To ask the Secretary of State for Work and Pensions, what assessment her Department has made of the effect of the five-week wait for a first payment of universal credit on levels of poverty.
30 January 2020
No one has to wait five weeks for their first payment of Universal Credit. New claim advances are available to support those in financial need until their first payment is made. The Department has learnt from where we did not get things right in the past in the legacy benefit system. Too often, the desire to pay quickly meant claimants not receiving their correct entitlement as we did not have an appropriate timeframe to review household circumstances.
Claimants can access up to 100% of the total expected monthly award, which they can pay back over a period of up to 12 months. We have announced that from October 2021, the repayment period for these advances will be extended further, to 16 months. Proposed repayments of the advance are explained, and all claimants are advised to request a level of advance which is manageable both now and when considering the repayments required.
The best way to help people improve their lives is through employment. Households where all adults are in work are around 6 times less likely to be in relative poverty than adults in a household where nobody works. This improves further if all the adults are working full time, reducing a child’s risk of being in poverty from 66% for (two-parent) families with only part-time work to 7%. Universal Credit allows households the freedom from the ‘cliff edges’ which featured in the legacy benefits system, where money was lost when working more than 16, 24 or 30 hours.
There are many reasons people use foodbanks and their growth cannot be linked to a single cause. We have listened to feedback on how we can support our Universal Credit claimants and acted quickly, making improvements such as removing waiting days and introducing housing benefit run on. These changes are giving support to vulnerable people who need it most, whilst at the same time helping people get into work faster.