DWP Universal Credit warning as payments can be reduced by 20 per cent
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Universal Credit and Pension Credit are among numerous financial lifelines for people in the UK. Yet, the Department for Work and Pensions (DWP) warns that claimants may face cuts worth between 5% and 20% in very exceptional circumstances. The cuts, referred to as 'third party deductions', take place when a benefits claimant owes money for court fines, rent, Council Tax or energy payments. Usually, this deduction will be at a fixed amount until the debt or debts are paid off, with a maximum of three debts payable at once through this method.
If you're receiving Universal Credit, 5% is deducted from your benefits payment for each debt owed, though for rent payments, it may be between 10% and 20%. Individuals receiving other benefits, such as income-based Jobseeker’s Allowance (JSA), income-related Employment and Support Allowance (ESA) and Income Support, may also see £4.55 a week cut for each debt owed.
The DWP's list of those affected is below:. Third party deductions are usually requested on behalf of an organisation which is owed money from an individual. These are then approved by the DWP in exceptional circumstances where an organisation has exhausted other avenues to recover the owed funds.
"You’ll be told how much will be deducted by letter or in your Universal Credit journal," the DWP's advice explains. "...If you want to pay more than the fixed rate towards your debts, you must arrange this with the organisation you owe money to.". Third party deductions for 'fuel debt' - owing money for gas and electricity - are more frequently referred to as Fuel Direct. Brits keen to pay off their ongoing bills can also contact a supplier to set up deductions that cover energy use.
