Boris Johnson has dismissed calls to ditch his plans to slash universal credit payments by £20 a week this autumn, telling MPs he wants a pandemic recovery based on creating jobs not extending welfare.
The prime minister’s comments came after work and pensions secretary Therese Coffey suggested that the cut - costing £1,040 a year for some of Britain’s poorest families, including many in low-paid jobs - would help get people back into work.
The reversal of the UC uplift introduced at the outset of the coronavirus lockdown last year will bring unemployment support to its lowest level in real terms for 30 years, at a point when the end of furlough is expected to force many workers onto the dole.
Both Tory and Labour MPs have urged a rethink on the £5bn cut, and the Joseph Rowntree Foundation has warned that half a million people, including 200,000 children, could be pushed into poverty in September if it goes ahead.
Macmillan Cancer Support today urged a change of mind from chancellor Rishi Sunak, warning that the cut will “leave the most vulnerable without vital support when they desperately need it most”.
The charity’s Eve Byrne said that “huge numbers” of UC claimants with cancer were “struggling to get by” because they were too ill to work and face higher costs while having treatment.
“People tell us they don’t how they will pay for the additional heating or electricity they need, or put food on the table,” she said. “It is vital that the chancellor steps in and does not rip £20 a week from the people who need it most.”
Ms Coffey today confirmed that the uplift will be phased out, telling the Commons work and pensions committee: “A collective decision was made that as we see the economy open up, we shift the focus strongly on to getting people into work and jobs.”
And Mr Johnson later resisted calls to reconsider from the committee’s chairman Stephen Timms.
Answering questions at the Commons liaison committee, the PM said that as the UK lifted coronavirus restrictions, “the emphasis has got to be on getting people into work and getting people into jobs”.
Declaring that the UK had higher employment than virtually any other G7 country, Mr Johnson said: “There’s a problem at the moment because of a shortage of labour, not a shortage of jobs...
“If you’re going to make a choice between more welfare or better, higher-paid jobs, I’m going to go for better, higher-paid jobs.”
Urged by Mr Timms to review the cut before September, he replied: “Of course I keep everything under under constant review, but I’ve given you a pretty clear steer about what my instincts are.”
Appearing before MPs on the Work and Pensions Committee, Ms Coffey denied claims the government was ignoring warnings of financial hardship.
“It’s not assuming everything is going to be OK,” she said. “We’re not putting our head in the sand … We’re not trying to pretend everything is going to work out for every individual, but that’s why we’re investing in people.”
She said the government had invested £3bn in the Restart programme, which aims to give UC claimants enhanced support to find jobs if they have been out of work for 12-18 months.
Despite the fact that almost 40 per cent of universal credit claimants are already in some form of employment, the work and pensions secretary suggested that the end of the uplift was part of a push to “fill ... vacancies and help people back into work” after lockdown restrictions end on 19 July.
Tory MP Nigel Mills criticised the government for taking away the uplift “regardless” of the lack of data on how the move would affect claimants. “It sounds like this is a dates-not-data decision,” he said.
Earlier this week, six Tory former work and pension secretaries urged Mr Sunak to make the uplift permanent.
But the Treasury said it was “right” that financial support was wound down as Covid measures are eased.
A survey by shopworkers’ union Usdaw found that 57 per cent of workers on UC are struggling to pay their gas and electric bills. Some 80 per cent said they would be worried or very worried if the government removed the £20 weekly uplift.
The union’s general secretary Paddy Lillis said: “Now is not the time to be removing this lifeline for low-paid workers and their families.”
Torsten Bell, chief executive of low-pay thinktank the Resolution Foundation, said the removal of the uplift will “cut the incomes of the poorest families by over 5 per cent overnight”.
“This huge cut will fall not on the families that have amassed large savings during the crisis, but on poorer families who have been more likely to take on additional debt,” said Mr Bell.
“There are difficult trade-offs with all major spending decisions, but taking a gamble with family finances and the strength of the recovery this autumn is the wrong choice.”
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies