Universal Credit (UC) is a new benefit for people under pension age which aims to replace 6 means-tested benefits, i.e. Working Tax Credit, Child Tax Credit, Housing Benefit, Jobseeker’s Allowance, Income Support and Employment and Support Allowance.
From November 2018, anyone in Edinburgh who is unemployed, unable to work due to sickness or on a low income will have to claim UC and will no longer be able to claim income-based JSA, income-related ESA, Income Support, Housing Benefit or Tax Credits.
Who is Affected?
This only applies to people making new claims and does not affect people who already have an existing claim for these benefits. Their existing claims will continue until they are ‘migrated’, i.e. transitioned onto UC. This transition is expected to take between 2019 and 2023, so you may not be affected right away.
In addition, people with 3 or more children won’t be able to make a new claim for UC until February 2019.
Why This New Benefit?
The Government’s aim is to simplify the benefits system so that you only need to apply for one benefit, instead of claiming different benefits from different agencies (HMRC, DWP and the Council).
However, a lot of benefits will still remain such as benefits that are based on your National Insurance (NI) contributions like contributory JSA and ESA.
Main Features of UC
- UC is based on your income, not your NI contributions.
- It is administered by the DWP.
- UC combines various elements into one single payment for you, your children, for your housing costs and childcare costs, and for being a carer or unfit for work.
- All claims are digital. You must apply online and manage your claim online in your journal, to communicate with the DWP.
- A single monthly payment to one person in household is made into a bank account.
- Rent payments will be made to you directly, NOT to landlords, unless the DWP agree to an Alternative Payment Arrangement.
- Your award is assessed every month, based on your income for the previous month.
- You can continue to claim UC if you work over 16 hours per week as long as your income is below the threshold—an improvement for people with variable earnings.
- Your claim remains ‘dormant’ for up to 6 months—if your earnings are too high. one month but go back down the next month, your claim restarts automatically.
- UC aims to encourage work. Most people are expected either to look for work, or prepare for work and improve their work prospects depending on their circumstances —although some people are exempt altogether (e.g. carers, people unfit for work in the Support Group).
- Lone parents (or main carers in a couple) with a child aged 3 or over are now expected to look for work.
- People who are in work but do not earn over the Conditionality Threshold (which is 35 hours per week at the Minimum Wage) may be expected to look for more work—unless their Work Coach agrees the threshold should be lowered due to caring commitments for example.
Ask us for advice!
You can click here for our factsheet on Universal Credit. In this factsheet, you will find more tips about:
- Making a claim for Universal Credit
- How to prepare for Universal Credit
- How to avoid problems with your UC Claim
- And some useful contact details
We can also provide training on Universal Credit to charities and housing associations. Contact us for more information.