How Universal Credit may affect you

11 Jan 2019
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Universal Credit is a flawed system which has a number of considerable difficulties which are seriously impacting the finances of our hard working members.

The GMB have been campaigning on a number of the issues relating to Universal Credit but members in the Midland & East Coast Region, in particular those who work in retail or in the service sector, have been campaigning about how overtime can seriously impact Universal Credit Payments.

Universal Credit has been set up so that if your monthly income increases then your UC payments reduce. This means that if one of our members works additional hours, for example in the run up to Christmas, then people could lose up to 75% of their additional earnings. This is a clear disincentive to work and it makes it difficult for people to put in extra hours to help out their family finances.

However, worse still, if this additional payment takes you over the upper limit for Universal Credit then you fall out of the system all together, meaning people will receive no payments, and it takes six weeks to reapply leaving people significantly worse off by simply working more hours.

This is clearly a significant risk to members who through working additional hours could find themselves in unexpected debt.

The GMB Midland and East Coast Region have therefore worked with Labour MP, Alex Norris, to raise this matter in Parliament. We have contacted our members in areas where Universal Credit was being rolled out to inform them of this risk and we have made our members aware of the GMB Credit Union so that they can get an affordable bridging loan so they don’t end up turning to expensive pay-day lenders to cover any shortfalls.

If you want to know more about how Universal Credit may affect you, call the Universal Credit Hotline on 0800 328 5644.

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