Benefit deductions should be stopped until inflation falls, say MPs
Ministers’ policy of clawing back hundreds of pounds a year from benefits has been criticised by MPs, who say it has tipped low-income families into destitution.
About 2.4 million households – nearly half of all claimants on universal credit – have on average £62 docked each month to repay benefit advances, tax credit overpayments and debts owed to landlords and utility companies.
With energy and food prices soaring and benefit levels pegged way below inflation, the deductions often leave struggling households without enough money to afford food or pay their bills, forcing some claimants to turn to food banks to survive.
The Commons cross-party work and pensions select committee urged ministers to give households extra “breathing space” by suspending all benefit deductions until inflation dropped to a manageable level or benefits were increased to accurately reflect living costs.
Stephen Timms, Labour chair of the committee, said: “Deductions by [the] DWP from benefits are contributing to the hardship, and the government should give those struggling some much-needed breathing space by following its own advice to other creditors and pausing repayments until the threat of inflation recedes.”
The committee noted that while the government has urged creditors to accept reduced monthly repayments from households battling the cost of living crisis, it “isn’t following its own advice” when it comes to deductions levied as a result of government policy rather than individuals’ behaviour.
The bulk of benefit deductions are for advance payments made to new universal credit claimants, introduced to help tide them over the built-in five-week wait for a first payment. They are interest-free but must be repaid from future benefit payments.
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