Universal Credit: What are Alternative Payment Arrangements and how are they considered?
Universal Credit follows a similar payment plan for most claimants but special arrangements can be made for people who fall into financial difficulties. Claimants who cannot effectively manage their single monthly payments could be issued with alternative payment arrangements (APA).
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However the claimant can highlight certain issues to a work coach, landlord or caseworker which will make the need more apparent.
It will be Universal Credit staff who ultimately decide if a claimant will receive APA.
Their decisions will be based on factors such as if the claimant is paying bills on time, if they have effective budgeting abilities and if the claimant has any vulnerabilities such as addiction issues.
APA will commonly be requested when a claimant falls into rent arrears, at which point managed payments will likely be put in place.
APA is aimed at claimants who cannot manage their single monthly payments and as a result of this may face what the government term “financial harm”.
There are currently three forms of APA for those who may need additional support:
- Paying housing costs of Universal Credit as a Managed Payment (MP) direct to the landlord
- More frequent than monthly payments
- Split payment of an award between partners
APA can be considered at any point during a Universal Credit claim but it is unlikely that it will be the claimant themselves who decides if its issued.
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APA will likely come into effect when a claimant is two months behind on their payments.
If a Universal Credit claimant falls into rent arrears a landlord can request this set up themselves.
If the claimant want so request this arrangement themselves they can do so via their journal on their online Universal Credit account, during their meetings with a work coach or by calling the Universal Credit helpline.
Budgeting issues can also result in Universal Credit payments being issued more frequently.
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These types of payments can be requested but they can only commence from the end of the first assessment period.
Usually these divided payments will come through twice monthly but in some exceptional circumstances they can come through four times a month.
It should be noted that these payments will be the original amount divided up and not additional payment on top of this.
In some very niche circumstances payments of Universal Credit can be divided between two members of a household.
Split payments will only be awarded to people in certain specific situations, such as domestic violence or where financial abuse occurs and one partner mismanages the Universal Credit payment.
While APA assessments are done on a case by case basis, Citizens Advice have laid out all the circumstances which may incur an APA set up. It may be possible to get an alternative payment arrangement if the person:
- Is in debt or rent arrears
- has a disability – including a mental health condition
- Is homeless or are at risk of losing their home
- Has experienced domestic violence
- Has a learning difficulty, like problems with reading or writing
- Is in temporary or supported accommodation
- Is 16 or 17 or leaving care
- Has an addiction to drugs, alcohol or gambling
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