What would you do if your partner denied you access to your bank account? If they gave you a tiny allowance, and made you account for every penny spent? Signed you up for credit and forced you into debt? What if your lack of financial independence left you trapped, as their controlling behaviour evolved into physical violence?
And how would it feel to discover the government was facilitating your abuser all along?
That’s the accusation made by the Women’s Budget Group, Surviving Economic Abuse and End Violence Against Women (EVAW) Coalition in a report published today. The report explores the impact of Universal Credit on victims and survivors of financial abuse in intimate relationships. It states: “Whilst not responsible for the abuser’s actions, government policy (such as the single Universal Credit payment) can be seen as facilitating abuse, and perpetuating inequality.”
This isn’t the first controversy to hit the government’s long-delayed Universal Credit system, which consolidates a variety of benefits – including child and housing – into a single monthly payment. Last week it was accused by the National Audit Office of failing to deliver its objectives and leaving thousands in hardship.
To claim Universal Credit, cohabiting couples must nominate a single bank account for the benefit to be paid into. It’s this requirement that the report’s authors fear will put women’s safety at risk.
Women’s Aid has also expressed concerns about the new benefit system. Chief executive Katie Ghose says Universal Credit “was not designed with survivors’ safety in mind.” The charity’s own research into the impact of Universal Credit has shown that “it risks exacerbating financial abuse for survivors, and poses an additional barrier to survivors’ ability to escape the abuse.”
Primarily affecting women, “financial abuse” manifests itself in various ways. As well as denying women access to household income, it can involve preventing a woman having a job, or the theft of her earnings. The WBG report shows that non-national women moving to Britain are especially at risk of financial exploitation, and disabled women are more likely to experience it. The abuse often exists in the context of wider violence: a 2015 survey published by Sharp-Jeffs found that 82 per cent of people experiencing this abuse also encountered other kinds of violent behaviour.
The government justifies the policy by claiming that few couples manage their finances separately. They argue that paying one benefit into a single bank account means families can make decisions about their household finances without government interference. However, this assessment ignores the realities of women trapped in controlling relationships.
Paying a household’s benefits in one payment into one bank account empowers an abuser to take sole control of the family’s finances. It concentrates resources and power into his hands – robbing a woman of financial autonomy.
This was the case for one woman quoted in the report. She describes how, after switching to Universal Credit, her husband “allocated a tiny amount” to her each month. The move forced her into total economic dependence.
It’s not just women’s organisations. The Department for Work and Pensions’ (DWP) own research into public and claimant perceptions of switching to this model revealed concerns about the impact on those with “less stable or problematic relationships”. The EHRC also highlighted the gendered impacts of a single monthly payment.
Aanya (not her her real name), told the report authors: “there are many problems with the system based on my experience as a single parent going through domestic violence… allowing your perpetrator [to] use the system as another means of persecuting you.”
Both Ghose and the WBG report raise how, for many women, the switch to the single payment system could make it harder to leave an abusive relationship.
If benefits are paid into her abuser’s account, a woman’s financial autonomy is compromised. Without access to her own money, or with her benefits controlled by a violent partner, she may be unable to afford to leave. The report estimates that if Universal Credit is paid to the highest earner, women in the lowest tenth of incomes could lose an estimated £3,650 on average per year. Without this income, women risk becoming trapped in violent homes.
A DWP spokesperson defended the move to Universal Credit. She told me staff receive training on signposting support services to abuse victims and survivors, and alternative payment methods are available to mitigate the impact of financial abuse.
One such alternative the DWP offers is an exemption to the single payment system. This is designed to protect victims of controlling and abusive behaviour. Called the “split payment”, it is open to benefit claimants where financial abuse means one partner mismanages the Universal Credit payments, or where domestic abuse is an issue.
However, this split payment is criticised in the report, as they are “only made in very exceptional cases […] and applying requires survivors to disclose abuse.”
The split payment has also been criticised by Women’s Aid. According to Ghose, “the current process of applying for a split payment could be dangerous for survivors. If the abuser finds out that a survivor has made an application, the survivor may be at risk of further abuse.” This is borne out by the testimony of one survivor quoted in the WBG report: “I’d get a beating if he found out I’d gone behind his back and changed the money.”
The right for women’s financial independence was hard-won. As recently as the 1970s, women weren’t able to take out a mortgage or credit card without a male relative’s signature. Women’s financial autonomy is a clear indicator of gender equality.
By moving to the single payment system of Universal Credit, the government risks undermining this right, and threatening the financial freedom of the most vulnerable.