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Community / New study sheds light on rise in benefits claims during pandemic

Photo: BBC

THE IMPACT of the coronavirus pandemic on people seeking benefits in Shetland has been highlighted in a new study, with new claimants for Universal Credit in April around five times higher than in the previous year.

New research from the BBC’s Shared Data Unit shows that in April last year there were 267 new starts on Universal Credit in Shetland compared to 52 in the same month in 2019.

By October 69 per cent of those who started Universal Credit in April, just after the pandemic hit, were still claiming.

This was the joint second highest number in the whole of the UK, with only Blackpool – 75 per cent – seeing more continued claims in October.

The number of new claimants in May was 124, compared to 43 the year prior.

The nationwide study highlights that areas of the UK traditionally reliant on tourism were among the most heavily impacted.

In Shetland the closure of Scatsta Airport in the summer, which was unrelated to coronavirus and led to a number of job losses, is also thought to have had an impact.

It is already well known that there was a sizeable increase in people in Shetland seeking benefits from the onset of the pandemic.

The figures also show that there was a seven per cent rise between February and October in the number of Shetland people claiming Universal Credit who were in work. This was one of the higher rates in the UK.

By November there were 1,151 people in Shetland claiming Universal Credit.

In comparison the figure for Orkney was 3,314.

Universal Credit is the UK Government’s means-tested benefit for people of a working age on low income.

It is a catch-all benefit that replaces various strands of the welfare system, such as income support, job seeker’s allowance and housing benefit.

The payment was increased by £20 a week in April last year as part of the response to the coronavirus pandemic.

Citizens Advice UK principal policy manager Minesh Patel said the organisation has understandably seen a significant increase in people seeking support.

“At the start of the pandemic, we saw a huge surge in people coming to us for advice about Universal Credit or employment more generally – mirroring the trend of more people applying for the benefit,” he said.

“Seven out of every 10 people coming to us didn’t need support previously, so we had lots of people who weren’t used to the benefits system applying for the first time and needing help with things like eligibility and how much they were entitled to.”