Why is Universal Credit being cut? Uplift payment set to end for claimants from October 6

Millions of people using Universal Credit have increased their monthly payments by an additional £ 20 per week.

It has relieved many families struggling because of the coronavirus pandemic and its aftermath.

But starting tomorrow, the £ 20 a week increase will be withdrawn by the government, leaving many families hundreds of pounds less a year.

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A new program – the Budget Support Fund – has been announced to tackle people’s economic problems in autumn and winter, but will it be enough?

Only time can tell. Why is the universal loan being cut? And what should I do if I am having a tough time because of the extra cash withdrawals? Here’s what we know

Why is the universal loan being cut?

As part of the government’s response to the coronavirus pandemic, Universal Credit applicants’ monthly payments increased by £ 20 per week.

But the hike was always meant to be a temporary measure, and ministers now believe the time is right to remove the extra money when the country recovers from the virus.

Not for everyone, the additional payments will end on Wednesday October 6th, 2021 as that depends on when your “Evaluation Period” is.

However, by November 5, everyone will be back to using the original credit system that Universal Credit operates.

Given that nearly 2 in 5 people say Universal Credit is employed, you might be wondering why these people can’t just work more hours.

But as a person’s income increases, the amount of universal credit they receive from the state decreases. So working more hours worth £ 20 won’t make up for the £ 20 a week shortfall.

What should I do if I have a difficult time because of the Universal Loan cut?

There have been various charities and organizations that have spoken out against the universal credit cut.

They include the housing association Crisis, which has warned that removing £ 20 a week could hit some households hard and potentially put them at risk with eviction.

The Citizens Advice Bureau has issued warnings that any third party could run into debt because of the withdrawal of the payment.

So what can you do if the cut in Universal Credits puts you in tough times?

The first thing to do when you are having a tough time from the universal loan cut is to see if you can apply for the Household Support Fund.

The payment, announced by the government earlier this week, will be made through the local councils and can help with food, heating and clothing costs. Check with your local authority to see if they can help you.

If that doesn’t help, contact your local citizens’ council. They can see if you have anything left and help you with your finances.


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