Minister Therese Coffey hints at U-turn over plan to axe £20 Covid benefits boost

Universal Credit £20-a-week uplift could be replaced with a £1,000 one-off payment amid growing pressure on ministers not to axe extra support as No10 insists Rishi Sunak is yet to make a final decision

  • Therese Coffey said ministers will decide ‘soon’ whether to extend the increase 
  • Chancellor has been resisting growing pressure to extend the higher payments
  • £20-per-week increase brought in last year and due to cease at the end of March
  • Chancellor said to be considering replacing cash with one-off £1,000 payment 

Downing Street today refused to rule out replacing a £20-a-week increase to Universal Credit with a £1,000 one-off payment.

The increase in the value of Universal Credit was introduced by ministers last year to help families through the coronavirus pandemic but the policy is due to expire in April. 

The Government is under mounting pressure to keep the extra weekly cash in place but reports suggest Chancellor Rishi Sunak is considering replacing it with a one-off lump sum. 

The Prime Minister’s Official Spokesman refused to rule out such a move at lunchtime as he said: ‘Again, it is a matter for the Chancellor and no decisions have been made.’

It came after Therese Coffey, the Work and Pensions Secretary, this morning hinted that the uplift could be retained. 

She said ministers will decide ‘soon’ whether to extend the increase in Universal Credit beyond March amid Tory backbench fury.

Ms Coffey, who is believed to be one of the ministers lobbying Mr Sunak to keep the cash, said she was in ‘active discussion’ with the Chancellor and that all options were under ‘active consideration’.

The Chancellor is said to have been resisting growing pressure to extend the higher payments because he fears they will become permanent, costing the Treasury an additional £6billion every year.  

He apparently told restive MPs that that would be the equivalent to a penny on the basic rate of income tax, or a 5p rise in fuel duty.

Therese Coffey said ministers will decide ‘soon’ whether to extend the increase in Universal Credit (UC) past March amid Tory backbench fury.

Ms Coffey, who is believed to be one of the ministers lobbying Rishi Sunak to keep the cash, said she was in 'active discussion' with the Chancellor and that all options were under 'active consideration.

Ms Coffey, who is believed to be one of the ministers lobbying Rishi Sunak to keep the cash, said she was in ‘active discussion’ with the Chancellor and that all options were under ‘active consideration.

The uplift was originally announced last year to support struggling families through the Covid-19 crisis but it is due to expire at the end of March.

Ms Coffey told BBC Radio 4’s Today programme that UC had been a ‘lifeline’ and said the Government wants to try to ‘extend our support throughout the impact of this pandemic’.

Asked whether that meant the uplift or other extra support will stay for the rest of this year, she said: ‘I think it is fair to say that I’m in active discussion with the Chancellor and of course with the Prime Minister about how we continue to make sure we support families during this difficult time.’

Last week six Tories backed a Labour motion calling for the higher rate of Universal Credit to stay in place, despite Mr Johnson pleading with his MPs to abstain.

The Opposition Day Debate was not binding on the Government, but underlined the divisions over the policy. 

Yesterday it was reported that Mr Sunak had altered plans for the benefit boost to be replaced by a £500 one-off payment, increasing it to £1,000.

The current £20-a-week uplift is worth more than £1,000 a year to families.  

But as its expiry on March 31 approaches, he and the PM are under pressure from Tory MPs, including Ms Coffey and many who won ‘red wall’ seats from Labour.  

Ms Coffey told BBC Breakfast: ‘We are hand in glove with the Treasury, working through to make sure we provide the best support to people throughout this pandemic…

‘I can assure you that we are in active consideration of the options on how to best support people during this time and I hope we will be able to come to a decision soon.’

She added: ‘We are working very closely with the Treasury so that we can make sure that we have the best decision which I hope the Prime Minister will be able to announce shortly.’