Tuesday, October 27, 2020

Universal Credit increase must be made permanent and extended to legacy benefits

Reversing the increase risks plunging 700,000 more people into poverty, report says.

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The SNP’s Shadow Work and Pensions Secretary has urged the UK Tory government to maintain the £20 increase to Universal Credit – instead of axeing it in April 2021 – and extend it to legacy benefits.

Ahead of the UK government’s autumn budget, leading anti-poverty charity, the Joseph Rowntree Foundation (JRF), has published a report setting out how the £20 increase has been a lifeline for families during the coronavirus crisis and called for it to be made permanent and extended to legacy benefits to strengthen the social security net.

Iain Porter, Social Security Policy and Partnerships Manager at JRF said: “The £20 per week uplift to Universal Credit and Working Tax Credit has been a lifeline for families during the coronavirus storm.

“But it is due to end in April 2021, whipping the lifeline away, cutting many adrift and seeing 700,000 more people pulled into poverty.

“The Government promised to protect living standards and level up the country, but around 16 million people are in families that will feel an overnight loss of £1,040 per year, disproportionately hitting those on the lowest incomes and families with children.

“This cut will impact both those who have newly turned to our social security system due to job losses as a result of the pandemic, and those who were already in poverty, plunging 500,000 more people into deep poverty – 50% below the poverty line.

“Cuts to social security after the last recession meant record employment did not protect many families from poverty, with more working families experiencing poverty, and child poverty on the rise.

“Having seen their living standards squeezed, many people entered the current recession lacking financial stability and finding weakened social security lifelines in the face of job loss.

“We must not repeat the mistakes of the past by cutting social security when we need it most.

“This time we must recognise the vital role of social security in protecting people from hardship, providing security and supporting the recovery.

“At a time when we need to bolster confidence and spending in our economy, strengthening social security offers an effective stimulus.

“Cutting it would instead take money out of the economy, reducing consumption and increasing household debt.

“This Government has already shown that it plans to do things differently by throwing us this vital lifeline, and the next step should be making it permanent.”

The report follows repeated calls from the SNP for Boris Johnson to take action to rebuild the social security net – after his party spent a decade dismantling it with austerity cuts which only served to exacerbate poverty in the UK.

Commenting, Neil Gray MP said: “The Tories have an opportunity at the upcoming budget to do what is right and maintain this lifeline, as well as extend the increase to legacy benefits.

“I urge them to do so to prevent people being pushed into, or further into, hardship.

“In their most recent report, the Joseph Rowntree Foundation has put forward the case for maintaining and extending the increase that is impossible to argue against.

“Taking this action would be a good first step in rebuilding the social security net but far more needs to be done if they are to make up for the damage caused by ten years of brutal austerity cuts.

“With unemployment rising and people’s working hours and incomes being cut back, it is more pressing than ever that the proper financial support is forthcoming – including extending the furlough scheme into 2021.

“If the Tories fail to act, the inequality gap will widen, people will fall into or further into debt and hardship, and millions will face or continue to live in poverty.”
 
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