Universal Credit

From October 2014 people making a claim for benefits will be put onto Universal Credit.

Universal Credit will take the place of many benefits. The individual benefits (things like ‘Jobseekers Allowance’ or ‘Housing Benefit’) will be rolled together into one single payment. The biggest change you will notice is that this single payment is paid monthly.

Which benefits is it replacing?

Universal Credit brings together six benefits and Tax Credits and replaces them with a single monthly payment. It is replacing the following:

·         Income-based Jobseekers Allowance

·         Income-related Employment and Support Allowance

·         Income Support

·         Child Tax Credit

·         Working Tax Credit

·         Housing Benefit ( this money will no longer be paid directly to the  landlord and means that rent payments will now be the responsibility of the claimant)

All other benefits not included in the above list will continue to be paid as usual, such as Child Benefit, Carers Allowance etc.  Other non-financial benefits, such as free school meals, also remain.

 

The main things you need to think about are:

  • People will get a single monthly payment -this means they will need to budget for the whole month.
     
  • All payments will be made to the claimant direct - if  Housing Benefit was previously paid to the landlord this will change. As rent is a priority to pay, it might be worth notifying the Landlord to let them know that there will be a delay in payment. In certain situations rent can be paid directly to the landlord using the Alternative Payment Arrangement (APA). This can happen when people are considered to be vulnerable or have a history of having rent arrears. If anyone is in receipt of Universal Credit and are struggling to make your rent payments please contact us and we can advise you of your options.
     
  • Couples receive one payment which might mean that changes need to be made in relation to budgeting and bank accounts as it might be better to have a joint account to help manage the money.
     
  • Universal Credit will get paid directly into a bank account, building society, or credit union. For more information about this you can see our banking section here.
     
  • Most people will have to make their claim for Universal Credit online at. www.gov.uk/apply-universal-credit . There are plenty of places to get free access to computers. If you are in Manchester you can use this search to find the nearest place to use a computer for free. There is also a booklet produced by Go-ON Manchester that you can read online here called 'get more out of life online'.
  • Claimants will not receive the first payment until almost 6 weeks after the claim is made. Interim payments are available and we can help with this, alternatively claimants can apply at the jobcentre. The advance will need to be paid back over a period of 6 months starting from when the Universal Credit payments begin. Only one advance payment will be made so it is important to work out how much money is needed. The maximum amount that can be awarded is around half of the personal allowance for the 5 weeks 5 days.

 

 

Sanctions

Failing to keep to the claimant commitment will mean losing some (or all) of the personal allowance part of  Universal Credit award – this is called a sanction. (Housing costs will be continued to be paid.)

Hardship payments are available to those people affected by a sanction who can demonstrate that they are suffering hardship. But these hardship payments will need to be claimed on a monthly basis and need to be repaid when your benefit is back in payment.

It’s important to keep up to date as some things could still change. Good places to look for information are the Gov.UK website and the Money Advice Service website.