SNP Suggest Replacing Universal Credit Advances With Grants Not Loans

UNIVERSAL CREDIT - The SNP has proposed a solution to overcome UK government concerns with making Universal Credit advance payments grants and not loans – and called for the social security net to be rebuilt after a decade of Tory dismantling.

In the last Work and Pensions Committee session, UK Minister, Will Quince MP, said the UK government fears that introducing advance payment grants for Universal Credit could see an increase in fraudulent claims. The SNP has said the solution to this would be to turn the advance payments – a loan claimants can apply for if they are unable to get by while they wait five weeks for their first Universal Credit payment – into non-repayable grants once the claimant has been deemed eligible for Universal Credit. This would also take away the need to reverse the five-week wait, which the DWP has said would be “operationally challenging.”

Image: Will Quince MP.

SNP Shadow Work and Pensions Secretary, Neil Gray MP, added that the advance payment could be determined on a “slide and scale” basis – dependent on need whereby a parent of two children would qualify for more than a single person – but all would receive an upfront payment to see them through until the first Universal Credit payment and prevent people from falling into, or further into, debt and financial hardship.

The Airdrie & Shotts MP has also called on Boris Johnson to rebuild the UK’s social security net - after his predecessors spent ten years dismantling it - to ensure people are protected if we face another crisis like the outbreak of COVID-19. This includes scrapping the benefit cap and the two-child cap with it's associated rape clause, and increasing all benefits.

Image: Neil Gray MP.

Commenting, Neil Gray MP said:

“Whilst the majority of social security powers remain reserved to Westminster, I am urging the UK government to look seriously at our proposal to implement grants not loans - and heed our call to rebuild the social security net so that future generations are protected if we face a crisis like this again.

“Turning the advance payments into non-repayable grants instead of keeping them as loans once people have been determined as eligible for Universal Credit would help millions now and in the future – it would prevent additional stress and anxiety of further debt, and enable people to start getting themselves out of financial difficulties.

“The Tories spent a decade systematically dismantling the UK’s social security net and now that the chickens are coming home to roost, they are only now realising what a huge mistake that was. It shouldn’t take a global pandemic – and the fact that it is now not only the working class and poor that are having to use the welfare system – for the Tories to sit up and take stock of the situation.

“The SNP will continue to propose solutions and work with the UK government to help them rebuild the vital social security net whilst these powers remain at Westminster. The outbreak of COVID-19 has given us many lessons – a key one being that everyone needs and has the right to a social security net. The UK government must recognise this and act swiftly or devolve the powers to the Scottish Parliament so we can get on with the job ourselves.”

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