Thank you for contacting me about Universal Credit (UC).
UC is the biggest and most fundamental reform to the welfare system since its creation. It is based on the principles that work should always pay and those who need support receive it, whilst also being fair to taxpayers.
A decade ago, the welfare bill cost each household around £8,500. This was an increase of nearly £3,000 per household since 1997. The system was failing to reward work and trapping people on welfare.
UC protects vulnerable claimants and ensures that work always pays. As UC entitlement is based on up-to-date information about a claimant’s circumstances, it more accurately reflects their financial needs.
Extra support was announced by the Chancellor as a temporary measure in March 2020 to provide additional support to those likely to be facing the most financial disruption due to the public health emergency. Alongside the temporary increase to Universal Credit and Tax Credits, the Government invested over £352 billion in measures to create, support and protect jobs and businesses, introduced mortgage holidays and additional support for renters, and worked with energy suppliers to protect those struggling with energy bills.
I know my colleagues in the Department for Work and Pensions remain focused on supporting people by helping them get back into work through the Government’s £30 billion Plan for Jobs. The Chancellor has announced further support for UC recipients to help with the cost of living, including Cost-of-Living Payments of £650 and £900.
This is on top of a previous £1 billion package of changes, providing two additional weeks of DWP legacy benefits for those moving onto UC, a 12-month grace period before the Minimum Income Floor is applied, and extending the payback period for Universal Credit advances from 12 months to 24, meaning in effect someone can receive 25 payments over 24 months.
Thank you again for taking the time to contact me.