Former Tory leader Sir Iain Duncan Smith has called for benefits to be immediately uprated in line with inflation to provide a “shield” against the sting of mounting living costs - with a one-off payment of £729 at the same time. He said rebates and discretionary funds represent “a step in the wrong direction for tackling poverty”, arguing it would be better to uplift Universal Credit (UC) as it “links benefits to work”.
The recommendation to bring benefits in line with inflation is set out in new report from the Centre for Social Justice (CSJ) – a think tank founded by Sir Iain in 2004 – calling for a “special fiscal event”, funded by above-forecast tax receipts, to ease the strain on cash-strapped households. UC payments rose by 3.1% in April, in line with the Consumer Prices Index (CPI) rate of inflation in the year to September 2021.
Meanwhile, CPI inflation rose to 9% in the year to April, Office for National Statistics (ONS) data signalled on Wednesday, up from an already high 7% in March. In its report, the CSJ says the Government should consider reviewing the rate of benefits quarterly, rather than annually, at least as long as the “current period of unusual inflationary pressure” lasts.
