DWP offers emergency payment of £ 800 to thousands in need during winter
As universal credit applicants face a reduction in their allowance of over Â£ 80 per month, saving money and finding additional sources of money will now be crucial for many people.
The government is hoping to encourage more people to work, offering a Â£ 500million support fund for months.
But footballer Marcus Rashford has warned that many families could face an agonizing choice between heating and eating this winter.
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The temporary Â£ 20 per week increase in universal credit was halted in early October.
Mr Rashford, an activist against poverty, said: “The cost of living has definitely gone up. You know household members have to decide – it reminds me of my situation when I was younger, to be fair – you have to decide between are you going to eat or are you going to be hot in the house?
“And these are decisions that you don’t want people to go through, let alone the kids, and, you know, there are other things – there is the price of fuel and electricity.”
But the DWP stressed that other help is available, including emergency bulk payments for those in dire need of money.
One of the options is a budget advance – a loan that people receiving universal credit, employment allowance and income-related support, income support, applicant’s allowance, etc. Income-related employment or pension credit can apply.
Applicants can get up to Â£ 812, designed to help with things like emergency home repairs, and getting to job interviews or staying at work, and funeral expenses.
But while the lump sum may seem tempting, the DWP points out that a budget advance is a loan and therefore will need to be repaid through a deduction from your regular Universal Credit payments.
The smallest amount you can borrow is Â£ 100. You can get up to:
- Â£ 348 if you are single
- Â£ 464 if you are a couple
- Â£ 812 if you have children
The amount you receive also depends on where you are in paying off the loan or if you have savings over Â£ 1000. The loan amount offered is reduced by Â£ 1 for each pound you save beyond the Â£ 1000 threshold.
The budget advance must be repaid within 12 months. If you switch to another benefit, or if you stop welfare altogether, then the DWP will require that other arrangements be made for it to be paid. within 12 months. The DWP is able to recover what you owe by contacting your employer and requesting that reimbursements be taken from your salary, or by involving debt collectors.
To obtain a budget advance, you must have:
- have obtained universal credit, income-related employment and support allowance, income support, income-related jobseeker’s allowance, or pension credit for six months or more, unless you need to money to help you start a new job or keep an existing job
- earned less than Â£ 2,600 (Â£ 3,600 jointly for couples) in the last 6 months
- reimbursed all previous budgetary advances
To request a budget advance, contact your local Jobcentre Plus work coach.
A similar amount – up to Â£ 812 – is also available for those receiving certain benefits in the form of a budget loan, the new name for what was once known as the crisis loan.
A budget loan can help pay:
- furniture or household items (eg washing machines or other “white goods”)
- clothes or shoes
- rent in advance
- moving costs
- the maintenance, improvement or security of your home
- travel expenses to UK
- the costs of obtaining a new job
- maternity expenses
- funeral expenses
- repay hire-purchase loans
- repay the loans taken out for the above items
To get a budget loan, you must have enjoyed one or more of these benefits in the past six months:
- Income support
- Income-based jobseeker’s allowance
- Employment allowance and income support
- Pension credit
Budget loans are not available if
- you are currently receiving universal credit
- you receive a new jobseeker’s allowance or a new style of employment and support allowance
- you are involved in industrial action (for example a strike, walkout or lockout)
- you owe over Â£ 1,500 in total for crisis loans and budget loans
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