UC deductions scale advance repayments with the standard allowance, but advances are recovered as fixed sums #2410

What is wrong

uc_deductions is min(uc_deduction_rate × uc_standard_allowance, award − minimum payable) for every deduction type. So any change to the standard allowance moves every household's deductions in proportion, advance repayments included.

The law does not tie advance recovery to the standard allowance. Regulation 10 of the Social Security (Payments on Account of Benefit) Regulations 2013 (SI 2013/383) says a payment on account "is to be offset by the Secretary of State" "against the sum payable … under the award", or "is to be deducted" from it or a later award. What is recovered is the advance itself. No standard-allowance rate applies.

uc_deduction_rate documents its above-cap excess as covering last resort and child maintenance deductions. That excess also scales with the standard allowance. Whether child maintenance deductions are flat amounts in law is still to be checked.

Effect

For a reform or uprating that raises the standard allowance, the model raises advance repayments (and the above-cap excess) in proportion. That overstates how much deductions rise.

For a capped family, whose award the cap holds flat, it also overstates the fall in the payment net of deductions. A qualification check (population_uc_standard_allowance_plus_10) found exactly that pattern on full 1.58.1 data: 139 capped units with deductions saw their payment fall.

Deductions set as a percentage of the standard allowance in law are not affected:

• the "5% of the standard allowance" heads in SI 2013/380 Schedule 6 (e.g. paras 8(4)(a), 11(4));
• the overpayment recovery ceilings in SI 2013/384 reg 11(2).

Fix

Hold the advance component (and any fixed-sum component) at its baseline cash amount when the standard allowance changes. For example, store the advance part as an amount rather than a rate, and scale only the percentage-of-allowance types.

Add a test: raising the standard allowance leaves a household's advance repayment unchanged.

Related: #1814 (deductions model), uk-data#450 (imputing deduction attributes).