ALMOST half of all Scottish households claiming Universal Credit are being hit by a “poverty tax” from deductions to their benefits.
The news comes as the SNP demand changes to the Department of Work and Pensions’ Universal Credit system as Scottish claimants are being hit by an accumulative £10 million a month tax through their deductions.
SNP MP Chris Stephens uncovered through a Parliamentary Question that in one month alone last year, 180,000 households in Scotland had an average of £60 deducted from their social security payments, according to official figures.
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A plurality of this (44%) was to pay back advance payment loans issued by the Department for Work and Pensions (DWP) to see people through the five-week waiting period for the first Universal Credit payment.
In ten Scottish constituencies over half of claimants are having their benefits clawed back to some extent, with average monthly deductions ranging from £57 to £62 per household.
Commenting, Chris Stephens MP, who is a member of the Work and Pensions Select Committee at Westminster, said: “This is essentially a poverty tax on people who are struggling to heat their homes and put food on the table. My constituents in Glasgow South West alone have had £286,000 a month deducted from their Universal Credit payments.
“Universal Credit is meant to be a subsistence benefit that covers basic living costs. If £60 a month is being taken away from it, when living costs are rising rapidly, how are people meant to subsist?
“The upfront loans should be replaced by upfront grants, recovery of tax credit overpayments should be capped at a lower level, and debts that have not been pursued for more than six years should be written off entirely, in line with the approach taken in the private sector.”
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