Universal Credit comes to town…..what it means for you
Our Benefits expert Jayne Knights updates you on what is happening with the new Universal Credit system. Over to Jayne….
Universal Credit is coming soon to a Jobcentre Plus near you – Literally! This highly controversial new benefit is coming in its ‘full’ version to Eastbourne, Brighton and Hove from this Autumn and nothing in the world of means tested benefits will be the same again for both claimants and their advisers. West Sussex, Lewes and Newhaven have breathing space until next Spring.
Universal Credit – An Overview
Universal Credit is the brainchild of Iain Duncan Smith and his colleagues in the Centre for Social Justice, and is intended to be a one size fits all replacement for the complex and inconsistent benefits system that currently prevails in most of Sussex. Any working age person (currently up to about 64) who needs help with living costs, rent and childcare will be a potential claimant of Universal Credit, all the ‘legacy benefits’ that have been around for years will become unobtainable, firstly to new claimants and then gradually to existing claimants. This term ‘legacy benefits’ is one that is officially used by the Department of Work and Pensions (DWP) and specifically means income support; housing benefit; working and child tax credits; income based jobseeker’s allowance (JSA) and income based employment and support allowance (ESA).
As things stand currently (i.e. prior to October 2017), the only people who can access Universal Credit in most of Sussex are single, uncomplicated, British jobseekers who are making new claims. This is because most of us are currently in ‘gateway’ areas, where only the most straightforward of claims make it through the ‘gateway’. Once our areas adopt the ‘full service’ or ‘digital’ version of Universal Credit, then the gateway conditions no longer apply. Universal Credit is opened up to the whole claimant range and it will no longer be possible for most people to claim any of the legacy benefits listed above if their claims are new. Hastings is the only area in Sussex to have the full service so far and their experiences have been very mixed.
Anyone who makes a successful claim for Universal Credit, whether in a gateway or a full service area, will have a waiting period of (up to) about 6 weeks to get through. During this period they will receive no money unless they claim an advance payment, which is paid in the form of a loan. After the long wait, a lump sum will be paid to them each calendar month – this will be a ‘standard allowance’ amount for living expenses, plus extra ‘elements’ where applicable for children, childcare costs, being a carer, being too ill or disabled to work and for housing costs – both rent and mortgage. Benefits such as Carer’s Allowance will be taken into account as income, along with earnings after disregards have been applied. Benefits such as child benefit and Personal Independence Payment (PIP) will carry on being disregarded as income. This means that most claimants will be expected to budget for their needs out of this single monthly payment of Universal Credit, plus whatever other income they have. Vulnerable or disabled people will be able to request different arrangements.
Tips for Universal Credit Survival
Many people are understandably anxious about the way Universal Credit is supposed to work. Stories in the press about the rising use of foodbanks in full Universal Credit areas are plentiful, along with accounts of rent arrears accruing due to delays in payment and a growing reluctance on the part of private sector landlords to take on Universal Credit claimants. Other people are worried about how they will actually manage to make and maintain their claims – the requirement in a full service area is to both make and manage claims online, with digital communication taking the place of letters.
My mantra is, as always, to be prepared. Here are some essential tips for Universal Credit survival!
- Remember that Universal Credit only affects means tested benefits. If you or your family member gets a contribution based benefit (e.g. contributory ESA) or a non-contribution based benefit (e.g. PIP, DLA or Carer’s Allowance), then these benefits are not affected by the arrival of Universal Credit;
- If you or your family member currently gets a means tested benefit such as income support, income based JSA/ESA, tax credits or housing benefit, then you will not be affected by Universal Credit, even when your area switches to the full service, UNLESS your circumstances change significantly or the DWP decides it is your turn to be ‘migrated’ to Universal Credit (the latter isn’t due to start happening for several years, but of course there are no guarantees). An example of a change of circumstances triggering Universal Credit would be someone who is currently on JSA starting a job of more than 16 hours a week: if their earnings were low enough to need some help with their rent, they would claim Universal Credit, which would act as a top up to their earnings.
- Try and steer clear of the hype and anxiety around Universal Credit. It is not perfect in any way and the implementation of the full service version is patchy and often incompetent. However, it’s happening here soon and is unavoidable, therefore you need to get the following pieces of preparation off your list if you think Universal Credit might affect you.
How to Prepare for Universal Credit
- Make sure that your current benefits are completely sorted and maximised. Use these excellent sites to help you: turn2us.org.uk or www.entitledto.co.uk.
- Make sure, if you possibly can, that you have a fully functioning bank account, NI number, email address, mobile phone and a means of accessing the internet which is reliable and as cheap as possible.
- Try and get a current passport or driving licence, even if you don’t intend to drive anywhere or even leave the country – this will save so much hassle in terms of identity verification.
- If you have housing costs, make sure you have an up to date tenancy agreement/mortgage proof.
- Make sure your medical certificates (or sick notes/fit notes) are fully up to date.
- If you care for someone, make sure your appointeeship/their Lasting Power of Attorney is up to date and easily verifiable.
- Don’t panic – there are many local advice agencies in your area that are available to help you.
I will be updating this blog as the full service Universal Credit unfolds in Sussex – watch this space!
Thank you to Jayne Knights for an extremely informative and helpful blog. Jayne can be contacted via her website, please click here.