Jeremy Corbyn busted the nasty trick Theresa May hid behind Universal Credit at Prime Minister’s Questions (PMQs) on 25 October.
The nasty trick
To outbursts from the Conservative benches, the Labour leader said [12:20]:
The welfare state was not created to subsidise low-paying employers and over-charging landlords.
Universal Credit combines six benefits, including housing benefit and working tax credits, into one. But as Corbyn points out, the nasty trick behind Universal Credit is that a lot of the money is actually going to rich corporations and landlords. Presently, your average low-income worker is spending 44% of their income on rent, according to Shelter. Rents are so high that ordinary people must apply for Universal Credit to cover the costs, resulting in a transfer of wealth from the taxpayer to landlords.
In the Commons, Corbyn followed through [12:32] on a similar story for low-paying employers:
Will the budget in November put the onus back onto employers to pay a decent wage so that workers can make ends meet?
Tesco, for example, pays workers so little that the taxpayer forks out around £364m per year to top up the huge business’s wages, through support such as working tax credits. This is despite Tesco’s rich shareholders enjoying a profit of £1.28bn in 2016/17. So a significant portion of the money the taxpayer puts into Universal Credit is in fact deepening the pockets of big business.
Exacerbating the problem
In the Commons, Corbyn also laid out [10:03] how the rollout of Universal Credit is exacerbating the problem of extortionate rents even further:
Universal Credit is in such a mess that councils are forced to pick up the bill… Croydon Council, which piloted the scheme, is now spending three million pounds of its own budget to prevent tenants from being evicted due to rent arrears caused by Universal Credit. Does the Prime Minister think it is right or fair that hard-pressed local authorities, having their budget cut by central government, having to dip into what little money they’ve got left in order to prevent people being evicted when they know full well it’s the responsibility of this government and its system of Universal Credit that’s causing the problem?
On top of real-term budget cuts of over 40%, some local authorities are now having to pay off landlords too.
In short, the Conservative government creates the conditions in which:
- Taxpayers must hand money to landlords, otherwise people face eviction.
- Taxpayers must hand money to rich corporations, otherwise people can’t afford to live.
But if we ended the culture of low pay and high rent in the first place, none of that would be necessary. Corbyn was spot on to expose the cruel trick behind Universal Credit at PMQs.
Watch Corbyn make the point here:
–Sign the petition from 38 degrees to pause the roll-out of Universal Credit.
Featured image via screenshot
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