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‘Perfect storm’ warning as MPs set to debate Universal Credit cut

Citizens Advice is sounding the alarm on the impact of a cut to Universal Credit with MPs expected to debate ending the £20-a-week increase today (Wednesday 15 September).

Previous research from the charity shows that 2.3 million people receiving Universal Credit will be pushed into the red by the cut. It warns people are one and a half times more likely to claim Universal Credit in areas the government has prioritised for levelling up.

Analysis of Citizens Advice data published today highlights the precarious state of people’s finances heading into the autumn:

  • Referrals for further charitable support have surged. Advice on grants and in-kind support - including for furniture, clothes and toiletries - is up 91% compared to summer 2019. Referrals to food banks are up 30% on last summer

  • Increasing worries about income. The charity’s webpage on how much Universal Credit people will receive has had 50% more page views this summer than last summer. Views of its debt advice webpage on increasing your income rose to their highest-ever level this August.

  • Increasing fuel debt problems as an energy price rise looms. The number of people Citizens Advice helps with fuel debt has risen over the pandemic, and they're often facing other debts too. Their situation will be worsened as maximum energy prices increase by well over £100 a year for both default tariffs and prepayment meter customers in October.   

Dame Clare Moriarty, Chief Executive of Citizens Advice, said:

“Millions are headed for an incredibly tough autumn. 

“Families still struggling with the impact of the pandemic face a barrage of fresh challenges including the cut to Universal Credit, the end of furlough, and a sharp rise in energy prices.

“Against this backdrop, keeping the £20 increase to Universal Credit is the single best way of protecting people from a perfect storm.”