Labour is set to force a vote in the House of Commons on Monday over the impending cut in Universal Credit and Working Tax Credits that will cause families to lose over £1,000 a year amid an ongoing pandemic.
Shadow Work and Pensions Secretary Jonathan Reynolds said: “Under the Conservatives, families come last. The government’s mishandling of the coronavirus pandemic means Britain is facing one of the worst recessions of any major economy.
“Boris Johnson’s decision to cut Universal Credit will hit millions of families who are already struggling to get by. There cannot be another repeat of the government’s indecision and mismanagement of the free school meals scandal.
“The government must put families first during this lockdown and act now instead of waiting until the last minute. If ministers refuse, Conservative MPs have to opportunity to vote with Labour and give families the support they need to get through this pandemic.”
The plan for a vote comes after Boris Johnson hinted on Wednesday that the cut would go ahead. He told the parliamentary liaison committee: “I think that what we want to see is jobs. We want to see people in employment.
“We want to see the economy bouncing back. I think most people in this country would rather see a focus on jobs and a growth in wages than focusing on welfare. But clearly we have to keep all these things under review.”
He did not acknowledge that Universal Credit is received by people in work. There were 5.7 million people in receipt of the social security payment in October last year, of which 2.2 million – 39% – were employed.
When Labour’s Stephen Timms raised the issue of legacy benefits not being uprated in line with UC during the pandemic, Johnson replied: “We want everybody to move on to Universal Credit. It’s a successful system.”
Timms had to point out that disabled people can receive a severe disability premium that is not taken into account by Universal Credit. For many people, moving to UC voluntarily would entail significant losses in income.
As highlighted by the Joseph Rowntree Foundation, those who opt to make the switch instead of being moved by the government via ‘managed migration’ – which is paused during Covid – would miss out on transitional payments.
The Department for Work and Pensions has repeatedly claimed throughout the pandemic that changing legacy benefits in the same way as Universal Credit was altered would be “more complex” due to “old” IT systems.
UC was increased by Rishi Sunak in March due to Covid. Although the pandemic is not over, the uplift is set to end in April – and the Chancellor will not confirm whether this will go ahead or not until the Budget in March.
The Child Poverty Action Group has said the uplift is essential to ensure “low-income families with children receive the support they need”. The JRF has warned that another 200,000 children could be pushed into poverty.
Polling in December showed that a majority of the British public support the policy of keeping the Universal Credit uplift introduced amid the Covid crisis and would like to see claimants continue receiving an extra £20 a week.
According to the poll conducted by Survation for Unite the Union, 54% of UK adults believe that the increased standard allowance in Universal Credit should be extended beyond April, while 28% disagree.
The research suggested that 40% of those who voted Conservative in the last general election back the policy of keeping the uplift and 70% of 2019 Labour supporters are in favour of the increase remaining in place.
Labour demanded five urgent changes to the social security system in April, from converting Universal Credit advances into grants instead of loans to removing the savings limit and suspending the benefits cap.
Below is the full text of Labour’s opposition day motion.
Mr Nicholas Brown
Universal Credit and Working Tax Credit
That this House believes that the government should stop the planned cut in Universal Credit and Working Tax Credit in April and give certainty today to the six million families for whom it is worth an extra £1,000 a year.