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Universal Credit will be cut by £20 per week from April 2021

28 September 2020

The £20 a week uplift in Universal Credit and Working Tax Credit will end in April 2021.

The uplift has been a lifeline for many claimants as they’ve struggled to get through the Coronavirus pandemic. 

On 6 April, 2020, the Chancellor raised the standard rate of Universal Credit and Tax Credits by £20 a week for one year - meaning those claimants will be up to £1040 a year better off.

However, an analysis of the Chancellor’s renewed package of economic support by the Resolution Foundation shows that there is no extension of the £20 week uplift.

The independent think tank says:

“With the Chancellor’s emergency support reducing, but far from stemming, a major rise in unemployment over the coming months, households now face a squeeze on living standards that they have largely been shielded from so far in this crisis.

Those flowing onto Universal Credit will not only see much large hits to their incomes, but the Chancellor yesterday missed the opportunity to avoid a further shock by extending the temporary boost to Universal Credit beyond March.

As a result, the analysis warns that over six million households could face an income loss of £1,000 from next April – at a time when unemployment could still be at its highest level in a generation.”

Ken Butler DR UK’s Welfare Rights and Policy Adviser said:

“Given that the £20 week uplift was thought necessary at the start of the pandemic it is difficult to see how its end can now be justified given all forecasts are for unemployment to rise.

Worse, it shows that the Government still rejects the case for awarding ESA claimants the same £20 week increase given to those receiving Universal Credit and Working Tax Credit.

This failure has been criticised by both the Social Security Advisory Committee and the Work and Pensions Committee of MPs.

Even before the Covid-19 crisis, benefit cuts and austerity hit disabled people the hardest.

While means tested benefits were uprated by 1.7% in April 2020, previously they were subject to a four year freeze.

In addition, since April 2017, the £30 week limited capability for work addition has no longer payable to new claimants of ESA.

By ringfencing the £20 week increase the Government continues to discriminate against the millions of disabled people on other benefits.

DR UK says that the £20 uplift should be extended for ESA to all means tested benefits and that it should remain post April 2021.

You can sign Don't Leave Disabled People Behind petition calling for a £20 a week increase to ESA @ 38degrees.org.uk.

For more information see The Job Support Scheme will not support enough jobs – risking a major living standards squeeze available from resolutionfoundation.org