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Universal Credit & Welfare Reform

Universal Credit & Welfare Reform. Implications for The Prince’s Trust and the young people we work with. Why?. Too complex Lack of incentive to work.

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Universal Credit & Welfare Reform

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  1. Universal Credit & Welfare Reform Implications for The Prince’s Trust and the young people we work with

  2. Why? • Too complex • Lack of incentive to work "The Universal Credit will mean that work will pay for the first time, helping to lift people out of worklessness and the endless cycle of benefits. Whilst those people who need our help and support will know they will get it without question“ - Iain Duncan Smith, March 2012

  3. Universal Credit – What? It will combine all of the means tested support for working age adults and children into one benefit: • Income support • Income-based jobseekers allowance • Income-based employment and support allowance • Housing benefit • Child tax credit • Working tax credit Universal Credit

  4. Universal Credit – What? 29 other benefits remain

  5. Universal Credit - Who? If you are... • Unemployed • In low paid work • A lone parent • Sick or disabled • A carer • Need help with living expenses, including rent or mortgage ...you will claim Universal Credit

  6. Universal Credit – Who? Conditions: • Aged 18 or over • Resident in Great Britain • Not in education • Subject to ‘claimant commitment’ • Savings and capital below £16,000 • Income (or combined income) sufficiently low

  7. Universal Credit – How much? • a standard allowance • an amount for each child • an amount for each disabled child • an amount for an ill or disabled adult • an amount if you are a carer • an amount for housing costs • an amount for childcare costs The sum total of the above will give the maximum Universal Credit for an individual or a couple. However, if the claimant(s) receive(s) any earnings and/or income or has any capital, the maximum amount is likely to be reduced.

  8. Universal Credit – How? • digital by design • monthly assessment and payment • direct payment of housing costs • single payment per household

  9. Universal Credit – Conditionality • ‘Claimant commitment’ • Conditionality group: • No work-related requirements • Work focused interviews • Work focused interviews and work preparation • All work-related requirements • ‘Actively looking for work’ • ‘Available for work’ • 35 hours

  10. Universal Credit – Conditionality

  11. Universal Credit – When? Apr 2013 Sep 2013 Apr 2014 Dec 2015 Oct 2017 Pilot No new JSA, ESA or Income Support claims Housing Benefit ‘phased out’ Can begin claims if in low-paid work, and no previous tax credits No new claims for tax credits No new housing benefit claims All JSA, ESA and Income Support claims to UC Leftovers transferred

  12. There is a single payment which covers unemployment and low employment benefit, children, childcare, caring and housing costs. • The number of hours worked does not affect entitlement • As your income increases, your benefit reduces, but you keep 35p of every extra £1 you earn • You do not need to report changes in your earnings, as there is real-time information from HMRC • If you are in a couple, you will make a joint claim • Claims are online and payments are monthly Universal Credit – in summary

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