Question to the Department for Work and Pensions:

To ask the Secretary of State for Work and Pensions, with reference to The Universal Credit (Earned Income) Amendment Regulations 2020, what assessment her Department has made of the potential impact of moving double-paydays to subsequent assessment periods on (a) working Universal Credit recipients and (b) resourcing within her Department; and what steps she is taking to reduce the impact on (i) claimants and (ii) resources.

The Department recognises that receiving two sets of earnings from the same employer within a single Universal Credit assessment period can create unexpected fluctuations in a claimant’s award. This situation typically occurs when a claimant’s monthly payday falls very close to the end of their assessment period, resulting in two wage payments being reported through HMRC’s Real Time Information (RTI) system in the same month. To address this, the Universal Credit (Earned Income) Amendment Regulations 2020 were introduced, allowing one set of monthly paid earnings to be reallocated to a different assessment period to ensure awards are calculated fairly. This rule only applies where earnings are paid calendar monthly.

The Department’s assessment found that enabling the reallocation of earnings has a positive impact on working UC recipients. By smoothing income across assessment periods, the change reduces financial volatility for the relatively small number of households affected and helps maintain a regular payment cycle. Importantly, it also prevents claimants from losing their Work Allowance in months when double reporting would otherwise occur.

Most cases affected by double earnings are now identified and corrected automatically, minimising any burden on customers and administrative pressure on the Department.