Call to extend extra UC cash

Plans to scrap the £20-a-week increase in Universal Credit (UC) introduced in the wake of the coronavirus outbreak would see four million families losing 13% of their benefits, a new report says.

Chancellor Rishi Sunak has so far resisted pressure to extend the extra payment after April, but The Institute for Fiscal Studies (IFS) says withdrawing the extra payment would mean a "significant decline" in finances for families hit by the move.

The IFS says: "The increase is due to end in April and would see about four million families losing an average of 13% of their benefits overnight.

"For some, the proportional fall will be much greater – a childless, non-disabled, single owner-occupier with no other source of income would see a 21% decline in benefits.

"IftheGovernmentchooses to make this increase permanent, it would add about 10% to the long-run cost of UC.

"But would undo, at most, two-thirds of the benefit cuts made since 2015, let alone those made during the coalition."

IFSspokesmanTomWaters said going ahead with scrapping the payment would ease welfare budgets, but mean big losses for families affected.

A Department for Work and Pensions spokesman said: "This Government is wholly committed to supporting the lowest-paid families and has already taken significant steps, including raising the Living Wage, ending the benefit freeze and increasing work incentives.

"During this challenging time we have provided £9.3bn extra welfare support as well as introducing income protection schemes, mortgage holidays and additional support for renters, and constantly keep these measures under review."