Income tax ‘will need to rise’ to pay for Universal Credit uplift extension warns Minister

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Raising income tax could cover Universal Credit uplift says MP

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During the interview on Sky News this morning, Business Minister Paul Scully said the £6billion it has cost to pay for the Universal Credit uplift of £20 a week would have to be recovered from somewhere if it was kept in place. However, he added that it was unfair to penalise the poorest in society and keep “giving with one hand and taking and increasing taxes with the other”.

Speaking on Sky News this morning Mr Scully said: “The Chancellor will look at the whole aspect of public finances in the Budget and the Spending Review that is coming up.

“But if you were to reverse the Universal Credit as it is, you would have to put up income tax by the equivalent of a penny and three pence on fuel.”

This follows news yesterday that Labour MP Thangam Debbonaire clashed with the Business Minister over the Universal Credit cut, accusing the Government of attempting to “starve working-class families” in a debate on BBC Politics.

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She fumed: “The government was warned about the heating crisis; they were warned about the impact of cutting Universal Credit.”

Ms Debbonaire added: “The childcare costs are going up; council tax is going up. Why starve working families of that money, which would actually help our economic recovery as a whole?”

In October the Universal Credit standard allowance will be reduced by £20 per week to its pre-pandemic level – something that many people are saying will hit the poorest in society the hardest.

Nearly six million people are claiming Universal Credit – almost double the figure of those needing the help before the Coronavirus Pandemic. The £20 per week uplift was put in place to help families struggling in the wake of the pandemic, which has been estimated would plunge more than 800,000 Britons into poverty.

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But controversial plans to scrap the uplift look set to go ahead in just over a week’s time unless Boris Johnson caves into this pressure.

It’s feared that up to 1.5 million working people could be forced into hardship this winter if the Prime Minister’s plans to remove the £20 uplift get the green light.

This is according to research carried out by Citizens Advice which says that two-thirds of working claimants are bracing themselves to face hardship when the uplift is abolished at the end of the month.

The organisation said as many as 600,000 working Universal Credit (UC) claimants are worried they might not be able to afford food or other basic necessities like toiletries after the reduction in their income is introduced.

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Boris Johnson says that the Universal Credit uplift was only meant to be temporary and will come to an end at the close of September.

However, a campaign group has warned the Government that it could be in breach of international human rights obligations.

Human Rights Watch (HRW) has written to more than 350 MPs representing varying areas of the UK, urging them to take action on the matter.

It has urged them to do everything they can to prevent the proposed cut from going ahead once Parliament is back in session next week because it says the UK could be in violation of the UN’s International Covenant on Economic, Social and Cultural Rights (ICESCR).

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