Universal Credit cuts to hit 280,000 people in Wales – are you affected?

Thérèse Coffey grilled on migration of Universal Credit

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The trade union is warning that tens of thousands of families across the country will be “worse off as a result” of the future changes.

Universal Credit replaced income support, child tax credit, working tax credit, housing benefit, income-based jobseeker’s allowance, and income-related employment and support allowance as a single one payment benefit.

Currently, the standard allowance for those under 25 on Universal Credit is £344 a month, with over 25s receiving £411.51 a month.

Couples under 25 get £490.66 under the benefits scheme, with couples over 25 receiving £596.58.

In April 2020, the Government raised the payment by £20 a week to assist struggling households and families at the beginning of the pandemic.

Previously, this raise on Universal Credit was set to end on March 31, 2021 but was pushed back due to public pressure.

However, in his Budget 2021 announcement in March, Rishi Sunak confirmed the uptick will last up to the end of September.

This was reiterated by Theresa Coffey, the Work and Pensions Secretary, when she spoke to MPs on the Work and Pensions Committee on July 7.

“Ahead of October we will start communicating with the current claimants who receive the £20 to make them aware that it will be phased out and they will start to see an adjustment in their payments,” she explained.

Shavanah Taj, Wales’ TUC General Secretary, came out strongly against the Government’s proposed cuts to universal credit, warning that low-income families will be the worst affected.

Taj said: “Everyone should have enough money to live on. “But if the Universal Credit cut goes ahead, tens of thousands of working families in Wales – including key workers – will be forced to get by on much less every week. It is levelling down – not levelling up.

“UK ministers should abandon this cruel cut that will hit low-income working families. We need a social security system that helps people get back on their feet – not one that locks them in poverty.”

He continued: “And we need decent jobs on decent pay for every worker, in every part of the country.

“That means increasing the minimum wage, investing to create good green jobs and tackling the scourge of insecure work. Cutting universal credit isn’t the way to achieve decent work.”

On top of this, Working Tax Credit is also being cut by the Government , having also been raised by £20 per week last year.

The basic amount for Working Tax Credit is up to £2,005 a year, which rises to £2,060 for single parents and couples, and dropping to £830 a year for those working less than 30 hours a week.

This specific cut has led to concerns from organisations, such as TUC Wales, that the numbers for Universal Credit will grow exponentially as more families transfer over from the Working Tax Credit.

Some 104,000 workers in Wales are currently receiving Universal Credit, which is the equivalent to around two in five of all credit recipients.

Wales TUC’s research found that 60,000 children in key worker households are currently growing up in poverty, with many receiving in-work benefits such as Universal Credit.

Research revealed that nearly half (43 percent) of people currently receiving Universal Credit in Welsh Secretary Simon Hart’s constituency of Carmarthen West and South Pembrokeshire are currently in work.

Around 2,560 workers in the area depend on Universal Credit to make ends meet.

In response to these cuts, Wales TUC is calling on the Government to increase the minimum wage to £10 per hour and put forward legislation to tackle insecure employment.

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