Why advanced payments are not the answer to Universal Credit

published on 18 Jul 2019

Annie Dell is Policy Analyst for The Salvation Army’s Public Affairs and Social Policy Unit. Here she examines whether advanced payments for those claiming Universal Credit is really the solution to the five week wait most face to receive their benefits. 

Travelling around the UK there is one problem I see that unites all 750 Salvation Army churches and community centres: the devastating effect that waiting for the first Universal Credit payment has on the people we help.

We are hearing the same stories repeated up and down the country; the mum who has to choose between buying school uniforms or paying the electricity bill or the young man who has lost his job and is now on the verge of losing his home. The hardship and pain of Universal Credit’s five week wait is often a contributing factor behind these issues.

Like Trussell Trust, ending the five week wait for a first payment of Universal Credit has emerged as a key priority in 2019 for The Salvation Army. This is why we are proud signatories of their campaign.

When speaking to policy makers about the problems caused by the five week wait, our community leaders tend to get a similar response: sympathy for those who are experiencing hardship, and reassurance from decision makers that advanced payments can provide a sufficient loan to prevent people falling into financial hardship while they wait for their first claim. 

So, are advanced payments the right answer? Has government solved the issues that we see every day? 

For The Salvation Army, the answer is a resounding no. Across our community services; including support for people who are homeless, debt advice, and employability, advance payments are both masking the core issues of delaying benefits, as well as creating significant new and unnecessary hardships for vulnerable people. 

Instead of fixing the issue, advance payments are perpetuating new ones. 

We’ve seen the number of food parcels we provide increase significantly under Universal Credit. In one of our centres, in Crewe, 51% of the people coming through our doors for food are there due to problems with Universal Credit. Like the Trussell Trust, these high percentages have been static for a number of years due to government inaction. 

However, what is changing is the point in which people are coming through our doors. Previously, we would see significant waves of people during the first weeks when they were moved onto the new Universal credit system and waiting for money. Now, with advanced payments we are seeing a second wave of people coming in when their claim starts and they have to pay back the loan. The struggle to pay back the loan is forcing individuals to use foodbanks once again.  

Advance payments aren’t reducing need; they are just delaying when people need our support because they are left with loans that are often too high to pay back. Advanced payments are not fixing the problem. They are creating new vulnerabilities. 

These are people who are disadvantaged. Without the five week wait, they could live without having to resort to food banks. Across our centres, time and again, our local community leaders tell us that the five week wait, under Universal Credit, is causing significant, and unnecessary, hardship for the people they engage with every day. This frustrates us because we know it doesn’t have to be this way. 

We can see that the government is fostering policies that push people into hardship, not lifting them up at a time when they need the most help. We are fully behind Trussell Trust’s campaign to end this wait, and will continue to push for policy solutions that enable people to live in dignity, free from destitution. 

Find out more about the '5 weeks too long' campaign.