Stephen Daisley Stephen Daisley

Why Rishi Sunak should keep the Universal Credit uplift

Chancellor Rishi Sunak agreed to sit down with Andrew Neil on GB News last night for what turned out to be a fairly brutal grilling. The Chancellor floundered under interrogation on the pensions triple-lock, the cost of climate-friendly policies and the Tories’ big-government instincts. However, one of the more uncomfortable moments came when Neil pressed him on the future of the £20 weekly Universal Credit uplift. The benefit supplement, which also applies to the basic element in Working Tax Credit, was introduced at the start of the pandemic because the government acknowledged that the coming recession would inflict particular hardship on those already on the lowest incomes.

Announcing the 12-month increase last March, the Chancellor said: ‘I cannot promise you that no one will face hardship in the weeks ahead, so we will also act to protect you if the worst happens.’ That meant, he said, taking measures ‘to strengthen the safety net’, citing the uplift by way of example.

When this March rolled around and we remained in lockdown, Sunak extended the uplift for a further six months, meaning it is due to expire at the end of September. Labour and various civil society groups are pressing for the extra £20 to be made permanent but there are no signs as yet that Number 11 is budging. It should take the Andrew Neil interview as a dress rehearsal for the next three months, when the Chancellor will come under intense pressure either to extend again or simply accept that returning people to the welfare status quo ante is a non-starter and make the uplift permanent.

The latter option may be the prudent thing to do politically but it is also, happily, good policy. If the government pulls away this economic ladder, it will drop millions of families into a worse financial position near the end of the year — i.e.

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