Mr Sunak stated the increase was pulled back by the end of September when the economy reopened during his Budget Statement for 2021. Many organisations and charities are criticising the government for ending help when people most need it, citing growing energy prices and a planned increase in National Insurance next year.
Many prolific figures have spoken against the UK government’s decision to end the uplift. Marcus Rashford, a professional football player, has been vocal about his views on the Universal Credit cut. He recently called on the UK Government to keep the £20 increase in place as many households depend on it.
Rashford states, “Instead of removing vital support, we should be focusing on developing a long-term roadmap out of this child hunger pandemic,”
Despite this, Grant Shapps, the current Secretary of State for Transport of the United Kingdom, has said that the £20 increase was a temporary measure and that there were no plans to have it implemented permanently. The UK government has specifically argued for the end of the uplift as they expect the economy to recover when more people return to work.
Universal Credit is a type of welfare for those who are from low-income households. It was first introduced in 2013 and was implemented as a way to combine previous types of benefits into a single payment. There were particular benefits that were replaced under the Universal Credit system, which includes:
- income support;
- income-based job seeker’s allowance;
- income-related ESA (employment and support allowance;
- housing benefit;
- child tax credit;
- working tax credit.
Universal Credit introduced a much simpler and efficient way of receiving welfare payments from the UK government as individuals no longer had to apply for separate benefits.
How does Universal Credit work?
Universal Credit is calculated based on your age, income, and whether you have a partner and/or children. Those who are eligible will receive a standard allowance; the amount will depend on your age and if you live with a partner. If this is the case, you and your partner will receive a single joint payment. To work out how much you are entitled to, you can refer to a benefits calculator.
It normally takes five weeks from the date of claiming to get the first payment. Additionally, you may request an advance if needed.
If you have received a boost of £20-a-week from Universal Credit, then you can expect it to officially end by the 6th of October. You will now receive the standard allowance before the uplift was introduced by the government.
If you are a single claimant under the age of 25, the monthly basic amount that you are entitled to for Universal Credit will be reduced by a quarter, from £344 to £257.33. If you are a single claimant over the age of 25, your benefits will be reduced by a fifth, from £411.51 to £324.84.
How does this decision affect those currently on Universal Credit?
The major reason behind ending this temporary relief for millions of those currently on Universal Credit is due to the UK government’s decision to recover a large amount of money used as support for the economy during the Coronavirus pandemic.
Ending the £20-a-week uplift has been extremely controversial and many lives will be affected. As of now, more than 5.8 million people in England, Scotland, and Wales are currently receiving Universal Credit, with nearly 40% are considered to be in some form of employment.
Citizens Advice has warned that removing the additional payment will leave a third of those on Universal Credit in debt. According to their report, they discovered the average gap would be between £51 and £55 per month. In addition to this, the Health Foundation has warned that the £20 cut might harm thousands of families' mental health and wellbeing.
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