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Half a million risk falling into deep poverty if emergency benefit increase withdrawn

MINISTERS must extend the emergency increase for benefit claimants or risk plunging half a million people into deep poverty next spring, a report warns today.

The £20 increase to universal credit and working tax credit has been a “vital lifeline” for low-income households during the Covid-19 crisis, the Joseph Rowntree Foundation (JRF) said.

The charity warned that if the emergency measure is removed as planned in April 2021, 700,000 people could be plunged into poverty while the incomes of 16 million people could suffer a hit of £1,040 per year.

It also said that a million people could be pushed into deep poverty, the point at which somebody’s income is at least 50 per cent below the official breadline.

The JRF is urging ministers to prevent this by making the emergency increase permanent as well as extending it to people on legacy benefits.

The Disability Benefits Consortium warned in April that the decision to exclude those on pre-universal credit benefits has deprived hundreds of thousands of disabled and chronically ill people during the pandemic.

The JRF’s acting director Helen Barnard said that the country cannot afford to deprive those receiving extra funding “at precisely the time when it’s needed most.”

“As we all adjust to living and working alongside Covid-19, we know many families have been hit by extra costs and barriers to earning as a result,” she said. 

“Too many households are at risk of being pulled into poverty as unemployment rises. 

“Now is the moment to help families stay afloat, not cut them adrift.”

Ms Barnard added that the upcoming autumn Budget offers an opportunity to strengthen social security by implementing such changes.

The economic impact of the virus has caused a surge in people applying for universal credit, rising to 2.7 million in July, up 117 per cent since March.

A Department for Work and Pensions statement said: “Government policies, in particular those related to the pandemic, are under constant review.”

Some £9.3 billion extra in welfare support has been offered “to help those most in need,” it said.

“Claimants on legacy benefits can make a claim for universal credit if they believe that they will be better-off but should check their eligibility before applying,” the statement added.

Anastasia Berry, Policy Manager at the MS Society and Policy Co-Chair of the DBC said: “It’s absolutely vital the government makes the £20 increase to Universal Credit permanent.

“Thousands of disabled people, including many living with multiple sclerosis (MS), have been hit with extra costs to survive the pandemic and are depending on this extra support to get by.

“The uplift must also be extended to the millions of disabled people and their carers on legacy benefits, who continue to be denied this lifeline at a time when they need it most. Despite the government’s evasive response and unconvincing excuses as to why disabled people aren’t getting this support – it cannot be right that those most at risk face a future living in poverty.”

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