Rishi Sunak claims £85-a-month Universal Credit cut plan is ‘right way to help people’

Chancellor Rishi Sunak defended his approach (Image: ITV)

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Rishi Sunak has claimed his plan that involves cutting six million people’s Universal Credit by £20 a week is the “right way to help people”.

The Chancellor made the extraordinary claim as he defended taking £85 a month from the pockets of some of the nation’s poorest people.

Millions wills start getting letters, phone calls and online messages within weeks informing them that the cut will kick in between September and October.

But Mr Sunak defended the cut – and said he’d made a conscious choice to press ahead with it at the same time as sending money to schemes to help people into work.

Despite 37% of Universal Credit claimants already having a job, he concluded: “I believe that is the right way to help people – especially as the economy is now reopening and businesses are reopening, hiring people, we can see that in the data.

“Hiring intentions have risen to higher the pre-crisis levels. It’s right that our support adjusts.”

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Universal Credit's standard allowance was raised from £318 to £410 a month for single people in April 2020 to help families through the pandemic.

After protests, the uplift was extended by six months to September – but the Treasury is refusing to extend it further.

That is despite ministers admitting they have made no assessment of how many children it will plunge into poverty.

Six former Tory Work and Pensions Secretaries have demanded the cut is cancelled, and a think tank has warned it will pull 400,000 children below the poverty line.

Today Mr Sunak insisted: “We are throwing literally the kitchen sink at helping people find jobs and find better jobs.

Millions of people will start being warned their payments are going to be cut by £20 a week
(Image: gov.uk)

“And I firmly believe that that is the right way long-term to help people and to support their families.”

Asked how a £20-a-week cut was supposed to help a family on the breadline into work, he replied: “What we are doing is making sure the work that families are in is well-paid and that’s £350 this year.

“We’re making sure that people are funded by the government to get new qualifications and skills.

“The PM last year outlined the Lifetime Skills Guarantee – 11million adults in this country don’t have a Level 3 qualification which is incredibly sad and we are going to try and fix that.

“So for the first ever time the government is fully funding those people to get a Level 3 qualification that’s worth £3,500… and all the evidence tells us that if we can get people that type of qualification, their prospects of getting a job or indeed getting paid more go up considerably.”

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Yet Work and Pensions Secretary Therese Coffey yesterday admitted just over 40,000 young jobseekers have started on Mr Sunak’s flagship Kickstart work scheme – out of a hoped 250,000.

She said lockdowns had held back the scheme, saying: "I’m not going to pretend otherwise, I wish we’d had more starts."

DWP permanent secretary Peter Schofield admitted that while 230,000 jobs are being advertised, "I don’t think" they will all have people starting by December. He later insisted: "I'm absolutely determined to drive as close to it as I possibly can, if not exceed it".

Labour's Work and Pensions Shadow Jonathan Reynolds told Times Radio the £20 cut “makes no sense at all”.

He added: “I could not be clearer. This cut is economically and morally wrong.

“And the reason for that is, first of all, there has been so much money that has been taken out of the Social Security system over the last 10 years, the austerity, even when we had those tax credit rebellions in parliament from Conservative MPs as well as Labour ones, those costs were just rolled into Universal Credit. So the real value of this is very, very low.

“But the other point is, look at where this country is in terms of the recovery in the economy. Are we really saying we want to take out a thousand pounds a year from 6 million households, people who are in work already?”

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