The Department for Work and Pensions has announced a cash boost for thousands of people moving on to Universal Credit.
And the extra money does not have to be paid back.
Universal Credit replaces six existing benefits:
- Child Tax Credit
- Housing Benefit
- Income Support
- income-based Jobseeker’s Allowance (JSA)
- income-related Employment and Support Allowance (ESA)
- Working Tax Credit
Anyone moving from one of those to Universal Credit typically finds their existing benefits are stopped.
That can create financial difficulties during the wait for Universal Credit – which is around five weeks but can be 11 weeks or more.
Since April 2018, those on Housing Benefit were given two weeks extra when moving to UC and this is believed to have helped 2.3 million households.
And now that two weeks extra is also being offered to those who move to Universal Credit from income-based Jobseeker’s Allowance (JSA), income-related Employment and Support Allowance (ESA) and Income Support (IS).
That could help an estimated 1.1 million households, according to one report seen by Birmingham Live.
The DWP today announced that thousands of benefit recipients moving to Universal Credit are to receive up to two weeks of additional cash to provide them with extra support.
From Wednesday, July 22, if someone’s existing claim of income-based Jobseeker’s Allowance (JSA), income-related Employment and Support Allowance (ESA) or Income Support ends due to them applying for Universal Credit they will receive a payment worth up to two weeks of their legacy award.
By our reckoning, it could mean around £120 to £200 extra to tide people over during the wait for Universal Credit – and could ease the need to take out an advance payment of UC that then has to be repaid like a loan.
This one-time payment, known as a run-on, is to help people during their first assessment period, and does not have to be paid back.
It will be paid automatically to eligible claimants when they claim Universal Credit for the first time, so they don’t have to contact the Department for Work and Pensions to receive it.
And it will not affect the amount of Universal Credit they receive.
Minister for Welfare Delivery Will Quince said: “This one-off payment will provide additional support as claimants move from legacy benefits to Universal Credit.
“It doesn’t have to be paid back and won’t affect their UC award, so is welcome extra cash in pockets.”
Run-on payments will include other premiums that claimants have been receiving prior to moving over to Universal Credit, including Enhanced Disability Premium, carer premium or ESA work-related activity component.
Anyone on the legacy benefits being replaced by Universal Credit is moved across when their circumstances change, such as moving home, losing their job or having a baby.
Everyone else on the legacy benefits is expected to be moved across by September 24. This date is much later than originally forecast and will increase the cost of implementing Universal Credit to £4.6 billion.
The DWP insists that Universal Credit “simplifies the benefit system” and means that “people are moving into work faster and staying in work for longer than they were on previous benefits.”
Since mid-March, the DWP has managed to process more than 2.5 million claims for Universal Credit and pay over one million new claims advances, which it says has meant hundreds of millions of pounds getting to those in urgent need within days.