New figures suggest that the cost-of-living crisis may be easing. But this is not the case for disabled people who face lower incomes, higher costs and diminishing support
Today’s Labour Market Statistics show that average prices have not exceeded average wages for the first time since 2010.
This could be interpreted as early signs that living standards in the UK are increasing, which would be good news for most. But this does not necessarily mean an improvement in disabled people’s living standards.
Firstly the figures show that the costs an average person faces are not greater than their pay. But this may not be the case for disabled people, who are likely to be in lower-paid jobs. On average disabled people earn over £1 an hour less than non-disabled people.
Secondly, the figures do not recognise a problem for disabled people’s living standards that pre-dates the recession – one owing to the additional costs of disability.
Yesterday Scope launched a report bringing together new research and analysis to show that disabled people often face a financial penalty. This might mean:
- Having to buy more of everyday things (like heating, or taxis to work)
- Paying for a specialist items (like a wheelchair or a hoist)
- Paying more than non-disabled people for same products and services (like insurance)
We found that on average disabled people spend an extra £550 a month on disability related items.
Over 20 years ago Disability Living Allowance (DLA) was introduced in recognition of this financial penalty and to help cover the extra costs of disability. DLA and its successor, the Personal Independence Payment (PIP), go some way to level the playing field so that disabled people have an equal chance to contribute to and benefit from economic growth, access services and participate fully in their communities. Around 200,000 people use DLA to get to work.
However, fewer people are getting support and the support people get is decreasing. A 20% cut to the budget for DLA will mean 600,000 disabled people lose their support by making the benefit harder to get.
The third reason why the ONS figures do not necessarily point to an improvement in disabled people’s living standards is that crucial extra costs payments are now uprated each year by the Consumer Prices Index (CPI) rather than in line with the Retail Prices Index (RPI).
This means the value of extra costs payments will diminish in real terms every year that CPI inflation slows. Between 2010 and 2017, 3.25 million DLA claimants will be £1,000 worse off because of the change.
On top of this, the prices people face for goods and services relating to their disability are not ‘average’; they are often specialist and very expensive. For example Lightwriters – which turn text into speech – can cost up to £3,500.
With lower incomes, higher costs and diminishing support to offset these costs, disabled people are likely to face considerable financial instability. Disabled people are twice as likely to have household debt totalling more than half their household income and have on average £108,000 less in savings and assets than non-disabled people.
The problem of extra costs needs urgent address. The government must protect the budget for crucial extra-costs payments from the overall cap social security. It must also make sure these payments keep up with disabled people’s costs by placing a ‘triple lock’ on them, as they have done on pensions, and tackle the root causes of extra costs by rebalancing markets and introducing cross-governmental accountability.
Official figures are showing that living standards in the UK might finally be on the rise. But parties truly committed to raising disabled people’s living standards in the lead up to the next election must commit to tackling the problem of extra costs.
Ellie Brawn is a public policy adviser for Scope. Earlier this month Scope published the first in a series of reports looking at disabled people’s living standards - Better Living, Higher Standards. The second in the series Priced Out was published yesterday. The research from the Centre for the Analysis of Social Exclusion is available here
