STA limiters

UC guidance on STAs says they should be 50% of your likely entitlement, subject to a repayment cap of 40% of your standard allowance over 6 months.

Say the likely UC entitlement for an unemployed person making a new claim is £700.00pm, they would hopefully get an STA of £350, and the repayment cap of £317.82 x 6 x 40% = £762.77 would not be problematic.

But the repayment rates for STAs are set out in regs, and the repayment rate for an unemployed person is 15% of the standard allowance. That being so, the abovementioned £350 STA would not be recovered within the 6 month repayment period set out by the DWP (15% of £317.82 x 6 = £286.04). What happens then? Does the claimant get £350.00 or £286.04?

The abovementioned DWP guidance does not I think resolve this. Should the normal 6 month recovery period then be extended, or does it effectively become an additional kind of cap on the amount of STA you can have?

Any views?

Apologies if this has already been addressed.

Steve

You’ve probably seen this already…

http://www.cpag.org.uk/stba/uc-advances

I guess the part about breaching the repayment cap would apply regardless of the actual rate of recovery - you’d hope DWP would use their discretion.

Thanks Jon. I had read the CPAG item, which indeed refers to the capacity to exceed the cap. However, in my example the cap was not the problem. It is instead the inability of the prescribed recovery rate to recover the STA within the 6 month target. As you say, lets hope sensible discretion prevails.