Government urged to think again about its ‘unacceptable’ decision to cut the incomes of millions of families by more than £1,000-a-year in six months’ time

Budget announcement of extension to the universal credit uplift serves only to 'kick the can down the road' leaving millions facing a financial cliff edge in the autumn

The government has been urged to think again about its 'unacceptable' decision to cut the incomes of millions of families by more than £1,000-a-year in six months' time.

In yesterday's Budget 2021, the Chancellor Rishi Sunak announced that -

'To support low-income households, the universal credit uplift of £20 a week will continue for a further six months, well beyond the end of this national lockdown [and] we’ll provide working tax credit claimants with equivalent support for the next six months.'

However in response, and while welcoming the fact that claimants will not face a cut next month as feared, Alistair Cromwell, Acting Chief Executive of Citizens Advice, said that the six-month extension serves only to 'kick the can down the road', leaving millions facing a financial cliff edge in the autumn.

In addition, while the Chancellor also announced that the Coronavirus Job Retention Scheme will be extended to the end of September 2021, the chair of the Work and Pensions Select Committee Stephen Timms said that it will be very hard to justify cutting benefits at the very moment the furlough scheme is due to end and many jobs will be at risk.

Calling for the government to 'urgently right this injustice, Helen Barnard, director of the Joseph Rowntree Foundation, said that the decision 'makes no sense' and will pull hundreds of thousands more people into poverty as we head into winter.

Meanwhile, the Disability Benefits Consortium highlighted that the Chancellor was silent on any additional support for the 2.5 million people on legacy benefits who have not been entitled to the uplift since its introduction in April 2020. Agreeing, Mr Timms said that it cannot be acceptable that people are excluded from support simply because, through no fault of their own, they are claiming older benefits.

However, despite calls from Citizens Advice for the uplift to be kept for at least a year to help people pick up the pieces from the Covid crisis, and from the Joseph Rowntree Foundation for the Chancellor 'to do the right thing', the Chancellor said today that

' ... [the uplift] was put in place while we were in a national lockdown. Obviously that's gone on for longer than we would have liked. We are going to exit this national lockdown in the coming weeks and the universal credit uplift will be in place well beyond the end of that ... [and] that's just one of the things we're doing to support low-income families .. the national living wage is being increased above inflation starting in April, that's a £350 pay rise to those who are full time on the national living wage. Also we're providing a lot of support for those vulnerable families who need help with their rent payments through something called local housing allowance - that's a billion pounds of extra investment next year ... we're also providing three and a half million families with £150 to help with their council tax bills and, what is really important, as the economy re-opens, is that we focus our attention on giving people the opportunity to get new jobs ...'

NB - among other reactions to the Budget, Shelter said that it's a missed opportunity to build back better, while Age UK and the Care and Support Alliance said that they are deeply disappointed that no immediate or longer-term support for social care, so badly battered by the pandemic, was announced.