The DWP boss said there had been problems with people not being able to access their cash quickly enough and having to seek help for food.
Previous Tories had denied there was a link between food banks and benefits waits.
But Ms Rudd honestly told MPs today: "It is absolutely clear that there were challenges with the initial rollout of Universal Credit .
"And the main issue that led to an increase in food bank use could have been the fact that people had difficulty accessing their money early enough.
"We have made changes to accessing Universal Credit so that people can have advances, so that there is a legacy run-on after two weeks, of housing benefit, and we believe that will help with food insecurity."
Brits can access some of their money upfront in an advance, but they then have to pay it back starting from the next month.
The Sun is campaigning to Make Universal Credit Work – including slashing the long five-week wait Brits have to get their first payment through.
DWP boss Frank Field hailed today's admission and said she was listening. He said: “At last, we have a secretary of state who is willing to have a much more open debate on the link that exists between Universal Credit and the need for food banks.
"Most importantly for claimants, this debate needs to result in action which eliminates the lengthy wait for benefits to be paid."
Last week it was revealed that UC staff have been told NOT to give foodbank vouchers out to people who can't afford food.
Workers are advised to "verbally signpost" struggling people to charities who can formally refer them instead, further delaying the time it takes to get help.
It was also confirmed today that 10,000 Brits on existing benefits will be moved over to Universal Credit as part of a trial starting in July.
That will then be looked at by officials to work out how to put the other 3million onto the new welfare programme.
The Sun wants to Make Universal Credit Work
One million people are already receiving it and by the time the system is fully rolled out in 2023, nearly 7 million will be on it.
But there are big problems with the flagship new system – it takes 5 weeks to get the first payment and it could leave some families worse off by thousands of pounds a year.
And while working families can claim back up to 85 per cent of their childcare costs, they must find the money to pay for childcare upfront – we’ve heard of families waiting up to 6 months for the money.
Working parents across the country told us they’ve been unable to take on more hours – or have even turned down better paid jobs or more hours because of the amount they get their benefits cut.
It’s time to Make Universal Credit work. We want the government to:
- Get paid faster: The Government must slash the time Brits wait for their first Universal Credit payments from five to two weeks, helping stop 7 million from being pushed into debt.
- Keep more of what you earn: The work allowance should be increased and the taper rate should be slashed from 63p to 50p, helping at least 4 million families.
- Don’t get punished for having a family: Parents should get the 85 per cent of the money they can claim for childcare upfront instead of being paid in arrears.
Together, these changes will help Make Universal Credit Work.
Join our Universal Credit Facebook group or email [email protected] to share your story.
The news comes after Ms Rudd's officials refused to ease the "cruel" burden of benefit sanctions for some Brits, a report said today.
The Government rejected a plea from MPs to protect single parents and disabled Brits from having their benefits docked.
Ms Rudd also announced today that the Government will introduce lengthy jail sentences for ruthless CEOS who recklessly mismanaged pension funds – like Carillion and BHS.
She said that fines weren't enough and that a new criminal offence would be introduced to punish "wilful or reckless behaviour" relating to pensions.
"The Government is on the side of workers saving for retirement," Ms Rudd said today.
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