UNIVERSAL Credit claimants who borrowed money to get by could be in line for refunds.
You can get so-called “hardship payments” if your Universal Credit has been cut because of a sanction or penalty for fraud.
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The money is designed to cover the cost of household expenses such as food and bills if you have a shortfall.
You normally have to pay the money back as it’s a loan but the most hard up claimants can request the repayment is waived.
Now, the Department for Work and Pensions (DWP) has said anyone who previously asked to stop repayments but was refused can now apply again to get the cash back.
The DWP said the refunds were being issued after it “reviewed its policy” on when Universal Credit hardship payments should be repaid.
We’ve approached the DWP to see how many people this might impact and how much they could be owed and will update this story when we’ve heard back.
Who is eligible?
If you had to repay a hardship fund between January 1, 2014 and January 11, 2021 then you could be entitled to a refund from the DWP.
But all of the following must apply:
- DWP refused your request to waive (stop) the repayment
- you have repaid the hardship payment
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You will also need to show that either:
- you could not afford to repay the hardship payment at that time
- repaying it had a significant effect on your or your family’s health or wellbeing – this means that it caused a health condition or made a health condition worse
The criteria applies to people in England, Scotland and Wales.
How can I claim a refund?
If you meet the above criteria, you can apply for a refund from December 19 and the deadline is June 19, 2023.
An application form will be posted on the government’s website that you’ll need to fill in, but it’s not there yet.
However, the government’s website does currently say that what you will need is evidence from the time you were repaying your hardship payment that you couldn’t afford to repay the loan and the repayment affected you or your family’s health or wellbeing.
This evidence could include bank statements, loan statements or letters from creditors at the time.
Plus, if you have information from a doctor or medical professional saying that repaying the loan caused a health condition or made it worse, that will be useful to put to the DWP.
You’ll also need to provide information about your income and living costs at the time.
You’ll need to send the form to Debt Management (C), Mail Handling Site A, Wolverhampton, WV98 2DF.
It’s worth noting you might not actually get the refund.
If the DWP decide you’re entitled to one, they’ll contact you within six weeks of receiving your application to let you know they’ve got it.
They will then send you a decision about your application within 13 weeks of receiving it.
Plus, the refund you get will depend on how much your hardship payment was worth.
What is a hardship payment and who is eligible?
You could be entitled to a hardship payment if your Universal Credit has been cut due to a sanction or you’ve received a penalty for fraud.
Sanctions are issued when you don’t meet certain responsibilities, like if you miss a meeting with your work coach.
The loans are supposed to tie you over until your next Universal Credit payment.
If you’re still struggling financially the next month, you can apply for a further hardship payment.
The payment is usually 60% of the amount you were sanctioned by in the previous month.
But you have to pay the money back in most cases – it will usually be taken out of your Universal Credit payments each month until it’s paid off.
But you have to meet a number of criteria if you want the payment.
You must be 18 or over (16 if your payment is reduced because of fraud) and struggling to pay for a child or young person’s accommodation, heating, food and hygiene.
Plus, you must have made “every effort” to stop spending money on non-essential thing such as leisure or entertainment activities.
And lastly, you must have done everything possible to get money from other sources such as family and friends and must have done all the work-related activities that you were supposed to do in the seven days before applying for the hardship payment.
How can I claim for a hardship payment?
You can make a hardship payment claim by updating your Universal Credit account.
Alternatively, you can contact your nearest Jobcentre or call the Universal Credit helpline on 0800 328 5644.
But you’ll need some evidence to hand to prove you’re entitled to a payment.
This mean you’ll have to explain:
- what you’ve done to find other sources of financial help from family or friends
- what other income or savings you might have to help pay your costs
- what you’ve done to reduce your non-essential costs, like entertainment costs
- which living costs you’re struggling to meet
You’re more likely to get a payment if you can show a budget or financial statement proving your monthly income and living costs.
You should be able to check if you’ve had a hardship payment by speaking to your work coach or contacting your local Jobcentre.
