The £20 uplift to Universal Credit payments will now continue for a further six months, Chancellor Rishi Sunak has announced. If you already benefit from this scheme or hope to in the future, here’s what the extension of the uplift could mean for you.
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What is Universal Credit?
Universal Credit is a benefit payment aimed at assisting people – those who are on low income, out of work or cannot work – with their bills and living expenses.
To be eligible for Universal Credit, you must be:
- On low income or unemployed
- Aged 18 years and above (though exceptions exist for 16 and 17-year-olds in some cases)
- Under state pension age (both you and your partner, if you have one)
- Have less than £16,000 in savings between you and your partner
- A UK resident
What is the £20 Universal Credit uplift?
At the start of the first coronavirus lockdown in March 2020, the government announced a temporary £20 weekly increase for individuals receiving Universal Credit.
The main aim of the uplift was to support those already struggling during what was a tough time for the economy.
This uplift was due to end in April 2021. But as Rishi Sunak announced during Wednesday’s Budget speech, it will continue until September 2021.
The continued uplift will apply to all new and existing claimants. You do not need to make a separate claim for the £20 boost. It will automatically apply to everyone who qualifies for Universal Credit.
In total, the boost is worth around £1,000 a year.
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Why is the government extending the Universal Credit £20 uplift?
The financial impact of coronavirus has pushed millions of Brits onto the benefits system.
The number of people on Universal Credit, for example, has more than doubled since the beginning of the pandemic. As of January, government stats show that six million people were on Universal Credit. That’s up from 2.8 million in the same month in 2020.
Before announcing the Budget, the Treasury had been reluctant to extend the top-up. This is due to the relatively high costs of the initiative which come to around £6 billion a year.
But with lockdown restrictions still in place across the country and the financial impact of the pandemic being felt by many, pressure has been mounting from various sources such as debt charities for the government to continue helping those in need.
The extension of the scheme will undoubtedly be welcomed by millions of people who have come to rely on the Universal Credit benefit.
Still, there are some concerns that the six-month extension might not be enough. This is mainly because the furlough scheme will end at around the same time, meaning that the rate of employment could peak then.
What other help is the government providing?
Apart from the extension of the £20 uplift to Universal Credit payments, the government has also extended the furlough scheme until September.
There is some good news for the self-employed too. The Self-Employed Income scheme (SEISS) has been extended to September with people who are newly self-employed now being able to claim for the first time.
The National minimum wage is also going up to £8.91 from April.
Further information on all of the measures the government is putting in place to help protect jobs and livelihoods, strengthen public finances and boost economic recovery be found on the gov.uk website.
On a more personal level, if you or your loved ones have been affected by the coronavirus and finding things difficult, you can use the government coronavirus support tool to find out about support you may be entitled to.
