RISHI Sunak is under growing pressure to U-turn on his plan to end the £20-a-week boost to Universal Credit or risk sparking a major rift with a senior Cabinet colleague.
Work and Pensions Secretary Therese Coffey said extending the uplift for six million families was “under very active consideration” in a pointed warning to the Chancellor.
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She insisted that ensuring the support continues is “top of my priority list” and is petitioning the Treasury to carry on the scheme, which is due to wrap up at the end of March.
She said: “Universal Credit has been a lifeline to people who may have never been on benefits before.
“I’m conscious that we want to continue to try and extend our support throughout the impact of this pandemic.
“It’s fair to say I’m in active discussion with the Chancellor and of course with the PM about how we continue to make sure we support families during this difficult time.
“We’re very conscious of the fact unemployment has risen, is still predicted to rise, and will take a while before it turns around.”
She said he was “hopeful a decision will be made soon” on extending the scheme and that she is aware families need certainty to plan their finances.
Boris Johnson has said the possibility of a prolongation is “under review” following pressure from Tory MPs in North and Midlands.
The Northern Research Group of MPs has said cutting the extra cash would be “devastating for the six million individuals and families who are already struggling to stay afloat”.
Six Conservative MPs rebelled against the PM and voted to keep the uplift, backing a non-binding Labour motion last week.
But Mr Sunak is said to be strongly opposed to extending the £20 boost over fears it would end up becoming permanent at a cost of £6 billion a year.
He has reportedly offered to give six million people a one-off £1,000 payment instead in a bid to fight off an internal rebellion.
A Government said: “One of the motivations of the Treasury is they think people will go out and spend it and help stimulate the economy.”
Mr Sunak has been going around telling Tory MPs that prolonging the current scheme would mean inevitable tax rises later this year.
The Chancellor has warned them the cost of prolonging the scheme is the equivalent to slapping 1p on income tax plus 5p per litre on fuel duty.
He is already laying the ground for tax rises in March after warning Tory MPs it’s time to wean the country off the “magic money tree”.
Mr Sunak is said to be planning a huge increase in corporation tax in March, which could see rates rise from 19% to as high as 23%.
