Universal Credit claimants missing out on hundreds of pounds a year just because of when their payday is
UNIVERSAL credit claimants are losing out on hundreds of pounds a year if their payday falls too close to their assessment date, a charity has warned,
Being paid early as a result of weekends or bank holidays makes it look like a worker has earned more because they receive two payments in a calendar month.
The figures skew how much they are then assessed as being entitled to in benefits, according to the Child Poverty Action Group (CPAG).
It said one in 20 cases analysed by its early warning system, which uses evidence from welfare rights advisers to identify issues, were hit by problems with the monthly assessment system.
Alison Garnham, CPAG chief executive, said: "Universal Credit isn't working for working people.
"Our early warning system shows claimants are often left flummoxed by how much, or how little, universal credit they will receive from one month to the next.?
"But we believe most of the problems created by the monthly assessment system can be fixed relatively easily if the political will is there.
"The mass migration of families on to universal credit should not begin until these fundamental problems are resolved."
Assessments for allowances are based on the date the benefit was first awarded to a claimant.
What to do if you have problems claiming Universal Credit
IF you're experiencing trouble applying for your Universal Credit, or the payments just don't cover it, here are your options:
Apply for an advance - Claimants are able to get some cash within five days rather than waiting weeks for their first payment. But it's a loan which means the repayments will be automatically deducted from your future Universal Credit pay out.
Alternative Payment Arrangements - If you're falling behind on rent, you or your landlord may be able to apply for an APA which will get your payment sent directly to your landlord. You might also be able to change your payments to get them more frequently, or you can split the payments if you're part of a couple.
Budgeting Advance - You may be able to get help from the government to help with emergency household costs of up to £348 if you're single, £464 if you're part of a couple or £812 if you have children. These are only in cases like your cooker breaking down or for help getting a job. You'll have to repay the advance through your regular Universal Credit payments. You'll still have to repay the loan, even if you stop claiming for Universal Credit.
Cut your Council Tax - You might be able to get a discount on your Council Tax or be entitled to Discretionary Housing Payments if your payments aren't enough to cover your rent.
Foodbanks - If you're really hard up and struggling to buy food and toiletries, you can find your local foodbank who will provide you with help for free. You can find your nearest one on the
If the claimant's payday is on or close to the first day of their assessment period it can have a significant impact on how much they receive, CPAG warned.
"In the worst cases, people are losing out on significant amounts of money - hundreds of pounds over the course of a year - simply because of when their paydays and assessment periods fall.
"This unfairness is most starkly shown by the experience of employees at the same company, with identical hours and pay, some of whom are subject to the benefit cap most months of the year simply because they are on a four-weekly contract, while their colleagues on a monthly contract are not."
Back pay and tax rebates can also trigger the problem, the charity warned.
And the issue can also lead to claimants losing out on free prescriptions, eye tests, wigs and glasses.
As well as over-assessing how much someone has earned as a result of two paydays falling within one month, the system can also penalise them the following period, it found.
A cap on benefits payments that covers low earners who generally work under 16 hours a week can be triggered because the claimant appears to have zero payments in the month after their double payday.
CPAG called for reforms to the system, including allowing claimants to change the date of their assessment period dates so they do not clash with paydays.
It said earnings should be averaged when assessments are made over whether the benefit cap should be imposed.
"The problems we have identified undermine some of the key selling points of UC, namely that it was supposed to be simple, adjust to people's earnings in real time, and reward work or increased earnings in ways which are easy to understand," the report said.
MOST READ IN MONEY
"In reality the current monthly assessment system is a huge oversimplification, which does not reflect the reality of people's lives and work."
Unison general secretary Dave Prentis said: "It's wrong that working people are losing money because of flaws in the system.
"This is causing chaos as this report starkly highlights. No family should be hundreds of pounds worse off just because of when they're paid. It means they can't budget.
"The Government has created this mess and it needs fixing quickly."
A Department for Work and Pensions spokesman said: "We are listening to stakeholders' concerns and working on issues regarding payment cycles and we will consider this report carefully."
In June, we revealed the 7 shocking ways that Universal Credit is failing.
We pay for your stories! Do you have a story for The Sun Online Money team? Email us at [email protected] or call 0207 78 24516. Don't forget to join the for the latest bargains and money-saving advice.