Pressure on chancellor Rishi Sunak to extend the £20-a-week Universal Credit uplift continues to mount as the next budget on March 3 nears.
The Institute for Fiscal Studies (IFS) is the latest organisation to call for maintaining the £20-a-week increase today (February 16), noting that “given that basic support for the (childless) unemployed has not risen in 50 years as earnings have more than doubled, and is much less generous than in many comparable countries, there is a case for maintaining this increase”.
The IFS noted that if the payment is not to be made permanent, at the very least it must be phased out slowly – otherwise many households would see their incomes fall sharply at a time when unemployment is only expected to continue rising.
Meanwhile, new evidence has shown that axing the £20-a-week Universal Credit increase, first introduced as an emergency measure last March but slated to end at the next month, could plunge nearly half a million children into poverty.
The Mirror reported this week on the new research by the House of Commons Library, which found that 420,000 children would fall into relative poverty if the government did not extend the Universal Credit uplift after March.
Commenting on the latest research, Feeding Britain director Andrew Forsey told the Mirror, “The findings of this analysis are as stark as they are frightening.
“A failure to extend the Universal Credit increase will plunge hundreds of thousands more children into the clutches of poverty and hunger.”
Even a growing number of the government’s own Tory MPs are calling for the extra £20 a week in Universal Credit payments to be extended for at least another year.
The Telegraph reported that 40 Tory MPs have written a private letter to prime minister Boris Johnson and chancellor Rishi Sunak demanding they extend the Universal Credit uplift for another 12 months.
Last month, Labour put forward a motion in an Opposition Day debate calling on the government to keep the Universal Credit uplift – Tory MPs were instructed to abstain but six rebelled and sided with Labour.
Tory MP Peter Aldous, among those who voted with the Labour motion, told the Telegraph that he had written his own private letter to the prime minister demanding the government keep the Universal Credit increase – and ensure it lasts a year.
“The danger with extending [the Universal Credit increase] for six months is that a cliff edge still looms very quickly,” he said. “Doing it for a year provides comfort and assurance.”
The chancellor is said to be weighing up multiple options for the Universal Credit increase – beyond axing it altogether or extending it for a year, it is understood he is also considering a shorter extension or a lump sum payment.
Critics were quick to point out problems with the lump sum payment option.
“Unemployment is projected to peak later this year so ending the lifeline now and giving a lump sum will not help people for whom the worst impact is yet to be felt,” said Joseph Rowntree Foundation director Helen Barnard.
“People living on a low income have seen their incomes fall, and fall fastest over the last decade, and face an extremely challenging year ahead of them,” she added. “If the Chancellor wants to wrap the nation’s arms around families facing a long period of financial insecurity he would keep the £20 for a further year rather than cut benefits and give a lump sum, ensuring that everyone who needs support during the year can benefit.”
Free school meals
Meanwhile Labour has continued to push the government to extend free school meals during all school holidays of the year.
Labour’s shadow education secretary Kate Green held virtual talks on Monday (February 15) with parents, headteachers and foodbank directors on the first day of half-term calling for a ‘transformation in support for families’.
Despite a concerted campaign for the government to provide free school meals over the February half-term, led in part by footballer Marcus Rashford, the government has refused to do so directly.
Instead, councils have been told to use money from the Covid Winter Grant to fund meals for children in need over the week-long break. But government guidance to councils has specifically stated that the funding “is not intended to replicate or replace free school meals”.
Commenting ahead of the virtual meeting with parents, headteachers and foodbank leaders, shadow education secretary Kate Green said, “A decade of Conservative government had eroded families’ safety nets with poverty rates rising even before the pandemic.
“The last year has shone a light on the impacts of poverty on health, wellbeing and learning,” she added.
“As we rebuild after this pandemic, we must deliver a transformation in support for families, starting with cancelling the planned cut to universal credit and guaranteeing provision of free school meals across all school holidays this year.”
Unite assistant general secretary Steve Turner called on the government to act now.
“The economic havoc the Covid pandemic has unleashed has not been fully felt, with unemployment expected to get a lot worse later on in the year,” he said.
“It is vital that families who are struggling the most on the lowest incomes are given immediate reassurance that the government will not suddenly abandon them in their hour of need,” Turner added.
“They can do this by committing to cancelling the £20-a-week cut to Universal Credit now and extend it to people on legacy benefits. Even before the pandemic, child poverty was a protracted problem in the UK – for the government to consign a further 420,000 children to hunger and hardship would be a scandalous dereliction of duty.
“Our so-called social security net is riddled with holes. Making the £20-a-week increase permanent and extending it to legacy claimants would go a long way in addressing the inadequacy of our benefits system,” Turner continued.
“And let’s not forget the majority of Universal Credit claimants are in work. So Unite will continue to demand decent wages so workers shouldn’t be forced into claiming benefits in the first place.”
By Hajera Blagg