Questions & Answers
Q1
Partial Answer
▸
Context
The question arises from the observation that universal credit claimants who receive one-off bonuses, such as those awarded to key workers during the pandemic, often see their monthly payments reduced after receiving these bonuses.
What assessment has been made of the effect of bonuses on the level of payments made to universal credit claimants? My constituent received a £120 bonus but had £172.69 deducted from her next month's payment under universal credit, eroding the reward for hard work.
Bonuses are treated as earnings under universal credit, reflecting HMRC guidance. Universal credit ensures people are better off in work compared to legacy benefits. Under the previous system, claimants could lose up to 91% of their additional earnings, whereas under universal credit, it is a maximum of 75%. The government has already made significant investment to increase the generosity of universal credit.
▸
Assessment & feedback
The Minister did not directly address whether temporary changes will be considered to enable key workers to receive their bonuses in full.
Thanking Key Workers
Response accuracy
Q2
Partial Answer
▸
Context
The question pertains to the impact of universal credit on claimants receiving one-off pandemic bonuses, noting a specific case where a key worker received a £120 bonus but had over £172 deducted from her next month's payment.
My constituent, a key worker in a pharmacy, received a one-off bonus of £120 for supporting vulnerable people during the pandemic. However, this reward was eroded when £172.69 was deducted from her universal credit payments. Is that fair? Will temporary changes to work allowances and taper rates be considered to prevent such deductions?
Universal credit ensures that claimants are better off in work, with a maximum withdrawal rate of 75%, compared to up to 91% under the legacy benefits system. The government has already increased the generosity of universal credit through measures like reducing the taper rate and increasing work allowances.
▸
Assessment & feedback
The Minister did not address whether temporary changes will be made to ensure key workers keep their bonuses in full without deductions.
Thanking Key Workers
Response accuracy