Work and Pensions Secretary Therese Coffey MP has confirmed that the UK government will begin to “phase out” the £20-a-week Universal Credit uplift from late September, despite fears that the £1040 a year cut could plunge many more households into hardship and poverty.
Speaking in front of the Work and Pensions Committee, Coffey said the Tory government will begin writing to current claimants “to make them aware that [the uplift] will be being phased out and they will start to see an adjustment in their payments.”
She defended the controversial decision by reiterating past comments that the boost was introduced as a “temporary measure”, to support people during the Covid-19 pandemic and that it had been a “collective decision” by ministers.
The decision comes after six former Work and Pensions Secretaries urged the UK government to make the Universal Credit increase a permanent feature.
In a letter to the Chancellor Rishi Sunak, the former Work and Pension Secretaries said: “The UC uplift has rightly been allocated into the standard allowance of UC as many have not been able to work and it has been right to protect people whilst they cannot work.
“But as the economy reopens, and the Government re-evaluates where it has been spending money, we ask that the current funding for individuals in the Universal Credit envelope be kept at the current level.”
Former DWP boss Iain Duncan Smith said: “Universal Credit has held up well as a system for distributing money to those who need it, and the extra £20 added to has been essential in allowing people to live with dignity.”
“Today all six former Conservative secretaries of state for work and pensions have written with one voice to urge the Chancellor to protect the extra money he has invested in Universal Credit.
He added that scrapping the uplift would “damage living standards, health and opportunities for some of the families that need our support most as we emerge from the pandemic.”
A report from the Institute for Public Policy Research (IPPR), published in May, found the UK’s relative poverty rate among working households has already hit a record high this century of 17.4 per cent – with one in six working households now languishing in poverty.
Tory backbencher Andrew Rosindell angered opposition MPs after telling BBC’s Politics Live: “I think there are people that quite like getting the extra £20 but maybe they don’t need it.”
Hitting back, Labour MP Carolyn Harris said: “£20 is food for a week. £20 is a lifeline for people on Universal Credit.”
Boris Johnson defended the decision. Asked by a Commons committee if he accepted that it would lead to more hardship and poverty, the PM said: “I think that the best way forward is to get people into higher wage, higher skilled jobs.
“That’s the ambition of this government and if you ask me to make a choice between more welfare or better, higher paid jobs, I’m going to go for better, higher paid jobs.”
But Labour’s Shadow Work and Pensions Secretary, Jonathan Reynolds MP, warned that “six million families are set to lose £1000 a year while out of work support will be left at its lowest level in decades.”
“There is near universal opposition to this cut, including from prominent Conservatives,” he said.
“It is time the Government saw sense, backed struggling families and cancelled their cut to Universal Credit.”
SNP Work and Pensions spokesperson, David Linden MP, said: “It is becoming increasingly clear that this UK government are being driven by dates – not data – when it comes to cutting Universal Credit.
“Despite numerous reports from leading anti-poverty organisations like the Joseph Rowntree Foundation and the Trussell Trust, who have urged the UK government to make the uplift permanent and extend to legacy benefits, we are yet to see any progress.
“We know that by making the uplift permanent, we could prevent as many as 700,000 people – of which 300,000 are children and 60,000 live in Scotland – from being plunged into poverty, yet these cruel cuts remain on the table.”
Unite assistant general secretary Steve Turner said: “This is the news struggling families have been dreading. This cut will cause so much hardship and despair because that £20 was the difference between heating and eating.
“It also makes no economic sense to pull cash from the economy at a time when the recovery is fragile.
“That money is spent locally in our struggling high streets, yet the chancellor is draining support away from them at a time when they, too, need every penny.
“The grim reality is that work doesn’t pay in this country. The chancellor should be focusing on halting the march of poverty pay, not taking £20 from those most at need.
“Even before the pandemic, child poverty was a deeply entrenched problem in the UK – for the government to consign a further 420,000 children to hunger and hardship is a scandal.
“Vulnerable children will suffer. The chancellor has to think again.”