Published On: Mon, Mar 12th, 2018

Spring Statement: Philip Hammond urged by Iain Duncan Smith to invest in Universal Credit | UK | News

The Chancellor is expected to announce a small rise in the country’s finances during the major statement in the House of Commons.

However, research from the Joseph Rowntree Foundation has revealed the poorest fifth of working households have been left worse off in real terms over the period the Tories have been in Government.

Calling for major investment in Universal Credit, former Work and Pensions Secretary Iain Duncan Smith said: “The whole point of Universal Credit is to entice people back into work.

“The more money we’re able to offer people to do that, the more successful we will be.”

Mr Hammond has been urged to use the extra £10billion in the Treasury’s coffers following the UK’s better than expected growth to help fund a rise in the Universal Credit budget.

Since 2015 there has been a freeze on the “work allowance” which helps determines how much people can earn before seeing a reduction in their Universal Credit payment, despite a rip win living costs.

It is reported it would cost £2billion a year to restore real term earning back to where they were before the freeze came into place.

It is believed the money would help three million people and take 340,000 out of poverty.

Backbench Tory MP, Johnny Mercer, is one of those who has called on Mr Hammond to invest more in helping those on the lowest incomes.

He said: “We have a duty to help the poorest in society who are trying to do the right thing.”

While those in the bottom fifth of earners have seen a real time cut in their finances since 2010, the middle fifth are said to be £16 a week better off.

The Chief Executive of the Joseph Rowntree Foundation, Campbell Robb, added: “In-work poverty is the problem of our times.

“His economic update must address the challenges facing families struggling to cover rent or put food on the table.”

A report by ex-Conservative Treasurer, Lord Ashcroft, published last week revealed that the Tories could be set to lose control in important local council elections in May.

Boroughs usually considered Tory strongholds, including Wandsworth, Barnet and Westminster, look set to fall to Labour.

The poll found that many voters were frustrated with the continued policy of austerity.

Despite the calls for the £10billion windfall to be invested in public services and Universal Credit, the Chancellor is so far resisting the demands of his colleagues.

Mr Hammond believes the extra cash should be used to reduce the national deficit.

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