Overview

• The UK government has lowered the Fair Repayment Rate for Universal Credit debt deductions from 25% to 15%, effective April 30, 2025.
• This change will increase annual incomes by an average of £420 for 1.2 million households, including 700,000 with children.
• The reform impacts the 2.8 million households with Universal Credit debt deductions, ensuring more benefits are retained by claimants.
• The policy is part of the government's 'Plan for Change' initiative aimed at addressing the cost-of-living crisis and improving financial security.
• Recipients will also benefit from a recent 1.7% increase in Universal Credit standard rates, further enhancing their financial support.