Source: Labour List UK
Labour has warned that Universal Credit is “clearly failing” as new figures have shown that half of all households visiting food banks have struggled to afford essential goods as a result of repaying debt accrued through the benefit.
The party responded to data published by the Trussell Trust this morning that revealed deductions from claimants’ payments, in most cases to repay the Universal Credit advanced loan, could reduce household incomes by up to a third.
Commenting on the figures, Jonathan Reynolds said: “It cannot be right that people are turning to food banks because the government is taking money from those who can least afford it. The Universal Credit system is clearly failing these families when they cannot afford essentials.”
The Shadow Work and Pensions Secretary added: “Labour called on the government to end the five-week wait and pay advances as grants not loans to stop this spiral of debt and support Britain’s struggling families through this crisis.”
Claimants can apply for a Universal Credit loan to see them through the five-week waiting period for the benefit payments to begin. But this is repayable through deductions to the subsequent payments an applicant receives.