A significant policy change to Universal Credit takes effect today, reducing the maximum percentage the government can deduct from benefits for debt repayment. <\/p>\n\n\n\n
This reform, introduced as part of a broader effort to alleviate financial hardship, aims to leave households with more money available for everyday essentials.<\/p>\n\n\n\n
According to the Manchester Evening News<\/a><\/em>, the new cap is expected to provide tangible relief for many of the lowest-income families across the UK. <\/p>\n\n\n\n The adjustment will affect over one million households and is projected to increase their average disposable income, offering a more stable financial outlook and easing pressure caused by persistent repayment obligations.<\/p>\n\n\n\n Effective from April 30, the Department for Work and Pensions (DWP) has reduced the cap on deductions from Universal Credit standard allowances from 25% to 15%. This applies to all assessment periods beginning on or after this date.<\/p>\n\n\n\n This change was announced by the Chancellor of the Exchequer during the Autumn Budget as part of the government\u2019s broader Plan for Change<\/strong>, designed to improve living standards and combat the cost-of-living crisis.<\/p>\n\n\n\n The DWP<\/a> estimates that 1.2 million households will be affected by the new cap, with an average annual gain of \u00a3420<\/strong>. Among these, 700,000 are households with children, highlighting the measure\u2019s targeted impact on families.<\/p>\n\n\n\n In total, 2.8 million households<\/strong> currently face deductions from their Universal Credit payments each month to repay debts. The revised policy aims to ensure those repayments remain sustainable while allowing claimants to meet essential daily expenses.<\/p>\n\n\n\n In a statement, Chancellor Rachel Reeves<\/a><\/strong> emphasized the practical impact of the reform:<\/p>\n\n\n\n As announced at the budget, from today, 1.2 million households will keep more of their Universal Credit and will be on average \u00a3420 better off a year. Work and Pensions Secretary Liz Kendall<\/a><\/strong> also highlighted the reform\u2019s wider social purpose :<\/p>\n\n\n\n As part of our Plan for Change, we are taking decisive action to ensure working people keep more of the benefits they\u2019re entitled to \u2013 which will boost financial security and improve living standards up and down the country.Fair Repayment Rate Now Capped at 15%<\/h2>\n\n\n\n
1.2 Million Households to Benefit, Including Families With Children<\/h2>\n\n\n\n
Government Highlights Support for Working Families<\/h2>\n\n\n\n
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This is our plan for change delivering, easing the cost of living and putting more money into the pockets of working people.<\/p>\n<\/blockquote>\n\n\n\n\n
We\u2019re delivering meaningful change to ensure everyone has a fair chance, the support they need, and real hope for the future.<\/p>\n<\/blockquote>\n\n\n\nPart of Broader Anti-poverty Initiatives<\/h2>\n\n\n\n