Universal Credit uplift could only stay if we hiked income or fuel tax, Govt minister tells LBC

23 September 2021, 11:31

Brits would face tax rises to fund the benefits system if the Universal Credit uplift is not scrapped, a minister has insisted to LBC.

The warning comes amid research showing 1.5 million working people could be plunged into hardship during the winter if the extra £20 a week is withdrawn, according to Citizens Advice.

The withdrawal would bite as fuel bills potentially skyrocket in the wake of soaring gas prices, and the organisation said about 600,000 claimants fear not being able to afford food or basic necessities like toiletries.

Citizens Advice added that many people it speaks to would struggle to find extra work for more pay.

About two-thirds of working claimants are bracing themselves for difficulties, the organisation said, as they fear they will struggle to pay bills, get into debt or be forced to selling their possessions.

Another quarter of claimants could face even worse difficulties, the research, published on Thursday, said. It surveyed 2,183 adults receiving Universal Credit.

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Business minister says tax rises would be needed to keep UC uplift

Speaking on Nick Ferrari at Breakfast on Thursday, business minister Paul Scully dismissed criticism from Labour over the Tories' plan to withdraw the £20-a-week uplift.

He said they hadn't suggested "what else they can do to find the £6bn that we need to raise to keep that Universal Credit uplift".

He said: "That's the equivalent of a penny on income tax, and 3p on fuel."

The uplift was introduced when Covid broke out but the Chancellor, Rishi Sunak, wants it to end by October. He has already extended it for six months, with the uplift having originally been intended to last for a year.

Business Secretary Kwasi Kwarteng has admitted the winter could prove "very difficult" for some families.

Citizens Advice chief executive Dame Clare Moriarty said: "With energy bills set to rise and family finances already stretched to the limit, this cut is coming at the worst possible time.

"Shop workers, nursery assistants and security guards are just some of the people on Universal Credit seeking our help because they're already struggling to make ends meet.

"The Government has shown in this pandemic that it's willing to support people through hard times.

"With a cost of living crisis under way, it must reverse the disastrous decision to cut this lifeline."

Around 2.3 million Universal Credit claimants are in work already, while another 1.7 million cannot work because of health or care responsibilities.