Unpacking Universal Credit: Benefits, Eligibility, and Payment System

Universal Credit A Technical Briefing Stockton & District Advice & Information Service

What is Universal Credit? means-tested benefit dependent upon income and savings designed to replace most working age benefits ( Legacy Benefits ) designed to make work pay

6 means tested benefits Income-based Jobseeker's Allowance (JSA) Universal Credit replaces 6 means- tested benefits with 1 monthly payment Income-based Employment Support Allowance (ESA) Housing benefit (HB) If you re in a full service area, everyone who currently applies for any of these will need to apply for Universal Credit instead Income Support (IS) Child Tax Credits (CTC) Working Tax Credits (WTC) Stockton will be a full service area from July 2018 Universal Credit

What benefits does Universal Credit NOT replace? Personal Independent Payment (Disability Living Allowance) Attendance Allowance Carers Allowance Council Tax Support Child Benefit Statutory Sick Pay, Statutory Maternity Payment Contribution based JSA & ESA

Standard allowance The payment is made up of a basic standard allowance and extra payments that might apply depending on someone s circumstances Limited capability for work element - if a Work Capability Assessment decides someone s physical or mental health limits their ability to work Child element - for people responsible for a child or qualifying young person Disabled child addition - an addition to the child element for any children in receipt of DLA or PIP This is then means tested against any earnings or capital the client has Childcare element - for people who are in work and pay for registered childcare Carer element - for people caring for a severely disabled person for at least 35 hours a week Housing element - for renters / owner occupiers

How is UC different? Most other benefits Full service Universal Credit When do you receive payments? Paid fortnightly Paid monthly Claims could often be made over the phone or on a paper form How do you make your claim? Everything is done online as standard Changes to a claim or payment could often be made over the phone or through a letter How do you manage your claim? Everything is done online as standard Paid to households - so a couple gets a single payment (although they apply separately) Who is it paid to? Normally paid to individuals

Universal Credit Basic Conditions aged 18 or over (some 16/17 year olds can get Universal Credit) not receiving education satisfy residence tests accepted Claimant Commitment meet financial conditions - income not too high - savings over 16k = no UC - if savings between 6k 16k tariff income applied - tariff income 4.35pcm on every 250

Universal Credit Stockton People receiving legacy benefit will continue to receive it until they are transferred ( migrated ) to Universal Credit. Two types of Migration: Managed Migration Natural Migration

Universal Credit Stockton Migration Managed Migration when DWP moves a client from legacy benefits to Universal Credit Natural Migration where client has change in circumstances and has to make new benefit claim A key feature of Managed Migration is clients will get transitional protection should not be worse off due to being moved on to UC. Clients who come under Natural Migration will not get transitional protection .

Migration Managed Migration due to start 2019 Many people will Naturally Migrate due to change in circumstances

Universal Credit The Claim

Universal Credit After the Claim normal assessment period is one calendar month paid on same date of each month paid monthly in arrears Paid into a bank account on-going assessment and adjustment. Changes in circumstances during assessment period can affect next Universal Credit Payment

Universal Credit The Claim Advance Payments - early payment of part or all of Universal Credit award - loan to be repaid over 12 months - can be requested at any time - after first payment of Universal Credit, must be due to change in circumstances

Universal Credit Alternative Payment Arrangements money for rent paid direct to landlord Universal Credit weekly or fortnightly payment to two accounts instead of one

Alternative Payment Arrangements (APA) APA can be considered if client: - Cannot manage the usual payment arrangement - Risk of financial harm to client or family considered on individual basis High likely need addiction problems - severe debt - mental health condition - rent arrears/threat of eviction - domestic violence - family with multiple and complex needs Discretionary and no right of appeal

Claimant Committment Must be accepted to get Universal Credit Must be adhered to for ongoing UC entitlement List of what claimant must do; - work related requirements - what actions must be done and by when - how to report changes in circumstances - information on sanctions Can be changed by DWP Updated regularly - - - - - - - - -

Work related requirements Depend on circumstances May have to; - look for work ( be available and searching for work) - prepare for work - attend work-focussed interviews - do none of the above - - - - - - Work coach to help claimants set and meet work related requirements -

Stockton & District Advice & Information Service

Universal Credit The Issues Evidence from:- National CAB research from 18 Full Service areas Thirteen Stockton & District Advice & Information Service

Universal Credit The Issues Claiming Waiting period Budgeting On-going claim management Debt

Claiming Universal Credit Access to computer Support to use computer Support to make claim Evidence to support claim Need to claim other benefits

Claiming Universal Credit National CAB Research:- 52% found online application difficult 30% made 10+ calls to helpline Delays in claim mean delays in payment

Waiting period Time from claim to first payment:- 61% - 6 weeks or less 28% - between 7 to 10 weeks 11% - over 10 weeks Waiting period now reduced to 5 weeks from February 2018

Waiting Period How UC clients are managing financially during the 6 week wait (NACAB Survey)

Budgeting Not used to budgeting monthly 55% UC clients previously in work were not paid monthly Not used to paying landlord Fluctuating wages + UC/wages misalignment

Budgeting Misalignment of UC & Wages High UC Paid on 27thJune Low UC Paid on 27thJuly UC Assessment Periods

10% 10% Don't know Don't know 22% 28% No - but I would not have used this Help with budgeting or managing debts Rent Payments direct to my landlord No - but I would not have used this No - but I would have used this No - but I would have used this 38% 42% Yes Yes 30% 20%

35% 13% Don't know Don't know 42% 19% No - but I would not have used this No - but I would not have used this Split payments between me and my partner More frequent payments of Universal Credit No - but I would have used this No - but I would have used this 59% 19% Yes Yes 8% 5%

On-going claim management Access to on-line journal - 14% people have no home internet access - 45% UC clients had difficulty accessing or using internet If claim is not managed - risk of sanctions - increased risk of debt

Debt Hartlepool/Thirteen Average debt per UC customer - 791 Average debt per non UC customer - 470

Debt National CABx; - UC clients more likely to have debt problems than people on legacy benefit 26% UC clients needed help with debt 19% legacy benefit clients needed help - UC clients more likely to have priority debts 47% UC clients had rent arrears 30% of legacy clients had rent arrears

Universal Credit The Claim

What is happening now Briefings to local groups/forums - Locality Forums - Crisis Support Agencies - VCSE Forums Information sheets Applying for Universal Credit; UC Jargon Conference February Thirteen and Infinity On-going evidence collection and campaign work with National Association of Citizens Advice Bureaux

Universal Credit The Changes 7 day waiting period abolished from February 2018 repayment of advances up to 12 months 100% advance up from January 2018 easier on-line application for advances from Spring 2018 additional 2 weeks Housing Costs at start of Universal Credit Claim from April 2018 easier to have Housing Costs paid direct to landlords if it is already the way you currently pay and you are a private tenant it will be automatically offered to you