MPs increase pressure on Sunak over Universal Credit

MPs increased pressure on Chancellor Rishi Sunak to extend a £20 increase in weekly benefits, saying scrapping the payment would plunge hundreds of thousands of families into poverty during the pandemic.

The Work and Pensions Committee called on Sunak to extend the increase to Universal Credit by a year at the very least. The cross-party committee also said the government should abandon any plans to replace the weekly increased payment with one-off payments.

The committee warned that removing the payment with families struggling during the pandemic would consign many households into poverty including children and drag those already in poverty into destitution. The Joseph Rowntree Foundation said scrapping the increase would sweep 700,00 people into poverty, including 300,000 more children.

Sunak introduced the increase at the start of the first Covid-19 lockdown in March to help struggling families. The payments, worth £1,050 a year to each claimant, at a cost of £6bn a year to the Treasury, was meant to finish at the end of March.

But the government has faced mounting pressure from Labour, campaigners and its own backbenchers to make the change permanent or at least extend it during the crisis. Six Tory MPs voted with Labour in January on a motion to extend it by 12 months. Reports said dozens of Conservative MPs were unhappy about ending the payment.

Stephen Timms, who chairs the committee, said: "Removing the extra payment in March would represent a failure by Government – failure to recognise the reality of people struggling. Without regular support, hundreds of thousands of families will be swept into poverty or even destitution. Government must end the uncertainty and commit to extending this lifeline."

Timms said the committee would prefer Sunak to make the change permanent with inflation-based increases but that with difficult economic decisions on his plate an extension would be a good move. He said one-off payments would not give claimants a steady income and could be prone to fraud.

Sunak is due to present his budget in the first week of March.