Universal Credit
The question
To ask the Secretary of State for Work and Pensions, with reference to the report by the Joseph Rowntree Foundation entitled Guarantee our Essentials: reforming Universal Credit to ensure we can all afford the essentials in hard time, published on 4 March 2025, if he will make an assessment of the potential merits of introducing an essentials guarantee for welfare recipients.
Answered by Sir Stephen Timms
A Universal Credit award is made up of a standard allowance rate to provide towards basic living costs, paid according to age and household unit. Additional amounts are added to provide for individual needs such as housing, disability, and childcare costs.
We’ve taken important steps to support people with their living costs. The Universal Credit Act legislates to rebalance Universal Credit by bringing in, for the first time ever, a sustained above inflation increase to the standard allowance for all claimants. This will benefit around 4 million households and is estimated to be worth around £760 annually in cash terms by 2029/30 for a single household aged 25 or over (£250 above inflation) or over £1195 (£400 above inflation) for a couple where one is aged 25 or over with children by 2029/30.
We will also be uprating most working age benefits, across Great Britain in 2026/27, subject to parliamentary approval, in line with the Consumer Prices Index for the year to September 2025 – an increase of 3.8%.
The Government is also taking action to reduce child poverty through the removal of the two child limit. Removing the two child limit is the fastest and most cost-effective way to reduce child poverty over this Parliament and estimated to alone lift 450,000 children out of poverty by the end of this Parliament.
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