In April this year, the government announced that there would be a temporary increase of £20 a week for those in receipt of Universal Credit - an absolute lifeline for those on already low incomes for whom the economic impact of the Covid-19 pandemic could have otherwise left them unable to feed their families.
But with no real commitment from the Government to keep this £20 uplift beyond April 2021, many are concerned that the drop in income could force hundreds of thousands of people into poverty overnight.
“16 million people will be in households facing an overnight income loss equivalent to £1,040 a year”
That is why we, along with 50 other organisations including Citizens Advice, Lloyds Bank Foundation and The Trussell Trust, have signed a joint letter to call on the Chancellor to make the £20 a week increase to Universal Credit permanent and extend the same support to those on legacy benefits.
Together, the coalition wrote:
We welcomed the swift action you took at the start of the pandemic to implement this much needed investment. Falling incomes and rising costs throughout the pandemic have put families under immense financial pressure, but the £20 uplift has been a lifeline that has enabled many of them to keep their heads above water and has stopped us seeing a marked surge in poverty levels.
However, if the uplift ends in April 2021, this good work risks being undermined. Modelling by the Joseph Rowntree Foundation indicates that around 16 million people will be in households facing an overnight income loss equivalent to £1,040 a year, with those on the lowest incomes and families with children being hardest hit.
At a stroke, 700,000 more people will be pulled into poverty, including 300,000 children, and 500,000 more of those already in poverty will be plunged into deep poverty (more than 50% below the poverty line). We are therefore urging you to make the uplift permanent and stop families being cut adrift whilst they need help to stay afloat.
Keep the Lifeline
The letter was sent following the Chancellor’s statement last week in which he outlined his Winter Economy Plan and acknowledged that many families will see job losses over the coming months. Even those whose jobs are protected through the Job Support Scheme will see income cuts. Despite this, there was no commitment to keeping this temporary Universal Credit uplift beyond April.
Here at Neighbourly, we’ve heard from hundreds of small charities and community groups who this year have seen steep increases in demand for support, including emergency food parcels for children and families.
As more people face risks to their livelihoods, our social security system will have a key role in protecting families from poverty and in enabling people to grasp new opportunities as they become available.
Support for legacy claimants
The letter also emphasises the importance of extending this lifeline to claimants of legacy benefits who are currently excluded from the additional £20 a week of support.
Further, it is simply not right that those on legacy benefits, who are mostly sick or disabled people and carers, and so have been most at risk during this pandemic, have not been thrown an equivalent lifeline. We urge you to follow the advice of the Social Security Advisory Committee and support 1.5 million more people by applying an equivalent uplift to those on legacy benefits who have so far been excluded from increases.
“It’s only right to prioritise those hardest hit"
Commenting on the publication of the letter, Helen Barnard, Director of the Joseph Rowntree Foundation who coordinated the letter, said: “Today’s letter shows the overwhelming support that exists for this lifeline which is playing a critical role in helping many families keep their heads above water in extremely turbulent times. Building on existing cross-party support in Parliament, we are coming together to urge ministers not to cut social security at precisely the moment our country needs it most.
“It’s only right to prioritise those hardest hit, pulling families worst affected by the pandemic back from the brink. We are united in calling on the Chancellor to keep doing the right thing by making the uplift to Universal Credit permanent and extending it to those claiming legacy benefits.”