Category Archives: deductions

DWP rejects MPs’ plea to pause benefit deductions – hides it behind Queen’s funeral

The Department for Work and Pensions has refused to stop taking money from already-inadequate benefit payments – and has hidden the decision by releasing it while the media were focused on the Queen’s funeral.

MPs on the Commons’ Work and Pensions Select Committee called for the DWP to stop debt repayments being deducted from benefits, back in July.

They said deductions should be restarted only when inflation eased or benefit levels caught up.

It seems DWP chiefs have spent around two months waiting for “a good day to bury bad news”, as the saying goes.

According to Open Democracy,

[MPs] said the debt deductions were causing “hardship” for “households currently struggling with huge financial pressures”, and people needed “breathing space”.

Nearly half (45%) of people on Universal Credit are currently having deductions taken out of their benefits to repay debts, at an average of £62 a month. The debts are typically caused by historic overpayments and other errors, advance payments made during the five-week-wait for Universal Credit, and by arrears on energy costs and other priority bills. Currently the government can deduct up to a quarter of someone’s benefits each month to repay these debts.

MPs heard from charities including the Joseph Rowntree Foundation that these deductions were “a key factor in destitution”. The Trussell Trust said the practice was pushing “people into destitution and needing to turn to a food bank”.

Now brace yourself for the DWP’s nonsense justification for putting people into destitution:

the Department for Work and Pensions said it did not believe pausing deductions was “necessarily in the claimant’s best interest”. It said that if that deductions were paused between now and the April 2023 rise, people might then not notice the impact … when it comes … and people might “feel no better off”.

But they’re not going to feel better-off anyway if the whole uplift has to go towards servicing debts that could be avoided if the DWP simply paused these deductions for a while.

The government also rejected MPs’ calls to bring forward the uprating of benefits, currently not due to take effect till April 2023. In April this year, benefits were increased by an inflation rate that was seven months out of date – rising 3.1%, at a point when inflation was already running at 9%.

So already, people on benefits are receiving far less than they should, simply to keep up with inflation.

Claimants are eligible for additional money to help with housing costs – but this is “not intended” to cover the rent fully in many areas, meaning people have to make that shortfall up from their benefits, too. MPs called for the housing element to be increased, as happened during the pandemic, but the government rejected this call, too, citing its work on helping people on benefits save for a deposit to buy a house instead. According to housing charity Shelter, most private tenants have a shortfall, as the maximum amount is set to cover only the lowest 30% of rents in any given area, and there are other exclusions as well.

It should be easy to conclude from this that the Tory “benefit” system is unfit for purpose and the sooner they are taken out of its administration, the better.

And the reason the DWP is refusing to take action to stop people on benefits from falling into debt and destitution should be clear: that is exactly what the Tory system is designed to do.

Source: DWP rejects ‘cost of living’ plea by MPs to pause benefit deductions | openDemocracy

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