Oliver
filmTV chef Jamie Oliver turned down role in The Hobbit
News
The official police photograph of Dustin Diamond taken after he was arrested in Wisconsin
peopleDownfall of the TV star charged with bar stabbing
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Arts and Entertainment
Jeremy Clarkson, left, and Richard Hammond upset the locals in South America
tvReview: Top Gear team flee Patagonia as Christmas special reaches its climax in the style of Butch and Sundance
News
people
Sport
Ashley Barnes of Burnley scores their second goal
footballMan City vs Burnley match report
Arts and Entertainment
Peter Mayhew as Chewbacca alongside Harrison Ford's Han Solo in 'Star Wars'
film
News
i100
Arts and Entertainment
Man of action: Christian Bale stars in Exodus: Gods and Kings
film
Arts and Entertainment
Tracy Emin's 1998 piece 'My Bed' on display at Christie's
artOne expert claims she did not
News
Ernesto Che Guevara and Fidel Castro, right, met at Havana Golf Club in 1962 to mock the game
newsFidel Castro ridiculed the game – but now investment in leisure resort projects is welcome
News
Hackers revealed Oscar-winning actress Lawrence was paid less than her male co-stars in American Hustle
people
Arts and Entertainment
Clueless? Locked-door mysteries are the ultimate manifestation of the cerebral detective story
booksAs a new collection of the genre’s best is published, its editor explains the rules of engagement
Sport
Robin van Persie is blocked by Hugo Lloris
footballTottenham vs Manchester United match report
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Recruitment Genius: Business Manager

£32000 - £40000 per annum: Recruitment Genius: A Business Manager is required ...

Recruitment Genius: Operations Manager

£45000 - £55000 per annum: Recruitment Genius: This is an exciting opportunity...

Recruitment Genius: Panel & Cabinet Wireman

£20000 per annum: Recruitment Genius: Panel Wireman required for small electro...

Recruitment Genius: Electronics Test Engineer

£25000 - £27000 per annum: Recruitment Genius: An SME based in East Cheshire, ...

Day In a Page

A timely reminder of the bloody anniversary we all forgot

A timely reminder of the bloody anniversary we all forgot

Who remembers that this week we enter the 150th anniversary year of the end of the American Civil War, asks Robert Fisk
Homeless Veterans appeal: Former soldiers pay their respects to a friend who also served

Homeless Veterans appeal

Former soldiers pay their respects to a friend who also served
Downfall of Dustin 'Screech' Diamond, the 'Saved By The Bell' star charged with bar stabbing

Scarred by the bell

The downfall of the TV star charged with bar stabbing
Why 2014 was a year of technological let-downs

Why 2014 was a year of technological let-downs

Security breaches and overhyped start-ups dominated a year in which very little changed (save the size of your phone)
Cuba's golf revolution: But will the revolutionary nation take 'bourgeois' game to its heart?

Will revolutionary Cuba take 'bourgeois' golf to its heart?

Fidel Castro ridiculed the game – but now investment in leisure resort projects is welcome
The Locked Room Mysteries: As a new collection of the genre’s best is published, its editor Otto Penzler explains the rules of engagement

The Locked Room Mysteries

As a new collection of the genre’s best is published, its editor explains the rules of engagement
Amy Adams on playing painter Margaret Keane in Tim Burton's Big Eyes

How I made myself Keane

Amy Adams hadn’t wanted to take the role of artist Margaret Keane, because she’d had enough of playing victims. But then she had a daughter, and saw the painter in a new light
Ed Richards: Parting view of Ofcom chief. . . we hate jokes on the disabled

Parting view of Ofcom chief... we hate jokes on the disabled

Bad language once got TV viewers irate, inciting calls to broadcasting switchboards. But now there is a worse offender, says retiring head of the media watchdog, Ed Richards
A look back at fashion in 2014: Wear in review

Wear in review

A look back at fashion in 2014
Ian Herbert: My 10 hopes for sport in 2015. Might just one of them happen?

Ian Herbert: My 10 hopes for sport in 2015

Might just one of them happen?
War with Isis: The West needs more than a White Knight

The West needs more than a White Knight

Despite billions spent on weapons, the US has not been able to counter Isis's gruesome tactics, says Patrick Cockburn
Return to Helmand: Private Davey Graham recalls the day he was shot by the Taliban

'The day I was shot by the Taliban'

Private Davey Graham was shot five times during an ambush in 2007 - it was the first, controversial photograph to show the dangers our soldiers faced in Helmand province
Revealed: the best and worst airlines for delays

Revealed: the best and worst airlines for delays

Many flyers are failing to claim compensation to which they are entitled, a new survey has found
The stories that defined 2014: From the Scottish independence referendum to the Ice Bucket Challenge, our writers voice their opinions

The stories that defined 2014

From the Scottish independence referendum to the Ice Bucket Challenge, our writers voice their opinions
Stoke-on-Trent becomes first British city to be classified as 'disaster resilient' by the United Nations

Disaster looming? Now you know where to head...

Which British city has become the first to be awarded special 'resilience' status by the UN?