Background
Universal Credit has a “baked in” wait for the first
payment. After completing all of the stages of their application,
claimants must then wait for at least five weeks to receive their
award. They can ask for an Advance payment if they need money
more urgently, which they then pay back out of their future
Universal Credit payments.
Many organisations have concluded that the five week wait for a
first Universal Credit payment must be reduced or eliminated
entirely. There is, however, a lack of agreement about how this
might be most effectively—and affordably—achieved. Some of the
options suggested include:
- Scrapping the five
week wait for all claimants: for example, by making the Advance
non-repayable;
- Offering
non-repayable Advances to some claimants: for example, those
considered vulnerable;
- Allowing more
flexibility for the start of a claim to be backdated;
- Extending run on
payments to cover all legacy benefits;
- Substantially
reducing the rate at which Advance Payments—the main existing
mitigation measure—are paid back, to help claimants better manage
their money;
- Paying UC
two-weekly, like many legacy benefits, rather than monthly.
The Committee wants to help the Government to better understand
the upsides and downsides of these options, and explore other
possible solutions.
Chair of the Work and Pensions Committee, Rt Hon MP, said:
“It’s now widely recognised that the lengthy wait for a first
payment of Universal Credit is causing real difficulties for
people—so it’s hugely welcome that the Minister is open to
looking at how to fix it. The Committee wants to look carefully
at all the possible solutions, and work out which are the most
practical, affordable, and likely to make a meaningful difference
to people’s lives.”
What does the Committee want to hear about?
The Committee would like to hear your
views on the following questions about the wait for a
first payment of Universal Credit.
You can respond as an individual, a group or an
organisation. You don’t need to answer all of the questions.
The deadline for sending your views is Friday 17 April
2020.
- To what extent have
the mitigations the Government has introduced so far (e.g.
Advance payments) helped to reduce the negative impact of the
five week wait for UC claimants?
- What problems
do claimants still experience during the five week wait?
- What is the best
way of offsetting the impact of the five week wait?
- Is it possible
to estimate how much this would cost the Department?
- Is it possible
to estimate any costs or savings to third parties (for
example, support organisations)?
- Are different
mitigating options needed for different groups of
claimants?
- Are there barriers
or potential unintended consequences to removing the five week
wait—either for claimants or the Department? How can they be
overcome?
