Stephen has criticised the government for rejecting the Work and Pensions Select Committee’s recommendation that universal credit deductions should be paused during the cost-of-living crisis. Over a million people had their monthly payments reduced as the government pursues debts from past overpayments that are often due to HMRC’s own errors.
Data from the Department for Work and Pensions show that last year 1.3 million universal credit claimants had their benefits docked because of past tax credit overpayments. Many of the debts the government is claiming were due to the government’s own mistakes, with claimants often unaware they owe money until it is deducted from their payments. The government has also threatened families with debt collectors.
Speaking to Sky News, Stephen said, “[it is] causing real hardship for people. My select committee, which is an all-party committee with a Conservative majority, recommended that the government should pause these deductions while inflation is running at its current level.” The government rejected the Work and Pension Select Committee’s recommendation.
Tax credits were introduced in 1999 by Labour to offer support to parents and low income households. In 2014, the Treasury and DWP agreed that debts from tax credit over payments would be transferred onto universal credit as tax credits were phased out.