Benefits update: Universal Credit

Welcome to the Blesma's regular section on the benefits system. As well as highlighting some useful information regarding the benefits system, on occasions we will be raising awareness of some health and social care matters.

If you would like to discuss your benefit entitlement or have a social care query, please contact your Blesma Support Officer. Alternatively, you can contact Liz Watling in the Independence and Wellbeing team by email at iwabenefits@blesma.org or by calling her on 0208 548 3516.

In March 2020, in response to the pandemic, the Government temporarily increased the standard rate of Universal Credit by £20 per week. This is equivalent to an extra £1,040 per year. There is lobbying taking place to request the government continues with the increased amount. However, at the time of writing, the Government plans to end this uplift in October this year, which will result in claimants seeing a decrease in their monthly entitlement.

The government started informing claimants in July by updating claimant statements, notifying them of how much of their standard allowance is a result of the temporary uplift. There will be further communications over the summer via the claimant statement and journal messages. Claimants will receive a notification alert via email or test, depending on their preferred method of communication, which lets them know to check their Universal Credit online account.

If you have any concerns or questions about your benefit entitlement please contact your BSO in the first instance. 

Post Office Card Accounts

We start with a reminder that Post Office card accounts are due to end in November 2021.

The Department for Work and Pensions (DWP) and HM Revenue & Customs (HMRC) will stop making payments, including Universal Credit, other benefits, tax credits or your state pension, into Post Office card accounts.

The DWP will write to all customers who currently receive their State Pension or benefit payments into a Post Office card account. The letter will inform that the Post Office card account service is closing and customers to provide alternative account details. Their dedicated customer service centre is available to take calls from Post Office card account customers, to accept new account details or answer any questions. They will ensure all future payments are switched to the customer’s new account from the next available payment date and there will be no interruptions with their payments. For anyone who is unable to open a different type of account or provide new account details, a payment exception service will be available.

If you are affected by this change and have any queries, please contact the Post Office card account Customer Service Centre Telephone on 0800 085 7133

Support with rent payments

For the rest of this edition we are focussing on ways to receive support with your rent from the benefits system. Whilst some people have remained in employment on their full pay, Covid-19 has impacted on jobs, whether this has seen a reduction in income due to furlough or a job loss. For those that have less disposable income, there has been a knock on effect on managing to pay their rent.

The government made temporary changes to the eviction rules by making landlords unable to evict people who have fallen into rent arrears due to the effect of Covid-19 on their income (they can still evict due to anti-social behaviour or domestic violence or other reasons not related to Covid-19).

These changes will come to an end at some point over the next few months, dependent on the area of the UK you live in.

Once the restriction on evictions comes to an end, your tenancy may be at risk if you are not able to pay all of your rent, including any arrears that have built up.

What support is available through the benefits system?

Support is available via Universal Credit or Housing Benefit which are both means tested benefits. Your income and capital will affect whether you can receive support through one of these benefits. If you are part of a couple, your income and capital for both of you affects your entitlement.

Universal Credit is for working age people and Housing Benefit is for people over State Pension age. If you are part of a couple and one of you is below State Pension age and one above, you will need to claim Universal Credit.

For further information on Universal Credit and Housing Benefit, please read on. Following this, if you are considering making a claim for benefit it is advisable to speak to your Blesma Support Officer beforehand as this information is a guide and the rules can be more complex depending on your individual circumstances.

Universal Credit

What is Universal Credit?

Universal Credit supports you if you are on a low income whether in or out of work. It includes support for the cost of housing, children and childcare, carers, and people too ill or disabled to work.

It is a means tested benefit. This means your income and capital will affect your entitlement. Some of your income and capital may be ignored.

Who can claim Universal Credit?

You can apply for Universal Credit if you are in or out of work, and on a low income. 

You will usually only be able to claim Universal Credit if you are aged 18 or over and under State Pension age. Some people within this age bracket will be excluded from claiming, such as certain students.

How is Universal Credit calculated?

Universal Credit is a single payment that is made up of different amounts depending on your circumstances.

The calculation will take into account:

• your earnings if you are working
• your partner’s earnings if they are working
• any other income that is coming into your household e.g. an occupational pension
• the capital you and your partner have

The amount you get is worked out each month, so may be different from one month to the next if you earn a different amount, or if your circumstances change.

Some income may be disregarded within the calculation, such as a War Pension and Armed Forces Compensation Scheme Guaranteed Income Payment.

There is a capital limit of £16,000, meaning that claimants with capital above this level will not be able to receive a payment of Universal Credit.

What is expected of the claimant?

In return for getting Universal Credit, you will be expected to meet further requirements, such as look for, or prepare for work, unless you are unable to.

Claimants will have different responsibilities dependent on their circumstances.

If you are unable to work due to ill health or disability, you will have to take part in a Work Capability Assessment, to determine the level of further requirements attached to your claim.

What does Universal Credit replace?

Universal Credit replaces:

• Working Tax Credit
• Child Tax Credit
• Income Support
• Income based Jobseeker’s Allowance
• Income related Employment and Support Allowance
• Housing Benefit

You cannot receive Universal Credit and one of these benefits at the same time.

If you receive any of these benefits or tax credits and your circumstances change, you may need to claim Universal Credit instead.

If you are already claiming any of these benefits or tax credits, you will be expected to change to Universal Credit at some stage, whether or not there is a change in your circumstances. The Department for Work and Pensions will get in touch with you before there are changes to your benefits or tax credits.

It is recommended you speak to your Blesma Support Officer before making a claim for Universal Credit. It is a complex benefit made up of different elements. If you are already part of the means tested benefits system, these benefits may be affected by a Universal Credit claim and you may find yourself worse off.

Housing Benefit

What is Housing Benefit?

Unlike Universal Credit, which has a number of different elements, Housing Benefit is a single benefit to support you with your rent costs only. Some of your income and capital may be ignored.

Housing Benefit is being replaced by Universal Credit. It is now only available to those who are already receiving it and some new claimants. You cannot receive Housing Benefit and Universal credit at the same time.

Housing benefit can help pay your rent if you are unemployed or on a low income. It is a means tested benefit. This means that your income and capital will affect your entitlement.

Who can claim Housing Benefit?

You can only make a new claim for Housing Benefit if either of the following apply:

• You have reached State Pension age
• If you are part of a couple, you must both have reached State Pension age
• You are in supported, sheltered or some types of temporary housing

If you are working age and already receiving Housing Benefit and your circumstances change, you may need to claim Universal Credit instead.

You will also be expected to change from Housing Benefit to Universal Credit at some stage, whether or not there is a change in your circumstances. The Department for Work and Pensions will get in touch with you when this applies to you.

How is Housing Benefit calculated?

There is no set amount of Housing Benefit. The award will take into account:

• Your earnings if you are working
• Your partner’s earnings if they are working
• Any other income that is coming into your household e.g. an occupational pension
• The capital you and your partner have

Some income may be ignored within the calculation. Local Authorities, who administer Housing Benefit have a discretionary power to disregard War Pension and Armed Forces Compensation Scheme Guaranteed Income Payment.

There is a capital limit of £16,000, meaning that claimants with capital above this level will not be able to receive a payment of Housing Benefit, unless they are in receipt of Pension Guarantee Credit.