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Deductions can be taken from benefit payments for a range of reasons including repayment of universal credit advances, legacy benefit overpayments, budgeting loans, rent arrears, utilities bills and mortgage interest.

In April 2020, the Westminster Government temporarily paused the recovery of benefit overpayments for three months as part of its emergency response to the Covid-19 pandemic. The Government Government chose not to suspend the recovery of advance payments to universal credit. Advance payments are repayable loans, which many claimants receive from the government during the five-week wait for their first universal credit payment. The suspension of government debt recovery was only a temporary one; and the recovery of benefit overpayments recommenced in July 2020.

In this paper, we explore the impact of repaying these government debts on people who are already on very low incomes.

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