Universal Credit slashed by up to 25 percent for thousands of claimants to pay off debts | Personal Finance | Finance

New estimates released by Shadow Work and Pensions Secretary Jonathan Reynolds have claimed that half a million benefits claimants have seen their payments slashed due to debt repayments. Some 500,000 Universal Credit claimants are seeing their benefits cut by the maximum 25 percent allowed which comes to £149.50 a month. Including the £20 uplift cut, this means that Universal Credit claimants are losing upwards of £229.50 a month.

This means that a third of all claimants, 1.57 million people, have been hit with deductions to advance payments while they have been waiting for Universal Credit to be paid.

Speaking to The Mirror, Mr Reynolds explained: “Families are facing a very difficult winter because of this Conservative Government’s cuts to Universal Credit, tax hikes and a cost of living crisis.

“To place further strain on families through deductions is cruel, particularly when they have largely been forced on people by the Government, through their five-week wait policy or from their own errors in tax credit overpayments.


“Labour would replace Universal Credit with a system that offers genuine security for all, tackle the cost of living crisis through a VAT cut on energy bills to ease the burden on families this winter.”

Despite these cuts to Universal Credit, many social mobility and poverty groups believe the debate around the uplift will lead to a renewed and improved social security net down the line.

Lucy Bannister, Policy Campaigns Manager at the Joseph Rowntree Foundation, believes the pandemic has shone a light on the necessity for a strong benefits system.

Ms Bannister said: “The debate around the £20 cut has improved understanding among decision makers of the essential role of social security in our society, the opportunity to tailor it to the economy we want and how inadequate basic levels of support currently are.

“This has been helped by previous Conservative Work and Pension Secretaries and Ministers acknowledging that cuts over the last decade went too far and urging the Government to invest in support ‘to allow people to live with dignity’.

“Baroness Stroud has urged the Government to boost support for those out of work, saying “there is still no safety net, and that should worry us all”.

“A huge number of Conservative MPs called for the £20 to stay, and there remains fertile ground for continued conversations on further improving the support available.

“Over the coming weeks and months, we will begin to see the reality of support being at such historically and internationally low levels and the cost of living rising.

“Front-line organisations will have to deal with increased need for food aid, advice, mental health and crisis support.

“As we see this reported, it’s crucial that the many organisations who have come together to warn against the £20 cut, can continue to point towards the inadequacy of our social security system.

“Particularly for those out of work, as a key driver in this, and maintain the pressure on the Government to urgently invest in support.”

Express.co.uk has reached out to the Department for Work and Pensions (DWP) for comment.

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