Saturday, December 5, 2020

DWP under pressure to turn Universal Credit advances into non-repayable grants

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The SNP has renewed calls for the UK government to strengthen welfare protections after the Work and Pensions Secretary ruled out implementing immediate grants instead of advance hardship loans – despite half a million people applying for Universal Credit in the last nine days.

In this morning’s Work and Pensions Committee, Therese Coffey claimed that it would not be “operationally feasible” to make advance loans into non-repayable grants to reduce the five-week wait and denied that the 70,000 people – of 273,000 Universal credit applications – who applied for an advance payment last week were now in debt to the Department for Work and Pensions (DWP).

SNP Work and Pensions Committee Member, Chris Stephens MP has said that if Universal Credit – which was designed to be “agile” – is not adapted to support people affected by the current COVID-19 pandemic then thousands more could be plunged into debt at the hands of the DWP.

Therese Coffey MP, Work and Pensions Secretary. Photo by Office of the UK Prime Minister.
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Coffey said: “I don’t see it as being in debt. I see it as about spreading effectively an annual payment into 13 payments, rather than 12. Then people can chose early on what level of advance they get.”

The SNP has consistently called for the UK government to strengthen welfare protections in response to the coronavirus crisis.

In a letter to Rishi Sunak on Saturday, SNP Westminster Leader Ian Blackford urged the UK government to increase Child Benefit and make Universal Credit more flexible, proposing a package of practical measures.

These include:

  • Introducing an immediate upfront payment (not hardship loan)
  • Extending the backdating of benefits for those who might not have realised they were eligible and relaxing the criteria under which backdating is allowable
  • Providing a new one-off hardship payment for self-employed people who are impacted
  • Removing the 9-month qualifying period for support with mortgage interest, and providing a one-off grant for mortgage holders making new claims
  • Removing the capital tariff reduction to Universal Credit when claimants have £16,000 in savings
  • Removing the shared accommodation rate from the Local Housing Allowance, for both Universal Credit and Housing Benefit.
  • Stopping the bedroom tax
  • Uprating ESA and PIP

Commenting, Chris Stephens MP said: “The coronavirus lockdown makes it even more vital that welfare protections are strengthened now, so that all those affected by this unprecedented emergency receive the support they need – including the millions of freelancers, self-employed and unemployed people who are struggling to get by.

“The SNP is calling for the UK government to deliver urgent support by increasing Child Benefit and making Universal Credit more flexible by introducing an immediate upfront payment instead of a loan, providing a new one-off hardship payment for self-employed people, and removing the rule that prevents those with £16,000 of savings from claiming.

“The UK government must think again and introduce these sensible measures so no one is left behind. With half a million new Universal Credit applications, the SNP will continue to press the UK government to deliver the support that is needed now.”

Margaret Greenwood MP.
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Labour’s Shadow Work and Pensions Secretary, Margaret Greenwood MP (pictured above), has also called for Universal Credit advances to be turned into grants.

“Unprecedented numbers of working people are having to access the social security system for the very first time because of the health emergency,” she said.

“Not only is there chaos as they seek to secure support, they will be shocked at the low level of payments.

“It is vital that people get the support that they need in the face of this crisis.

“The government should make advance payments for Universal Credit automatic and make them a grant not a loan.”

She added: “They should also support the self-employed by extending eligibility for the Jobs Retention Scheme to them.

“The DWP has cut tens of thousands of posts since 2010. The government should look to calling people back into employment during this crisis to make sure people can get the support they need in good time.”

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