Surplus Earnings

The surplus earnings policy was introduced to prevent people who are paid large amounts of earnings on an irregular basis from receiving a greater amount of benefit and earnings than claimants who for example earn the same annual salary but are paid over 12 regular salary payments.

This means that where a claimant receives a large payment of earnings within an assessment period which is sufficient to end their universal credit award, and then reclaims universal credit within six months of that award ending, earnings above the de minimis level will be taken into account as earnings for the new award.

I will sign a determination to extend the current £2,500 universal credit surplus earnings de minimis level from 1 April 2020 to 31 March 2021 and will place a copy in the Library. This will safeguard the efficient administration of universal credit by not reducing the de minimis to £300 as provided by the Universal Credit Regulations 2013.

This measure will cost £70 million in 2020-21 and will mean around 500,000 fewer people will see their universal credit award reduced by surplus earnings.

[HCWS147]