Universal Credit claimants are reportedly losing out on £110 each month because the Department for Work and Pensions (DWP) does not accurately account for pension contributions when calculating benefit payments. This issue was brought to light by a claimant who contacted former Pensions Minister Sir Steve Webb to raise concerns over the DWP’s refusal to adjust their Universal Credit award.
The claimant explained that despite contributing £200 monthly into a personal pension in addition to their workplace pension, bringing total pension contributions to 15% of their gross salary, the DWP has continuously disregarded these payments when calculating net income for Universal Credit eligibility.
“I reported my pension contributions through the online journal, but the DWP maintains that my net pay award cannot be adjusted to reflect these payments,” the claimant stated. After their request for a mandatory reconsideration was ignored, they intend to escalate the matter through a tribunal claim.
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Public response has highlighted frustrations regarding this policy. Some question why individuals receiving tax relief on pension contributions can still qualify for Universal Credit without those contributions being considered. Others suggest that pension payments should reduce the amount of Universal Credit awarded or affect eligibility altogether.
Critics argue that while temporary benefits during job transitions might be understandable, long-term eligibility despite substantial pension contributions seems unfair. Some express disbelief that individuals paying sizable monthly amounts into pensions can simultaneously claim Universal Credit, labeling the situation as unjust or misleading.
This ongoing dispute raises important questions about how pension contributions influence Universal Credit calculations and whether current DWP policies fairly reflect claimants’ financial circumstances.