Universal Credit claimants ‘face having benefits deducted to pay their debts’

THOUSANDS OF Universal Credit claimants are having 40 per cent of their benefit deducted to pay back outstanding debts.

Labour MP Ruth George said the high level of deductions from payments “will see more people with no option but to go into debt”.

The Department for Work and Pensions said there were safeguards to protect benefit claimants from big reductions.

But figures obtained by Ms George show just how many Universal Credit claimants are having major chunks of their benefit deducted every month.

In January, six per cent of all Universal Credit full service claims had 40 per cent deducted from their standard allowance, according to figures released in response to a written parliamentary question.

DWP also says a small percentage of less than 0.5 per cent of claims had total deductions of more than 40 per cent.

In these cases, deductions for rent or fuel costs are applied first, in order to protect claimant welfare.

But the whole deductions system has prompted concerns among MPs and charities over the financial impact on claimants.

Ms George, a member of the Work and Pensions select committee, said she was very worried about the low level of income people are left with.

“Support under Universal Credit is already below poverty levels for many groups, especially lone parents and disabled people,” she said.

DWP can directly collect debts from Universal Credit payments, including for previous benefit and tax credits overpayments and certain third-party debts such as council tax and rent arrears.

A DWP spokeswoman said: “We have a duty to the taxpayer to recover any overpayments and we recovered £1.1bn last year.

“People are told about this in advance and they are recovered by regular deductions.”