Universal Credit is a payment designed to provide assistance to those who are out of work, unable to work or on a low income. The payment, overseen by the Department for Work and Pensions (DWP), is issued each month to help Britons manage day-to-day costs. While Universal Credit can offer regular aid, there may be some instances where costs might be more than a person expected.
This could occur, for instance, if there is an emergency problem within the home which requires money to fix.
Understanding this eventuality, the Government has made available a payment which is designed to offer a further helping hand.
A Budgeting Advance is described as a payment which is intended to help Britons with unexpected costs.
This could include an emergency household cost, such as replacing a broken cooker, or covering funeral payments.
READ MORE: State pension warning as women at risk if Triple Lock is scrapped
What a person ultimately receives depends on whether the loan can be paid back, and if someone has any savings over the value of £1,000.
The DWP has said it will reduce the loan amount it offers to an individual by £1 for every £1 they have in savings over the £1,000 threshold.
Universal Credit claimants, however, should be aware that this Budgeting Advance is a loan, and will need to be repaid.
To pay back the sum, deduction are made from a person’s single monthly Universal Credit payment.
The first deduction is made on the day a person gets their next payment, and must be repaid within 12 months.
The £812 Budgeting Advance could prove useful to Universal Credit claimants as the £20 temporary uplift comes to a close.
The policy was introduced as a measure to help people throughout the pandemic, providing them with extra support.
However, as restrictions begin to ease, the DWP has communicated it is an appropriate course of action to phase out this measure.
Work and Pensions Secretary Therese Coffey told MPs the change had been a “collective decision” taken by ministers.
She added: “Ahead of October we will start communicating with the current claimants.
“We will make them aware that will be being phased out and they will start to see an adjustment in their payments.”
Commenting on the matter to Express.co.uk previously, a Treasury spokesperson said: “Throughout this crisis, the Government has spent £400 billion protecting people’s jobs, livelihoods and supporting businesses and public services.
“We went long and extended economic support well beyond the end of the roadmap, right through to the end of September. That includes unprecedented welfare support.
“More than £9 billion will have been spent on the uplift by the time it ends in September. It is right that economic support is wound down as we come out of this crisis and we focus on helping people back into work.
“We have purposely provided a three month cushion once restrictions are lifted in order to support those who most need it.”
For all the latest Business News Click Here
For the latest news and updates, follow us on Google News.