UK Credit

Millions of people claiming universal credit have their benefits cut to pay off government debts

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Half a million claimants now lose £ 229.50 per month due to a combination of debt repayment and the £ 20 per week cut in the Vital Benefit

Tax on health care and social benefits will be a ‘double whammy’ for workers

Millions of people claiming universal credit are seeing reduced benefits for paying off debt, including loans taken to help them weather the pandemic.

In another devastating blow to the UK’s poorest, it can be revealed that at least one in three claimants see significant deductions from the controversial benefit payment.

The deductions come on top of the controversial £ 20 cut in universal credit payments the government pushed ahead last month in the face of fierce opposition.

Half a million claimants are now losing £ 229.50 per month due to government debt reduction and repayment.

Figures uncovered by Jonathan Reynolds of Labor, the shadow secretary for Work and Pensions, show that in June of last year there was no universal credit deduction to pay off public debt, but in May of this year it had grown to over 1.1 million.

Public debt includes repayments of social fund loans, hardship allowances, integration loans as well as overpayments of allowances, tax credits or housing allowances.

But in addition to the public debt, an average of 1.57 million, or one-third of the 4.73 million claimants, are also affected by deductions for advance payments made to them while waiting for their universal credit payment to be made. .








Work and Pensions Secretary Therese Coffey
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Picture:

REUTERS)




When the benefit was introduced, claimants transferred to it had to wait up to six weeks for their first payment to be made and received advances which had to be repaid.

Over 500,000 claimants are seeing their benefits reduced by the maximum 25% allowed, or £ 149.50 per month. Combined with the £ 20 per week cut, that means many are losing up to £ 229.50 per month.

Jonathan Reynolds said, “Families are facing a very difficult winter due to the Conservative government’s cuts to universal credit, tax hikes and a cost of living crisis.

“Putting more pressure on families through deductions is cruel, especially when they have been largely imposed on people by the government, due to their five-week wait policy or their own mistakes in payments. too many tax credits.

“Work would replace Universal Credit with a system that offers real security for all, fight the cost of living crisis by lowering VAT on energy bills to ease the burden on families this winter.”





Helen Barnard, associate director of the Joseph Rowntree Foundation, said: “It is totally unacceptable that social security levels have been cut so low that many people cannot afford the essentials and meet their bills. This situation is further compounded by the fact that the government is putting additional financial pressure on families whose debt repayments are unaffordable.

“The government urgently needs to restore social security to adequate levels, especially for jobless families whose main support rates are now at their lowest level in real terms since around 1990. No one should be left behind. destitution and forced to turn to crisis services. due to the minimum wait of 5 weeks for the first payment of the Universal Credit.

“Ministers have the power to alleviate worsening debt levels in our country by ensuring that work coaches always do an affordability assessment before making deductions for child support. For Social Security to provide a reliable lifeline for families, repayments must never leave families without the ability to pay their rent, their bills and live with dignity.



Work and Pensions Minister David Rutley revealed the numbers in response to written questions from Jonathan Reynolds.

He said: “Processes are in place to ensure deductions are manageable and customers can contact DWP Debt Management if they experience financial difficulties to discuss a reduction in their reimbursement rate or a temporary suspension, depending on financial circumstances. “

He said the problems worsened because deductions were suspended for three months at the start of the pandemic last year.

Chancellor Rishi Sunak was the subject of much criticism when he decided to go ahead with his plan to cut weekly universal credit payments by £ 20 per week amid severe warnings over the impact that this will take on millions of people living on the poverty line in the UK.


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