Press release: Chancellor must boost incomes to diffuse "mounting Tory debt bomb"

New research shows Universal Credit claimants have seen debts grow

The SNP has said the Chancellor must "reject austerity and boost incomes" at the Budget - as new research reveals growing debt amount people claiming Universal Credit.

Research from the Resolution Foundation, published today, reveals three-in-ten (31%) people who started claiming Universal Credit (UC) during the pandemic have acquired new debts, or seen existing debts grow. While one-in-five (21 per cent) have fallen behind on paying essential (non-housing) bills.

The think tank warns almost half (45%) of these families have reported seeing their income fall by at least a quarter, while around one-in-three (34 per cent) reported seeing their income fall by at least 40 per cent. Three-in-five (61 per cent) families on Universal Credit say they will struggle to keep up or will fall behind on bills in the next three months.

Commenting, SNP Shadow Work and Pensions Secretary David Linden MP said:

"The Chancellor must take his head out of the sand and urgently act to tackle the growing problem of poverty and inequality, which has worsened on his watch.

"It is shameful that after a decade of Tory austerity cuts, millions of families are struggling to get by and are getting into debt just to pay everyday living costs. Rishi Sunak must reject austerity and boost incomes at the Budget to diffuse this mounting Tory debt bomb.

"The SNP has repeatedly called for action to put money in people's pockets. The UK government must make the £20 uplift to Universal Credit permanent and extend it to legacy benefits, reverse the Tory public sector pay freeze, deliver support for the 3million excluded, and stimulate economic growth with a fiscal package of at least £98billion.

"Scotland has led the way with action to tackle poverty, including introducing new benefits like the Scottish Child Payment, but people's incomes have been hammered by Tory cuts and damaging policies like Brexit, which has already taken £4billion out of Scotland's economy.

"People in Scotland have the right to decide their own future and choose what sort of country we should be after the pandemic. The only way to protect Scotland's interests and secure a strong, fair and equal recovery is to become an independent country."