Universal Credit increase should be scrapped and replaced with hardship payment – report




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By Hannah Rodger

Westminster Correspondent

AN EXTRA £20 in Universal Credit should not be maintained but replaced with a pandemic hardship payment, according to new research.

The uplift, and possible removal of it, has caused fierce debate since it was introduced last year, with the SNP, Labour and the Liberal Democrats all urging the Chancellor to keep the increase.

However, research published today by the Centre for Policy Studies, the centre-right think tank with links to the Conservative Party, claims the increase across the board is a “blunt instrument”.

It argues that rather than maintaining the £20-a-week increase, Rishi Sunak should instead consider a coronavirus hardship payment from April.

The briefing paper states that repackaging the increase would “ensure claimants do not see a sudden fall in income while restrictions are still in place”. It suggests that this would allow the payments to be “clearly defined as a temporary measure to last a further six months, with an additional three-month phasing-out period at half the value to prepare for its withdrawal”.

Author James Heywood, head of Welfare and Opportunity at the CPS, explained that the UK Government should change the benefits system to “ensure it always pays to work”. He said: “Simply maintaining the uplift would be poorly targeted, as it means those who previously had relatively low entitlements benefit much more in percentage terms than those with families and children to support. Research shows the standard allowance for a single claimant under 25 increased by 36 per cent compared to just 19% for a couple over 25 years old.”

He said that Boris Johnson’s Government had “backed themselves into a corner” with the current situation, and explained: “It’s much harder to take something away once it’s in place. However, they do have the opportunity now to make significant changes to the system to benefit claimants and ensure it always pays to work.

“Replacing the uplift with a clearly defined temporary support mechanism, combined with other reforms, would offer the intended financial support while making it easier to prepare claimants for its eventual withdrawal.”

It comes after numerous campaigners, charities and advocates who work with people living in poverty claim that by removing he extra £20, it could force thousands more people into poverty.

Earlier this week the Child Poverty Action Group Scotland told MPs that 22,000 children could be plunged into poverty if the payments were removed.

The Chancellor has not yet said what will happen with the extra cash, ahead of the spring Budget statement March.

This week an overwhelming majority of MPs backed a Labour motion at Westminster to keep the £20 increase.

The non-binding motion was backed by 278 votes to zero in the Commons on Monday, after Boris Johnson ordered Conservatives to abstain from taking part. Despite his order, six Tory MPs rebelled and supported the Labour motion, which was brought forward as an attempt to increase pressure on the Government over the issue.

Neil Gray, SNP MP and the party’s spokesman for work and pensions, said there still needed to be an increase to the overall level of Universal Credit, and said people are still worse off today on benefits than they were in 2011. He said: “We have to remember even with the uplift people are £1,600 worse off than 2011 and if the cut to Universal Credit goes ahead in April, social security will be at its lowest ever level relative to wages. That’s why the uplift needs to be made permanent regardless of where we are with the pandemic.

“My colleagues and I have also repeatedly urged the UK Government to pilot a Universal Basic Income and increase the national minimum wage in line with the real living wage as steps towards creating a fair society in which no-one is ever left struggling to afford the basics.”

A UK Government spokesman said: “We are committed to supporting the lowest-paid families through the pandemic and beyond to ensure that nobody is left behind.

“That’s why we’ve targeted our support to those most in need by raising the living wage, spending hundreds of billions to safeguard jobs, boosting welfare support by billions and introducing the £170 million Covid Winter Grant Scheme to help children and families stay warm and well fed during the coldest months.

“We will continue to assess how best to support the economy.”

Terminally ill Scots live on £340 a month and told to wait until after pandemic for benefits

Scottish Universal Credit claimants near 500,000 as help requests soar


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