It explains that the way childcare costs are paid through Universal Credit conflicts with the Government’s goal of getting more people in work.

One of the Government’s biggest selling points for the scheme is to get 200,000 more people back to work.

However, making parents pay for childcare costs upfront and claiming reimbursement from the Government leaves homes waiting weeks or months to get paid back.

This in turn leaves parents with a tough decision: to turn down a job offer or get entrenched into debt in order to pay for childcare, the report says.

The powerful committee says the scheme’s success or failure depends on working parents.

Frank Field, chairman and veteran backbencher, said: “If the Government has set out to design a system to make it harder for parents to get into work, it could hardly have done better than this one.”

“It’s not just driving parents into despair and debt and creating problems for children provider – it’s also actively working to prevent the Government achieving its own aim of getting more people into work.

"If the Government doesn’t sort this out, Universal Credit childcare support will work against all that good, as well as against the objectives of Universal Credit itself.”

The report explains “some 100,000 households – including the poorest – will receive less for their childcare costs than under the legacy system” in the current Universal Credit scheme.

The Sun wants to Make Universal Credit Work

Universal Credit replaces six benefits with a single monthly payment. One million people are already receiving it and by the time the system is fully rolled out in 2023, nearly 7 million will be on it.

But there are big problems with the flagship new system – it takes 5 weeks to get the first payment and it could leave some families worse off by thousands of pounds a year.

And while working families can claim back up to 85% of their childcare costs, they must find the money to pay for childcare upfront – we’ve heard of families waiting up to 6 months for the money.

Working parents across the country told us they’ve been unable to take on more hours – or have even turned down better paid jobs or more hours because of the amount they get their benefits cut.

It’s time to Make Universal Credit work. We want the government to:

Together, these changes will help Make Universal Credit Work.

The report states: “Too many will face a stark choice: turn down a job offer, or get themselves into debt – to the Department for Work and Pensions, or to friends, family or other loan providers – in order to pay for childcare.”

The DWP retains the current system is in place to reduce fraud and to prevent people from making false claims for childcare.

The committee’s report concluded: “Prioritising this objective has created a barrier to employment that will be insurmountable for some households."

Field told The Mirror: “It is simply irresponsible of Government to suggest that the way around this policy’s inherent problems is for struggling, striving parents to take on more debt – still more so to claim, untruthfully, that it is not a debt at all. It clearly is.

Are you on Universal Credit? Do you have a story? Email: [email protected]

“This is about more than employment figures.

“Good quality childcare enhances a child’s life chances—and that enhances our society and our economy.”
The report says Universal Credit should be updated so it can start making direct payments for childcare support.

It suggests improving the availability of the Flexible Support Fund for parents, which can help them up get upfront childcare costs, and to divert funding from the Tax Free Childcare scheme as households earning up to £200,000 a year can get 30 hours of free childcare.

In response a DWP spokeswoman said: "This report doesn't acknowledge that with Universal Credit childcare is more generous.

"Working parents can claim back up to 85% of eligible costs, compared to 70% on the old system."

What to do if you have problems claiming Universal Credit

IF you're experiencing trouble applying for your Universal Credit, or the payments just don't cover costs, here are your options:

Apply for an advance – Claimants are able to get some cash within five days rather than waiting weeks for their first payment. But it's a loan which means the repayments will be automatically deducted from your future Universal Credit pay out.

Alternative Payment Arrangements – If you're falling behind on rent, you or your landlord may be able to apply for an APA which will get your payment sent directly to your landlord. You might also be able to change your payments to get them more frequently, or you can split the payments if you're part of a couple.

Budgeting Advance – You may be able to get help from the government to help with emergency household costs of up to £348 if you're single, £464 if you're part of a couple or £812 if you have children. These are only in cases like your cooker breaking down or for help getting a job. You'll have to repay the advance through your regular Universal Credit payments. You'll still have to repay the loan, even if you stop claiming for Universal Credit.

Cut your Council Tax – You might be able to get a discount on your Council Tax or be entitled to Discretionary Housing Payments if your payments aren't enough to cover your rent.

Foodbanks – If you're really hard up and struggling to buy food and toiletries, you can find your local foodbank who will provide you with help for free. You can find your nearest one on the Trussell Trust website.

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