Labour warns it would be ‘profound mistake’ to slash Universal Credit

Labour’s motion urging the Government not to scrap its £20-a-week Universal Credit increase last night won by a landslide.

The motion – to extend the extra cash payments given last year to help families through the coronavirus pandemic – received 278 votes in favour with 0 against. 

Boris Johnson had earlier ordered his MPs to abstain from voting on the motion – which is not legally binding on the Government.

However six Conservative MPs – Peter Aldous, Robert Halfon, Jason McCartney, Anne Marie Morris, Matthew Offord and Stephen Crabb – rebelled and voted in favour of the motion.

Former work and pensions secretary Mr Crabb, rebelling for the first time against the party whip, said the weekly rise should be kept for a further 12 months in order to give people ‘certainty’ over their finances. 

Mr Johnson had earlier accused Labour of ‘playing politics’ with their motions, which he described as ‘legislatively vacuous’ debates.

But No10 yesterday refused to rule out extending the Universal Credit increase.

Speaking before the vote, the PM’s Press Secretary, Allegra Stratton, said: ‘We have always said, the Chancellor has said repeatedly, that he will be coming back to the House in due course with his decision on what should be done with the £20 uplift that is due to end at the end of March.’ 

But Labour leader Sir Keir Starmer last night took a swipe back at abstaining Tory MPs, saying in a Tweet: ‘They didn’t even show up’. 

Labour had earlier warned the Government it would be a ‘profound mistake’ to scrap the increase in Universal Credit payments – which equate to an extra £1,000 a year for six million families.

The party argued it would ‘pull the rug from under the economy’s feet’, while Sir Keir described Mr Johnson’s call to abstain as ‘pathetic’.

The Government rolled-out the extra cash last year to help families through the coronavirus pandemic.

But the policy is due to expire in April – sparking Labour to hold an opposition day debate in a bid to force the Government to commit to extending the payments.

Shadow work and pensions secretary Jonathan Reynolds told the House of Commons that cutting benefits during a recession is ‘always the wrong choice’. 

Downing Street had earlier argued it is ‘not the right and proper moment’ to decide if the extra payments should be kept in place.

Number 10 has said Chancellor Rishi Sunak will ‘come forward when he thinks the time is right’ to deliver a final verdict, with ministers having hinted that moment will be the Budget on March 3.  

Will Quince, the Minister for Welfare Delivery, defended the approach as he responded to Mr Reynolds, telling MPs the Government does not know what the coronavirus situation will be in April so it is right to wait to make a decision.    

The motion – to keep the extra cash given last year to help families through the coronavirus pandemic – received 278 votes in favour with no votes against. Pictured: The vote count is read out in the Commons tonight

Boris Johnson instructed Tory MPs to abstain on Labour’s vote on Universal Credit and free school meals

Following tonight’s vote, Labour leader Sir Keir Starmer took a swipe at the Conservatives, saying in a Tweet: ‘They didn’t even show up’

The Government had earlier labelled Labour’s debate and vote a ‘political stunt’, with Mr Johnson accusing Sir Keir Starmer of ‘playing politics’.  

Mr Johnson said similar votes in the past had been ‘misrepresented’ by Labour and he did not want to risk that happening again.  

But he repeatedly declined to state whether or not the increase will be extended when questioned during a visit to Oxfordshire.

‘What we have said is we will put our arms around the whole of the country throughout the pandemic,’ the Prime Minister told reporters.

‘We have already done £280 billion worth of support and we will keep all measures under constant review.’

He added: ‘It’s the policy of the opposition to abolish Universal Credit altogether, which I don’t think is a sensible way forward.’

Meanwhile, Mr Sunak is said to be at the centre of a Cabinet row on whether to extend the payments.  

The Chancellor reportedly wants to scrap the increase because he believes that if it remains in place there is a risk it could become permanent at a cost to the Treasury of approximately £6billion per year. 

Tory MPs have demanded Mr Sunak keep the extra payments until the UK is clear of the Covid-19 crisis while Cabinet ministers, led by Work and Pensions Secretary Therese Coffey, are also urging him to look at extending the policy. 

Opening the opposition day debate for Labour, Mr Reynolds said: ‘What I am here to do is put forward a clear, and I believe compelling, case that reducing Universal Credit and working tax credit this April would be fundamentally the wrong decision.

Shadow work and pensions secretary Jonathan Reynolds (pictured left) said it would be a ‘profound mistake’ to scrap the £20-a-week increase but Minister for Welfare Delivery Will Quince argued the Government needed to wait before making a final decision

‘It would be a profound mistake for families, for the economy and for our ability to effectively tackle and recover from the Covid pandemic.’

The Labour frontbencher said cutting benefits during a recession is ‘always the wrong choice’ and that claimants need certainty now about what will happen in April. 

He said scrapping the £20-a-week increase would be like ‘pulling the rug from under the economy’s feet’ because the recipients of Universal Credit are more likely to spend the money than save it.

But Mr Quince blasted Labour as he accused the party of ‘playing politics with the lives of nearly six million vulnerable people rather than focusing on helping them through this pandemic’. 

He argued it is right to wait to make a decision on extending the payments because ‘one of the evident features of a pandemic is uncertainty’. 

He told the Commons: ‘We simply do not know what the landscape will look like and that is why it is right that we wait for more clarity on the national economic and social picture before assessing the best way to support low income families moving forward.’

Earlier, the Prime Minister’s Press Secretary, Allegra Stratton, said a decision has not yet been taken on whether the increased payments will be extended as she explained why Tory MPs have been told to abstain. 

She said: ‘He is asking people to abstain because today is not the right and proper moment for the Government to be talking about Universal Credit and the £20 uplift.’ 

Asked why the Government does not simply make a decision now, Ms Stratton said: ‘The Chancellor is constantly filtering the latest up to date information on the economic and health context.

‘That is what he has been doing throughout the pandemic. He has always said he and the Prime Minister will do whatever it takes. That remains true.

‘He is monitoring that data and will come forward when he thinks the time is right.’

She added: ‘We haven’t said whether or not we will continue [with the uplift]. The Chancellor will be coming forward in due course.’ 

 However, Sir Keir labelled Mr Johnson’s decision to tell Tory MPs to abstain ‘pathetic’. 

He told ITV’s Lorraine: ‘If he’s going to call it a stunt, he should probably come with me to a food distribution centre to see these families this morning and explain to them what is a lifeline to them is a stunt, because it certainly isn’t from their point of view.

‘I actually think in their heart of hearts, quite a lot of Tory MPs know that cutting this money to people who desperately need it in the middle of a pandemic is the wrong thing to do, they know that, they probably want to vote with us but because of the tribal way we do politics, they can’t.

‘The Prime Minister’s now saying in answer to the question: ‘Do you think this uplift should stay or not?’ he’s saying: ‘I don’t want to say yes and I don’t want to say no, so we’re going to abstain’. He’s got no view on whether it should stay or not – that’s pretty pathetic.’

The Times reported that Mr Sunak, Mr Johnson and Ms Coffey met on Friday to look at alternatives to the Universal Credit uplift but no decisions have been made.

One option which is said to be under consideration is to replace the increased payments with a one-off payment of £500. The uplift is currently worth more than £1,000 a year.  

A final decision is not expected to be announced until Mr Sunak delivers the Budget on March 3. 

Chancellor Rishi Sunak is reportedly facing a Cabinet row over whether to extend a £20-a-week increase in Universal Credit payments 

A Whitehall source suggested Mr Sunak will be isolated in the Cabinet if he does try to scrap the extra payments, telling Politico: ‘The Chancellor is about to find himself on his own. Read the room Rishi.’  

But allies of the Chancellor have pointed to the cost of keeping the policy as they argued it cannot continue indefinitely. 

One Tory official said: ‘As conservatives, we know that work is the best way out of poverty. It’s time we reminded ourselves of that.’ 

However, Labour has highlighted that many Universal Credit claimants are already in work. 

Labour deputy leader Angela Rayner tweeted: ‘2.2m recipients of UC are *working* & 70% of children in poverty are in working families. The problem is poverty pay.’ 

The Government is under pressure from its own backbenches to keep the extra £20-a-week payments in place. 

The Northern Research Group, which consists of 65 Tory MPs from the north of England, north Wales and Scotland, has called for the payments to be kept until lockdown restrictions have been lifted. 

Speaking on behalf of the NRG, Conservative MP John Stevenson said: ‘The £1,000 uplift to universal credit has been a real life-saver for people throughout this pandemic. 

‘To end it now would be devastating for the 6million individuals and families who are already struggling to stay afloat.

‘Equally, replacing the current system with a £500 one-off-payment which is half the amount people have been receiving and would exclude the estimated 800,000 people expected to become unemployed in the second quarter of 2021 after the job retention scheme stops will not be sufficient.

‘It would see many people falling through the gaps and would damage our economic recovery.

‘That is why the NRG are once again calling on the Chancellor to extend the Universal Credit uplift until restrictions are lifted, to ensure that individuals and families who have been worst affected by this pandemic are supported through our recovery with the security they need.’

Prior to the vote, Tory former work and pensions secretary Mr Crabb said he intended to vote with Labour, arguing that withdrawing the increase ‘will cause hardship to families’.

Mr Crabb told the BBC it will be the first time he has rebelled against the Tory party whip.

‘I just feel very, very strongly that the current Treasury plan, which is to withdraw that additional amount of money at the end of March, will cause hardship to families, there’s no question about that,’ he said.

Speaking in the Commons later, Mr Crabb praised Mr Sunak’s ‘historic’ financial support policies during the pandemic but said: ‘The question for us right now is whether at the end of March this year, just 10 weeks away, it’s the right time to begin unwinding this support – specifically to remove the extra support for Universal Credit claimants – and I don’t believe it is the right moment.’

Mr Crabb said the extra £20 a week has helped those ‘right at the bottom of the income scale’, adding: ‘The truth is the labour market is a horrible place right now for many people.

‘Opportunities for people to find new work, increase their hours, boost their earnings, improve their family finances have been massively curtailed by the economic impact of the public health emergency, and that’s the context for this discussion about cutting back the £20 per week uplift.

‘It’s why I believe the uplift is so important right now and it’s why I believe it needs to be extended for a further 12 months.’

Conservative MP Simon Fell (Barrow and Furness) added: ‘I’m glad to stand with my colleagues in the Northern Research Group when we say that now is not the time to consider any reduction in the uplift in Universal Credit.’ 

Meanwhile, senior Tory backbencher Robert Halfon, who chairs the Education Select Committee, said Universal Credit has been ‘invaluable for millions of people during the lockdown’.

Speaking ahead of the vote, he said: ‘Depending on what the Government says later, I am most likely to vote for the Labour motion unless the Government makes it absolutely clear it will be extending.’

Labour held the opposition day debate yesterday in a bid to force the Government to keep the payments and to demand the extension of the free school meals programme. 

The votes that follow the debates are non-binding but Mr Johnson told Tory MPs to abstain because he is wary of what could happen if they vote against the motions.

According to The Sun, Mr Johnson told Tory MPs in a WhatsApp message sent yesterday that he knew many would be ‘thirsting to give battle’ to Labour.

He continued: ‘But after the shameful way in which they used their army of Momentum trolls last time to misrepresent the outcome and to lie about its meaning and frankly to intimidate and threaten colleagues – especially female colleagues – I have decided not to give them that opportunity.’