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Universal Credit

Question for Department for Work and Pensions

UIN HL5214, tabled on 3 June 2020

To ask Her Majesty's Government, further to the reply by Baroness Stedman-Scott on 2 June (HL Deb, col 1279), why they do not suspend the repayment of universal credit advance payments for six months as opposed to converting advances into non-repayable payments, as recommended by the Resolution Foundation.

Answered on

17 June 2020

Nobody has to wait five weeks for a payment under Universal Credit. Advances are a mechanism for getting claimants faster access to their entitlement; allowing claimants to receive 13 payments over 12 months with up to 12 months to repay the advance.

New Claims Advances of up to 100 per cent of potential entitlement are available if a claimant needs support during their first assessment period. Face-to-face checks for Universal Credit advances have been scrapped due to COVID-19, so people get the support they need despite COVID-19 restrictions.

The Government has already taken steps to help ease the burden of the repayment of advances.

We have reduced the maximum deduction from 40 per cent to 30 per cent of a claimant’s standard allowance. The Budget 2020 set out that the maximum level will be further reduced, so that standard deductions will not exceed 25 per cent of a claimant’s Standard Allowance from October 2021.

The repayment time for advances has already been extended from six months to 12 months, and a further extension to 24 months from October 2021 was announced in the budget. Claimants can ask for repayments to be delayed for up to three months if they can’t afford them.

We continue to review our policies but have no further planned changes at this time.