Westminster’s ‘stubborn refusal’ to reinstate £20 benefit hike ‘punishes people in poverty’, MP says

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MP Hywel Williams

Arfon MP Hywel Williams has called on the UK government to reinstate the £20 increase in Universal Credit from July to protect vulnerable households from the cost of living crisis.

The £20 increase was introduced at the start of the Covid pandemic but was withdrawn in October 2021, leaving struggling families £1,040 a year worse off.

Mr Williams said Westminster’s ‘stubborn refusal’ to restore the hike ‘punishes people in poverty‘ with ministers repeatedly resisting calls to restore it despite the escalating cost of living crisis.

The MP who is Plaid Cymru’s work and pensions spokesperson said that given the ‘urgency’ facing households, a £20 increase should also be extended to those receiving inherited benefits , and that all benefits should also be increased in line with inflation.

“Households in Wales are facing a cost of living emergency, but Westminster’s stubborn refusal to raise the level of payments for those on Universal Credit is punishing those living in poverty even more,” said he declared.

“Our welfare system has been gutted by successive British governments – both blue and red – driven by an ideological obsession with shrinking the size of the state.

“We need to at least restore a basic principle of how the system should work – that financial support should follow the cost of living. This is why, in addition to restoring the increase, the British government must increase benefits in line with inflation.

“The least generous”

Plaid Cymru is also calling on the government to end direct debits.

The Child Poverty Action Group has estimated that around 92,000 households in Wales claiming Universal Credit receive on average £60 less per month than they are entitled to, due to automatic deductions from their UC payment.

These deductions affect approximately 106,000 children in Wales.

Wales has the highest poverty rate of the UK’s four countries, with almost 1 in 4 people (23%) living in poverty.

Universal Credit offers only a fraction of the unemployment benefits provided by other European countries, according to Plaid Cymru.

Most European countries provide a proportion of previous earnings with a minimum benchmark; the Nordic countries offer up to 90 per cent of previous wages. By comparison, the lump sum payment offered by the UK is equivalent to just 14% of average weekly earnings, they said.

“Ahead of what will be an incredibly difficult autumn for households, the UK government should also reconsider its ruthless policy of automatic deductions,” said Hywel Williams.

“Around 92,000 households on Universal Credit in Wales receive on average £60 less each month than they are entitled to, due to automatic deductions from their UC payment. These deductions affect approximately 106,000 children in Wales.

“Credit Universel is one of the least generous social protection systems in Europe. If Westminster is unwilling to show the most basic level of human decency, we must demand powers over welfare so that we can create a decent welfare system for the people of Wales.

At work

The suppression of the uprising has affected over 280,000 people across Wales, 37% of whom are working.

The typical Welsh family on Universal Credit has also been hit by the Chancellor’s tax hikes and benefit cuts, in addition to food bills rising and heating costs rising by more than 50%.

A 3.1% increase in benefits took effect in April, well below the rate of inflation, which is expected to reach more than 9% this month.

According to analysis by the charity Joseph Rowntree Foundation, this will result in the biggest drop in the value of the base unemployment benefit rate in 50 years.

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