The Department for Work and Pensions (DWP) has announced that thousands of Universal Credit claimants may be eligible for additional funds temporarily this autumn to avoid a sudden decrease in income. This initiative is part of the ongoing reform of the benefits system and aims to support individuals transitioning to Universal Credit from legacy benefits.
Currently, nearly seven million people are on Universal Credit, with more individuals being switched from older forms of welfare support such as tax credits, Income Support, Housing Benefit, and others. As part of the ‘managed migration’ process, households are receiving letters and a three-month window to apply for Universal Credit before their existing benefits come to an end.
The DWP has provided an update outlining the rules for increasing people’s Universal Credit during this transition period. They have introduced a transitional element that can be added under specific conditions to bridge the gap between the previous benefits amount and the Universal Credit entitlement.
It is estimated that by the end of 2025, around 2.2 million households will receive transitional protections to ensure their benefits do not fall below previous levels. Additionally, 1.2 million families are expected to maintain their current benefit amounts, while 3.8 million could see an increase in their payments under Universal Credit.
The transitional element is calculated based on the indicative Universal Credit award, which considers various factors such as employment status, family structure, income, savings, children and childcare costs, disabilities, and existing benefits. The goal is to protect the benefit entitlement of claimants as they transition to Universal Credit.
Officials have emphasized the thorough process for determining Universal Credit eligibility, which involves cross-checks with data from DWP, HM Revenue and Customs, and local councils. In cases like Housing Benefit, a transitional element may be added to prevent a significant decrease in benefits, ensuring that Universal Credit amounts align with previous benefit levels.
The primary objective of transitional protection is to prevent individuals moving to Universal Credit from experiencing a sudden loss of income, maintaining their financial support at the same level as their previous benefits. It is important to note that any changes in circumstances after a claim has been made may impact the transitional protection received by claimants.
Overall, the additional funds provided by DWP aim to support Universal Credit claimants during the transition period and ensure a smooth and fair process for individuals moving from legacy benefits to the new system.
