Calls have been made for the Universal Credit uplift to be brought back - and increased in value. Millions of families benefitted from the £20 a week uplift during the pandemic which was withdrawn by the government which said it was a ‘temporary measure’.
However calls are growing for it to come back and be increased to £25 amid growing evidence its axing plunged some of the poorest people in the country into even more financial difficulties. The Institute for Fiscal Studies (IFS) published its findings on Sunday ahead of a full report into “Living Standards, Poverty and Inequality in the UK”, which is funded by the Joseph Rowntree Foundation. The IFS report said that it expected “the absolute poverty rate to be 0.16ppts (106,000 people) higher in 2022–23 than in 2021–22 as a result of the £20 cut to Universal Credit”, meaning more than 100,000 people have been pushed into real penury by the decision BirminghamLive reported..
It said that other changes to the Universal Credit system had not been as impactful as the £20 increase in payments. The cuts to Universal Credit have been described as ‘devastating’. The £20 uplift from the Department for Work and Pensions lasted for 18 months - and amounted to £1,560 in total. The DWP said it had only been a temporary measure when it was cut in October 2021.
David Linden, Shadow SNP Spokesperson (Social Justice) and a member of the House of Commons Work and Pensions Committee, said it must be reinstated as soon as possible and raised to £25. He told MPs: “The Joseph Rowntree Foundation’s latest cost of living tracker found that 5.7 million low-income households are having to cut down or skip meals because they do not have enough money for food, while the number going without items such as food, heating and basic toiletries has remained at about 7 million for more than a year - all of that in the sixth largest economy in the world.
“The basic rate of Universal Credit is now at its lowest level as a proportion of average earnings. Indeed, the JRF’s latest cost of living tracker warns that about nine in 10 low-income households on UC have gone without at least one essential for the third survey in over a year.
“Rather than offering one-off payments to shore up struggling families’ incomes, the DWP should reverse the damaging policies that are impacting the most vulnerable people. It should reinstate the Universal Credit uplift at £25 per week and, of course, extend it to legacy benefits. Let us not forget the 2.5 million disabled people who were cruelly left behind without that uplift during the pandemic. The Government also needs to remove the benefit cap and the two-child limit. They also need to halt the punitive sanctions regime so that all households are lifted out of poverty now and in future.”
The IFS said: “However, our analysis shows that the £20 uplift had a much larger effect on overall poverty rates than the taper rate reduction. The impact of the uplift being in place for six months of 2021–22 was to reduce absolute poverty among the whole population by 0.3 percentage points (ppts), equivalent to 0.6ppts on an annualised basis (379,000 individuals), a result that is comparable to other simulation exercises based on pre-pandemic data.”
“Another reason that the £20 uplift had a bigger impact on poverty was simply that it was a larger policy, costing around £6 billion for a full year.”
Guy Opperman, Minister of State at the Department for Work and Pensions, said: “Universal Credit, as we see, provides a massive amount of support on an ongoing basis, which is targeted to help those most impacted by rising prices throughout this financial year.
“Targeted support includes support for people on means-tested benefits such as Universal Credit, with up to three cost of living payments totalling up to £900. We have delivered the first £301 payment to 8.3 million households in support worth £2.5 billion. The two further payments of £300 and £299 will be made in the autumn and next spring.
“To help with additional costs, we have paid the disability cost of living payment to 6 million people as well as paying the winter fuel support payment. A huge amount is being done in jobcentres, whether that is through the in-work progression offer, the support of extra work coaches, the over-50s support, the administrative earnings threshold support or the 37 new district progression leads who are working with key partners, including local government, employers and skilled providers, to identify and develop local opportunities and to overcome barriers that limit progression.”
