Corbyn blasts Universal Credit rules that seize Greggs workers’ £300 bonus
Jeremy Corbyn has blasted "mind-numbingly complex" Universal Credit rules that are set to seize all but £75 of some Greggs workers' £300 bonuses.
19,000 staff at the bakery chain were given a payment to celebrate the vegan sausage roll – after sales jumped more than 13% last year.
But benefits experts have said the combination of welfare and tax rules means some of those workers will only be able to keep £75 of the payout.
Slamming the situation at Prime Minister's Questions, Jeremy Corbyn demanded action from Boris Johnson to let the workers keep more of their bonus.
He accused the Tory leader of doing nothing to help despite fighting with "unbelievable" energy to protect bankers' bonuses.
Mr Corbyn added: "If the Prime Minister can answer that question and show me that's just and fair, I'll buy him a vegan roll from Greggs myself."
The country's biggest bakery chain announced its bonus earlier this year in a move that was widely celebrated.
But millions of low-paid workers in the UK are on Universal Credit to top up their income and support their family.
Under that system, if they're in work, they lose benefits at a 'taper rate' of 63p for every extra pound they earn.
Benefits advisor Gareth Morgan claimed that for Greggs workers on just over £12,500, that could see them lose £129 of the £300 bonus over and above tax and national insurance – leaving just £75.48.
Torsten Bell, the chief executive of the Resolution Foundation think tank, told The Guardian: “Workers on universal credit could lose up to £225 of their £300 cash bonus,
"That is an argument for the government to lower the taper rate in universal credit, rather than for employers to stop paying their staff more."
Boris Johnson did not engage directly with the question at first when asked how much bonus they should keep. Instead he trumped a rise in the minimum wage for over-25s.
He said: "I think perhaps the best answer I can give him is to remind him that just this week this Government increased the living wage by the biggest ever amount so that people on the living wage will be receiving an extra £1,000 a year."
But Mr Corbyn accused the Government of "punishing, not supporting" workers.
Mr Corbyn said: "Greggs are currently giving 25,000 workers a £300 bonus, but some of those workers on Universal Credit will only be allowed to keep £75 out of that £300.
"The first aim of Universal Credit, which is set to affect 6 million people, was to make work pay. But when low-paid workers can't even keep their own bonuses, it's clear the Government is punishing not supporting people.
"Will the Prime Minister do something to ensure that workers and companies like Greggs on low pay will be allowed to keep their bonuses?"
Mr Johnson replied: "Under this Government people on low pay will be able to keep more of the money that they earn and it is this Government that is cutting National Insurance contributions for everybody in the country.
"It is this Government that is increasing the living wage and it was Mr Corbyn who voted against tax cuts for the low paid to the tune of £7,800."
Mr Corbyn raised several concerns about Universal Credit – including "punitive" five week wait for someone's first payment and the "cruel and callous" two-child limit on benefits.
"Why won't the Prime Minister just have the guts to admit there is a link between poverty and the two child limit?" he asked.
Yet Boris Johnson brushed off the concerns – saying there were 400,000 fewer people in poverty, a "substantial reduction in child poverty" and a "massive increase in employment".
In fact the government's own figures state the number of children in "relative low income", after housing costs, has risen by 500,000 from 3.6million in 2010/11 to 4.1million in 2017/18.
The number of children in "absolute low income", after housing costs, has also risen from 3.6million to 3.7million in the same period.
It was "time the Labour Party changed their tune", the Prime Minister claimed.
But Mr Corbyn said Labour will "never abandon the poor of this country" before adding: "Universal Credit had three aims – it was to meant to make work pay. Low-paid workers are not even allowed to keep their bonuses.
"It was meant to be simple but has created mind-numbing complexity. It was meant to reduce poverty, but it's driving people to food banks.
"As we've seen today the Prime Minister isn't able to answer questions on it. The fact is this Government has baked in austerity for tens of millions of people. When will he finally accept that the Universal Credit system is broken, is damaging, is dangerous to people's living standards and it should go?"
Mr Johnson replied: "(Mr Corbyn) wants to do nothing else but keep people in the welfare trap, stop helping people out of welfare and into work.
"And I think he should pay tribute to all the people who by their hard work have found fantastic jobs over the last year and pay tribute to the growth of employment in the UK economy."
But Labour's leader said: "This government has baked in austerity for tens of millions of people.
"The Universal Credit system is broken, it's damaging, it’s dangerous to people’s living standards and it should go."
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