Ben Everitt, the MP for Milton Keynes North, has welcomed the news families in Milton Keynes on Universal Credit could receive a boost of £1,000 a year.
As announced in the Autumn Budget, the taper rate – the amount that a person’s Universal Credit is reduced by as they earn more – has dropped from 63% to 55%. Simultaneously, work allowances, the amount eligible claimants can earn before their Universal Credit is reduced, have increased by £500 per year.
The changes mean people will keep more of what they earn, representing an effective tax cut worth £2.2 billion for the lowest earners.
Taken together the move will see, in total, almost two million of the lowest paid working families better off each year by an average of £1,000.
The Department for Work and Pensions has introduced the changes as quickly as possible, passing regulations last week to secure the higher payments for the lowest earners in time for Christmas.
Ben Everitt MP said: "The pandemic has been extremely tough, especially for those on low incomes, so I'm delighted we are making sure hard-working people can keep more of the money they earn.
"We've boosted the National Living Wage and this £2.2 billion tax cut for the lowest earners will continue to ensure we are supporting people in work.
Prime Minister, Boris Johnson said: "It’s right that we support hard-working families, and this change will help some of the country’s lowest income families keep more of their money.
"Together with the increase in the minimum wage and our investments in skills and training, it shows this is a government committed to making work pay."