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Keep the £20 per week UC uplift for another year “at the very least” says Work and Pensions Committee

09 February 2021

A new report from the Work and Pensions Committee of MPs notes that since March 2020 the number of people claiming UC has doubled to around six million, while job vacancies remain far below pre-pandemic levels.

Given this, the MPs warn that removing the temporary payment from April 2021, while the effects of the pandemic are still being felt, would “plunge hundreds of thousands of households, including children into poverty” while dragging those already in poverty ”down into destitution”.

While the Committee recognises that continuing with the increase would come at a “substantial cost”’, the Committee argues that this should be seen in the context of the Treasury’s own £280 billion figure for total spending on coronavirus support measures this year. 

The Joseph Rowntree Foundation has estimated that keeping the £20 rise would cost around £6.4 billion the next financial year.

The report has been published after evidence sessions with frontline support organisations and policy experts and the Secretary of State and Permanent Secretary last week.

The MPs cite analysis by the Joseph Rowntree Foundation that has concluded that withdrawing the temporary increase ‘”will risk sweeping 700,000 more people, including 300,000 more children, into poverty”’

The committee conclude that if the Chancellor cannot make the £20 week uplift “permanent, he should at the very least extend it for a further 12 months. The Government should then announce its future plans for the rate of Universal Credit no later than the Autumn Statement 2021, to give claimants enough time to plan and budget.”

The MPs also explain stress that it still recommends that the £20 week uplift  be extended;

“For reasons of time, this report is focused only on the temporary increase to Universal Credit and Working Tax Credit. That does not mean, however, that we are not concerned about other elements of the social security.

In particular, we are conscious that people on legacy benefits—including many disabled people—have not received any increase directly as a result of the coronavirus pandemic. 

We recommended in June 2020 that those benefits should be increased by an amount equivalent to the increases in Universal Credit and Working Tax Credit. 

We were disappointed that the Government rejected that recommendation, and we will continue to press Ministers on that and other recommendations.”

Rt Hon Stephen Timms MP, Chair of the Work and Pensions Committee, said:

“Removing the extra payment in March would represent a failure by Government – failure to recognise the reality of people struggling. Without regular support, hundreds of thousands of families will be swept into poverty or even destitution. Government must end the uncertainty and commit to extending this lifeline.

The Chancellor faces difficult decisions about the public finances. He may find it hard at present to make the increase permanent. But the pandemic’s impact on the economy and livelihoods will, sadly, be with us for some time. An extension for a year should be the bare minimum."

The Work and Pension committees report Universal Credit £20 weekly increase must be extended to prevent hundreds of thousands falling into poverty is available from parliament.uk.