45% hit by Covid pay cut as think tank warns of long term effects
Almost half of all workers in Scotland had their pay cut as coronavirus hit the country, a new report has found.
The IP PR Scotland think tank spoke about the impact of Covid-19 on people's finances - but also warned the pandemic would still pose a "significant threat to lives and livelihoods across Scotland for some time to come".
The new Weathering the Winter Storm report told how coronavirus had "exacerbated financial insecurity for families across Scotland", adding many more people were now affected by this.
It called for urgent act ion from the Scottish and UK governments to tackle the problem, urging Westminster to make the temporary increase in benefits permanent and also consider how it can provide" additional support for families with children".
The Scottish Government is being challenged to invest a further £40 million to help low-income families with children this winter, with measures such as a new winter school clothing grant suggested.
The think tank also wants Holyrood ministers to work with lenders, energy providers, council sand housing associations to establish a Covid-19 arrears package - which could combine debt writesoffs and interest-free loans to help those who have built up arrears and debts in house - hold bills during the pandemic. The report found that just before the pandemic hit 220,000 households in Scotland- one in 10- were behind on bills, with this rising to one in four among the poor est households.
Prior to the pandemic, 1.1 million people in Scotland (one in four) could cope for just one month or less if they lost their main source of income.
"From this starting point, the Covid-19 crisis has exacerbated financial insecurity for families across Scotland and drawn many more people into a state of insecurity," the report said.
By May, IPPR Scotland said one in five people were concerned about their ability to meet their financial commitments in the coming months.
Just under half (45 per cent) of workers in Scotland reported experiencing a drop in pay at some point between April and June. It said: "The Covid-19 crisis began as a public health emergency.
"As the crisis has unfolded, however, its economic impact and its effect on household finances have become clearer. Covid-19 is a disease that has claimed thousands of lives in Scotland but it will see many other victims from its economic effects. Already, we have seen an economic contraction like nothing seen before in this country and across the world.
"As we look ahead to the rest of this year and the prospect of unprecedented levels of unemployment, it is clear that this pandemic will continue to po sea significant threat to lives and livelihoods across Scotland for some time to come."
Rachel Statham, IPPR Scotland senior research fellow and one of the report authors, said: "Now that we can see the ongoing five-tier restrictions many will face through a Covid-19 winter in Scotland, further support is required to keep families afloat.”