Advice NI urge ‘caution’ for healthcare and other public sector workers in receipt of Universal Credit who are in line to receive pay awards.

Kevin Higgins, Head of Policy Advice NI said:

"Universal Credit is based on a monthly Assessment Period and so any additional income for example due to any bonus payment and backdated pay is likely to impact on the Universal Credit payment for that Assessment Period, and potentially future Assessment Periods depending on the additional amount received. The impact is likely to either be a reduction to the Universal Credit payment or more likely depending on the size of the payment there may be no Universal Credit payment for that Assessment Period and potentially reduced Universal Credit payments in future Assessment Periods due to what is called 'surplus earnings' rules, if the additional income is £2,500 or more.

This is obviously a very unsatisfactory situation particularly for claimants who may see their Universal Credit award reduced to zero and will cause anxiety for many claimants already struggling to make ends meet. There is also the potential for knock-on impacts for example with rent and rates payments and on what are called 'passported benefits' such as free school meal entitlement, help with health service charges for example with eye care and dental services.

It is vital that affected Universal Credit claimants exercise caution, understand the impact of receiving this additional income and budget accordingly. It is important that claimants engage with Universal Credit via their UC Journal or via the UC Helpline.

For independent advice and information on this issue, please contact Advice NI or your local independent advice provider, details are available on www.adviceni.net".

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Note:

The earnings taper and (if eligible) the work allowance will mean that the Universal Credit payment will not be reduced by the full amount of the back pay and bonus payment.

Even if the Universal Credit payment is reduced to zero, the claim will remain open for a period of six months, therefore the claimant should not be required to make a new Universal Credit application.