Background to the report

The Department for Work & Pensions (the DWP) has rolled out Universal Credit (UC) to replace six existing means-tested benefits for working-age households. Universal Credit is assessed and paid in arrears, on a monthly basis. As a result, claimants have to wait at least five weeks from making their claim to receiving their first payment while the DWP assesses their income and eligibility for the claim. The DWP acknowledges that waiting for the first payment “can be a challenge” for claimants, so it provides claimants with the option of an advance based on their estimated first payment – what the claimant is likely to receive once the assessment process is completed. This is designed to act as an “interest-free advance to those who face immediate, short-term financial need”, to be paid back from deductions to subsequent UC payments.

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By mid-2019, various national media outlets were reporting stories around alleged fraud in UC advances. A number of illegal practices were identified, including providing false information to boost the value of the advance, and fraudulently using the personal identification details of third parties, either knowingly or without their consent. Additionally, there were allegations that social media sites were being used to spread knowledge of how to commit various types of advances fraud.

Content and scope of the report

We looked at how the Department for Work & Pensions was managing fraud in Universal Credit advances after specific concerns were raised by the then chair of the Work and Pensions Select Committee, Frank Field MP. These concerns were:

  • whether the DWP had anticipated advances fraud in its risk assessments;
  • what action was it taking to tackle it; and,
  • what it might do in the future to mitigate this type of fraud.

This report sets out our findings based on the fieldwork we undertook between July and December 2019.

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Publication details

Press release

View press release (20 Mar 2020)

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