Question to the Department for Work and Pensions:

To ask the Secretary of State for Work and Pensions, what proportion of claimants of universal credit have (a) taken out an advance at a 40 per cent deduction rate and have been unable to pay back that advance within 12 months, (b) taken out at advance at a 40 per cent deduction rate and (c) taken out the maximum available advance at a 40 per cent deduction rate.

Data showing the proportion of the standard allowance which is being used to repay a Universal Credit (UC) advance which: (a) taken out an advance at a 40 per cent deduction rate and have been unable to pay back that advance within 12 months, (b) taken out an advance at a 40 per cent deduction rate and (c) taken out the maximum available advance at a 40 per cent deduction rate could only be supplied with analysis which would incur disproportionate cost to the Department.

The maximum amount of a UC advance a claimant can access is subject to them being able to repay it over 12 monthly payments at a rate of no greater than 40 per cent of their standard allowance (this will be reduced to 30 per cent from October 2019). However, there are reasons why the advance repayment may not be taken or may be taken at a lower amount from a claimant in any given month, such as:

a. If they have insufficient Universal Credit left in payment, after reductions such as earnings, capital yield and other income are taken into account, then a reduced repayment will be taken or none at all, depending on the amount of UC payment they have left.

b. If they have a Fraud Penalty or Conditionality Sanction, the repayment of the advance will stop until these end.

c. If they experience an unexpected financial hardship then they can request a deferral of up to 3 months, during which time they will not make any advance repayments.

d. If their UC award ends, for whatever reason, they can renegotiate the repayment rate and period with Debt Management who will take into account their new financial circumstances.