Published: 19th September 2024
New research from the Public Law Project, authored by Jagna Olejniczak, has revealed the harmful impact of the DWP applying deductions to people’s benefits, which affects over half of households on Universal Credit.
The majority of these deductions relate to debt owed to the Government, which is often driven by system design or mistakes made by the DWP.
According to a new report from Public Law Project:
- One third of survey respondents became destitute as a result of deductions
- 42% had their mental health negatively impacted and 30% had their physical health negatively impacted
- 29% reported that they spent less on essentials and 26% that they used food support such as food banks as a result of the deduction
- 21% had to delay bill repayments, 21% took out additional loans, 19% had to borrow money from family and friends and 12% took out additional credit card debt
- 9% reported that they had slept rough for one or more nights as a result of a deduction
- People with physical and mental health conditions and neurodivergent people were disproportionately impacted
Many of these debts are the result of the DWP’s own error: in 2021, 75% of Universal Credit overpayment debts recorded on DWP’s debt manager system were due to Official Error, meaning the DWP had initially miscalculated people’s Universal Credit.
The research found that people can’t easily challenge or seek relief from these harsh deductions due to the DWP’s confusing and fragmented system. In fact, they might not even be told about these deductions before having them applied.
Barriers to seeking relief from debt include insufficient information about the debt the deductions related to and the process for requesting relief, a fragmented system where departments fail to communicate, and psychological or emotional barriers such as fear, stress and embarrassment.
For example, people with physical and mental health conditions and neurodivergent respondents are more likely to have concerns about contacting the DWP, and people with health conditions like terminal cancer may not have the time or energy for such a stressful and difficult process.
The Public Law Project supports calls for a reduction in the default rates of recovery for deductions. In addition, it urges the DWP to improve this system in the following ways:
- The DWP should carry out a proactive assessment of claimants’ individual circumstances and their ability to repay before deciding to recover an overpayment
- Claimants should be contacted before the recovery is triggered to establish an affordable repayment plan
- The DWP should improve coordination between different departments and organisations, as well as the consistency and quality of communications with claimants
- People should be directly told about all available remedies and hardship measures.