Good morning,
One of the most common questions we are asked by staff on our Universal Credit training course or via the website www.ucadvice.co.uk is; how will tenants cope financially if they have to wait 5 weeks for their first payment of benefit?
The answer for most tenants will be to claim a UC Advance Payment – a form of interest free loan, designed to avoid financial hardship, and to assist them meet ongoing liabilities whilst they’re awaiting that first payment.
So what is a Advance Payment and how does one qualify?
An advance can be paid, following an application at the Jobcentre, for such assistance, to typically someone who is awaiting that first payment of Universal Credit or where they experience a period of exceptional delay or temporary suspension to a UC payment.
The first payment of UC is intended to be paid 1 month & 7 days after the “date of claim”. So, for example, if someone claimed UC on 19th May 2015 their first payment of UC could be expected on 26th of June, covering the period 19th May to 18th June. At the same time as making their UC claim they could ask Jobcentre staff to consider an advance payment.
 In order to qualify for an Advanced Payment the claimant must demonstrate:
  1. A ‘likely’ underlying entitlement to Universal Credit. The DWP Decision Maker (DM) must be satisfied that the claimant is entitled to benefit, or is likely to be entitled to benefit. This includes providing satisfactory evidence of a claim having been made; proof of identity e.g. a valid national insurance number and satisfying any other eligibility conditions, like having signed their claimant commitment); and
  2. The claimant’s ability to receive and repay the advance, by deduction from their UC award, within the specified period of 6 months, whilst repaying other debts (e.g. rent/fuel debts); and
  3. The claimant meets specified criteria that show they are in financial need as defined by Regulation 7 of the Social Security (Payment on Account of Benefit) Regulations, 2013 and have no access to other sources of support, such as tax credits, other income, savings, final wages etc.
Further information about Universal Credit Advances can be found on the www.gov.uk site.
Another question we’re asked is:
“If a claimant has a sanction applied to their existing JSA/ESA benefit, when they move to Universal Credit (UC), will they still be able to request an Advance Payment?
The answer, again, is yes.
The Advance Payment (benefit transfer), would usually be an amount of up to 50% of the UC award, to help make the transition from fortnightly benefits to monthly payments of UC. Again, an advance would only be made if the DWP Decision Maker is satisfied that an amount of UC would be payable. This would be based on the total UC amount paid, including all elements of the award, such as the housing costs element.
For example, if a claimant with an outstanding JSA sanction makes a UC claim and after application of the JSA sanction they are still entitled to a monthly UC payment of £500, the claimant will be able to receive up to 50% of this amount i.e. £250. This amount would then be recovered over the next 6 months from their ongoing UC award.
In cases where an existing benefit sanction has been applied to the UC claim and there is no amount of UC payable in respect of the first assessment period – for example, in the case of a young, single male (under 25 years old) claimant with no housing costs – if the application of the existing benefit sanction reduced the UC award to nil – they will not be able to receive a Universal Credit Advance (benefit transfer).
If you require any further advice or assistance in relation to Universal Credit or any other feature of the reforms, please get in touch by phone 07733 080 389 or e-mail bill@ucadvice.co.uk
Bill Irvine
UC Advice & Advocacy
www.ucadvice.co.uk