Universal Credit Row Erupts As Boris Warns

24 September, 2021 by Denzil Otieno 4 mins read Category:  Money

According to the prime minister, extending the temporary measure would cost about £6 billion. The £6 billion increases were first implemented at the start of the first lockdown to assist individuals in surviving the pandemic. However, the government has stated that the initiative would expire on October 6th, leaving participants £1,040 worse off each year.

The Move Has Attracted Criticism 

The proposal has been profoundly criticized, with Conservative backbenchers opposing the benefits decrease.

Mr. Johnson told reporters in America that he had “sympathy” for those struggling. Tax increases will be unavoidable if the policy is extended—the money has to be found somehow. 

Business minister Paul Scully said that although he sympathizes with those finding it hard, Britons should understand that to sustain the Covid uplift, the government will have to find an extra five or six billion in tax, which would, of course, come out of the citizen’s pocket. 

Alternatively, he suggested that the best solution would be to continue investing in people’s skills, to ensure that they get jobs that compensate for their hard work.

Improving peoples’ skills will see wages going up. Wages are growing faster than they’ve been for a long time. And the government’s philosophy is to endeavour to create a high-skill, high-wage economy. 

He concluded that the government is looking for ways to support families during this challenging economic time. 

Pushing for the Government to Reverse the Decision

Former Tory leader Iain Duncan Smith and ex-Cabinet minister Damian Green attempt to persuade the administration to reconsider scrapping the boost.

However, Business Minister Paul Scully has stated that both income tax and fuel duty will be raised to keep it in effect.

Additionally, the Chancellor will look at the fundamental aspect of public finances in the Budget and the next Spending Review.

He also added that reversing Universal Credit as it is now would need an increase in income tax of a cent and a 3p increase in gasoline prices.

When informed that most individuals would accept a penny increase in income tax to maintain the rise, Mr. Scully responded that they have to find £6 billion from somewhere, besides what they don’t want to be doing, especially for the lowest-paid, is giving with one hand and taking and increasing taxes with the other.

His remarks come as Citizens Advice warns that the reduction will cause hardship for 1.5 million employees.

There Could be a Surge 

The charity anticipates an increase in the number of families seeking its assistance as rising energy bills and higher living costs are exacerbated by the Universal Credit decrease.

According to its most recent data, two-thirds (67%) of working claimants will experience hardship if the cut goes forward.

This includes failing to pay their expenses, falling into debt, or being compelled to sell possessions to make up for a loss in income.

One in every four working claimants, or 600,000 individuals, is concerned that they cannot buy food or other basic requirements such as toiletries.

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