In a significant shift that could impact thousands of households across the UK, the Department for Work and Pensions (DWP) has been granted authority to reduce Universal Credit payments without providing advance notice to claimants.
The Power to Cut Payments Immediately
Under newly implemented rules, when the DWP decides a claimant has been overpaid Universal Credit, officials can immediately slash ongoing payments without the standard one-month notification period. This dramatic change applies specifically during what's known as the 'mandatory reconsideration' phase - the initial stage where claimants can challenge a DWP decision.
How the New System Works
The process unfolds as follows:
- The DWP identifies what it believes to be an overpayment of Universal Credit
- Claimants receive a decision notice outlining the alleged overpayment
- If the claimant requests a mandatory reconsideration, the DWP can now immediately begin deducting money from their ongoing Universal Credit payments
- These deductions continue while the case undergoes review
What This Means for Claimants
This policy change represents a substantial departure from previous procedures, where reductions typically wouldn't commence until after the mandatory reconsideration was complete. The new approach means households could see their income suddenly reduced while still challenging the DWP's original decision.
Financial experts are warning that this could create severe hardship for vulnerable families who rely on Universal Credit to cover essential living costs. The lack of warning period removes the opportunity for households to prepare for reduced income or seek additional support.
Understanding Your Rights
Despite these new powers, claimants maintain important rights:
- You can still request a mandatory reconsideration of any DWP decision
- If unsatisfied with the reconsideration outcome, you can proceed to an independent tribunal appeal
- Deduction rates are subject to maximum limits, though these can still represent significant reductions
The DWP maintains that these measures are necessary to recover public funds efficiently, but welfare rights organisations express concern about the impact on families already struggling with the cost of living crisis.
