Calls for Universal Credit Rule Changes to Stop Applicants Falling into Debt

A Scottish charity has called for the government to change some of its rules around Universal Credit (UC) payments to help people avoid falling into debt they’ll struggle to get out of.

Citizens Advice Scotland (CAS) has said the five-week wait for initial UC payments should be scraped and anyone undergoing an eligibility assessment should be given a non-repayable grant as a means of essential financial support.

The issue of having to wait five weeks before receiving an initial UC payment was highlighted by respondents to recent CAS polling as being the biggest problem that applicants for the benefit find themselves facing.

According to the polling, close to half (48 per cent) of new UC applicants needed to borrow money to survive the five-week wait for their initial payment.

Meanwhile, a majority (65 per cent) of the people who borrowed money under those circumstances told CAS that they would find it tough to repay the debt they took on, even if they’re given several years to make those repayments.

The research also found that people who are single, homeless or without a final wage from their most recent employment were more likely than others to require loans to survive the five-week wait for initial UC payments.

Single parents were also found to be disproportionately likely to rely on some form of debt to get by while they waited for a first UC payment.

“The five-week wait punishes the most vulnerable, those without savings and without family or friends to borrow from and those who are paid weekly who don’t have a final monthly salary payment to rely on,” said Nina Ballantyne, social justice spokesperson with the CAS.

“People we spoke to said they had no choice but to take on debt from an advance payment or struggle hand to mouth during the five-week wait because they had nowhere else to turn,” she explained.

“Abolishing the five-week wait and replacing it with a non-repayable grant would level up Universal Credit to function as an immediate social security safety net.”

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