Question to the Department for Work and Pensions:

To ask the Secretary of State for Work and Pensions, for what reason Support for Mortgage Interest payable to Universal Credit claimants who make mortgage payments has not been revised and increased in line with mortgage interest rates.

The primary purpose of SMI is to provide owner-occupiers receiving an income-related benefit with a level of support that is sufficient to protect them from the threat of repossession. Lenders recognise that the payments we make will not always mirror the mortgage-holders liability, but we expect that they will, nonetheless, exercise forbearance.

The rate at which SMI is paid changes only when the Bank of England’s average mortgage rate varies from the rate in payment by 0.5 percentage points or more. Through guidance from the Financial Conduct Authority, lenders are aware that a change to the rate of SMI payments is triggered only in these circumstances and so should continue to offer tailored forbearance to their customers.

While SMI is kept under review, there are currently no plans to amend this policy. There has been no assessment on the impact of rising mortgage repayments for those claimants who are in receipt of SMI. Therefore, there has been no estimate made on the number of Universal Credit claimants who have been made homeless due to increases in mortgage interest rates.