Universal Credit: the wait for a first payment - Work and Pensions Committee - UK Inquiry Tracker

Universal Credit: the wait for a first payment

Work and Pensions Committee Closed Inquiry

Opened: 9 Mar 2020 Closed: 2 Feb 2022 Parliament page

This inquiry looked at the five week wait that faces new Universal Credit claimants before receiving their first benefits payment. It examined the options that the Department for Work and Pensions could consider for reducing or ending the wait and explore other possible solutions. Read the call for evidence to … Read more

40 Recommendations

15 Conclusions

1 Report

6 Oral sessions

7 Letters

6 Events

Activity timeline 15 events

16 Jul
2021

Correspondence

Correspondence with Minister for Welfare Delivery - joint meeting with House of Lords Economic Affairs Committee follow up

12 Jan
2021

Report published

Third Special Report - Universal Credit: the wait for a first payment: Government Response to the Committee’s Third Report

19 Oct
2020

Report published

Third Report: Universal Credit: the wait for a first payment

24 Sep
2020

Correspondence

Correspondence from NAO about net recovery rate of fraud and error on Universal Credit

11 Sep
2020

Correspondence

Correspondence with Minister for Welfare Delivery on Universal Credit: the wait for a first payment – follow up to 15.7 evidence session

11 Sep
2020

Correspondence

Correspondence with Financial Secretary to the Treasury on the impact of tax credits debt repayments on Universal Credit claimants

11 Sep
2020

Correspondence

Correspondence with the National Audit Office (NAO) on analysis of rent arrears of Universal Credit claimants

2 Sep
2020

Oral evidence

Work and Pensions Committee meeting

28 Aug
2020

Correspondence

Correspondence with the Financial Conduct Authority about best practice in the consumer lending

15 Jul
2020

Oral evidence

Work and Pensions Committee meeting

1 Jul
2020

Oral evidence

Work and Pensions Committee meeting

24 Jun
2020

Oral evidence

Work and Pensions Committee meeting

Oral evidence sessions 6 sessions

2 Sep 2020

View on parliament.uk

Work and Pensions Committee meeting

Gareth Davies · Department for Transport Jonathan Davidson · Financial Conduct Authority Joshua Reddaway · National Audit Office Nisha Arora · Financial Conduct Authority

15 Jul 2020

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Work and Pensions Committee meeting

Neil Couling · Department for Work and Pensions Will Quince MP · Department for Education

1 Jul 2020

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Work and Pensions Committee meeting

Gareth Morgan · Ferret Information Systems Phil Booth · medConfidential Rt Hon Sir Iain Duncan Smith MP · Department for Work and Pensions Stephen Brien · Department for Work and Pensions The Baroness Stroud · Department for Work and Pensions Tom Loosemore · Public Digital

24 Jun 2020

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Work and Pensions Committee meeting

Adam Smith · Kent County Council Hugh Owen · Riverside Housing Group Jacqueline Hickmore · Cornwall Housing Jeremy Hewer · Scottish Federation of Housing Associations Laura Courtney · Community Housing Cymru Muhammed Butt · London Councils Noel Duke · Harrogate Borough Council Sheila McKandie · Highland Council Sue Ramsden · National Housing Federation

17 Jun 2020

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Work and Pensions Committee meeting

Anvar Sarygulov · Bright Blue Ben Fell · Policy in Practice Dr Mandy Cheetham · Teesside University Dr Sophie Wickham · Department of Public Health, Policy & Systems, University of Liverpool Mike Brewer · Resolution Foundation Nicholas Timmins · Institute for Government Patrick Spencer · Centre for Social Justice

10 Jun 2020

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Work and Pensions Committee meeting

Emma Revie · Trussell Trust Gemma Hope · Leonard Cheshire Iain Porter · Joseph Rowntree Foundation Jennifer Harrison · Changing Lives Mark Gale · Young Women's Trust Minesh Patel · Mind Peter Tutton · StepChange Tom Lee · Child Poverty Action Group

Reports 1 report · click to expand

Title	HC No.	Published	Items	Response
Third Report: Universal Credit: the wait for a first payment	HC 204	19 Oct 2020	55	Responded

Recommendations & Conclusions

55 results

1 Conclusion Not Addressed

Third Report: Universal Credit: th…

The wait for a first payment of Universal Credit is not the only source of...

The wait for a first payment of Universal Credit is not the only source of the problems people face, but it can exacerbate them. For people who may already be going through a difficult time, enduring five weeks—or longer—without any … Read more

Government Response

The government's response quotes and then rejects a separate recommendation about commissioning research on food bank use, rent arrears, and mental health, rather than addressing the committee's conclusion about the impact of the Universal Credit waiting period.

Department for Work and Pensions

2 Recommendation Rejected

Third Report: Universal Credit: th…

DWP has previously adopted a sceptical attitude towards the evidence linking food bank use with...

DWP has previously adopted a sceptical attitude towards the evidence linking food bank use with Universal Credit. The Minister has now recognised that the Department needs to do more to improve its understanding of the what causes food bank use … Read more

Government Response

The government explicitly rejects the recommendation to publish its analysis of foodbank use drivers, stating that due to resource reallocation for the COVID-19 pandemic, it will not be conducting or commissioning any research.

Department for Work and Pensions

3 Recommendation Not Addressed

Third Report: Universal Credit: th…

The Trussell Trust’s data, described by the National Audit Office as the best research it...

The Trussell Trust’s data, described by the National Audit Office as the best research it has seen, establishes an association between Universal Credit and food bank use. We share the National Audit Office’s view that the Department should conduct further … Read more

Government Response

The government's response does not address the recommendation to conduct further research into the link between Universal Credit and food bank use, or to encourage the Trussell Trust to share its data. It instead references ministerial meetings with stakeholders and their publication.

Department for Work and Pensions

4 Recommendation Rejected

Third Report: Universal Credit: th…

We also heard evidence which suggests that people on Universal Credit are more likely to...

We also heard evidence which suggests that people on Universal Credit are more likely to have rent arrears than people still claiming legacy benefits. The Department’s own data show that, while some people who come onto Universal Credit have pre-existing … Read more

Government Response

The government rejects the recommendation to investigate the link between Universal Credit and rent arrears, citing resource reallocation due to the pandemic and arguing that attributing arrears solely to UC is simplistic.

Department for Work and Pensions

5 Recommendation Rejected

Third Report: Universal Credit: th…

There is also research which found evidence of an increased prevalence of psychological distress, following...

There is also research which found evidence of an increased prevalence of psychological distress, following the introduction of Universal Credit, among people affected by the policy. The research was not able to delineate whether a change of benefit system in … Read more

Government Response

The government rejects the implicit recommendation to conduct further research and evaluation to understand the drivers and clinical impact of psychological distress linked to Universal Credit, citing resource reallocation due to the COVID-19 pandemic and outlining other support measures.

Department for Work and Pensions

6 Recommendation Rejected

Third Report: Universal Credit: th…

DWP should conduct or commission research, before the end of this financial year, to develop...

DWP should conduct or commission research, before the end of this financial year, to develop its understanding of the impact of Universal Credit, particularly the wait for the first payment, on the rising use of food banks; on claimants’ levels … Read more

Government Response

The government rejects the recommendation to conduct or commission research on the impact of Universal Credit and the five-week wait on food bank use, rent arrears, and mental health, citing resource reallocation due to the COVID-19 pandemic and highlighting other support measures.

Department for Work and Pensions

7 Recommendation Rejected

Third Report: Universal Credit: th…

DWP should publish details of the meetings that it holds with stakeholders, like the Trussell...

DWP should publish details of the meetings that it holds with stakeholders, like the Trussell Trust, to ensure that the public and Parliament know that important and well-regarded research, such as that produced by the Trussell Trust, is considered when … Read more

Government Response

The government states that Ministerial meetings with stakeholders are already published quarterly on GOV.UK but rejects publishing details of every engagement, including topics discussed and actions taken, citing the need to maintain trust and partnership with stakeholders.

Department for Work and Pensions

8 Conclusion Acknowledged

Third Report: Universal Credit: th…

People who are moving to Universal Credit through managed migration are doing so because of...

People who are moving to Universal Credit through managed migration are doing so because of a decision by the Government. Nothing in their own circumstances has changed. Under the Government’s plans, however, they would have to wait at least five … Read more

Government Response

The government acknowledges the concern for a seamless transition but states that no one has to wait five weeks for money due to advances and run-ons. It maintains that suitable provision is in place and implicitly rejects the premise that their transition is not seamless.

Department for Work and Pensions

9 Recommendation Not Addressed

Third Report: Universal Credit: th…

At present, the Government plans to mitigate the impact of the five week wait on...

At present, the Government plans to mitigate the impact of the five week wait on this group of claimants by offering two week run-on payments of some, but not all, of the legacy benefits they are currently receiving. That is … Read more

Government Response

The government response discusses changes to the Universal Credit deduction cap, reducing it from 30% to 25% from October 2021, and the rationale behind setting the cap, but does not address the committee's concerns regarding the five-week wait or two-week run-on payments for legacy benefits.

Department for Work and Pensions

10 Recommendation Rejected

Third Report: Universal Credit: th…

We recommend that DWP should eliminate the five week wait for all claimants moving to...

We recommend that DWP should eliminate the five week wait for all claimants moving to Universal Credit through managed migration, including for claimants moving from tax credits. Those claimants should continue to receive their existing benefits during their first monthly … Read more

Government Response

The government rejects eliminating the five-week wait by continuing legacy benefits, citing existing advance payments and run-ons. It also rejects offering fortnightly payments by default, stating that monthly payments prepare claimants for work and Alternative Payment Arrangements are available case-by-case.

Department for Work and Pensions

11 Recommendation Not Addressed

Third Report: Universal Credit: th…

We recommend that DWP set out, in response to our report, a detailed analysis of...

We recommend that DWP set out, in response to our report, a detailed analysis of how our recommended approach could work in practice. It should also assess how the costs of this approach would compare with the costs of its … Read more

Government Response

The government does not provide the requested detailed analysis of the committee's recommended approach or a cost comparison, instead reiterating its stance on existing provisions and rejecting the core recommendations.

Department for Work and Pensions

12 Recommendation Rejected

Third Report: Universal Credit: th…

The evidence we received was overwhelmingly in favour of some form of initial, non-repayable payment...

The evidence we received was overwhelmingly in favour of some form of initial, non-repayable payment for new Universal Credit claimants. That would give new claimants the money they need for basic living essentials like food and heating, without requiring them … Read more

Government Response

The government discusses existing repayable Advances for financial support, the Breathing Space scheme, and increased funding for debt advice, but does not commit to the recommended non-repayable 'starter payment'.

Department for Work and Pensions

13 Conclusion Rejected

Third Report: Universal Credit: th…

We have considered the various options carefully.

We have considered the various options carefully. In recommending a course of action, we have chosen an approach which offers simplicity: a simple amount of money, so it is clear to claimants what they can expect, and a simple process, … Read more

Government Response

The government rejects the need for a starter payment, stating that New Claim Advances are already available, and introducing non-repayable advances would increase fraud risk and administrative burden.

Department for Work and Pensions

14 Recommendation Rejected

Third Report: Universal Credit: th…

We recommend that the Department pay all first time claimants of Universal Credit a “starter...

We recommend that the Department pay all first time claimants of Universal Credit a “starter payment” equivalent to three weeks of the Standard Allowance of Universal Credit. This payment should be made two weeks after the initial claim, and only … Read more

Government Response

The government rejects the recommendation to pay all first-time Universal Credit claimants a 'starter payment,' stating that New Claim Advances are already available and that non-repayable advances would increase fraud risk, administrative burden, and could lead to inappropriate gains.

Department for Work and Pensions

15 Recommendation Not Addressed

Third Report: Universal Credit: th…

Terminally ill people already face thousands of pounds of additional costs because of their illness,...

Terminally ill people already face thousands of pounds of additional costs because of their illness, and the money provided by Universal Credit counts more than ever. We welcome the fact that the Department has been reviewing how the Special Rules … Read more

Government Response

The government's response discusses the availability of New Claim Advances and the existing fast-track process for terminally ill claimants, but does not address the recommendation to publish its review of the Special Rules for Terminal Illness by 30 November.

Department for Work and Pensions

16 Recommendation Rejected

Third Report: Universal Credit: th…

The starter payments we have recommended would also be available to people making claims under...

The starter payments we have recommended would also be available to people making claims under the Special Rules for Terminal Illness. We recommend that the Department consider what further support it could offer to people making claims for Universal Credit … Read more

Government Response

The government rejects the recommendation for further support, including starter payments or enhanced backdating, for terminally ill claimants, stating that existing New Claim Advances negate the need for a starter payment and that UC already has an established fast-track process for these claimants.

Department for Work and Pensions

17 Conclusion Acknowledged

Third Report: Universal Credit: th…

Advance payments can provide a valuable lifeline to people who might otherwise face going five...

Advance payments can provide a valuable lifeline to people who might otherwise face going five weeks—or longer—without any income. The changes that DWP has introduced so far, especially allowing people to request Advances equivalent to their entire expected award and … Read more

Government Response

The government reiterates its view that advances are not loans and describes existing measures like limiting advance amounts, encouraging claimant consideration, Work Coach budgeting support, and the ability to defer repayments for up to three months. It is also considering automatic referral for budgeting support.

Department for Work and Pensions

18 Recommendation Not Addressed

Third Report: Universal Credit: th…

Even with starter payments of the kind we have recommended, we anticipate that some claimants...

Even with starter payments of the kind we have recommended, we anticipate that some claimants would still need to ask for an Advance to cover their immediate 80 Universal Credit: the wait for a first payment costs. But some claimants … Read more

Government Response

The government's response discusses explicit consent rules, data protection, and stakeholder engagement, but does not address the recommendation to use requests for substantial advances as an indicator to provide early support to struggling claimants.

Department for Work and Pensions

19 Conclusion Rejected

Third Report: Universal Credit: th…

The Department continues to claim that Advances are not loans, but we find that argument...

The Department continues to claim that Advances are not loans, but we find that argument impossible to accept. Advances must be repaid at a set rate, over a set period. The Department risks misleading claimants, and damaging its own credibility, … Read more

Government Response

The government explicitly rejects the committee's finding, reiterating that a new claim Advance is not a loan but rather a spreading of UC entitlement. It explains that advances are limited to estimated awards, with support available for budgeting and repayment deferrals for hardship cases.

Department for Work and Pensions

20 Recommendation Not Addressed

Third Report: Universal Credit: th…

We recommend that Advances should be renamed “new claim loans”, so that it is clear...

We recommend that Advances should be renamed “new claim loans”, so that it is clear to claimants that they will need to be repaid. Before a new claim loan is granted in full, the Department should provide personalised budgeting support—when … Read more

Government Response

The government's response focuses on publishing data for Work Capability Assessments and a future Health and Disability Green Paper, completely failing to address the recommendation regarding renaming Advances or providing budgeting support.

Department for Work and Pensions

21 Conclusion Not Addressed

Third Report: Universal Credit: th…

For this group of claimants, the burden of future repayments of Advances is likely to...

For this group of claimants, the burden of future repayments of Advances is likely to be particularly difficult to bear. Given that benefits broadly provide people with a subsistence level of income, any system that reduces that monthly income, including … Read more

Government Response

The government's response discusses Work Capability Assessments and payment timeliness, rather than addressing the committee's concerns about the burden of Advance repayments.

Department for Work and Pensions

22 Recommendation Not Addressed

Third Report: Universal Credit: th…

The Department should strive to bring in the extension to the repayment period and lowering...

The Department should strive to bring in the extension to the repayment period and lowering of the deduction cap sooner than planned, no later than April 2021— recognising the likely increase in the numbers of claimants over this winter. We … Read more

Government Response

The government's response does not address the recommendation to accelerate the extension of the repayment period, lower the deduction cap to 10%, or bring changes in sooner than planned, instead referring to encouraging HMRC to reduce historic debt.

Department for Work and Pensions

23 Recommendation Not Addressed

Third Report: Universal Credit: th…

DWP has capped the deductions that claimants can face from their Universal Credit award at...

DWP has capped the deductions that claimants can face from their Universal Credit award at 30%, and yet in some circumstances, such as where a claimant has rent or fuel arrears, or benefit sanctions, DWP can deduct more than this … Read more

Government Response

The government's response discusses encouraging timely claims, the 'Help to Claim' programme, and backdating provisions, but does not address the committee's recommendation regarding deduction caps or using data to help claimants with debt without further reducing their Universal Credit award.

Department for Work and Pensions

24 Recommendation Rejected

Third Report: Universal Credit: th…

The Department says that claimants who are struggling can already defer repayments of their Advance...

The Department says that claimants who are struggling can already defer repayments of their Advance for three months. But the evidence we have heard from charities who work with claimants is that this option is not effectively communicated. Without reliable … Read more

Government Response

The government rejects publishing additional specific data on advance repayment deferrals, stating no plans to do so at this point, though it will include general information on advances in its annual report. It does not address the recommendation for work coaches to proactively inform claimants of the deferral option.

Department for Work and Pensions

25 Recommendation Deferred

Third Report: Universal Credit: th…

We welcome the announcement of the Breathing Space scheme, which is scheduled to be introduced...

We welcome the announcement of the Breathing Space scheme, which is scheduled to be introduced next year, and the Government’s confirmation that Advances in Universal Credit will be covered by the scheme. We find it disappointing, however, that debts in … Read more

Government Response

The government commits to implementing the Breathing Space scheme for benefit overpayments and legacy benefit advances from May 2021. However, UC Advances and Third Party Deductions in UC will only be included once the full implementation of UC is complete due to system complexities.

Department for Work and Pensions

26 Recommendation Rejected

Third Report: Universal Credit: th…

Some people in financial distress during the wait for their first payment can face a...

Some people in financial distress during the wait for their first payment can face a difficult choice between using their Advance to pay their housing costs, or to cover other essential costs, such as food or heating. No one should … Read more

Government Response

The government rejects the recommendation to offer direct payment of the housing element of an Advance to landlords. It states that existing Managed Payments to Landlords are already available and cautions against the potential for landlord pressure if this option were introduced for advances.

Department for Work and Pensions

27 Recommendation Accepted

Third Report: Universal Credit: th…

We recommend that vulnerable claimants or claimants with specific needs are prioritised for having the...

We recommend that vulnerable claimants or claimants with specific needs are prioritised for having the housing element of their Advance paid directly to their landlord. This could include people with learning disabilities, people with mental illness, people who have previously … Read more

Government Response

The government states that existing provisions, such as Managed Payments to Landlords and a new online service for direct rent payments, already sufficiently address the committee's suggestion. They argue against prioritising advances due to potential risks and highlight specialist budgeting support.

Department for Work and Pensions

28 Recommendation Not Addressed

Third Report: Universal Credit: th…

DWP was right to increase the standard allowance for Universal Credit and support for housing...

DWP was right to increase the standard allowance for Universal Credit and support for housing costs as part of its response to the pandemic. Benefit rates, and in particular support for housing costs, had become detached from the actual cost … Read more

Government Response

The government's response discusses split payments for couples and managing finances jointly, failing to address the recommendation to maintain Universal Credit and Local Housing Allowance increases.

Department for Work and Pensions

29 Conclusion Acknowledged

Third Report: Universal Credit: th…

Help to Claim is a hugely valuable service for people who are applying for Universal...

Help to Claim is a hugely valuable service for people who are applying for Universal Credit. But its focus is on helping people to complete their initial claim. It does not provide support for people throughout their claim, to help … Read more

Government Response

The government acknowledges the committee's observation about Help to Claim's focus, but defends the service's current scope and positive reception. It states that Help to Claim signposts users to other support services for debt advice, budgeting, and digital skills.

Department for Work and Pensions

30 Recommendation Rejected

Third Report: Universal Credit: th…

We recommend that the Department invests in expanding and developing Help to Claim so that...

We recommend that the Department invests in expanding and developing Help to Claim so that the service can provide support to people beyond the application process. This should include debt advice, support for people who are struggling with Advance repayments, … Read more

Government Response

The government rejects expanding Help to Claim to directly provide ongoing support like debt advice and digital skills. It states that Help to Claim already signposts claimants to other support services for these needs and defends the current scope of the service.

Department for Work and Pensions

31 Conclusion Acknowledged

Third Report: Universal Credit: th…

DWP currently lacks a comprehensive system for recording and tracking claimants’ needs.

DWP currently lacks a comprehensive system for recording and tracking claimants’ needs. The introduction of pinned notes is a step in the right direction but, as the National Audit Office said, pinned notes are the digital equivalent of a post-it … Read more

Government Response

The government acknowledges the need for better tracking of claimants' needs and states that work is underway to collect sensitive information to provide more tailored support. It also notes that staff can already use pinned notes to flag ongoing easements.

Department for Work and Pensions

32 Recommendation Accepted in Part

Third Report: Universal Credit: th…

DWP must immediately make improvements to the Universal Credit system to formalise how it identifies...

DWP must immediately make improvements to the Universal Credit system to formalise how it identifies and defines vulnerable claimants, as part of its overall approach to safeguarding vulnerable people. This will be a substantial piece of work, and DWP should … Read more

Government Response

The government states it is working on collecting sensitive information to provide tailored support and monitor improvements for specific claimant cohorts, and that vulnerable accounts can already be flagged. However, it does not commit to a formalised system or timeline for defining and identifying vulnerable claimants as comprehensively recommended.

Department for Work and Pensions

33 Recommendation Acknowledged

Third Report: Universal Credit: th…

Support organisations have expressed concern that DWP’s approach to data sharing and consent has had...

Support organisations have expressed concern that DWP’s approach to data sharing and consent has had a detrimental effect on their ability to support vulnerable claimants. The Department now says it is exploring options for improving its model Universal Credit: the … Read more

Government Response

The government defends its explicit consent policy for data sharing, stating it is exploring options with SSAC and stakeholders to improve the process but does not commit to publishing details of progress or considering an implicit consent model.

Department for Work and Pensions

34 Conclusion Accepted

Third Report: Universal Credit: th…

DWP has made substantial progress in improving payment timeliness,.

DWP has made substantial progress in improving payment timeliness,. The Department has increased the proportion of people paid on time from just over half in 2017 to over 90% in 2020—a significant feat given the recent upsurge in Universal Credit … Read more

Government Response

The government asserts that no one has to wait five weeks for UC payments, citing advances available from day one and two-week run-ons for legacy benefits. They state that sufficient provision is in place and reject the idea of continuing tax credits with UC or introducing APAs by default.

Department for Work and Pensions

35 Recommendation Accepted in Part

Third Report: Universal Credit: th…

We welcome the announcement of funding for the recruitment of over 13,500 new Work Coaches—double...

We welcome the announcement of funding for the recruitment of over 13,500 new Work Coaches—double the current number—over the next financial year. This is an ambitious programme of recruitment. The Committee would welcome a written update from the Department, by … Read more

Government Response

The government provides an update on Work Coach recruitment and details plans to maximise estates capacity, including using local authority space. However, they reject the request for monthly updates, stating they will provide 'relevant updates to Parliament' instead.

Department for Work and Pensions

36 Recommendation Deferred

Third Report: Universal Credit: th…

We acknowledge that most disabled people and people with health conditions receive the core elements...

We acknowledge that most disabled people and people with health conditions receive the core elements of their claim on time. However, we find it troubling that, because of the time taken to complete the Work Capability Assessment process, people must … Read more

Government Response

The government defends the current WCA assessment period for thoroughness and fairness, not committing to speeding it up directly. However, they commit to collecting and publishing WCA data and will explore assessment reform options in a forthcoming Health and Disability Green Paper.

Department for Work and Pensions

37 Recommendation Rejected

Third Report: Universal Credit: th…

The Universal Credit application process requires claimants to provide a great deal of information about...

The Universal Credit application process requires claimants to provide a great deal of information about their circumstances, to enable the Department to assess their claim. When they have done this, Universal Credit claimants rightly expect that they should be paid … Read more

Government Response

The government rejects the recommendations, stating payment timeliness must be balanced with fraud reduction, and defending the existing WCA process which includes backdating awards if a delay occurs. They do not agree to pay claimants at the highest rate during WCA delays or limit repayments to only deliberate fraud.

Department for Work and Pensions

38 Conclusion Acknowledged

Third Report: Universal Credit: th…

Repayments of tax credit overpayments can compound hardship for people who may already be struggling.

Repayments of tax credit overpayments can compound hardship for people who may already be struggling. The evidence that some people are left unaware of these debts, which can be several years old, until they make a claim for Universal Credit, … Read more

Government Response

The government acknowledges the impact of debt and explains existing support from Work Coaches and the Money and Pensions Service for claimants. They state an obligation to recover public funds but will continue to encourage HMRC to reduce historic tax credit debt.

Department for Work and Pensions

39 Recommendation Rejected

Third Report: Universal Credit: th…

The recovery of Tax Credit debt from claimants’ Universal Credit awards clearly presents problems.

The recovery of Tax Credit debt from claimants’ Universal Credit awards clearly presents problems. However, the option of returning responsibility to HMRC now would be too challenging to deliver in practice. Instead, we recommend that DWP should continue to collect … Read more

Government Response

The government rejects the recommendation for a 10% cap on debt repayments, stating its 30% cap balances claimant needs with responsible fund administration. It does not address recommendations to delay debt recovery until advances are repaid, write off debts over 6 years, or extend the FCA's approach to public sector debts.

Department for Work and Pensions

40 Recommendation Accepted

Third Report: Universal Credit: th…

We welcome the Minister’s recognition that the Department needs to improve its understanding of the...

We welcome the Minister’s recognition that the Department needs to improve its understanding of the reasons why so many people claim for Universal Credit long after they become eligible. The Department must prioritise this work so that it can tackle … Read more

Government Response

The government agrees on the importance of timely applications and states that a UC Full Service Omnibus Survey published in February 2019 already investigated reasons for delayed claims, finding that a fifth of claimants delayed due to job seeking or lack of awareness.

Department for Work and Pensions

41 Recommendation Rejected

Third Report: Universal Credit: th…

Many claimants are simply unaware that they can ask for their claim to be backdated...

Many claimants are simply unaware that they can ask for their claim to be backdated by a month. Even when they do ask for backdating, they sometimes face an intrusive and bureaucratic process. We recommend that the Department review the … Read more

Government Response

The government rejects the recommendation, stating that UC is designed for quick claims at the point of need, and that extending backdating beyond one month could disincentivize this. They do not commit to reviewing evidence use for backdating, publishing work coach information, or increasing awareness.

Department for Work and Pensions

42 Recommendation Rejected

Third Report: Universal Credit: th…

Currently, backdating is only permitted up to a month before the claim was submitted.

Currently, backdating is only permitted up to a month before the claim was submitted. Given the seriousness of the life events which might allow the backdating of a claim—bereavement, serious illness, relationship breakdown—this period seems astonishingly short. We recommend that, … Read more

Government Response

The government rejects extending the backdating period beyond one month, arguing that it could disincentivize claimants from making their UC claims at the point of need. They reiterate that existing limited provisions and support are available for vulnerable claimants.

Department for Work and Pensions

43 Recommendation Not Addressed

Third Report: Universal Credit: th…

The Universal Credit Transition Fund is an initiative to support vulnerable people in applying for...

The Universal Credit Transition Fund is an initiative to support vulnerable people in applying for Universal Credit as soon as they are eligible, and rightly puts organisations that work most closely with these groups at the centre. Timely applications to … Read more

Government Response

The government states the Universal Credit Transition Fund was suspended due to COVID-19 and highlights other existing funds like the Coronavirus Community Support Fund, Flexible Support Fund, and Help to Claim, without committing to renewing the specific Transition Fund.

Department for Work and Pensions

44 Conclusion Accepted

Third Report: Universal Credit: th…

While monthly payments do mirror the world of work for many, DWP’s own figures show...

While monthly payments do mirror the world of work for many, DWP’s own figures show that a significant minority of people who claim Universal Credit received or continue to receive weekly or fortnightly wages. Other sources suggest that a majority … Read more

Government Response

The government acknowledges that claimants can struggle with monthly budgeting but states that Universal Credit already allows for more frequent payments (twice or four times monthly) and that Work Coach guidance already directs offering financial advice and Alternative Payment Arrangements.

Department for Work and Pensions

45 Recommendation Accepted

Third Report: Universal Credit: th…

We recommend that the Department provide new and clearer guidance for Work Coaches to mitigate...

We recommend that the Department provide new and clearer guidance for Work Coaches to mitigate the impact of the wait and monthly payment system by making the option of more frequent payments under Alternative Payment Arrangements easy for all claimants … Read more

Government Response

The government reiterates that UC is paid monthly by default but more frequent payments (APAs) are available where claimants struggle. They state that existing guidance for Work Coaches already covers offering financial guidance and considering APAs, preferring a tailored, individualised approach over a universal offering.

Department for Work and Pensions

46 Recommendation Accepted in Part

Third Report: Universal Credit: th…

We recommend that the Department publishes the guidance given to Work Coaches when they advise...

We recommend that the Department publishes the guidance given to Work Coaches when they advise people on APAs, to improve transparency in the process. The Department should make clear when and how a claimant is made aware of APAs both … Read more

Government Response

The government states it has published guidance on APAs and routinely publishes data, but rejects expanding current reporting on unsuccessful applications. It acknowledges providing tailored support for split payments where appropriate but does not agree a broader review is needed.

Department for Work and Pensions

47 Recommendation Rejected

Third Report: Universal Credit: th…

Universal Credit works best when it mirrors people’s daily lives.

Universal Credit works best when it mirrors people’s daily lives. Payments which align with people’s rent schedules could make it easier for claimants to budget and plan. We recommend that the Department explain in response to our report whether it … Read more

Government Response

The government rejects the recommendation to align Universal Credit payments with rent schedules, stating it is not appropriate due to potential difficulties if claimants change address, and highlights an existing payment alignment feature for social landlords.

Department for Work and Pensions

48 Conclusion Accepted in Part

Third Report: Universal Credit: th…

While Scottish Government data shows a quarter of people revert from More Frequent Payments under...

While Scottish Government data shows a quarter of people revert from More Frequent Payments under Scottish Choices, DWP’s research does not provide a detailed understanding of how the Department monitors how more frequent payments work for people, and what it … Read more

Government Response

The government commits to adding the recommendation to publish figures on claimants reverting from twice-monthly payments to its development programme. It also points to existing data on Alternative Payment Arrangements and data published by the Scottish Government.

Department for Work and Pensions

49 Recommendation Accepted in Part

Third Report: Universal Credit: th…

We recommend that the DWP improve the quality and detail of its published data on...

We recommend that the DWP improve the quality and detail of its published data on alternative payments, by publishing its figures on how many people revert to monthly payments from the twice monthly payment option in England and Wales. DWP … Read more

Government Response

The government will add the recommendation to publish figures on how many people revert to monthly payments to its programme for development, and notes the Scottish Government already publishes management information on Scottish Choices.

Department for Work and Pensions

50 Recommendation Acknowledged

Third Report: Universal Credit: th…

Faster Payments offer the Department a quick and efficient way to pay claimants.

Faster Payments offer the Department a quick and efficient way to pay claimants. They could, if more widely used, reduce the time that people have to wait for a first payment. The Department already has plans to increase its use … Read more

Government Response

The government acknowledges the recommendation by stating it is already examining how to modernise payment services through its 'Future Payments' programme, targeted for completion by 2022/23. However, it does not provide the detailed strategy, timings, or engagement plans requested.

Department for Work and Pensions

51 Conclusion Rejected

Third Report: Universal Credit: th…

It is disappointing that suggestions to improve Universal Credit have apparently been thwarted by an...

It is disappointing that suggestions to improve Universal Credit have apparently been thwarted by an IT system which was supposed to be developed in an agile fashion, yet seems to be anything but. It is unfortunate that such a rigid, … Read more

Government Response

The government rejects the committee's characterisation of the Universal Credit IT system as rigid and clunky, instead asserting its agility and strong performance in supporting claimants throughout the pandemic, maintaining high payment timeliness.

Department for Work and Pensions

52 Recommendation Rejected

Third Report: Universal Credit: th…

The monthly assessment is a core part of design of Universal Credit for the Department...

The monthly assessment is a core part of design of Universal Credit for the Department and is the guiding reason behind the five-week wait and payment in arrears. Although the Department says that most people in the wider economy are … Read more

Government Response

The government rejects the recommendation to consider more flexible assessment systems, stating that such a system is not easily operationalised due to complexities with fluctuating earnings and multiple income sources, which would cause financial uncertainty and poor customer service.

Department for Work and Pensions

53 Recommendation Rejected

Third Report: Universal Credit: th…

We recommend that the Department assesses a model in which it estimates people’s daily pay...

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 … Read more

Government Response

The government rejects the proposed model for daily pay rate estimation and day-one payments, explaining it cannot be easily operationalised for claimants with fluctuating or multiple earnings due to reconciliation challenges and potential over/underpayments, but it does detail the data received from HMRC.

Department for Work and Pensions

54 Conclusion Acknowledged

Third Report: Universal Credit: th…

The coronavirus pandemic has put the Universal Credit system under unprecedented strain.

The coronavirus pandemic has put the Universal Credit system under unprecedented strain. It has also highlighted the strengths of its digital, automated processes: a manual system could not have coped with millions of new claims in such a short time. … Read more

Government Response

The government acknowledges the committee's recognition of Universal Credit's strong performance during the pandemic, highlighting its agile adaptation to support increased claims and maintained high payment timeliness.

Department for Work and Pensions

55 Conclusion Accepted

Third Report: Universal Credit: th…

The five week wait for a first payment of Universal Credit is an inevitable consequence...

The five week wait for a first payment of Universal Credit is an inevitable consequence of the fixed monthly assessment period. It is very difficult to remove the wait for 88 Universal Credit: the wait for a first payment all … Read more

Government Response

The government states that no one has to wait five weeks for payment because advances are available and have been widely distributed, serving as a crucial support measure.

Department for Work and Pensions

Government Response AI assessment · 55 of 40 classified

Accepted 6

Accepted in Part 5

Deferred 2

Not Addressed 12

Rejected 22

Total 40 recs + 15 conclusions

Correspondence 7 letters

16 Jul 2021 Correspondence with Minister for Welfare Delivery - joint meeting with House of Lords Economic Affairs Committee follow up

Parliament page

24 Sep 2020 Correspondence from NAO about net recovery rate of fraud and error on Universal Credit

Parliament page

11 Sep 2020 Correspondence with Minister for Welfare Delivery on Universal Credit: the wait for a first payment – follow up to 15.7 evidence session

Parliament page

11 Sep 2020 Correspondence with Financial Secretary to the Treasury on the impact of tax credits debt repayments on Universal Credit claimants

Parliament page

11 Sep 2020 Correspondence with the National Audit Office (NAO) on analysis of rent arrears of Universal Credit claimants

Parliament page

28 Aug 2020 Correspondence with the Financial Conduct Authority about best practice in the consumer lending

Parliament page

27 Apr 2020 Correspondence with the Minister for Welfare Delivery about first payments of Universal Credit

Parliament page