Universal Credit

Lord Bishop of St Albans Excerpts

Monday 24th November 2014 Lords Chamber

[Lord Freud]

The poverty figures show that we are making really good progress in tackling poverty, with 600,000 fewer people in poverty through this Government. We are ensuring that housing costs are covered within universal credit and that people can take control of their lives in that way.

[The Lord Bishop of St Albans]

My Lords, the House will be aware that the Chancellor has announced that the working allowances for universal credit will be frozen until April 2018. There is a real danger, if there is no lift in those allowances—at least in line with inflation—that that will significantly reduce the real net incomes of low earners. Could the Minister tell your Lordships’ House what assessment Her Majesty’s Government have made of the impact of these measures on the level of poverty among those who are already in work, especially for those families who are earning too little to benefit from further rises in the personal tax allowances?

[Lord Freud]

The working allowances in universal credit are much greater than under the legacy system, so there is a freeze that will have a small effect. Nevertheless, the poverty impacts are to take 300,000 children out of poverty.