TENS of thousands of hard up Brits could see Universal Credit payments rise from Monday after a loophole fix comes into force.
The rule change will prevent around 85,000 people on benefits from being left out of pocket if they're paid by their employer twice in a month.
From November 16, if a worker receives two wage payments in the same month the benefits system will register one in the following assessment period.
The rule change comes after the Court of Appeal ruled in June that the "irrational and unfair" system pushed four single mums into poverty and forced them to rely on foodbanks.
The Department for Work and Pensions (DWP) was then ordered to fix the flaw.
The current automatic system is supposed to adjust payments monthly based on changes to a claimant's income, but in reality it only takes into account wages received in the same calendar month.
What to do if you have problems claiming Universal Credit
IF you’re experiencing trouble applying for your Universal Credit, or the payments just don’t cover costs, here are your options:
- Apply for an advance – Claimants are able to get some cash within five days rather than waiting weeks for their first payment. But it's a loan which means the repayments will be automatically deducted from your future Universal Credit payout.
- Alternative Payment Arrangements – If you're falling behind on rent, you or your landlord may be able to apply for an APA which will get your payment sent directly to your landlord. You might also be able to change your payments to get them more frequently, or you can split the payments if you're part of a couple.
- Budgeting Advance – You may be able to get help from the Government for emergency household costs of up to £348 if you're single, £464 if you're part of a couple or £812 if you have children. These are only in cases like your cooker breaking down or for help getting a job. You'll have to repay the advance through your regular Universal Credit payments. You'll still have to repay the loan, even if you stop claiming for Universal Credit.
- Cut your Council Tax – You might be able to get a discount on your Council Tax or be entitled to Discretionary Housing Payments if your existing ones aren't enough to cover your rent.
- Foodbanks – If you're really hard up and struggling to buy food and toiletries, you can find your local foodbank who will provide you with help for free. You can find your nearest one on the Trussell Trust website.
The problem with this is that it doesn't make allowances for those who are paid multiple times in a month, for example, because payday would normally fall on a weekend or bank holiday.
The flaw leaves vulnerable families without any benefits for a whole month when they don't get paid, and a portion of the "double payment" is docked from their next Universal Credit payment because of the taper rate.
This is when 63p for every £1 earned over the work allowance is deducted from Universal Credit.
The Sun has been campaigning for hard-working Brits to get to keep more of their cash in our Make Universal Credit Work campaign.
In September, the international watchdog, the Human Rights Watch (HRW), slammed the automated system for pushing people into hunger and debt.
The responsibility for manually moving the payday still relies on Universal Credit although it is recommended that the claimant should inform their work coach in advance if possible via their online journal.
It will be based on Real Time Information (RTI) from the employer as normal – meaning you won't have to do anything extra.
The amendment won't change the day employees are paid either but will simply record it in the following Universal Credit assessment period.
The Sun wants to Make Universal Credit Work
UNIVERSAL Credit replaces six benefits with a single monthly payment.
By the time the system is fully rolled out in 2023, nearly 7million will be on it.
But there are big problems with the flagship system – it takes five weeks to get the first payment and it could leave some families worse off by thousands of pounds a year.
And while working families can claim back up to 85% of their childcare costs, they must find the money to pay for childcare upfront – we’ve heard of families waiting up to six months for the money.
Working parents across the country told us they’ve been unable to take on more hours – or have even turned down better paid jobs or more hours because of the amount they get their benefits cut.
It’s time to Make Universal Credit work. We want the government to:
- Get paid faster: The government must slash the time Brits wait for their first Universal Credit payments from five to two weeks, helping stop millions from being pushed into debt.
- Keep more of what you earn: The work allowance should be increased and the taper rate should be slashed from from 63p to 50p, helping at least 4million families.
- Don’t get punished for having a family: Parents should get the 85% of the money they can claim for childcare upfront instead of being paid in arrears.
Together, these changes will help Make Universal Credit Work.
Join our Universal Credit Facebook group or email [email protected] to share your story.
The overhaul will make it easier for Universal Claimants to budget on the otherwise unpredictable system.
The changes will particularly benefit workers over the festive season who will see pay day come earlier due to the Christmas bank holidays.
But it will only apply to employees who are paid monthly, so won't help those who are paid weekly or fortnightly to budget.
The four mums behind the court appeal originally challenged the DWP back in 2018. It's not clear if the rule change will be backdated until then.
When the rule change was announced, Sara Willcocks, from charity Turn2Us, said: "It is great news to hear that the DWP has finally addressed this by changing Universal Credit regulations.
"However, the fact that it needs to be done manually is a cause for concern.
"Are work coaches going to proactively look to intervene or will it put the onus on individual claimants?
"Instead of tweaking a broken system around the edges, the government needs to consider whether the IT system needs a complete overhaul in order for it to be fit-for-purpose in the 21st century."
Peter Tutton, head of policy at StepChange welcomed the change but added: "It is also important DWP continues to seek ways to stabilise payments for those who face similar problems, such as those who are paid weekly or bi-weekly or have an irregular income."
Minister for welfare delivery, Will Quince, said: "Universal Credit is a flexible benefit, and we continue to make changes and improvements to make sure people have the best experience possible.
"This change will give stability to people if they’re paid two pay cheques in a single assessment period, by ensuring that their Universal Credit payments remain consistent."
Dame Gillian Guy, chief executive of Citizens Advice, said that while it's a step in the right direction, it only helps people who are paid monthly.
"It could still leave people with fluctuating benefits payments if they’re paid every four weeks and more than one pay packet falls within their assessment period.
“We hope the government will build on this improvement and make Universal Credit a truly flexible benefit that fits with the reality of people’s lives.”
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