Learn with us. Improve with us. Influence with us www.cih.org Universal credit Sam Lister, Policy & Practice Officer, CIH
Content UC winners and losers HB caseload and UC roll out Basic conditions and eligibility Calculation of awards The housing costs element Appeals and changes Payments Summer Budget 2015 cuts Learn with us. Improve with us. Influence with us www.cih.org 2
UC winners and losers Learn with us. Improve with us. Influence with us www.cih.org
Winners and losers 2.5 million gainers 1.4 million losers 2.5 million no change Bottom 60% of incomes gain on average Top 40% lose slightly Couples with children gain the most Learn with us. Improve with us. Influence with us www.cih.org 4
Weekly net earnings & benefits (ex CTR) Current & UC compared 600.00 500.00 400.00 Earnings plus basic benefits (excluding CTRS) HB/WTC/CTC 300.00 200.00 100.00 Earnings plus basic benefits (excluding CTRS) UC 0.00 Gross weekly pay ( ) Couple, two children, one earner, rent 75.00, council tax 23.00 Before July 2015 Budget changes Learn with us. Improve with us. Influence with us www.cih.org 5
HB caseload and UC roll out Learn with us. Improve with us. Influence with us www.cih.org
PRS HB caseload Wales Pension age Working age Local housing allowance 8,136 65,517 Non-LHA deregulated 3,697 6,196 Regulated 943 128 Total 12,776 71,841 DWP, February 2015 Learn with us. Improve with us. Influence with us www.cih.org 7
Working age LHA caseload Household type Children / Childless 54.2% 45.8% Single / Couples 78.8% 21.2% Work status JSA(IB) 18.0% ESA(IR) 14.1% Income support 28.9% Working 16+ hours 30.3% Other non-passport 8.7% DWP, February 2015 Learn with us. Improve with us. Influence with us www.cih.org 8
UC roll out and transition Cover all Jobcentre offices by the end of 2015? But so far new claim JSA singles only and in a limited number of areas JSA couples Gradually widen the cohort and expanding to include major changes of circumstance Expansion families and couples to end of 2017 After transition phase block migration to 2020 The lobster pot cannot go back to HB Learn with us. Improve with us. Influence with us www.cih.org 9
PRS working age LHA: Wales 20.0% 18.0% 16.0% 14.0% 12.0% 10.0% 8.0% 6.0% Income support JSA(IB) ESA(IB) Work 16+ hours Other non-passport 4.0% 2.0% 0.0% Single Lone parent Couple, no child Couple with children Learn with us. Improve with us. Influence with us www.cih.org 10
Basic conditions and eligibility Learn with us. Improve with us. Influence with us www.cih.org
Summary key features Replaces six existing benefits JSA(IB), ESA(IR), income support HB (working age) Child tax credit, working tax credit Working age benefit (mirrored by pension credit) A single award per household Couple joint claimant Paid monthly in arrears to the claimant Awarded in-work and out-of-work (no hours rules) Administered by the DWP Learn with us. Improve with us. Influence with us www.cih.org 12
UC basic conditions Under state pension credit age* Aged 18 or over (certain 16/17# year olds but no HCE) Not a student* Present in Great Britain# Meet additional conditions if a migrant# Not a prisoner or detained in hospital# Accept a claimant commitment (work related requirements) * Only one member need meet if a couple # single person rate if one member of couple does not meet Learn with us. Improve with us. Influence with us www.cih.org 13
Two homes & temporary absence Two homes No overlap following move Large family housed in two properties by social landlord Fear of violence (12 months) Adapting for disablement needs (one month) Essential repairs (only one normal home) Temporary absence 6 months (instead of 13 or 52 weeks) 12 months fear violence with intention to return 1 month adapting property or waiting to move in from a care home Learn with us. Improve with us. Influence with us www.cih.org 14
Waiting days & backdating Extended payments (abolished) Seven waiting days (no entitlement) Backdating limited to one month Couples both have to satisfy test Good cause replaced with qualifying circumstances Notice of expiry of another benefit not received Disability (mental, physical, language) Health condition that prevented you from making a claim Unable to make claim due to unexpected system failure or planned maintenance Learn with us. Improve with us. Influence with us www.cih.org 15
Calculation of awards Learn with us. Improve with us. Influence with us www.cih.org
Maximum amount Standard allowance (single/couple) Child element (includes disabled child) Housing costs element LCW / LCWRA element Equivalent WRA and support component of ESA Carer element Child care costs (70% costs up to maximum) Learn with us. Improve with us. Influence with us www.cih.org 17
Basic calculation Calculate maximum award Deduct any unearned income Most benefits except (PIP, child benefit) Deduct 65% of earnings less work allowance from maximum award The result is your monthly UC unless your UC plus child benefit exceeds the cap No cap if earning 100 per week If cap applies it is the capped amount Learn with us. Improve with us. Influence with us www.cih.org 18
Work allowance Single (rented housing) Weekly equivalent Lone parent 263 60.69 No child but limited capability for work 192 44.31 Any other case 111 25.62 Couple (rented housing) Weekly equivalent Responsible for one or more child or young person 222 51.23 No child but limited capability for work 192 44.31 Any other case 111 25.62 Learn with us. Improve with us. Influence with us www.cih.org 19
Housing costs element Learn with us. Improve with us. Influence with us www.cih.org
Calculation Rent Service charges Less under occupancy deduction (not joint tenants) Less housing costs contribution (equivalent of nondependant deductions) Learn with us. Improve with us. Influence with us www.cih.org 21
Eligible service charges Window cleaning of upper floors (A) Maintenance and cleaning of communal areas (B) Supply of water and fuel to communal areas (B) Reasonable facilities, laundry rooms children s play areas and grounds maintenance (B) Provision of basic communal services and their on-going cleaning and maintenance (refuse collection, lifts, secure access, TV aerial, provision of telephone and staff management and maintenance to provide these (C) Use of essential items in own accommodation (furniture and appliances) (D) Learn with us. Improve with us. Influence with us www.cih.org 22
Housing cost contributions Similar exemptions to HB (blind, DLA etc ) Single flat rate ( 16.00 weekly equivalent) Zero rate charge if non-dependant.. is aged under 21 gets state pension credit gets daily living component of personal independence payment gets carers allowance is responsible for a child aged under five Learn with us. Improve with us. Influence with us www.cih.org 23
Appeals and changes Learn with us. Improve with us. Influence with us www.cih.org
Assessment period Begins on the first day of your entitlement to UC and lasts one calendar month Changes occurring part way through an AP get made from the start of the AP (not on a pro-rata basis) Gain if advantageous change takes place before end of assessment period Lose if a disadvantageous changes occurs at end of assessment period Learn with us. Improve with us. Influence with us www.cih.org 25
Rent increases A rent increase is an advantageous change (because results in more UC) Provided that the increase is reported before the end of the assessment period in which it first occurs it is awarded from the start of that period Otherwise from the assessment period it is reported in Learn with us. Improve with us. Influence with us www.cih.org 26
Appeals and overpayments Must go through an internal review before you can appeal (time limits etc unchanged) All overpayments are recoverable Any amount overpaid at a previous address can be taken into account at new address Learn with us. Improve with us. Influence with us www.cih.org 27
Payments Learn with us. Improve with us. Influence with us www.cih.org
UC payment principles UC is a surrogate wage Paid the wage earner (or jobseeker) No separation of housing costs Paid monthly in arrears No third party (landlord) rights to know Learn with us. Improve with us. Influence with us www.cih.org 29
Personal budgeting support DWP strategy for claimants who need support Money advice Alternative payment arrangements (APAs) 1. Managed payments switch back 2. Payment frequency 3. Split payments Two tiers (one-off, on-going) Support locally delivered led by DWP districts Learn with us. Improve with us. Influence with us www.cih.org 30
APAs: key features Case by case basis Claimant knowledge and consent Without consent if Two months arrears Third party payments for arrears Always a temporary arrangement Learn with us. Improve with us. Influence with us www.cih.org 31
Third party payments Guidance (ADM D2022-23) History of persistent mis-spending Threat of eviction No other suitable method of dealing with debt Not making repayments / no agreement to repay Rate of deduction Minimum 10% of standard allowance Maximum 20% of standard allowance Learn with us. Improve with us. Influence with us www.cih.org 32
Summer Budget 2015 cuts Learn with us. Improve with us. Influence with us www.cih.org
Welfare cuts Description April 2016 million New and existing awards April 2017 million Freeze working age benefits and LHA for 4 years 90 940 Reduce benefit cap to 20,000 100 310 Reduce TC threshold TC and UC work allowance 2880 3060 Increase TC taper rate to 48% 1475 1035 Limit backdating in HB to 4 weeks 10 * New claims only Limit child element in TC /UC to 2 children 315 Remove family element/ premium in TC/UC/HB 220 410 End HB for most out-of-work 18-21 year olds 25 35 Abolish WRA component in ESA 55 Learn with us. Improve with us. Influence with us www.cih.org 34
Conclusions Learn with us. Improve with us. Influence with us www.cih.org
Conclusions UC is broadly positive especially if in-work Advantages undermined by July 2015 Budget Work out your profiling Change but much that is familiar Just different for what have been used to Coherent and easy to explain Winners and losers complex Standard families in work gain the most Risk of loss higher if disability, childcare and u25 Learn with us. Improve with us. Influence with us www.cih.org 36
Any questions? Learn with us. Improve with us. Influence with us www.cih.org
The UC & HB rules in detail Learn with us. Improve with us. Influence with us www.cih.org