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Seven Day Benefit Wait Brings Hope To Wonga

October 27, 2014

With many thanks to Benefits And Work.

In a move that will bring new hope to struggling payday lenders, the DWP have extended the waiting days for employment and support allowance (ESA) and jobseeker’s allowance (JSA) from 3 days to 7 days from today.

The new rules mean that claimants applying for ESA or JSA will not be entitled for any payments during the first 7 days that they would otherwise be eligible for benefits.

Claimants will not be affected if they have made a previous claim for ESA or JSA in the preceding three months, however, as they will be considered to have already served their waiting days. ESA claimants will also not be affected if they have claimed statutory sick pay immediately before claiming ESA.

Terminally ill claimants are exempt from serving waiting days.

The move has brought condemnation from trade unions and charities, but the chancellor George Osborne argues that: “Those first seven days should be spent looking for work and not looking to sign on.”

Last month Wonga was forced by the Financial Conduct Authority to write off £220 million in loans interest and charges to people who should never have been given loans in the first place. There have been calls for other payday lenders to suffer similar penalties.

But the decision by the Coalition to extend the waiting period for ESA and JSA to seven days means that there is likely to be an upsurge in applications for short-term loans by people with no other resources to fall back on.

Given that waiting times for a first payment of universal credit (UC) are likely to be around 6 weeks – and up to six months for people whose earnings were too high, according to new government proposals – and bearing in mind that UC also includes a housing costs element, the future for payday lenders is beginning to look rosy again.

5 Comments leave one →
  1. October 27, 2014 10:07 am

    George Osborne is an evil bastard

  2. October 27, 2014 11:36 am

    Has anyone else been told that if you’re ill for more than 2 weeks whilst claiming JSA you’re automatically transferred to ESA? you don’t apply yourself the JCP does it for you, I called in to my Work program provider and told them I am having a minor heart procedure in December and they told me that, when I explained I would fail the WCA it made no difference, can anyone see see the madness in this? if I take longer than I think to recover I will be “Moved” on to ESA yet I will fail the WCA and therefore have to go back on JSA

    anyone else feel dizzy?

  3. October 27, 2014 1:07 pm

    Reblogged this on Britain Isn't Eating.

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