Legacy benefits claimants may be switched to Universal Credit early

Autumn Statement: Hunt announces rise in Universal Credit

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The process whereby the DWP moves people over is known as ‘managed migration’ with people receiving a letter ahead of the administrative change. But an individual may be moved over ahead of this process in some cases, which is known as ‘natural migration’.

New Work and Pensions Secretary Mel Stride told the Work and Pensions Committee this week that a claimant will automatically trigger a move if they report a change in their circumstances.

According to the Government website, changes can include:

  • Finding or finishing a job
  • Having a child
  • Moving in with a partner
  • Starting to care for a child or disabled person
  • Changing a mobile number or email address
  • Moving to a new address
  • Changing bank details
  • Rent going up or down
  • Changes to a health condition
  • Becoming too ill to work or meet your work coach
  • Changes to earnings (only for the self-employed)
  • Changes to savings, investments and how much money a person has
  • Changes to immigration status, if a claimant is not a British citizen.

Universal Credit is gradually being rolled out in different parts of the country, replacing these six legacy benefits:

  • Child Tax Credit
  • Housing Benefit
  • Income Support
  • Income-based Jobseeker’s Allowance (JSA)
  • Income-related Employment and Support Allowance (ESA)
  • Working Tax Credit.

Mr Stride told the cross-party panel of MPs that his department’s three main objectives are helping the most vulnerable, getting people back into work and tackling benefits fraud.

But some MPs challenged him and queried if the UK Government is taking money from those with the least by delaying moving some legacy claimants onto the new system, through sanctions, and by recovering overpayments.

Mr Stride told the Work and Pensions Committee the UK Government has a “particular duty now to focus on those most in need as we go through these difficult times”.

Conservative MP Nigel Mills asked about the delay to managed migration of people on legacy benefits such as Employment and Support Allowance (ESA) onto Universal Credit.

The migration process was due to be accelerated next year ahead of the original completion deadline at the end of 2024.

But Chancellor Jeremy Hunt announced in the Autumn Statement the managed migration scheme would be delayed until 2028.

Mr Stride told the MPs that 33 percent of people on ESA are likely to lose out as a consequence of that migration, and 55 percent will get a bigger payment.

He said he sees the delay as an “opportunity for a reallocation of resources” to help the department focus on those who need the help.

The DWP previously said more than one million of the remaining legacy benefits claimants would get more money on Universal Credit.

The categories of claimants who may get a higher payment under Universal Credit include:

  • Employment and Support Allowance (ESA) Support Group not in receipt of the Severe Disability Premium
  • In-work households receiving Housing Benefit only or Working Tax Credit and Housing Benefit – this is because the earnings taper rules are more generous with Universal Credit
  • People who do not work enough hours to receive Working Tax Credit
  • Households who have not been claiming all the legacy benefits they are entitled to.

People who will see their payments decrease may be able to get transitional protection, to keep them at the same level for a period, to avoid a sudden drop in income.

Types of claimants who may get a lower payment with Universal Credit, and who may be eligible for transitional protection, include:

  • Households who receive Employment and Support Allowance (ESA) with the Severe Disability Premium and Enhanced Disability Premium
  • Households with the lower disabled child addition on legacy benefits
  • Self-employed households who are subject to the Minimum Income Floor, after the 12-month grace period has ended.
  • In-work households that work a specific number of hours (for example, lone parent working 16 hours claiming Working Tax Credits)
  • Households receiving tax credits with savings of more than £6,000, and up to £16,000.

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