The number of Universal Credit claims has surged dramatically – by several million – this year, as Britons felt the financial impact of the coronavirus pandemic. The COVID-19 crisis continues, and as 2021 nears, many are beginning to think about their finances for the year ahead.
Chancellor of the Exchequer Rishi Sunak announced in March this year a £1,000 uplift to the Universal Credit standard allowance, which would last for one year only.
In his speech, delivered on March 20, he said: “To strengthen the safety net, I’m increasing today the Universal Credit standard allowance, for the next 12 months, by £1,000 a year.
“For the next twelve months, I’m increasing the Working Tax Credit basic element by the same amount as well.
“Together these measures will benefit over four million of our most vulnerable households.”
The uplift is something which Will Quince, Parliamentary Under Secretary of State at the Department for Work and Pensions (DWP), spoke about during a recent exclusive interview with Express.co.uk.
Asked about the increase – which works out at a boost of around £20 per week – and what it meant for families, he said: “It has made a huge difference because that was one of a number of measures that the Chancellor put in place.
“I have to pay tribute to the Chancellor because despite seeing an unprecedented surge in claims to the UC system, without the interventions that he put in place such as the furlough scheme and Self-Employment Income Support Scheme, there’s absolutely no doubt that it would have been many millions more.
“So we have to pay tribute to the Chancellor for being quick in terms of putting those schemes in.”
Addressing the temporary £20 per week Universal Credit uplift, which runs until March next year, he continued: “All those on Universal Credit will have that increase to the standard allowance and the security of that through til the spring next year, so the end of March, early April.
“But what I would say – because I know there’s lots of people, charities and others that are rightly raising questions about this with me about what’s going to happen post then – throughout this crisis, the Chancellor has always made sure that he has looked after the most vulnerable in our society.
“But I think what he has rightly said, is, ‘Look, let’s get to that point.’ See where we are in the spring of next year, the early part of next year.
Mr Quince went on to state the temporary measure costs around £6billion for the year.
Following a wealth of calls for the Chancellor to extend the uplift, Express.co.uk asked whether, if the covid crisis continues, the government would commit to an extension.
“I think the Chancellor has been clear that he hasn’t taken the decision and all options are on the table,” Mr Quince replied.
“But he initially brought in what was a temporary measure for 12 months and he’s been clear, and I think he said this as such in the recent statement as part of the Spending Review, that in the early part of the new year, he’s going to review this in the broader context and then make a decision.”
Mr Quince pointed out “people do have the security of those payments through the spring next year, so through to the end of March, early April”.
“And the Chancellor is going to take a decision,” he added. “But what I would say is, both myself and indeed the Secretary of State for Work and Pensions are working really closely with the Treasury, discussing all of these issues.
“I’d also say, the Chancellor so far throughout this pandemic has not hesitated to support people facing the most financial disruption. And in particular, supporting the poorest and most vulnerable in our country.
“And I have no doubt, that depending on where we are as part of this pandemic, and gosh I hope that with the vaccine roll out and our plan for jobs in place and our labour market and our economy picking up that actually we will be seeing lots of people, who I know are desperate to get off Universal Credit, are back into work and we’re going to be in a very different place.
“But I completely understand why the Chancellor, not withstanding the discussions that we’re having, will just want to have a look in the early part of next year, where we stand, given that he doesn’t have to make a decision now, and look at it in the broad context of the economy, of the vaccine, of the labour market, and then make a decision ahead of what will be the fiscal event in the spring.
“I think it’s important that we give the Chancellor the space to do that because, as I said, this is not a low-cost fiscal measure, it’s around £6billion.”
Mr Quince also discussed how the DWP has had to adapt and cope with the multi-million increase in the number of claims for Universal Credit this year.
Paying tribute to DWP employees, he remarked on how “the teams across the DWP have worked so hard over the course of the past 12 months in particular since the height of the pandemic”.
“The Prime Minister has rightly recognised them because they have been quite actually incredible,” Mr Quince said.
“Universal Credit has stood up to the challenge, if you like, of COVID-19. It has responded really effectively to the surge in new claims. But I think it’s only one piece of the jigsaw.
“Having that sort of modern, agile, dynamic system has meant we have been able to process an unprecedented number of claims in what is just an incredibly short period of time.
“But behind of that, of course, are the very very many – tens of thousands – of DWP employees who very very quickly changed what they were doing and focused on the processing of claims. So it’s very much a team effort between the system that has risen to the challenge and worked, and incredible DWP staff who have been really resilient and really gone the extra mile to make sure that people have been paid their benefits as quickly as possible, in full and on time.
“To give you an idea of numbers, we have processed over 3.7 million new claims since the middle of March and that is around six times the volume that we would typically receive. So there’s now about 3.8 million people on Universal Credit.”