The Universal Credit (‘UC’) reforms were announced over a decade ago. Yet they remain beset by criticism to this day, being viewed by many as forcing some of the most vulnerable in society into debt. Those who have moved from the old ‘legacy benefit’ system to UC have typically seen a reduction in the level of benefits that they receive, and recipients also must wait 5 weeks for their first UC payment, owing to UC being paid in arrears. This has caused incredibly difficult circumstances for many people and is the reason why there remain calls for the UC system to be scrapped, even before it is yet to become fully operative across the country.

Within the financial remedies context, UC arises as an issue in a larger number of cases than one may initially realise. It is not an issue reserved just to low asset cases, particularly at present, given the impact that the Covid-19 pandemic has had on many businesses and thus on people’s employment and livelihoods. There are significant differences between the old benefits system and UC which practitioners must be aware of when considering fair and realistic settlements, most notably in respect of the surrounding spousal maintenance payments.

This article is split into two sections. The first provides an overview of the UC system itself and highlights the differences between this system and the legacy benefits. The second focuses more on what issues arise in respect of UC within the financial remedies context and how such issues may be resolved.

Read Elisabeth Andrew's full article for Family Law Journal, first published July 2021 via the link below.