DWP explains Universal Credit payment rule and admits system 'could work better'
The DWP has explained how Universal Credit payments work after concerns that some claimants have to wait weeks for their cash to arrive. MP Jamie Stone raised the issue of the five-week wait that claimants face until they get their first payment.
He was talking about people on older legacy benefits who have to move over to Universal Credit. The benefit is replacing six benefits which are gradually being phased out.
These six benefits are being replaced by Universal Credit:
Income-based Jobseekers Allowance
Income-related Employment and Support Allowance
Income Support
Housing Benefit
Child Tax Credit
Working Tax Credit.
People on key DWP benefit could get up to £447 every month next year
The DWP is writing to people on these benefits to invite them to apply for Universal Credit - and anyone on them needs to apply or their payments will stop.
Speaking about people in this situation, Mr Stone said in Parliament: "The trouble is that they have to wait five weeks until they get their first cash. How will they make ends meet?
"What about the direct debits? I worry about that." He also told Labour ministers they should look at making changes to the policy as "people are really caught in a trap".
Guidance on the gov.uk website about moving to Universal Credit sets out this timeframe: "Your claim starts on the day you submit it in your account, however it usually takes around five weeks to get your first payment."
What extra support is available to people moving to Universal Credit?
The DWP was asked for a comment about what support is available to people who struggle to get by during this five-week interval.
A spokesperson said: "We support millions of people through Universal Credit every year, and it remains a top priority for us to ensure they get the support they are entitled to. Advances are available for new and existing customers that urgently need support.
"People moving on to Universal Credit also receive a two-week extension of their legacy benefits."
This extension applies to people moving over from Employment and Support Allowance, Jobseeker's Allowance, Housing Benefit or Income Support.
This is on top of the Transition to Universal Credit Housing Payment, a two-week extension of Housing Benefit. The department also explained the reason for the five-week wait to get your first payment.
READ MORE: PIP applicants issued key advice by former DWP assessor after cut 'delays'
As the benefit is assessed and paid monthly and paid in arrears, it's not possible to award a payment as soon as a claim comes in, but rather the assessment period needs to run its course before the award can be calculated.
If you apply for an advance payment, you have to pay back the amount in instalments, out of your future Universal Credit payments.
The DWP also acknowledged that improvements could be made to the system. The spokesperson said: "We recognise Universal Credit could work better for people, which is why we're reviewing it, including how best to support people before they receive their first payment."
How much is Universal Credit?
These are the current rates for the monthly Universal Credit standard allowance:
If you're single and under 25 - £316.98
If you're single and 25 or over - £400.14
If you live with your partner and you're both under 25 - £497.55 (for you both)
If you live with your partner and either of you are 25 or over - £628.10 (for you both).
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