By Chaminda Jayanetti
'Long Covid' is one of the most vicious aspects of coronavirus. Affecting survivors of the disease of all ages, it describes how symptoms can drag on for months. It debilitates sufferers long after they are out of immediate danger, causing lasting harm to their quality of life.
The economic impact of coronavirus is not dissimilar. There is the immediate spike in unemployment and shorter working hours, with many falling through the safety net of the furlough scheme and self-employment support. Benefit claims have soared in response, as has food bank use.
Where there is deprivation, there is debt - and debt drags. Thanks to the design of the benefit system, it could drag hardest and longest on those least able to respond.
The problem - as so often - is Universal Credit (UC), the government's all-encompassing welfare scheme. UC payments can be cut substantially by the Department for Work and Pensions to repay various debts and loans, whether the claimant can afford it or not.
It's not the first benefit to be subject to such clawbacks. The tax credit system was riven with debt deductions - but the sheer quantity of claimants hit by these deductions is unprecedented. Deductions rarely affected more than 30% of tax credit claimants in any given year - itself a very high proportion, but nowhere near the 60% of UC claimants whose benefits were being cut to repay debts as of last May.
With UC claims rocketing during the pandemic - rising from 2.9m in February to 5.5m in July - the number of people affected is likely to rise sharply too.
Part of the problem is the design of UC itself. Recipients of UC must wait five weeks for the first payment to arrive. Claimants are left with an unappetising choice - tide themselves over with what money they have, live at a deficit until the money arrives, or take out an advance loan from the DWP.
For the million or so new claimants who took the advance loan, this will need to be repaid over up to 12 months - with the money owed deducted from ongoing benefit payments.
But the debts don't stop there. Many claimants are already burdened with tax credit debts, with the DWP having decided to use its new UC system to pursue such debts going back many years, even though the passage of time makes it hard to assess whether these debts are genuine or down to administrative error.
And then there are Covid's financial fangs - rent arrears, council tax debts and utility bills. The fall in earnings and rise in unemployment, particularly for those already in insecure work, has exacerbated all of these.
Homelessness charity Shelter says that more than 300,000 private renters have fallen into arrears since the start of the pandemic. Based on survey responses, Citizens Advice estimates three million people were behind on water bills in July, with 2.8m behind on energy bills, the same number behind on council tax, and 1.2m in rent arrears.
All these debts can be recovered by cutting UC benefit payments. Up to 30% of the basic UC payment - the 'standard allowance', excluding add-ons for things like housing costs, children or disability - can be cut each month in order to repay these debts and loans.
A single claimant under 25 would be left with £55 a week to live on if their benefits are deducted by 30%. That wouldn't affect the housing element of UC, but if they pay the average rent in their local area, the housing element of UC won't actually cover their entire rent.
"The central problem with benefit deductions is that they are, in effect, reducing an already minimal income," says Louisa McGeehan, director of policy, rights and advocacy at Child Poverty Action Group (CPAG). "Means-tested benefits such as Universal Credit already fall short of a decent income and many families are having to use money intended to meet their children's needs to make up shortfalls in housing costs."
CPAG has found that people who suffer deductions from their UC often accrue other debts, thus compounding the problem - a false economy in every sense. Having their already low benefits cut to repay rent arrears or advance loans means they cannot afford to keep up with utility bills and consumer debts. Parents struggle to buy food or nappies, and end up resorting to food banks.
All this takes a toll on people's mental health, especially if they are struggling to meet the basic needs of their children.
A survey by debt charity StepChange found that of its clients receiving UC, more than half had at least one deduction to their benefits in place, with 40% experiencing at least two deductions at the same time. Most common were UC advance loan repayments, followed by benefit overpayments and council tax arrears.
While private debt collection agencies are now forced to accept repayment plans based on debtors' ability to pay, the DWP often ignores this when pursuing debts, with the onus on benefit claimants to tell the department if they're struggling financially - even though the government already has plenty of data on claimants' financial circumstances at its fingertips.
The lifting of the evictions ban means tenants are now at greater risk of losing their home. But the backlog in the court system means eviction notices are liable to take months to pursue, and landlords may instead decide to seek deductions from benefits to recover rent arrears.
The UC standard allowance can be cut by up to a fifth to repay rent arrears - a cut of £82 a month for single claimants over 25, and £119 a month for couples where at least one partner is over 25.
"Shelter is being flooded with calls from worried renters unexpectedly plunged into debt, and the situation is likely to get even worse with a recession underway," says Polly Neate, chief executive of Shelter. "Keeping people safe in their homes will only be possible if they can clear these covid rent debts. That's why we are urging the government to give struggling renters emergency grants to help pay these one-off arrears caused by the pandemic."
CPAG suggests a variety of measures to address the problem - higher benefits, the reversal of cuts such as the bedroom tax, greater flexibility in the UC system to allow deductions at lower rates, more discretion regarding rent arrears and the write-off of historic benefit debt, and the introduction of rent control.
The ending of the furlough scheme, the limited scope of its replacement, and the weakness of the jobs market all mean the number of people on Universal Credit is likely to rise, and the debts that can be recouped from UC payments are liable to rise as well.
The government, utility firms, landlords and even councils can all afford to take some of the strain of bad debts far more than cash-strapped debtors themselves, especially during a pandemic.
It is entirely a political choice that all the burden should continue to fall on people least able to bear it.
A statement from the DWP said: "Universal Credit advance repayments are made gradually over 12 months, and deductions are capped at 30% of claimants’ standard allowance. From October 2021, the repayment period will be extended from 12 months to 24 months and the reduction of the deductions cap from 30% to 25%. For those who find themselves in unexpected hardship, advance repayments can be deferred for up to three months in certain cases."
Chaminda Jayanetti is a freelance journalist. You can follow him on Twitter here.
The opinions in politics.co.uk's Comment and Analysis section are those of the author and are no reflection of the views of the website or its owners.