MPs vote for Universal Credit reduction to be scrapped
At the start of the pandemic, the government increased the standard allowance of Universal Credit by £20 a week. The uplift equates to £1,000 a year.
But this uplift was only a temporary measure and is due to end in April. Its withdrawal will see many families face financial hardship as the pandemic and lockdown continue.
Labour initiated an Opposition Day debate about maintaining the £20 a week uplift beyond April.
Prime minister Boris Johnson ordered Tory MPs to abstain from the vote, which took place in the House of Commons last night, accusing Labour of trying to ‘politicise the issue’. But six Tory MPs defied him and backed it.
Jonathan Reynolds MP, Labour’s shadow work and pensions secretary, claimed that “Conservative MPs are heartless, or lack compassion, or have insufficient regard for the poorest people in this country”.
However, the result of the vote is non-binding. This means nothing has changed on the policy, although the result will still raise difficult questions for the government.
Reynolds said: “It is disappointing that the Conservative government refused to vote with Labour to provide families with certainty and secure our economy. They can still do the right thing and drop their plans to cut Universal Credit.
“Britain is facing the worst recession of any major economy because of the government’s incompetence and indecision. Families cannot be made to pay the price.”
Karl Handscomb, senior economist at the Resolution Foundation, said: “Last year, unprecedented government support largely protected family incomes from the biggest economic contraction in over 300 years.
“But while the economic outlook for this year is far rosier, the living standards hit from the Covid-19 crisis is ahead, rather than behind us. Unemployment is set to rise, and over six million households are on course to lose over £1,000 if Universal Credit is cut.
“The living standards outlook for 2021 looks bleak at present – but the government can directly improve it.
“Deciding if the £20 a week uplift to Universal Credit should be extended will determine whether millions of households are able to enjoy any sort of living standards recovery next year. And looking further ahead, the decision on whether to keep the UC boost will help define whether this is to be a parliament of ‘levelling up’ living standards, or pushing up poverty.”