Universal Credit payments set to rise next week for tens of thousands of people after rule change

Tens of thousands of Universal Credit claimants are set to receive more money from next week.

A change in the rules takes effect from Monday, November 16 which closes a loophole that had been costing a lot of people money unfairly.

The old rules had seen people who for various reasons got paid twice a month by their employer penalised on the Department for Work and Pensions system, the Mirror Online reports.

This applied, for instance, with people receiving a late or early payment because of a bank holiday, or for those paid on the first or last working day of the month.

Such payments are currently flagged as ‘over-earning’ on the official system.

More than 85,000 claimants’ pay has been reduced – sometimes to nothing – as a result to reflect the higher income paid into their account that month.

The mistake frequently left vulnerable families without any benefits for a whole month.

And in most cases, a portion of the so-called “double payment” was docked from the next payment.

Now, from Monday, the loophole will be shut off and those who get paid twice in one month will no longer be penalised in their following payment.

The changes will benefit workers over the festive season who get paid early due to the Christmas bank holidays.

However, be warned – they will only apply to employees who are paid monthly, so the reform will not help those who are paid weekly or fortnightly.

The turnaround follows a legal ruling earlier in the year.

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In June, four single mothers took a case to the Court of Appeal and won.

The four mothers fell into rent arrears, defaulted on council tax, incurred bank overdraft charges, borrowed money and even become reliant on food banks to make ends meet as a result of being unfairly penalised.

One Mum, Danielle, said she had experienced serious fluctuations in her benefit income because of a ‘clash’ between her monthly pay days and the DWP’s fixed monthly Universal Credit assessment periods.

The judge concluded that the system was “irrational and unfair”, put them into poverty and forced them to rely on food banks.

The DWP was told to fix the flaw – hence the change from Monday.

Officials say that from November 16, the benefits system will only register one payment for every assessment period to stop anyone losing out.

The responsibility for manually moving the pay day will still rely on Universal Credit.

However, it is recommended that the claimant should inform their work coach in advance, if possible, via their online journal.

It will be based on Real Time Information (RTI) from the employer as usual, which means the worker will not have to do anything extra.

Peter Tutton, head of policy at StepChange, welcomed the change but added: “It is also important DWP continues to seek ways to stabilise payments for those who face similar problems, such as those who are paid weekly or bi-weekly or have an irregular income.”

Will Quince, minister for welfare delivery, said: “Universal Credit is a flexible benefit, and we continue to make changes and improvements to make sure people have the best experience possible.

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“This change will give stability to people if they’re paid two pay cheques in a single assessment period, by ensuring that their Universal Credit payments remain consistent.”