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Community / Overwhelming opposition to Tories’ ‘cruel’ Universal Credit cut

£20-a-week reduction will come as furlough ends & energy prices rise

SHETLAND Islands Council, opposition politicians and the local Citizens’ Advice Bureau (CAB) have united in strongly condemning the UK Government’s planned £20-a-week cut to Universal Credit.

CAB estimates that the cumulative impact of the policy, due to take effect on 6 October, will cost families in the islands nearly £1.3 million a year, while the Shetland Greens describe it as “a policy dripping with cruelty”.

Coming in tandem with the furlough scheme for workers drawing to a close at the end of September and the expectation of the highest energy price rises in a decade, CAB says that combination “is likely to make the coming months very hard for many Shetland households”.

Local CAB branch manager Karen Eunson said the entire bureau network supported retaining the £20 a week increase in Universal Credit, introduced at the start of the pandemic. Removing it would cost those reliant on the payment over £1,000 a year.

“This includes low paid workers and people who are too sick to work, as well as people who are unemployed,” she said.

In Shetland and Orkney there were 2,261 claimants of Universal Credit in June 2021, almost half of whom were in employment.

Citizens Advice Bureau manager Karen Eunson. Photo: Shetland News

Eunson pointed out that for those in work who have only been entitled to Universal Credit because of the temporary £20-a-week increase, the cut “will also end their entitlement to passported benefits like the Scottish Child Payment, meaning they will suffer a larger cut to their incomes in September”.

She continued: “The cut to Universal Credit will come at the same time as the ending of furlough and also of the various mitigations that were put in place during the pandemic to help those in debt.

“In October – at the start of winter – we will also see the biggest energy price rise for a decade for those on default tariffs when Ofgem raises the price cap.”

SIC leader Steven Coutts said there was something of a “perfect storm” brewing heading into the autumn – highlighting the longer term issue of a benefits system that does not reflect the real cost of living in the Northern isles, estimated to be anything between 20 and 60 per cent higher than the UK mainland.

Coutts pointed out that the number of islanders claiming Universal Credit had almost doubled during the pandemic, and he fears more households will “really begin to struggle” after the furlough scheme ends.

“We would certainly be seeking for [the uplift] to be retained, but alongside that we’ve got a longstanding concern about the level of support payments… because they’re nationally set and don’t reflect the cost of living in Shetland.”

Alex Armitage of the Shetland Greens said the policy would hit the weekly budgets of the islands’ hardest-up families.

“So many people in our community can’t afford to heat their homes and are already facing a harsh winter,” he said. “Coming in the autumn, the timing of these cuts exposes the callousness of the UK Government.

“From an economic perspective this will end up more expensive in the long run. Already over-stretched health and care services will have to foot the bill for providing support for the consequences of pushing more families into a state of despair. Poverty wastes lives.”

He added that the Greens supported the introduction of a universal basic income aimed at eliminating poverty, describing it as “a real investment in people that would unleash the creative potential of our community”.

Isles MP Alistair Carmichael. Photo: Shetland News

Northern Isles MP Alistair Carmichael, meanwhile, pointed to analysis by the Joseph Rowntree Foundation and described it as “the biggest overnight cut to the basic rate of social security since the foundation of the modern welfare state” which would affect some 5.5 million UK families.

“This is further evidence of the harm we risk by cutting Universal Credit as we are still attempting to recover from the pandemic,” Carmichael said.

“We are in some ways fortunate in the isles to have a lower rate of people making use of Universal Credit than elsewhere, but that still represents thousands of families.

“The rate has been rising and many people will be feeling vulnerable during the current economic climate. This is no time to be cutting support.

“People need greater certainty after a chaotic year – to cut Universal Credit now is to cut people’s confidence in a more stable future after the pandemic.”

The Conservatives’ Highlands and Islands list MSP Jamie Halcro-Johnston said the uplift to Universal Credit had been a “positive intervention” and that the Scottish party had “successfully campaigned for the uplift to be extended by six months” at the height of the pandemic.

But he echoed the UK Government’s stance, saying it was “right that the government looks carefully at what can be delivered in the light of the billions of pounds of funding that has been made available, in Scotland as with other parts of the United Kingdom, over the last 18 months”.

He added: “However, it is disappointing that, while SNP ministers have been loud in their calls for more support to be given, we’ve heard little or nothing on how they might use the new welfare powers they have – and the record levels of funding the Scottish Government has received in the last few years – to deliver that support here in Scotland.”

  • Anyone who has questions about benefits or worries about debt or high energy costs can contact Shetland CAB on 01595 694696 or email via its website at www.shetlandcab.org.uk