Universal Credit claimants are facing what has been described as a "penalty", with some people receiving £140 less due to their age. Benefits specialists recently addressed MPs on the worrying matter, warning that certain DWP claimants receive "a lower payment".
Policy Campaigners Testify Before Committees
Policy campaigners appeared before the Work and Pensions Committee and the Education Committee to discuss implementing the Child Poverty Strategy. Charis Chittick, representing One Parent Families Scotland, warned about the "young parent penalty" whereby "under 25s will get a lower payment". She informed the committee: "That is where under-25s are paid a lower rate of Universal Credit than over-25s. That used to be mitigated for young parents; it is not any more.
"That is why we call it the young parent penalty. The costs are still the same for those young people.
"It costs the same amount to raise a child whether you are 22 or 32. We really need to see that policy changed to protect children and families as well."
£140 Less in Payments
This relates to the varying Universal Credit monthly standard allowance payments depending on your age. Single claimants under 25 receive £338.58 per month, while those aged 25 and above receive £424.90, creating a gap of £86.32.
For couples where both partners are under 25, the monthly household payment stands at £528.34, whereas couples with at least one partner aged 25 or above receive £666.97 – a difference of £138.63.
Extra Payments for Universal Credit Claimants
Those claiming Universal Credit may qualify for additional assistance if they're responsible for children. Claimants receive an extra £303.94 monthly per child living in their household on top of their basic entitlement.
Further support may be available if your child has a disability and receives specific benefits. These additional payments include £164.79 monthly at the lower threshold and £514.71 monthly at the higher rate.
Working Universal Credit recipients can also reclaim up to 85 per cent of childcare expenses. Parents may also want to check their eligibility for Child Benefit, which provides £27.05 weekly for your eldest or sole child and £17.90 weekly for each other child.
DWP Response
The DWP was questioned about the rationale for varying Universal Credit amounts based on age thresholds of 25 and over. A DWP spokesperson said: "Universal Credit includes separate elements to support eligible customers with the cost of housing, children and childcare, and working families on Universal Credit can claim up to 85 per cent of eligible childcare costs each month.
"What's more, our Child Poverty Strategy will lift 550,000 children out of poverty in 2030 – the biggest reduction in a single parliament. We're also rebalancing Universal Credit to tackle the perverse incentives that discourage work while delivering the first sustained above inflation rise in the basic rate since it was introduced."
The department explained that younger workers in employment generally receive lower wages than those over 25 and are more frequently residing in another person's home, so they have lower household expenses. The DWP also said that the reduced Universal Credit rate for those under 25 creates an encouragement for young people to secure employment and advance professionally.
The Government department also highlighted that claimants are receiving an above-inflation uplift in their entitlements, as outlined in the Universal Credit Act 2025. This means a single claimant under 25 will receive an additional £255 this year, more than £110 above what an inflation-only increase would have provided.
For couples where both partners are under 25, they will get approximately £365 more this year, which is £140 more than what an inflation-linked rise would have delivered.
