Cllr Nigel Ayre, Executive Member for Finance and Performance, has written to the Secretary of State for Work and Pensions to urge for the £20 uplift in Universal Credit to be maintained after April 2021 and extended to legacy benefits to ensure millions of families are not forced into poverty.
The changes in benefits policy, implemented in the early months of the crisis, including the £20 a week boost to tax credits and Universal Credit, have provided a lifeline for millions of families during the pandemic. But this boost is currently only intended to go up to March 2021.
In York, as across the rest of the country, we have seen a significant increase in Universal Credit claimants. The figures show that this year the number of claims for Universal Credit in York more than quadrupled - from 2,372 to 12,830. This saw the Council urgently invest to support those transferring to Universal Credit. We also increased the existing emergency support funding (York Financial Assistance or YFAS scheme) by £1.2m to help those in need of financial assistance.
Analysis by the Joseph Rowntree Foundation shows that if the £20 uplift is not made permanent, 6.2 million families will see £1,040 a year cut to their incomes overnight and 500,000 people, including 200,000 children, are at risk of being swept into poverty.
The glaring absence of any announcement on the £20 uplift at last week’s Spending Review suggests that the Government does not intend to extend this lifeline to legacy benefits. This would leave disabled people and carers without help as they face rising costs, increased barriers to work and heightened risks from the pandemic.
Liberal Democrats have long campaigned for the welfare system to be strengthened, calling for the sanctions system and the two-child limit for Universal Credit to be abolished, as well as the five-week wait for claimants to receive their first UC payment to be reduced to just five days.
Cllr Nigel Ayre, Liberal Democrat Executive Member for Finance and Performance, commented:
“The £20 uplift in Universal Credit has been a lifeline to so many across York and the country. The removal of this support would not only be wrong, but would also damage the UK’s recovery, as this would see around £8 billion withdrawn from disposable incomes in 2021-22, precisely from those groups and places that need it most to support spending and the economic recovery in 2021-22.
“The fact that this relatively minimal boost has been so crucial to millions of families across the country, should be seen as a reflection of the fact that out-of-work support was not adequate when we entered the crisis and certainly won’t be adequate in future is the uplift is not at least maintained.
“Major issues are still inherent in the Universal Credit system, most notably, people having to wait five weeks for their first payment and the ongoing delays in receiving support, leaving many reliant on food banks, falling seriously behind with their rent, and experiencing increased levels of psychological distress.
“Ultimately this crisis has once again emphasised the fact that our welfare system requires a fundamental rethink.
“I would urge the Government to ease the crippling uncertainty that will grip millions of people over Christmas, by making the £20 uplift to Universal Credit permanent and extend this same support to those on legacy benefits.”