We can do better: Women, welfare and the gender benefits gap

Today we’re talking about the gender benefits gap as it’s a big week for women with the Spring budget 2024, International Women’s Day and Mothers’ Day. This blog explores women and the welfare state, taking a look at how the system supports, and in some cases works against, women.

Women experience higher rates of poverty than men for two main interconnected reasons: women typically earn lower wages per hour and work fewer paid hours over their lifetimes, while also facing income loss due to caregiving responsibilities.

Although this wage gap may be offset by the earnings of male partners in dual income (and mixed sex) households, it leaves single women, pensioners, and especially single parents in precarious financial situations, susceptible to poverty-level incomes.

Women, particularly single mothers, rely more heavily on benefits as part of their income, rendering them vulnerable to cuts in benefits. Moreover, as we see in benefit takeup rates, women are more likely to qualify for means tested benefits, exacerbating their struggle to escape poverty.

The intersectionality of gendered poverty compounds its impact on women with other marginalised identities. Black women, for instance, face higher odds of being single parents and working low-wage jobs.

Additionally, households belonging to Black, Pakistani and Bangladeshi communities are more likely to have dependent children and larger families, making them more susceptible to reductions in Universal Credit or policies such as the two child limit.

Women make up the majority of benefit claimants and are more likely to have their benefits capped

On the whole, women make up the majority of benefit claimants. At face value, this could be for several reasons:

• Women, especially low income women, are more likely to manage their household finances and therefore are more likely to make and manage claims, and more likely to lead on household bills and budgets.
• However, women are also more likely to suffer financial vulnerability, earn less on average, and have less to retire on than men. Recent analysis by the Pensions Policy Institute found that women need to work an additional 19 years to keep up with men’s pensions.
• Women earn less than men and therefore could be entitled to more benefits, and higher benefit rates as a result when they do claim. Lower earnings, career breaks for family care, and providing more unpaid care than men leave women in a financially poorer position.

It therefore stands to reason that we would see more female benefit claimants. But the numbers are still startling.

94% of all single parent families on Housing Benefit are female-led families

As one of the six legacy benefits being slowly migrated to Universal Credit for working age women, and with managed migration to Universal Credit ramping up this year, more women face potential disruption to their claims. Knowledge of the transitional protection window and making the move to Universal Credit at the right time will be vital to protecting these family incomes.

88% of existing claims for Child Benefit were made by women

Of the more than 7 million households in receipt of Child Benefit, only 13% are made by male claimants, and 80% of all new claims are made by women.

This week’s Spring Budget included changes to the High Income Child Benefit Charge (HICBC), a change likely to impact many women positively.

The new rates for HICBC reduce child benefit payments when one parent earns more than £60,000 a year, tapering down to zero when that parent earns £80,000 or more. In the year to August 2022, female claimants made up 85% of households opting out of child benefit payments as a result of the HICBC.

77% of people receiving Income Support are women

While Income Support is another one of the six legacy benefits being phased out and replaced with Universal Credit, there remains a significant imbalance of women on the lowest incomes, or with no income at all.

73% of people receiving Carer’s Allowance are women

Women also make up a larger proportion of unpaid carers with as many as 10.3% of women provided unpaid care compared with 7.6% of men.

62% of Attendance Allowance claimants are women

Our analysis finds £5.2 billion in Attendance Allowance is unclaimed each year, and as women live longer, and report higher rates of disability, much of this unclaimed support is leaving women without vital income.

60% of all Pension Credit is claimed by single women

In addition, because they have an average life expectancy of 82.6 years compared to 78.6 years for men, the impact of lower incomes affects older women for longer. Women retire with less, live longer, and the gender pensions gap is such that to retire with the same pension pot as male counterparts, women need to start their pensions at the age of three.

58% of Universal Credit claimants are women

This is despite making up 51% of the population. The Universal Credit claimant commitment includes work conditionality for lead carers of dependent children, with potential sanctions applied for non-compliance. Lead carers are more likely to be female in a mixed-sex couple, leaving women with additional work conditionality rules.

55% of claims for Personal Independence Payments were made to women

Latest census figures tell us in England, 18.7% of females and 16.5% of males report being disabled, and with higher rates of disability, women are more likely to require, and qualify for, increased financial support as a result.  We see this trend in means tested disability benefit Employment Support Allowance too with 51% of claims made by women.

61% of all benefit capped households are led by women

In August 2023, the latest date for which figures are available from the DWP, of the 76,947 households were subject to the benefit cap, a limit on the amount of benefits a household can claim.

For households claiming Housing Benefit, 67% of capped households were female-led

Did the Spring Budget 2024 shift the dial in the right direction for women with female-centred policies? No. But can we continue to talk about women and our experiences of welfare and poverty? Absolutely.

Using data for good to close the benefit gender gap and better support women

Knowing what we know about gender and benefits, local authorities can analyse their administrative data sets to identify groups of low income households and target discretionary support.

Policy in Practice’s LIFT platform brings administrative data together to provide local authorities with the confidence that they are supporting vulnerable groups proactively, maximising income, and supporting women in their communities.

Our analysis shows that millions of people are missing out on at least £19 billion of support every year. We built our award winning Better Off calculator to empower everyone with the knowledge of what support and benefits they are eligible for. Our free version, recommended by GOV.UK, is used by thousands of people every week.

As a society we need to work together to narrow the gender benefit gap, but this alone doesn’t solve the problem. We need to make the case for a stronger social security system that fairly supports us all.

We celebrate International Women’s Day by raising awareness of the gender benefit gap, the issues facing low-income women, and we will continue to ask the right questions in our analysis and research. There is more to be done to support women in poverty. We can do better.