Cutting extra £20 Universal Credit payment would be 'deranged' and cost County Durham £1million, claim representatives

Households on Universal Credit have been receiving extra payments during the pandemic, but that is set to end - in a move opponents say would hit families hard as well as taking money out of the economy.

The Government is facing growing calls to maintain the current Universal Credit top up, which is due to revert back to previous levels at the end of March.

And Ministers have been urged to consider the wider implications of withdrawing the funding, beyond just the finances of the households receiving it.

“The public might not be aware, but £1million is how much money a week that extra £20 is putting into our local economy,” said Liberal Democrat county councillor Mark Wilkes.

“People on high incomes might think £20 wouldn’t have much impact, but for someone on a low income it has a massive impact.

“And £1million suddenly being taken away from our local economy would be an absolute disaster at a time when there’s shops closing and so many people struggling.”

Cllr Wilkes was speaking at a meeting of the county council’s Corporate Overview and Scrutiny Management Board on Friday January 22, which was held by videolink and broadcast via YouTube.

There have since been reports Chancellor Rishi Sunak may introduce a one-off £1,000 payment to people claiming Universal Credit in the hope of both boosting the economy and staving off a rebellion by Tory MPs over axing the £20 top up.

A non-binding motion passed the House of Commons on January 18 calling for the Universal Credit uplift agreed to support families during the coronavirus pandemic be extended.

The Labour Party-backed proposal passed with 278 votes in favour, including six Conservative MPs who defied orders to abstain.

If ministers bow to pressure, the move is expected to be worth an extra £1,000 a year to families claiming the benefit.

Before the pandemic, County Durham had about 30,000 Universal Credit claimants, a figure which has now surged to more than 52,000.

Cllr Wilkes called the prospect of cutting payments in April ‘completely unacceptable and deranged’.

And he was backed by panel chairman Rob Crute, who added: “[The uplift] needs to be extended, but I would also argue it needs to be made permanent.

“It isn’t just allowing families in need to put food on the table or heat their homes, it’s also about spiking demand in the local economy, putting money in the pot.

“It creates so many benefits in so many ways.”

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