Universal Credit

Department for Work and Pensions written question – answered on 7th March 2018.

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Photo of Ruth George Ruth George Labour, High Peak

To ask the Secretary of State for Work and Pensions, what assessment she has made of the effect of the 20 per cent deduction to repay rent arrears from the universal credit personal allowance, on personal debt and income.

Photo of Ruth George Ruth George Labour, High Peak

To ask the Secretary of State for Work and Pensions, whether her Department plans to (a) review the level of deduction from the universal credit standard allowance to repay rent arrears and (b) introduce flexibility within the system for landlords to request deductions at a lower level.

Photo of Alok Sharma Alok Sharma The Minister of State, Department for Work and Pensions

The Department consulted about deductions for rent arrears in 2014. Following this the Government provided for an increased amount to be deducted for rent arrears in order to protect claimants from eviction and to protect landlords’ income streams when all other options for recovery have failed. Increasing the deduction rate to repay rent arrears helps claimants pay off what they owe more quickly, and reduce the chances of eviction. This is an important step in helping claimants clear their debts and to prepare for, find and progress in work.

The rent arrears deduction rate is set at between 10% - 20% and is made up of two parts: a minimum deduction of 10% of the claimant’s standard allowance and up to a further 10% depending on individual circumstances, such as which other deductions may be being applied.

There are no plans to review the level of deductions that can be made. Landlords are however free to make their own arrangements with tenants for the repayment of rent arrears.

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