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Universal Credit: DWP confirms minimum income floor suspension will be extended into 2021

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Universal Credit payments can be received by the self-employed but they have to go through a different application process to PAYE applicants. The payment amounts are usually assessed by looking at the claimant’s actual earnings as opposed to their expected earnings, known as the minimum income floor.

Obviously, as coronavirus emerged business across the UK – and indeed the world – were impacted financially and as such, the government halted the use of the minimum income floor.

This pause was set to end on November 12 but today, an extension has been confirmed.

Thérèse Coffey said: “After careful consideration of the ongoing public health situation and the national working environment, the current easement of the suspension of the Minimum Income Floor in Universal Credit that was due to expire on November 12 2020 will be extended to the end of April 2021.

“Regulations will be laid and made prior to November 12 2020.”

The news was welcomed by Citizens Advice but they also called for additional changes to be made elsewhere.

Alistair Cromwell, the Acting Chief Executive of the organisation, said: “We’re pleased the government has taken this common-sense approach and listened to concerns we’ve raised.

“Many self-employed workers have viable businesses but are grappling with ongoing restrictions to trading.

“With more uncertainty in the months ahead, it’s only right to continue this support and avoid long term damage to livelihoods and the economy.

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“We’d now urge the government to build on this by reassuring claimants that they won’t see their Universal Credit or Working Tax Credit cut by £20 a week in the spring.”

The £20 being referred to is the temporary uplift offered to Universal Credit payments by Chancellor of the Exchequer Rishi Sunak earlier on in the year.

Calls have emerged for this additional payment to be extended or even made permanent but the government has resisted this.

Boris Johnson was recently questioned on this in parliament and in his response, the Prime Minister refused to make changes: “I am proud that we have been able to uprate it in the way that we have, and we will continue to support people across the country, with the biggest cash increase in the national living wage this year.

“The result of Universal Credit so far has been that there are 200,000 fewer people in absolute poverty now than there were in 2010.

“It is vital that we tackle poverty in this country. That is why this Government are so proud of what we did with the national living wage.

“We are putting another £1.7billion into Universal Credit by 2023-24. If that does not give him the answer he wants, he can ask again next week.

“We will continue to support people and families across this country, and we will continue to spend £95billion a year in this country on working-age welfare.

“But the best thing we can do for people on Universal Credit is to get this virus down, get our economy moving again and get them back into well-paid, high-skilled jobs – and that is what we are going to do.”

However, it should be noted these comments were made before the second lockdown in England was announced and as such, the Prime Minister’s tone may shift in the coming weeks.

Thus far, mortgage holidays and the furlough scheme have been extended, areas in which the government previously insisted could not be pushed further.

It remains to be seen if the government will make changes to other forms of state support in the coming weeks.

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