As a temporary measure during the pandemic, the government increased Universal Credit payments by £20 per week. With the pandemic hitting the economy, it has been a necessary measure to ensure those who have lost their jobs are supported properly, especially considering so many people were excluded from the other support schemes. Yet this measure is temporary, and the Conservatives want to scrap it now that the lockdown has been lifted.
This debate is not in a vacuum, however. The backdrop is years of discussion and argument around the benefits system and how we manage it properly. There are debates around what form welfare should take, with options ranging from giving everyone a set amount of money without questions, a Universal Basic Income, to clamping down on those fraudulent claims. These two sides of the argument have been around long before COVID-19, and that helps to explain where we are now.
So, the question is: why should we keep the £20 uplift? In part, it is because whilst the lockdown is over, the pandemic and the need to support people are not. GDP is still below where it was before the last quarter of 2019 and the number of people on payroll is still below where it was in March 2020. You also still have those who fell through furlough and the self-employed income support scheme who are struggling with their businesses or finding new employment.
The £20 per week uplift will help these people, but there is also a wider issue at stake: how much we pay to those who are on Universal Credit. The current system means that without any extra top-ups, someone who is single and over 25 will be on £3,898.08, and if they are single and under 25, they would be on £3,087.96. For a couple, there is a payment for both people, with those under 25 receiving £2,447.16 and those over 25 receiving £6,118.92.
Such a difference may seem small, but when the Joseph Rowntree Foundation puts a minimum income at “A single person needs to earn £20,400 a year to reach a minimum acceptable standard of living in 2021…” which is above even the minimum wage within the UK, it is clear that this is not something people can live on.
That is where I think the argument around the £20 increase is simple. How much we give to those who are on Universal Credit and what criteria we should have for the system are different arguments. Whether you want to reform the benefits system or not, and whatever the criteria you think the benefits system needs, it does not matter. That argument is a separate one and, as I said to begin with, one that we have been having for years. The argument here is that we have our current benefits system, and no matter how we intend to reform it, we also need to deal with the system as it is now.
There are undoubtedly people on this system who need support and have not been given enough money to support themselves properly. We can either choose to support them or to once again reduce their support. The arguments about who deserves to be on Universal Credit can then go on separately, and I will be arguing that we need a simpler system. For now, however, this is about the people who need help and have been hit by the pandemic and, in many cases, years of not being supported properly.
Director and Founder
Torrin is the Founder and Director of Centre Think Tank. His experience includes authoring over a dozen papers and over one hundred policies. His policies have been backed by an All-Party Parliamentary Group of over 260 MPs and included in various party manifestos. He has appeared in a wide range of print and broadcast media and previously had a weekly column for a national publication. He has a degree in Political Studies from Aberystwyth University.
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