Universal Credit UK: Claimants could lose over £1,000 – here’s how
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Universal Credit is a living support payment which provides valuable help to those who are out of work, or on a low income. And the payment has been especially valuable during the COVID-19 crisis, which has wreaked financial havoc on the country. As such, understanding the difficult circumstances many claimants were facing, the Department for Work and Pensions (DWP) decided to take action.
The DWP oversees the benefit, and chose to uplift the standard sum claimants receive in support.
While the first increase resulted from the end of the benefit freeze, the government chose to rise the sum even more to help those affected by the pandemic.
The £20 a week increase was welcomed by many households as a valuable cushion to their day to day expenses.
However, this was only intended to be a temporary measure, and now millions are facing losing over £1,000 a year.
At present, the government is planning to bring the payment increase to a close in April 2021.
This would mean most claimants are set to face an income loss of £1,040.
Many people and organisations have called for the uplift to be made permanent.
While the cost for the government is likely to be higher in this scenario, such an increase is likely to provide valuable support to those who need it most.
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Last week, a report from the Institute for Fiscal Studies (IFS) warned claimants would face a “significant decline” in income if the benefit cut went ahead.
And analysis undertaken by the Resolution Foundation found that approximately a third of families in the North of England, Wales and the West Midlands would lose out due to the change.
Torsten Bell, chief executive of the independent thinktank, said: “Allowing the policy to expire next year would be a disaster, not just for household incomes, but for economic policy too, as the Chancellor seeks to secure a recovery next year.
“This policy is bad politics, bad economics, and bad for living standards too.”
However, thus far, the Prime Minister Boris Johnson has seemingly resisted the calls for such an increase to be made permanent.
He has expressed his pride in the support the government has been able to give Britons throughout the crisis.
Speaking in the Commons last week, Mr Johnson said: “I am proud that we have been able to update it in the way that we have.
“The result of Universal Credit so far has been that there are 200,000 fewer people in absolute poverty now than there were in 2010.
“It is vital that we tackle poverty in this country. We are putting another £1.7 billion into Universal Credit by 2023-24.
“We will continue to support people and families across this country, and we will continue to spend £95 billion a year in this country on working-age welfare.
“But the best thing we can do for people on Universal Credit is to get this virus down, get our economy moving again and get them back into well-paid, high-skilled jobs – and that is what we are going to do.”
Universal Credit standard payments are currently based on a person’s age and relationship status.
Single people under 25 are set to receive £342.72 with older singletons entitled to £409.89.
Those who are in a couple under the age of 25 will get £488.59, and couples where either are 25 or over will receive £594.04.
Some Britons may be entitled to extra amounts if they have children, need help with rent, or have a disability or health condition.
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