Universal credit ‘workers tax’ should be cut to help Brits get back to work, think tank says

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The UNIVERSAL worker credit tax should be cut to help struggling Britons find jobs, according to a new think-tank report.

The current system makes it “less attractive for applicants to take up a job,” said a background paper from the Center for Policy Studies.

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Workers lose part of their payments when they earn more than a certain amountCredit: PA: Press Association

Currently, universal credit applicants are currently losing 63p of every £ 1 of their payments over a certain amount due to the declining rate.

This means that Universal Credit payments are reduced if applicants earn more than the Working Allowance, it exceeds £ 292 if you get housing assistance or £ 512 if you don’t.

The Sun called for a graduated rate cut and increased work allowance as part of our Make Universal Credit Work campaign, which this week won a landmark lawsuit.

Sun columnist Nichola Salvato, 49, has sued the government after incurring £ 2,000 debt while trying to pay for child care.

Meanwhile, the Center for Policy Studies has also urged the government to replace the universal credit increase payment of £ 20 with a ‘Covid hardship payment’.

The Sun wants to make universal credit work

The UNIVERSAL Credit replaces six services with a single monthly payment.

By the time the system is fully deployed in 2023, nearly 7 million people will be on it.

But there are big problems with the flagship system – it takes five weeks to get the first payment and that could make some families worse off by thousands of pounds a year.

And while working families can claim up to 85% of their child care costs, they need to find the money to pay for child care up front – we’ve heard of families waiting until. ‘to six months for the money.

Parents who work across the country told us they couldn’t take more hours – or even turned down better paying jobs or longer hours because of how much they were getting from their reduced benefits. .

It’s time to make universal credit work. Since December 2018, we have been calling on the government to:

  1. Get paid faster: The government must cut Britons’ wait times for their first universal credit payments from five to two weeks, helping to keep millions out of debt.
  2. Keep more of what you earn: The work allowance should be increased and the progressive rate reduced from 63p to 50p, helping at least 4 million families.
  3. Don’t be punished for having a family: Parents should get the 85% of the money they can claim for child care up front instead of being paid in arrears.

Together, these changes will help make universal credit work.

Join our Universal Credit Facebook Group or send an email to [email protected] to share your story.

Universal credit applicants have been given a boost due to the coronavirus, but it is expected to end soon.

James Heywood, Wellness and Opportunity Manager at the Center for Policy Studies, said:

“The government has gotten into a corner with the £ 20 universal credit increase – it’s much harder to pull something out once it’s in place.

“However, now they have the opportunity to make significant changes to the system for the benefit of claimants and to ensure that it still pays off to work.

“Replacing the hike with a clearly defined temporary support mechanism, combined with other reforms, would provide the expected financial support while making it easier for applicants to prepare for its eventual withdrawal. “

The £ 20 boost has been rolled out as a temporary measure for 12 months due to the pandemic, applying to all new and existing universal credit applicants.

This means that for a single Universal Credit applicant, aged 25 or over, the standard allowance has increased from £ 317.82 to £ 409.89 per month.

The flat-rate allowance is set at different levels for people under 25 or for couples.

What to do if you have problems claiming universal credit

IF you’re having trouble applying for your Universal Credit, or if the payments just don’t cover the fees, here are your options:

  • Request an advance – Applicants can get cash within five days rather than waiting weeks for their first payment. But this is a loan which means that the repayments will be automatically deducted from your future Universal Credit payment.
  • Alternative payment methods – If you are behind on rent, you or your landlord may be able to request an APP that will send your payment directly to your landlord. You can also change your payments to get them more frequently, or you can split payments if you are in a couple.
  • Budget advance – You may be able to get help from the government for emergency cleaning costs of up to £ 348 if you are single, £ 464 if you are in a couple or £ 812 if you have children. These are only in cases such as your stove breaking down or to help you find a job. You will need to repay the advance through your regular Universal Credit payments. You will still have to repay the loan, even if you stop claiming universal credit.
  • Reduce your housing tax – You may be able to benefit from a reduction on your council tax by requesting a reduction in council tax. Alternatively, you may be eligible for discretionary housing payments to help cover your rent.
  • Food banks – If you are really struggling and struggling to buy food and toiletries, you can find your local food bank who will provide help for free. You can find your nearest one on the Trussell Trust website.

But MPs urged the government to keep giving extra money as the pandemic continues until 2021.

Chancellor Rishi Sunak is under pressure to cover the costs of this boost and other coronavirus programs.

He privately warned that he would be forced to increase fuel duties by five pence per liter to pay for the extension of the universal credit increase after the lockdown.

A government spokesperson said: “We are committed to supporting families with the lowest pay during the pandemic and beyond to ensure that no one is left behind.

“That is why we have targeted our support to those who need it most by increasing the living wage, spending hundreds of billions to save jobs, increasing welfare by billions and introducing the subsidy program. £ 170million Covid Winter to help children and families stay warm and well nourished during the colder months.

“We will continue to assess how best to support the economy.”

Thousands of people claiming universal credit will be worse this month because coronavirus exemptions from the benefit cap begin to end.

People in difficulty can get free money through the Winter Covid grant program – here’s how.

The government has confirmed that coronavirus support for the self-employed will not be announced until the March budget.

Treasury to delay details of fourth self-employment grant until March budget – Martin Lewis describes move as “needlessly cruel”


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