Rishi Sunak says Brits should be ‘grateful’ for austerity as he all but confirms universal credit cut

Rishi Sunak has said the country should be “grateful” for austerity – in the same week he cuts millions of incomes by £1,040 per year.

Speaking at the Conservative Party conference, the chancellor defended government plans to cut universal credit by £20 per week and increase national insurance for struggling families, asking: “Is the answer to their hopes and dreams just to increase their benefits?”

But the cut – which has now been applied to most universal credit claims despite being officially scheduled for October 6 – risks pushing half a million more people into poverty, including 200,000 children, according to the Joseph Rowntree Foundation (JRF).

Labour’s plan to strengthen the UK’s social security system is “a desperately sad vision for our future”, Sunak added.

He repeated the government’s firmly-held stance on helping people on low incomes by getting them into work rather than increasing benefit payments. He said “we should all be grateful” for how the Conservatives have handled the economy for the past decade.

The majority of UK people living in poverty already live in working households, the Institute for Public Policy Research said earlier this year. Around 40 per cent of universal credit claimants already have jobs but are trapped below the breadline by low pay, unreliable hours, expensive childcare and soaring living costs.

Anti-poverty experts have hit out at the chancellor’s claims, labelling them “completely wrong”.

“The chancellor may say he has a plan for jobs but he has no plan for paying the bills,” said Helen Barnard, deputy director of JRF.

“He spoke of doing whatever it takes to protect people’s livelihoods, yet he is cutting the incomes of around 5.5 million families when we are facing a cost of living crisis.”

Barnard added: “It is completely wrong to suggest there is a trade-off between good jobs and adequate social security when they are both essential to improving people’s living standards.

“To impose the biggest ever overnight cut to social security would be economically irresponsible which is why it is so fiercely opposed from across the political spectrum. The government can’t credibly claim to be levelling up while levelling down people’s incomes.”

Sunak’s speech comes shortly after all leaders of devolved governments in the UK wrote to Westminster pleading with ministers to scrap the “morally indefensible” universal credit cut.

The first and deputy ministers of Scotland, Wales and Northern Ireland told Boris Johnson there was “no rationale” for reducing benefit payments at a time when UK households are facing “an unprecedented squeeze” on budgets.

A meaningful recovery from the pandemic must mean ensuring “the needs of our most vulnerable are met,” according to the letter signed by Nicola Sturgeon, Mark Drakeford, Paul Givan and Michelle O’Neill.

“It is not too late for you to reverse the decision to take money out of the pockets of the poorest in society at a time when they are facing a serious cost of living crisis.”

The prime minister told Andrew Marr on Sunday that keeping the £20-per-week increase – introduced at the start of the pandemic – would not be “appropriate” and railed against the idea of raising taxes to “subsidise low pay”.
But Johnson faces furious opposition to the cut, including from former Tory welfare ministers and his own backbenchers.

You can read more about just how many people, organisations and politicians are demanding a government U-turn here.