Thérèse Coffey grilled on migration of Universal Credit
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The JRF is a UK-based charity which funds and conducts research into solving poverty-related issues in the country.
JRF’s research found that half a million people are set to be pulled into poverty due to the Government’s proposals, including 200,000 children.
Families are set to be the most adversely affected, with around six in 10 of all single-parent families due to experience their income falling by the equivalent of £1,040 per year because of the cut in Universal Credit or Working Tax Credit.
Despite the Government’s promise to “levelling up” areas outside of London, the effect of the cuts will hit hardest in the North of England, Wales, the West Midlands and Northern Ireland.
Analysis on the adequacy of working-age social security by the organisation created a range of illustrative families to convey how adequacy has changed for different households over time.
In the JRF’s illustrative family of three children who live in a medium cost area, with one parent working full-time and the other working part-time, the study found they would have been living £271 a month above the poverty line in 2013/14.
Now in 2021, the charity estimates that the family would be living £150 per month below the poverty line if the cut goes ahead.
Universal Credit was rolled out in Jobcentres across the country in 2013, replacing six previous benefits for people of working age.
Universal Credit: Universal Credit cuts biggest since WWII (Image: GETTY)
Specifically, it replaced income support, child tax credit, working tax credit, housing benefit, income-based jobseeker’s allowance, and income-related employment and support allowance as a single one payment benefit.
The standard allowance for those under 25 on Universal Credit is £344 a month, with over 25s receiving £411.51 a month.
Couples under 25 receive £490.66 under the benefits scheme, with couples over 25 getting £596.58.
In April 2020, the Government raised the payment by £20 a week to assist struggling households and families at the beginning of the pandemic.
Previously, this raise on Universal Credit was set to end on March 31, 2021 but was pushed back due to public pressure.
In his Budget 2021 announcement in March, Rishi Sunak announced the uptick will only last up to the end of September.
This was confirmed by Theresa Coffey, the Work and Pensions Secretary, when she spoke to MPs on the Work and Pensions Committee on July 7.
“Ahead of October we will start communicating with the current claimants who receive the £20 to make them aware that it will be phased out and they will start to see an adjustment in their payments,” she explained.
The Government’s proposed cut is scheduled to be in law for October 6, 2021, which coincides with the last day of the Conservative Party Conference.
Universal Credit: In April 2020, the Government raised the payment by £20 a week (Image: GETTY)
Katie Schmuecker, the Deputy Director of Policy and Partnerships for the Joseph Rowntree Foundation, cautioned the Government about moving forward with the proposed cuts to Universal Credit.
Schmuecker said: “Universal Credit has been a lifeline that has helped keep millions of heads above water, but the new analysis should act as a stark warning of the immense, immediate and avoidable consequences of what amounts to the biggest overnight cut to the basic rate of social security since the Second World War.
“We all accept governing is about priorities but cutting the incomes of millions of the poorest families and sucking money out of the places in which they live, flies in the face of the Government’s mission to level up our country.”
She added: “This is not about generosity, it’s a matter of investing in families so they have the dignity of being able to meet their needs and supporting everyone in and out of work to escape poverty.
“The public deserve to know what the Government expects the impact of this cut to be. Ministers cannot hide the fact that they are ploughing ahead with a cut despite knowing it will be devastating for millions of families. They should publish their analysis on the impact of the cut as soon as possible.”