I understand the concerns raised regarding the rising cost of living. There is a fine line to be balanced between ensuring that taxpayers’ money is being spent correctly and allowing claimants to retain as much of their award as possible for day-to-day needs.
The standard deductions cap has been reduced three times – from 40 per cent to 30 per cent to 25 per cent. This has helped hundreds of thousands of UC claimants to retain more of their award. Reducing the standard cap below 25 per cent would reduce the range of debts a claimants could address, and risk vital obligations (such as Child Maintenance payments) not being made at all.
Claimants can contact DWP Debt management if they are experiencing financial hardship, to discuss a reduction in their rate of repayment or a temporary suspension, depending on their financial circumstances.
I welcome the Prime Minister’s action on energy bills. Under her plans, a typical household will pay no more than £2,500 a year on their energy bill for the next two years. This will be delivered through the ‘Energy Price Guarantee’ (EPG), which will take effect from 1 October.
This action is in addition to the £37 billion worth of support introduced earlier this year for households. This includes the £400 payment Energy Bill Rebate for households, and up to £1,200 for households in receipt of qualifying benefits, which will be delivered as planned.
I will continue to engage with ministerial colleagues to ensure that benefits recipients receive the support they need to cope with the cost of living.