- Biggest change to benefits system for people age 16-64, in/out of work
- Bundles several existing means-tested benefits and tax credits – income support, income based jobseeker’s allowance, employment and support allowance, child tax credit, working tax credit & housing benefit – into a centralised IT system relying on automated telephone calling and online processing.
- Local authorities, who currently deliver Housing Benefit, will not have a core role in delivering Universal Credit. However, the Government has started to recognise that there may be useful roles for local authorities in helping people to access the services within Universal Credit.
- Oct 2013 marks the introduction for new single claimants, but everyone will soon after be moved over.
- Paid directly to you as single month payment aka a Direct Payment Scheme – includes your housing costs (i.e. housing benefit will no longer be paid directly to your landlord).
- You will need to budget so that you can pay your rent.
- Easiest way to arrange payments is to set up a bank account.
BEDROOM TAX – ‘UNDER OCCUPANCY’
- If you are living in social housing which is ‘bigger than you need’, from April 2013, your housing benefit will be reduced.
- You will not be affected if you are of pension credit age (over 61 years and 5 months)
- However, if you are a couple and one of you is below the pension credit age, you are likely to be affected.
- You are ‘allowed’ one bedroom for each person over the age of 16 or as a couple.
- Children will have to share if they are under the age of 16 and of the same sex, or if they are under the age of 10 regardless of sex.
- If deemed to have one spare room, you could lose, on average, £14/week (14% of your housing benefit). If you are deemed to have two, you could lose, on average, £25/week (25% of your housing benefit).
- Even if you want to start a family and therefore remain in a larger home, you will have to fork out on the bedroom tax.
- Applied from 15 April 2013 in Bromley, Croydon, Enfield and Haringey local authorities. The rest are applying the cap between July – Oct 2013.
- Working age people (16-64 years) in non-working households will have benefits capped.
- £500/week (£26,000/year) cap for couples with/without children & single parents. £350/week (£18,200/year) cap for single people
- If you receive more than this, work out exactly how much you are getting by adding up your benefits – inc. housing benefit paid to your landlord
- If the amount you receive is more than the cap, your benefits will be cut (taken from your housing benefit), and you will have to make up the difference yourself
- Cap will apply to most households, but will not apply to you if you are of pension credit age (if 1 of a couple is below pension credit age, may still be affected), or if you get any of the following: disability living allowance, attendance allowance, constant attendance allowance, working tax credit, or the support component of employment support allowance.
- You will definitely be affected if you are receiving jobseekers allowance, income support, employment support allowance, housing benefit, child tax credit, industrial injuries disablement, child benefit
- From Mar 2012, non-dependant deductions apply to your benefits if you live with people who are over 18 years and not in education and who are working or claiming benefits. Non-dependant deductions will be taken from your housing benefit and can be between £12/week to £96/week depending on your level of earning.
COUNCIL TAX BENEFIT
- Re-branded ‘Council Tax Reduction’.
- Amount you can offset depends on where you live; circumstances; living with children / other adults; low income (based on savings, pension, income of the any other adults you live with).
- Each local authority will have their own scheme whereby the amount of support they provide will be reduced (some up to 30%).
- New scheme should protect pensioners and anyone who receives a qualifying disability benefit from cuts.
LOCAL HOUSING ALLOWANCE CAP
- LHA is a localised benefit paid to tenants in the private sector.
- As part of the assault on housing benefit, there will also be a reduction in local housing allowance rates from the bottom 50% to 30% of the local rental market.
- This means that those under 35 are no longer entitled to a self-contained property, but can only claim the Shared Accommodation Rate (SAR).
DLA – Disability Living Allowance
- This will also be changing
- It will be replaced by PIP for people aged 16-64 years
- It will be based on a medical assessment