As part of a Centrepoint research project looking at how homeless young people access the social security system, Oxera were commissioned to provide a backward-looking assessment of the impact that the social security system has had on young people under the age of 25 (under 25s) between 1988 and 2020. In light of this, Oxera also undertook a forward-looking cost–benefit analysis (CBA) to analyse the impact of six different policy recommendations provided by Centrepoint regarding the social security system in the UK.
Executive summary
As part of a Centrepoint research project looking at how homeless young people access the social security system, Oxera were commissioned to provide a backward-looking assessment of the impact that the social security system has had on young people under the age of 25 (under 25s) between 1988 and 2020. In light of this context, Oxera also undertook a forward-looking cost–benefit analysis (CBA) to analyse the impact of six different policy recommendations provided by Centrepoint regarding the social security system in the UK.
In this analysis, Oxera consider seven different households. These households were chosen in collaboration with Centrepoint to be representative of the different types of young people receiving benefit entitlements. Oxera also consider three different locations (Barnsley, Greenwich and Manchester) as a means of exploring the varying cost pressures across the UK.
The analysis shows that five of the seven households considered are worse off in real terms in 2020 compared to 1988. In particular, households in which young people work part-time have been negatively affected by the introduction of Universal Credit. Moreover, the ending of the £20 COVID-19 Universal Credit uplift, introduced in March 2020, has served to compound this impact.
Therefore, Centrepoint requested that Oxera consider the impact of a range of policy recommendations on young people. In doing this, Oxera find that four out of the six policy recommendations are expected to generate net benefits, with the monetary benefits outweighing the costs, even before any non-quantified benefits are taken into account
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What impact does the social security system have on under 25s who are claiming Universal Credit? An economic analysis prepared for Centrepoint by Oxera