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Welfare benefits news

The latest welfare rights service news.


Compensation for severely disabled people who lost money when moved to Universal Credit

The government has issued regulations that will allow for payment of compensation to severely disabled people who lost money when they were moved to Universal Credit from their previous benefits before January of this year.

The reason for the loss is that the ‘legacy’ benefits system paid a ‘severe disability premium’ to some claimants, and this premium is not reproduced in the Universal Credit scheme.

The Department for Work and Pensions (DWP) says that from 24 July 2019, people in this situation can receive an extra payment backdated to when they moved on to Universal Credit, and an ongoing additional amount every month. This may be between £120 and £405 a month, depending on the person’s circumstances.

It is not yet known how and when people will be contacted by DWP about this compensation.

Since 16 January 2019, it's not been possible for anyone with a severe disability premium to be moved to Universal Credit, and this protection will remain in place until January 2021.

For information and advice, email: welfarebenefits@derbyshire.gov.uk or tel: 01629 531535 from 11am to 4pm on Monday, Tuesday, Thursday and Friday.

Universal Credit

Universal Credit is slowly replacing means-tested benefits for working-age people (Income Support, Income Based Jobseeker’s Allowance, Income-Related Employment and Support Allowance, the tax Credits and Housing Benefit) which are referred to as ‘legacy benefits’.

To make the latest developments clear, here is a short summary.

The roll-out of Universal Credit

The timetable announced in the November 2018 Budget for the ‘managed migration’ of UC to all remaining claimants of ‘legacy’ benefits has not changed and is still due to take place between 2020 and 2023 to 2024.

From July 2019,UC is due to test its ‘managed migration’ system on a limited number of 10,000 claims before the government seeks approval for the remaining claims to be migrated. The test is to take place in the Harrogate area. Claimants in Derbyshire are unaffected. For the latest, see our leaflet ‘Universal Credit - what is happening now and in the future’.

What has changed is that UC will now test its ‘managed migration’ system on a limited number of 10,000 claims before the government seeks approval for the remaining claims to be migrated.

Severely disabled claimants who receive the ‘severe disability premium’

At the moment, people can only move on to UC if they make a new claim. Or they have a change in their circumstances which means that a ‘legacy’ benefit stops and they need to make a new claim for means-tested help.

In this situation, it is not possible to make a new claim for ‘legacy’ benefits and any claim will be for Universal Credit. This is referred to as ‘natural migration’.

This has caused a problem for some severely disabled claimants who live alone, as they received additional money in their legacy benefits called a ‘severe disability premium’. This additional help does not exist in UC, and so many disabled claimants found themselves worse off on UC.

From 16 January 2019, anyone who is entitled to the severe disability premium in their legacy benefits will not be able to claim UC and will not be affected by ‘natural migration’. Instead they can claim legacy benefits, even if they have a change in circumstances.

Anyone who has already lost their SDP through migration to UC will receive compensation, but this has not yet been passed in to law.

People of pension age who have younger partners

From 15 May 2019, couples made up of one pensioner and one person of working age must usually claim Universal Credit instead of Pension Credit until they are both of pension age.

Existing claims for Pension Credit will carry on, but seek advice if you have a change of circumstances. If on 15 May 2019 you were claiming Housing Benefit but not Pension Credit as a mixed-age couple, you may have a right to claim Pension Credit at a future date.

Up to 13 August 2019 you may still have a right to claim Pension Credit and/or Housing Benefit as a mixed-age couple, if you were entitled before 15 May 2019 but have not yet made a claim.

It is very important to seek advice on your entitlements in this situation.

Find out more about Universal Credit and how it works.

For information and advice, email: welfarebenefits@derbyshire.gov.uk or tel: 01629 531535 from 11am to 4pm on Monday, Tuesday, Thursday and Friday.

Changes to Tax Credits

Changes announced on 1 February 2019 mean that most people cannot now make a new claim for Tax Credits.

Most people who are working or looking after children and who need means-tested help will now have to claim Universal Credit.

Some new claims for Tax Credits are still allowed for people who are barred by the current rules from claiming Universal Credit.

If you are a disabled person who receives a ‘severe disability premium’ in a benefit such as Income Support, Income-Based Jobseeker’s Allowance, Income-Related Employment and Support Allowance or Housing Benefit, you can still claim Tax Credits where appropriate.

If you have an existing Tax Credits claim, this will continue for the time being. If you already have a claim for one Tax Credit and need to make a claim for the other after 1 February 2019 you can also continue to do this.

We recommend that you seek advice from our helpline if you have any queries about Tax Credits now that these changes are in place.