Skip to main content

Universal Credit Uplift

Volume 700: debated on Wednesday 15 September 2021

1. What recent discussions he has had with (a) Cabinet colleagues and (b) the Welsh Government on the effect of the planned removal of the £20 universal credit uplift on low-income families. (903355)

The House will be aware that today is the 10th anniversary of the mining disaster in Gleision, in which Charles Breslin, David Powell, Philip Hill and Garry Jenkins lost their lives. I know that colleagues across the Chamber will join me in paying appropriate respect at this time, and of course in sending condolences to their families.

We have always been clear that the universal credit uplift was temporary to help people through the economic shock of the pandemic. We are committed to supporting families most in need and planning a long-term route out of poverty by helping people find work.

I echo the words of condolence from the Secretary of State.

More than a third of all those who receive universal credit are in work and will now have to pay an extra £100 a year in national insurance contributions while also suffering a cut of £1,040 per year, and UK inflation has risen to 3.2%—its highest increase since 1997. Will the Secretary of State use his influence to push for the publication of any impact assessment or analysis of the consequence of this cruel cut to universal credit, which research suggests will mean that one in eight people will struggle to afford food?

I know that colleagues across the House have received representations from constituents, charities and other bodies on this subject, so it is one we take extremely seriously, and rightly so. Of course, one of the things the Government are absolutely committed to is to rebalance the economy, both local and national. We have, of course, the plan for jobs, the levelling-up fund, the shared prosperity fund and the community renewal fund. There is a number of ways in which we are attempting to do that, which will of course help those who are not in work, but also those people on in-work benefits. We are very conscious of the hon. Lady’s observations and, as I say, absolutely committed to making sure that every family, not just those out of work, are helped as best we possibly can.

A quarter of a million Welsh families now face the grim prospect of losing over £1,000 a year because of this Government’s shameful decision to slash universal credit. We know that the Secretary of State’s colleague, the Work and Pensions Secretary, seems to think that people just need to work harder, but I would remind him that nearly 40% of Welsh people who receive this payment are in fact in work, many of them key workers. What does the Secretary of State have to say to those families and their children who are struggling to make ends meet now and will be so much worse off as a result of this cut?

I touched on this obviously in the answer to the initial question, especially the temporary nature of the increase and of course the many plans and projects we have that are going to enhance and improve the economy in Wales, which will have a positive effect on the very families the hon. Lady talks about. I think it is just worth pointing out as well that it is this Government who increased the personal threshold on NICs—that was of considerable value to families across the land—and there have been other improvements, such as the increase in the national living wage. I think those things need to be taken into account as well, and I am sure the hon. Lady will do that.

I am not sure that is going to be much comfort to those families who are going to be losing £80 a month. This is not just a blow to Welsh families, but a real hit to Welsh shops and businesses, because we all know that families on low income have to spend their money locally on the very basics of life. This will suck £286 million per year out of the Welsh economy. The Conservative party constantly talks up the sums paid to get this country out of the pandemic, but is not the reality that the Tories are taking money away from Welsh businesses just at the time that so many of them need it most?

I do fundamentally reject that accusation. Having visited numerous companies, large and small, across Wales throughout the pandemic, the message I have had back is one of relief that the UK Government Treasury has been able to step in and offer the levels of help that it has. Particularly in relation to the hon. Lady’s comment about universal credit, what she is suggesting is that none of the remedial measures we have introduced will work. That is clearly not the case, so the families that she and other colleagues quite rightly raise as being concerned about what the future holds should, I hope, be reassured by the fact that the Government continue to be committed not only to companies, but to individual families themselves.

The north Welsh coast, when one goes from Wylfa to Trawsfynydd to Capenhurst, is intimately connected with the north-west of England through Capenhurst, Warrington and all the way up to Sellafield and Moorside. Does my right hon. Friend agree with me that those economies work well together to solve problems in the nuclear industry, and that the North West Nuclear Arc is something we should be very proud of?

I absolutely agree with my hon. Friend, particularly because I have been on the receiving end of such compelling arguments from organisations, such as the Mersey Dee Alliance, that recognise the economic region and the economic drivers and recognise that administrative boundaries can sometimes be an impediment to investment. I absolutely share her enthusiasm and her confidence about what may be available in the future.

The Government’s attack on struggling families this autumn will make more than four in 10 families with children over £1,000 worse off. It is no surprise that the Secretary of State is content with plunging thousands of people into poverty, but these families spend their money in high street shops and local businesses. Government policy will be directly responsible for taking £286 million out of the Welsh economy. This is not levelling up; it is hammering down. What assessment has he made of the effect of the £20 cut in universal credit on the Welsh economy?

The right hon. Lady clearly did not listen to my answers to the first and second questions on this very subject, and her statement—rather than question—was predicated on the basis that absolutely none of the Government’s other economic interventions, such as the plan for jobs, the levelling-up fund and the other encouraging initiatives we have been talking about, will have any positive effect at all. That is clearly incorrect and is clearly not supported by businesses across Wales, which leads me to the conclusion that she is determined to talk down the economic prospects of the country she wants to represent.

It is clear that the Government are content that Wales loses almost £300 million. The pattern is clear from the United Kingdom Internal Market Act 2020, trade agreements, the control of state aid and now plans to cut the number of Welsh MPs from 40 to 32: the right hon. Gentleman’s Government are taking from Wales and giving to Westminster. Anyone can see that levelling up will only happen when we have a strong Parliament in Wales empowered to do the job and directly answerable to the people of Wales. We all know there is a reshuffle going on; is now the time to reshuffle the Wales Office out of existence?

The right hon. Lady will not be surprised to learn that I am not going to rise to the last of the baits she dangles in front of me, but she needs to make her mind up about whether she wants Westminster representation or not: she complains on the one hand that the numbers might be reduced, whereas in fact they are being equalised to be fairer, and on the other that we should not be here at all.