Source · Select Committees · Work and Pensions Committee
Recommendation 53
53
We recommend that the Department assesses a model in which it estimates people’s daily pay...
Recommendation
We recommend that the Department assesses a model in which it estimates people’s daily pay rate from data it already receives from HMRC, as suggested by Ferret Information Systems, and in which it would make payments from day one of the claim with reconciliation in month two. We request that the Department share information on what data that it receives from HMRC, including whether it knows how frequently people are paid, and makes clear what parts of its system are and can be automated. (Paragraph 232) Conclusion
Government Response
Not Addressed
HM Government
Not Addressed
The proposed system described by the Committee cannot easily be operationalised because, whilst you can conceptualise it for an individual case with regular earnings, you cannot reliably run it where earnings fluctuate (such as in zero hour contracts) or where there is more than one set of earnings data (such as in couple households where both maybe working, or individuals with more than one job). In these instances, the reconciliation would be challenging and likely to result in over and underpayments each month as earnings data is verified. This would lead to financial uncertainty and a poor customer service. HM Revenue and Customs sends information to the Department relating to UC claimants who are employed, this includes: gross taxable earnings less tax, National Insurance and pension contributions, pay dates and frequency of payments. This information is combined with any self-reported earnings and income to calculate awards of UC at the end of claimants’ assessment period.