Source · Select Committees · Scottish Affairs Committee
Recommendation 117
117
The Poverty Alliance in their written evidence to us highlighted that from their research they...
Conclusion
The Poverty Alliance in their written evidence to us highlighted that from their research they found that the five week wait was ‘the most negative aspect of Universal Credit for many people.’295 They argue that the policy is a major driver of poverty and destitution and has forced people into income crisis and food insecurity.296 Citizens Advice Scotland also highlighted that for people who have no savings or without family or friends to borrow money from the policy ‘forces people to use foodbanks; accumulate debt; and, causes detriment to their physical and mental health.’297 Their evidence also notes that: ‘A significant number of people do not have a financial buffer in the form of a final month’s salary to rely on during the five week waiting period [ … ] [and] 1 in 4 people living in Scotland have less than £500 in savings.’298
Government Response
Not Addressed
HM Government
Not Addressed
New Claim Advances are the claimant’s benefit paid early, allowing claimants to access up to 100% of their estimated Universal Credit payment upfront. With a Universal Credit Advance, claimants receive an additional Universal Credit payment, which now can result in 25 payments over 2 years, rather than 24. This extension to spreading payments over 2 years was for New Claim Advances or Benefit Transfer Advances issued from 12 April 2021. Advances issued before 12 April 2021, do not have their maximum repayment period extended as claimants agreed to having their 13 UC payments spread across up to 12 months. The introduction of non-repayable advances would increase fraud risk in the benefit system, as well as imposing the administrative burden of extra verification checks. Additionally, people with sufficient earnings or income with little or no entitlement to Universal Credit, could inappropriately gain, by speculatively claiming in order to obtain a non-repayable sum upfront. Furthermore, DWP estimates the costs of non- repayable grants to be between £2.2 and £2.8 billion.