The Department for Work and Pensions (DWP) has clarified a 'double payday' error that stripped Universal Credit claimants of their benefits.
As many as 85,000 people could have been affected by the error, although the Government believes the actual number is far lower.
Universal Credit is a payment to help with your living costs. It’s paid in arrears, based on a claimant's earnings in the preceding month.
The problem arises when someone receives next month's wage early because a weekend or bank holiday has brought their normal payday forward, reports Birmingham Mail.
DWP systems then calculate that the claimant has been paid twice in one month and stops their benefits for the following month.
The system error left many people broke and has led to court action for causing "considerable hardship" for working families.
The DWP has now given an update and says it does not intend to continue fighting the issue in the courts.
Work and pensions minister Will Quince says the Government will seek to identify who has been affected by the issue, with "remedial options" being assessed.
The Court of Appeal said the problem possibly affects as many as 85,000 people, but Mr Quince said he believes it to be a "small number" in the "region of 1,500".
Last week, Labour chair of the Work and Pensions Committee Stephen Timms said: "I welcome his confirmation last week of no appeal in the UC (Universal Credit) court case the department lost, but has he grasped the full scale of the problem that that issue has raised?
"He said in the House last week that only, at most, 1,500 people were affected and suggested that 85,000 was a figure that had come from the Opposition."
Responding, minister for welfare delivery Will Quince said he answered an urgent question on this last Thursday "where I confirmed that we would not be appealing the decision of the court".
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He added: "And as I made clear to (him), I am now considering options to address this issue and will keep the House updated on progress.
"Now the 85,000 figure which (he) references from the judgement, my understanding that figure came from the Opposition - it's referenced in the judgement - but it came from the Opposition and we do not recognise those figures.""
