DWP Hits Pause on Benefit Debt Recovery Amid COVID-19 Crisis
The Department for Work and Pensions (DWP) has slammed the brakes on benefit overpayment recoveries for three months. This move means many claimants will pocket more cash during the coronavirus outbreak.
Benefit Deductions Suspended to Boost Support
All deductions for Universal Credit and legacy benefit overpayments, Social Fund loans, and Tax Credit debts are temporarily paused. Most suspensions happen automatically.
If you’re repaying debts by standing order, Bank Giro, or online banking, you’ll need to contact your bank to stop payments.
DWP Shifts Staff to Frontline Support
The pause allows DWP to redeploy 10,000 staff from debt recovery to frontline roles, tackling the recent surge in benefit claims. More hires are in the pipeline to speed up payments to those in desperate need.
Some Debt Recoveries Will Carry On
- Recovery of Universal Credit advance payments will continue.
- Local Authorities have suspended referrals for Housing Benefit overpayments.
- Tax Credit debt transfers from HMRC are also on hold.
- Private debt collectors have been told to halt activity for Debt Management clients.
- Direct Earnings Attachments and voluntary repayments are suspended.
This emergency halt covers all benefit-related overpayments, Social Fund loans, and Tax Credit debts. While many recoveries stop immediately, some will phase out over time.
