The controversial Universal Credit scheme is due to begin trialling at the end of April, 2013. The first pathfinder pilot scheme will take place in parts of Manchester and Cheshire. It will take a further four years before the scheme is fully implemented across England, Scotland and Wales. The government sees Universal Credit as a way to streamline the benefit system supposedly making benefits fairer and easier to manage while also reducing costs. Whether the system proves to be a success remains to be seen, but for those who may be wondering what changes will be involved here is a brief overview.
At the Base of Universal Credit
Universal Credit will be primarily a digitally based system, intended for those of working age. Information will be able to be supplied online although it will still be possible for people to have face to face interviews or speak to someone by telephone. Benefits are means-tested and payments will be paid into a bank account on a monthly basis. In most circumstances, only one payment will be made for any couple who are living together and benefit entitlements will be considered as a couple. Under exceptional circumstances payment times may be split or paid more often.
Which Benefits are Affected and When?
Child Tax Credit, Working Tax Credit, Housing Benefit, Income Related Employment Support Allowance, Income Related Jobseekers Allowance and Income Support will all come under Universal Credit. No other benefits are affected although the current Disability Living Allowance will be replaced with Personal Independence Payments. The changeover to Universal Credit will take place in phases with different benefits and new claims being the first to take place. Exactly when these changes will occur depends on where you live as well as whether you are making a new claim or are shifting over from a current claim. If you are currently on a benefit, you will be informed as to when the change will occur and what, if anything, you need to do.
New claims for all affected benefits will be put into the new system from October 2013 to April 2014 with Tax Credits Benefits being the last to make the change over. If you have an existing claim and your circumstances change during this time, you will probably also be switched over to Universal Credit during this time. From April 2014 to December 2015 existing claimants of affected benefits, apart from Housing Benefit, will be switched to Universal Credit. The remainder of Housing Benefit claimants should be changed over by December 2017.
This is one of the areas that is of concern for many people. Each individual or family with no income will receive a basic benefit with extras available depending on the circumstances, but a cap will be put in place. This means some families may end up receiving less under the new system. At present the cap is set at £26,000, however, regional changes may possibly be introduced in the future.
According to Turn2Us1, anyone applying for Universal Credit will be placed in one of four groups: No work related requirements, Work focused interview requirements, Work preparation requirement or All work related requirements. Different expectations or requirements will be set for each group and claimants will need to sign a form agreeing to those expectations.
The present government views Universal Credit as a positive and innovative move towards simplifying the benefit system. While some concern exists as to whether the system is really sound and what the real effects will be, it is set to begin. If you are already receiving a benefit it is advisable to understand what changes are involved.
This article was written by Joe, he is a freelance journalist who enjoys helping people understand issues like universal credit.
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