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Forum Home  →  Discussion  →  Universal credit administration  →  Thread

Removal of the WRAC & Work Allowance

J.Mckendrick
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Welfare Benefits Team - Phoenix & Norcas

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In April 2017 the WRAC of ESA is scrapped whether it be Cont Based, Income Based ESA or UC equivalent. Can I therefore take it that the work allowance of £192-00 or £397-00 for those currently in receipt of UC (or future UC claimants) and deemed unfit for work will also be scrapped. If so theses clients get hit twice!

HB Anorak
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The UK Regs say the work allowance applies if the claimant has LCW. That will remain the case as I understand it. There won’t be a component in the maximum UC amount any longer but other consequences of having LCW (eg work allowance, lighter conditionality and student eligibility) will continue as before

J.Mckendrick
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Many thanks for the reply but could you expand or put it another way!

Daphne
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Claimants still get assessed as to whether they have limited capability for work. If they do have LCW they don’t get any extra money in their benefit but, if they have that status, they still get the work allowances under UC, or are able to do permitted work if on ESA. In other words they can have some earnings before they lose benefit.

As HBAnorak says it also means they have less conditionality, lighter sanctions and may qualify for disabled student status (if they get PIP/DLA as well)

Tom Messere
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Yes, the key thing is that the category - the ESA Work Related Activity Group or UC people with LCW with a work preparation requirement -  remains after the changes - along with sanctions and Work Allowances.  It’s just that the bonus for doing so disappears for new ESA claims / new UC based on LCW after April 6th .

The original ESA new deal was that the - much needed - extra amounts for long term illness were to be paid earlier in exchange for a little light work related activity - arguably a “something for something”  deal, based on the claim that long term benefits were a “perverse incentive” to stay unwell. 

This has now been turned into “nothing for something”  offer,  that reneges on that first Welfare Reform deal. Once again the justification is that the ESA WRAC / UC LCW element was a ” perverse incentive” to claim on sickness rather than jobseeker routes. Of course someone on JSA with a disability premium gets more, no evidence was produced for this actually being an issue and it is not a matter of client choice - they have to get past the Maximus gatekeepers first :-)

Civil servants do like to spot a perverse incentive if they can,  or make one up if they can’t :-)

Eligibility for the LCW related Work Allowance, then goes with the statusthat remains,  not the ESA component / UC element that doesn’t. Better news than you feared, but the cut back Work Allowances still works out less than the ESA Permitted Work disregards. And with no distinct “permitted work” category as such within UC , there is less protection against the anxiety that a successful period in work will lead to doubts being cast on your LCW. Under ESA there are some barriers from separations and DWP policy intent, but under UC that may be down to your JC+ Advisor’s approach.

You mention people already on UC losing out. However, the changes do not affect people who are receiving an LCW element or are in the process of being assessed for one,  at April 6th.  For ESA, it’s only totally new claims who lose the right to a WRAC - not existing ones whether currently on WRAC or on Support Component who might go on to WRAC , those still in the assessment phase nor new claims linking back to a pre-April ESA claim.

[ Edited: 14 Mar 2017 at 12:31 am by Tom Messere ]
Mike Hughes
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Senior welfare rights officer - Salford City Council Welfare Rights Service

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Whole new meaning for “bonus” there!!!