Ipswich Unemployed Action.

Campaigning for Unemployed Rights.

Universal Credit Leaves Families in Debt.

Protests as Universal Credit is rolled out in Clacton (6th August)

One of the first things you noticed in the changing High Street of the last decade was the invasion of loan companies, and pawn brokers and companies like BrightHouse,

Got no money but need a new TV? No problem. BrightHouse will sell you one in instalments… for a huge mark-up

Then there’s the Wonga, QuickQuid, and licenced loan sharks ads all over the telly.

Debt, the cause and the result of this has become a major problem.

But there’s nothing that Universal Credit can’t make worse.

Universal credit flaws leaving families in debt, campaign group says

Low-income working families are losing hundreds of pounds each year – and being wrongly denied free healthcare entitlements – because of flaws in the way universal credit is designed, campaigners say.

The Child Poverty Action Group (CPAG ) said arbitrary rules built in to the way universal credit is calculated leave some families unable to predict how much they will be paid each month, leaving households in debt and unable to budget.

It can lead to claimants being wrongly benefit-capped – a penalty designed to “incentivise” jobless or low-earning households by severely limiting their benefits – because the system fails to spot they are working and earning enough.

In other instances, the problem means claimants doing the same job and earning identical salaries can end up being paid different amounts of universal credit simply because their respective claims begin on different days of the month.

The complication, which occurs when pay dates fall close to the start of universal credit assessment periods, can result in claimants who are parents or disabled losing up to £258 of work allowance each month, CPAG has estimated.

The charity has called for universal credit to be halted in order to fix the problem before the benefit is extended to over two million people – including many families who are currently in receipt of working tax credits – from July 2019.

It says erratic payments have left families stressed and in hardship: “Claimants are often left flummoxed by how much – or how little – universal credit they will receive from one month to the next,” said the CPAG chief executive, Alison Garnham.

The full report is:

Rough justice: problems with monthly assessment of pay and circumstances in universal credit, and what can be done about them

The lengthy press release from the Child Poverty Action Group says that it’s people working who are hit hard,

Universal credit assessment system is leaving claimants out of pocket

Working people claiming universal credit are having their benefits capped when they shouldn’t be, and losing the effects of ‘work allowances’ worth up to £258 per month simply because of the dates on which their paydays and universal credit ‘assessment periods’ happen to fall, new evidence from Child Poverty Action Group (CPAG) shows. Last month the Work and Pensions Secretary acknowledged the need to look at “ … payment cycles for those in work.” (3)

In the worst cases workers are losing hundreds of pounds each year simply because their paydays clash with the monthly ‘assessment periods’ in universal credit (UC). Far from offering much-vaunted simplicity, universal credit rules leave many workers unable to predict what their payments will be from one month to the next. People who happen to move house at the ‘wrong’ point in their assessment period can also lose hundreds of pounds in help with rent.

One in 20 cases coming in to the charity’s Early Warning System – which gathers case evidence from welfare rights advisers across the UK – indicates a problem with the monthly assessment system in UC. ​

Universal credit assessment periods run for a calendar month, starting from the date Universal Credit is awarded. At the end of each month, claimants’ circumstances and income are assessed to determine their entitlement to UC, with payment made a week later in arrears. But where a claimant’s monthly payday is on or close to the first day of their assessment period and they are paid a day or two early some months, because their normal payday would fall on a weekend or bank holiday, they are then recorded as having had two paydays in one assessment period and none in the one after.

Two pay cheques in one assessment period can leave claimants facing unexpectedly low universal credit awards as well as losing the effect of one month’s work allowance (see below). Claimants can even lose help with prescription charges or travel costs for NHS treatment because when paid twice they appear to earn more than they do. And if they appear to have no earnings in the following assessment period – because they received two pay cheques in the preceding one – then rather than seeing their universal credit increase to compensate for this they may find that they are in fact subject to the benefit cap (which was designed to limit how much support is paid to people out of work or with very low earnings) so their support for that month is reduced too. Had they simply received one paycheque in each assessment period they would have a consistent UC award and would be recognised as earning enough not to face the benefit cap.

Claimants whose assessment period start-date and payday are both close to the end of the month are especially likely to miss out, as bank holidays are often in the last days of the month.

A worker paid on the last working day of each month in 2018, with assessm​ent periods dated 30th – 29th of the month will have:

§ 6 assessment periods with one payday

§ 3 assessment periods with two paydays

§ 3 assessment periods with no paydays.

People who are paid weekly, fortnightly or four-weekly will also have different numbers of paydays in different assessment periods over the course of a year, which makes budgeting challenging and also means that they may be eligible for passported help with health costs in some months but not others, or may be benefit capped in some months but not others, when their pay has not in fact changed at all.

For couples where both partners work on different pay cycles, the variability of their UC award month to month can make budgeting almost impossible – see case study Katie and Luke (page 9 of full briefing).

There is a lot more.

They conclude:

Commenting on the findings from CPAG’s Early Warning System, the charity’s Chief Executive Alison Garnham said:

“Universal Credit isn’t working for working people. Our Early Warning System shows​ claimants are often left flummoxed by how much – or how little – universal credit they will receive from one month to the next.​ But we believe most of the problems created by the monthly assessment system can be fixed relatively easily if the political will is there. The mass migration of families on to universal credit should not begin until these fundamental problems are resolved.”

And:  Child Poverty Action Group is taking legal action on the rigidity of assessment periods

Just to remind people where this ends:

Written by Andrew Coates

August 8, 2018 at 12:17 pm

18 Responses

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  1. Andrew Coates

    August 8, 2018 at 3:47 pm

  2. At least there is open criticism of Universal Credit now, from just about everywhere except the DWP. Now some of the worst aspects of UC are being dragged out into the open. So much of it is just planned cruelty and hardship for people on benefits to ‘persuade’ them to give up their benefit claims and get a job instead.

    John Greyfield

    August 8, 2018 at 4:41 pm

  3. When a manufacturer discovers that faults exist in their products they take them off the shelves and/or recall them. Universal Credit is riddled with flaws and problems so how can the government justify rolling it out when the design and implementation of the benefit is so obviously not fit for purpose?


    August 8, 2018 at 5:04 pm

  4. Because it is designed to make us destitute, hungry, and homeless which is what the Tory mafia want so in their warped minds it is fit for purpose.


    August 8, 2018 at 6:52 pm

  5. Reblogged this on michaelsnaith.


    August 8, 2018 at 8:24 pm

  6. It was always going to explode the moment it came to welfare for working people just like it was said it would.
    These people never thought this welfare reform would cruelly effect them, that it was all about the unemployed, the disabled and boy if they weren’t shocked when it landed at there door.
    Anyone bothering to read the welfare reform back at the beginning all those years ago would have known and foreseen this all day one yet all of mainstream media just sat there and complicity left every detailed flaw till public voiced the problems online when it actually effected them just so they could meter it out to keep people going back to their website.
    The whole point of media is to keep us well informed ahead of time and hold government accountable yet they instead have left us hanging all because they are losing the war of attention online to alternate media they are now attempting to shut down and or censor.


    August 8, 2018 at 11:49 pm

  7. One of the first things you noticed in the changing High Street of the last decade was the invasion of loan companies, and pawn brokers and companies like BrightHouse,

    There has always been lenders like Provident the extortionate rates of interest charged by these quickquid companies is mind blowing.


    August 9, 2018 at 2:03 am

    • ffs ken. Most borrowers default on loans from the likes of Provident. You think they are going to lend you say £100 and pay back £105. That means the lender has to chase you up for £100 just to break even minus expenses. Of course they are not – they are going to lend you £100 and pay back £1100. That way they are at break even minus expenses after they collect the first payment.


      August 9, 2018 at 8:20 am

      • The Provy used to be in small ads in the Daily Mirror, they weren’t in the High Street and on the telly all the time!

        Andrew Coates

        August 9, 2018 at 10:32 am

      • Provy rep around here would just post a leaflet through your letterbox.

        Old Betty

        August 9, 2018 at 10:42 am

      • Naming and shaming DWP in the media.


        Yet again media attention has proved the only source outside of a lengthy wait for tribunal at overturning inappropriately applied sanctions.
        Its rather a running joke don’t you think that RM, a system so called solely designed to prevent sanction miscarriages is less successful than media attention and tribunal at picking up on them.
        Isn’t it time the decision makers role was looked at in the light of so many mistakes.

        How does UC earn the name when the only thing universal is the mistakes it makes. Surely there’s no credit in that.


        August 9, 2018 at 11:30 am

  8. Entonoia (c.f. paranoia; etymology: Ye Olde English/Anglo-Saxon; c. Middle Ages) – a state where a person trusts someone automatically to have one’s best interest at heart and/or to not take advantage of or manipulate them.

    Word of the Day

    August 9, 2018 at 2:00 pm

  9. Reblogged this on seachranaidhe1.


    August 9, 2018 at 9:55 pm

  10. Can a job club force you to do unpaid work? Can they like send you to work experience? Anyone know?

    Worried Jobseeker

    August 9, 2018 at 11:31 pm

    • Sorry, doug is not online at the moment, but will answer your question as soon as they become available. Bye!

      doug's answerphone

      August 10, 2018 at 12:08 am

    • As far as I know these days unpaid work is voluntary. If in doubt ask and if you get told you have to do work for nothing ask for it to be put in writing, dated and signed. You then have proof that you were lied to and can hang whoever it is out to dry.

      Atilla the Gardener

      August 10, 2018 at 8:17 am

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