This month the Labour Party brought an opposition day debate to the Commons on the government’s commitment to scrap the Universal Credit (UC) and Tax Credits uplift in April. This debate is on a motion brought forward by Labour’s Shadow Secretary of State for Work and Pensions, Jonathan Reynolds MP. You can watch the debate here.
The Government announced a 12-month £20 increase in Universal Credit at the beginning of the Coronavirus crisis. The fact this step had to be taken shows that the social security system is not fit for purpose as the existing level of support was simply inadequate.
As the country looks to the government to renew this vital support, it is unthinkable that the Government is still planning to cut Universal Credit by £20 a week, or £1000 a year, in April 2021. This cut will impact 6.2 million families, including those on working tax credits. This £20 is what enables some of them to put food on the table at the end of the week. Despite being asked over 40 times in the Chamber, government representatives have refused to commit to ruling out the cut.
The Resolution Foundation has estimated that, if the £20 a week cut to Universal Credit goes ahead, the rate of basic unemployment benefit will fall to the lowest level in real-terms since 1992. The government simply cannot justify giving such meagre support to those hit by the pandemic. You can watch Jonathan Reynolds recent interview on this very point here.
Labour has consistently called on the government not to cut Universal Credit in April 2021. In November, we launched our Cancel the Cut campaign which you can see here.
The government has also excluded all other benefits (such as employment support allowance and job seekers’ allowance) from the uplift, repeatedly stating that the systems would take too long to update, even though we are now over nine months into the pandemic. I believe that the uplift should be extended across legacy benefits, and to refuse this is discriminatory and unfair.
The UK Government has the wrong priorities. They wasted £22bn of taxpayers’ money on a testing system that doesn’t work and spent billions on contracts to Tory donors – but now can’t find the money to support families. Dominic Cummings’ £40,000 pay rise alone would have spared 40 families this brutal cut for an entire year.
While UC is a reserved matter for the UK Government, the Scotland Act 2016 devolved significant new welfare powers to the Scottish Parliament, including responsibility for disability and carers’ benefits; benefits for maternity, funeral and heating expenses; and powers to vary the housing cost element of UC and UC payment arrangements. The SNP Scottish Government has regulation-making powers to vary the housing element of UC and powers to vary how it is paid. The Scottish Government has delayed taking on these welfare powers until 2024 despite them passing in 2016.
Labour’s shadow DWP Minister has written more about this, which you can see here.
In Scotland, we have the power to make different choices, and my colleagues in the Scottish Parliament have repeatedly called upon the SNP Scottish Government to use those powers for a £10 million cash injection to Discretionary Housing Payments for those most affected by the cost of living crisis brought about by cuts to UC. This would help protect some of the most vulnerable people in our society.
Millions of families are relying on the £20 a week uplift in Universal credit as a lifeline as we come through this crisis, especially as they face increased costs associated with the pandemic. Now is the time for more support, not cuts. By delaying a final decision on whether the cut will go ahead, the government is adding to stress and uncertainty for low income families at an already extremely difficult time. The Government need to put families first and cancel the cut.
The sacrifices families have made in the past year have been unimaginable. We can’t ask those who are already struggling to shoulder this burden. Families deserve support during this crisis, not cuts.
The vote was won 278-0 with the government abstaining and 6 Conservative MPs voting with the opposition. Johnson’s spokesperson then said: “We haven’t made a decision. We will be coming forward in due course with our decision.”
Although the vote is not binding I am hopeful that the government have listened to the justified anger over this proposal and will keep the uplift.