The Department for Work and Pensions has shared rules for financial support for benefit claimants who are struggling because their income has been reduced. In specific cases, it is able to issue a hardship allowance when a person cannot cover the cost of their rent, heating and food.
These payments are made if a person has received a sanction, where their benefits are canceled for failing to meet the conditions of their benefit claim. Most penalties are applied to people on Universal Credit, although they can also be applied to Income Support, Jobseeker’s Allowance (JSA) and Employment and Support Allowance ( ESA).
According to the latest figures from the Department for Work and Pensions, more than 5.8 million people are on Universal Credit and nearly 50,000 have had their payments reduced as a penalty for breaking the rules on their claim. The latest figures show 49,812 people in Britain on Universal Credit have been sanctioned, including 1,629 claimants in Birmingham. A very small number of people receiving Jobseeker’s Allowance and Income Support were also sanctioned.
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Sanctions can be imposed for things such as not showing up for an appointment at the employment office or not proving that you are trying to find work. More people risk facing penalties under new rules which mean an unemployment benefit claimant has just four weeks to find work in their preferred sector, instead of three months, before broaden your search.
How much is cut from benefits in a penalty?
According to national poverty charity Turn2us, if you are single and over 25 the penalty is £10.60 a day for as long as your penalty lasts. And if you’re single and under 25, the penalty will be £8.40 a day while it’s in place.
If you are in a relationship and one or both are over 25, the penalty will be £8.30 per day if only one of you has been penalized. If you are a couple and you are both under 25, the deduction will be £6.60 per day if only one of you has been sanctioned.
These amounts are equivalent to the universal credit allowance per day over the four weeks covered by each payment. So if you’re sanctioned for 28 days, that’s a whole month of Universal Credit standard allowance forfeited. But if you get an additional universal credit for children, disabilities, or housing costs, you’ll still get those components of your monthly payment.
A sanction can end up reducing your monthly Universal Credit standard allowance amount by up to 100% for a single applicant or up to 50% for each member of a couple.
How long does a penalty last?
For Universal Credit applicants, the highest level of penalty is 91 days (approximately three months) for the first offense within a 12-month period and 182 days (approximately six months) for a second offense. High-level sanctions apply in cases such as an applicant failing to apply for a particular job when asked to do so, refusing a job offer, quitting their job, or cutting their hours without a valid reason.
Mid-level penalties normally last 28 days, or 91 days for a second offence. These are imposed in case of inability to find work or increase income, as well as in case of unavailability to start work or to attend interviews.
And then there are low-level sanctions, which last seven days plus the time it takes you to fix the failure – these are things like not showing up for a job coach interview or a training courses.
If you think you have been wrongly sanctioned, you can ask them to review the decision, in what is called a mandatory reconsideration. You only have one month to do so, so you need to act quickly. If the DWP does not change its decision, then you can appeal to an independent tribunal.
How to get extra money to face a penalty
The DWP says claimants can apply for hardship pay if their benefits are reduced to such a level that they cannot afford basic living expenses.
Officials said: “You can apply for hardship allowance if you have received a sanction and cannot pay basic needs such as rent, heating or food. You will have to repay your hardship allowance a little both from your future Universal Credit Payments, so they will be lower until you pay them back.”
To apply for hardship compensation, you must be 18 or older and show that you have tried to find the money elsewhere and are only paying for the essentials.
You can get hardship compensation if you can prove that you cannot pay for:
You must be 18 or older and your Universal Credit payment must have been stopped or reduced due to a sanction. You cannot claim hardship compensation unless this has happened.
If you have been sanctioned for not doing something like attending a meeting and there is no end date for that sanction, you cannot get hardship pay until you have did not do what you were asked to do.
You must show that you have done everything reasonable to look for work within seven days of applying for hardship pay. If you haven’t, you won’t qualify. Each case is assessed individually.
The DWP said: “Where a sanction is imposed on a UC claim and the sanctioned claimant or couple has had their standard allowance reduced at the daily rate equal to 100% – or 50% for a couple – for a high, average or low level sanction, hardship payments may be available to claimants.
“These payments are equivalent to approximately 60% of the standard allowance and must be repaid. For UC claimants, hardship allowance is only available after the first reduced payment and when the claimant complies with all demands placed on them.
“They are available to any claimant who can demonstrate that they would suffer financial hardship if the benefit were not paid. Claimants are expected to seek a hardship payment for each assessment period where a sanction has been applied.”
To claim hardship compensation, call the Universal Credit helpline on 0800 328 5644 between 8am and 6pm, Monday to Friday.
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