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Universal Credit: Deductions

Question for Department for Work and Pensions

UIN 156459, tabled on 22 February 2021

To ask the Secretary of State for Work and Pensions, what recent assessment she has made of the effect of universal credit deductions on the (a) levels and (b) depth of child poverty.

Answered on

25 February 2021

No assessment has been made.

Tackling poverty will always be a priority for this Government. Our recent focus has rightly been on supporting people financially during these unprecedented times, with an injection of billions of pounds to strengthen the welfare system in response to the Covid-19 pandemic, including a temporary increase in the Universal Credit Standard Allowance to support those facing the most financial disruption. Through the Covid Winter Grant Scheme, announced on 9 November, we are extending that support with an additional £170m for local authorities in England so that they can support families with children and other vulnerable people with the cost of food and essential utilities this winter.

From October 2019, the overall maximum level for standard deductions is normally limited to 30% of a claimant’s Standard Allowance except for last-resort deductions. From October 2021, this is being reduced to 25% of the claimant’s standard allowance except for last-resort deductions. We recognise the importance of safeguarding the welfare of claimants who have incurred debt, so last resort deductions can be applied to protect vulnerable claimants from eviction and/or having their fuel supply disconnected, by providing an affordable repayment plan for arrears of these essential services.

Claimants can ask for New Claims and Change of Circumstances Advance repayments to be delayed for up to 3 months in exceptional circumstances.

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