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New universal credit rules which could leave 200,000 claimants waiting six months for benefit
New universal credit rules which could leave 200,000 claimants waiting six months for their benefit have sparked fresh fears over increased tenant rent arrears.
The new regulations, which were quietly laid in parliament last week, have been described by social landlords as likely to lead to increased hardship and evictions.
Currently, the Department for Work and Pensions (DWP) calculates a claimant’s universal credit monthly. If they earn above a certain threshold in that month, their entitlement is reduced or removed. Under the new rules, the DWP will take into account earnings the claimant has made in the six months previously.
This means a person who earns a larger amount in one month, but nothing the following month, may find they are unable to claim universal credit for up to six months. The change only applies to people making repeated claims within six months of a previous claim ending.
The DWP expects up to 200,000 universal credit claimants to be hit by the change after it comes into force on 6 April 2016 – nearly 10 times the number hit by the £26,000-a-year benefit cap.
The change means claimants who receive an irregular income will have to plan and set aside savings for when they are not in work, as they may not be able to fall back on benefit.
In response to a previous consultation on the change, the National Housing Federation said: ‘Any additional delay in tenants’ ability to access the right support will further increase the possibility of poverty.’
London landlord Peabody said an ‘obvious area of hardship’ would be when claimants took up additional seasonal work. The housing association added: ‘With the accruing rent arrears, there is every chance of people facing eviction.’
Community Housing Cymru, the Scottish Federation of Housing Associations (SFHA), Golden Gates Housing Trust and Wheatley Group have also expressed concern.
The government announced last week it had changed the finalised regulations to allow claimants to earn up to £300 more in one month than the next without being hit, halving the number of people estimated to be effected. The change is designed to prevent people who have an option on when they get paid from maximising universal credit.
Here’s a link to last week’s rightsnet news story on the Universal Credit (Surpluses and Self-employed Losses) (Digital Service) Amendment Regulations 2015 and the SSAC report on them -
and here’s the regs themselves -
So how does UC encourage people to go into work then if this scenario becomes well known?
So how does UC encourage people to go into work then if this scenario becomes well known?
The threat of sanctions!
This is very worrying and does mean that the whole point of UC encouraging people to work is going to fall down as working will leave them vulnerable in the future. Very worrying
This is very worrying and does mean that the whole point of UC encouraging people to work is going to fall down as working will leave them vulnerable in the future. Very worrying
Yes, see also this thread: http://www.rightsnet.org.uk/forums/viewthread/7317/
The regs come into force in April 2016 but they’ll only apply to claimants on the UC digital service (which by then may still be limited to just part-postcode SM5 2).
Even if the system to support the national digital service is ready on time, DWP don’t expect transition to the digital service to complete until Dec 2017.
[ Edited: 6 Mar 2015 at 10:20 am by Jon Blackwell ]
Had a look at these regs and to be honest I am a bit stuck with the formula as quoted in the new 54A. i.e. the nil UC threshold formula plus £300 equals the relevant threshold
I concede I didn’t do well at my higher maths exam but if I put numbers in…
Had a look at these regs and to be honest I am a bit stuck with the formula as quoted in the new 54A. i.e. the nil UC threshold formula plus £300 equals the relevant threshold
I concede I didn’t do well at my higher maths exam but if I put numbers in…
The formula is incorrect. It should have a divide by 65 in there. I have let DWP know and they will be making the relevant amendments. It was correct in the draft regs.
Victoria
I’m being thick - so what happened to this provision (UC Reg 54A) inserted by SI 2015/345 and amended by SI 2016 / 215 to apply from April 2017?
Its not included in Sweet & Maxwell Vol V or the consolidated legislation (Blue Book).
http://www.legislation.gov.uk/uksi/2017/197/regulation/2/made
Slipped another year
Thanx. Ah! - a snail out rather than a roll out (ouch).