Previous research has suggested that mental health in the UK has deteriorated since 2000, and that welfare changes have played a part in this. Universal Credit replaced six different benefits designed to cover housing and living costs for people facing unemployment, disabilities, and low pay. It was designed to provide greater incentives for claimants to enter employment and mimic work responsibilities and receipt of a monthly salary. It was first introduced in the North West of England in 2013 and then rolled out in other areas, until, by the end of 2018, 1.6 million unemployed people were receiving it across the UK.
Criticisms
Universal Credit has been criticised for having less frequent payments than the benefits it replaced, as well as longer waits for initial payments and stricter requirements over claimants preparing for work. It has also seen more use of sanctions, which involve recipients losing some or all of their benefits if they don’t meet requirements such as looking for work. As well as anecdotal reports of increased mental health difficulties and food bank use among claimants, qualitative research has shown negative effects on financial security, poverty and food insecurity, physical and mental health, and social and family lives and employment prospects.
Using data
Our 2020 paper used Understanding Society, linked to administrative data, and took advantage of Universal Credit’s phased roll-out to look at changes in unemployed people’s psychological distress as it was introduced in their area. We measured mental health by using the General Health Questionnaire (GHQ-12) and the Short Form Health Survey (SF-12). The mental health of unemployed people (i.e. intervention group) was compared to that of people who were working and/or not eligible for the benefit (comparison group).
Results
Whichever measure of mental health was considered, the results showed that the mental health of those exposed to the benefit deteriorated compared to that of people who were not exposed to Universal Credit. Among the benefit recipients, the number reporting psychological distress rose by 21% compared to the period before the new benefit was introduced. The number of people not on Universal Credit who reported psychological distress remained stable.
When we compared the groups, the number of unemployed people reporting psychological distress rose by 6.6% relative to the group who were employed. In other words, 7 in every 100 unemployed people affected by Universal Credit experienced worse mental health. This could mean that over 63,000 more unemployed people were experiencing psychological distress following its introduction. Previous research has suggested that around a third of people reporting this could reach the diagnostic threshold for depression. In this study, that would represent over 21,000 people. We suggest that, while the effect sizes in the study are moderate, the national impact of the new benefit could be far more significant.
Conclusions
Overall, the findings add to a growing body of evidence showing that restricting access to and reducing the level of welfare benefits has a negative impact on health. Given that 64% of households in the UK receive some kind of benefit, even if changes to the welfare system have small effects by themselves, the implications could be substantial.
We did not find any effects on physical health, but worsening mental health has the potential to increase costs for the NHS, social care, and welfare. The government has commissioned an evaluation of Universal Credit, but that it would only be looking at labour market outcomes. We found no evidence that being on Universal Credit was associated with moving into employment, despite this being one of the key goals, and we believe it is crucial that any assessment of welfare changes should measure the effect on health and wellbeing.
Read the original research in The Lancet Public Health
This blog was originally published in our Insights report, an annual in-depth look at the evidence on topical policy issues. Our next edition will be out in January
Authors
Sophie Wickham
Dr Sophie Wickham is a Wellcome Trust research fellow in public health at the Department of Public Health and Policy, University of Liverpool
