Controversial plans to stop the £20 Universal Credit boost brought in to help struggling families in the face of crippling coronavirus restrictions could be ditched.
Yesterday we reported how Chancellor Rishi Sunak was facing a growing revolt from MPs in Red Wall seats – the northern constituencies taken from Labour in 2019’s general election.
The uplift was brought in to support those in receipt of benefits during the pandemic but are only set to last until the end of March.
Sir Keir Starmer’s Labour party are set to force a government vote on the issue on Monday.
And 50 Conservative MPs signed a letter to the Chancellor demanding the temporary uplift stays in place until lockdown ends.
Now Prime Minister Boris Johnson, who signalled earlier this week the £1,040-a-year increase would end as planned, has held a meeting with Mr Sunak and Therese Coffey, the Work and Pensions Secretary, The Daily Telegraph has reported.
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Insiders insisted talks were ongoing and no decision had been made.
The Prime Minister told MPs on Wednesday he would “rather see a focus on jobs and a growth in wages than focusing on welfare”.
He also claimed “the best thing is to get people into employment” – despite the fact 39% of the 5.7million Universal Credit recipients are already in work.
The Joseph Rowntree Foundation warned the cut could see another 200,000 children pushed into poverty.
The influential Northern Research Group, representing Tories in the North and Midlands, put pressure on Mr Sunak for more support in the Budget in March.
They want the Universal Credit uplift and business rate rebates to continue until lockdown ends, VAT slashed to 5% for businesses in the leisure and tourism sector, and stamp duty abolished for homes under £500,000.
Chairman Jake Berry said: “Lockdowns – although necessary while we wait for the vaccine to be rolled out – only entrench and compound disadvantage already felt by those communities this Government has promised to level up.
“Whilst we welcome the unprecedented support provided by this Government for those impacted by this virus, to relinquish support now would cause long-term damage to large parts of the North and weaken our recovery.”
Tory former Work and Pensions Secretary Stephen Crabb tweeted: “Good to see colleagues in the Northern Research Group of MPs join call to extend Universal Credit uplift.
“UC has been especially important in Red Wall seats supporting low wage workers and those losing jobs.”
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Shadow Work and Pensions Secretary Jonathan Reynolds urged Tory MPs to vote with Labour on Monday, where they are calling for the benefit uplift to become permanent.
“The Government is refusing to scrap the Universal Credit cut in the face of opposition from 50 of its own Northern Research Group MPs, two former Conservative Work and Pensions Secretaries and dozens of charities and campaign groups.
“Britain is facing the worst recession of any major economy because of the chancellor’s incompetent handling of the pandemic.
” Rishi Sunak must end the uncertainty for millions of families and secure our economy by cancelling the cut.
“If he refuses to act, we urge Conservative MPs to vote with Labour on Monday to protect families’ incomes.”
It comes as ministers face growing pressure to provide free school meals in February half term following the scandalous images of woeful food ‘hampers’ received by some parents.
The Prime Minister’s spokesman has said support was already being provided to families through the Covid winter grant scheme.
Labour will also seek to force a vote on the issue on Monday.
Veteran Tory MPs are believed to be putting pressure on the Chancellor to push back against the dissent and stick to the plan.
Faced with spiralling debt he is said to be “very reluctant” to agree to Universal Credit extension, while Ms Coffey’s department want to see the scheme stay.
It is understood the financial impact of extending the boost is being looked at.
Downing Street declined to comment but acknowledge there was a difference of opinion between the departments.
Senior MPs think an extension could permanently damage efforts to reduce the welfare state.
One backbencher told The Telegraph: “The problem is that these temporary measures risk becoming permanent. I can see there is a purpose in continuing it in the pandemic. But you can bet your bottom boots that afterwards people will be agitating for it to remain.
“The Government must stop operating on an ad hoc policy and announce now that this will end after the pandemic. We must end this period of state reliance.”
The Mirror has contacted Downing Street for comment.
