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Benefits Blog

by Tombenefits

news and thoughts from the world of welfare rights
08 December 2017 at 21:38

Budget 2017 Pt 1: UC changes

A two part summary of the benefits changes in the November 2017 budget. Starting with some significant improvements to Universal Credit .

Next time we peak under the bonnet of the more dreary same old same old announcement of the new benefit rates from April 2018. 

In this 2 part Budget Benefits Blog,   I take a look at the announcements in the November Budget that directly affect the world of benefits. The two parts look at:

  - here in Part 1 - a very welcome sign of improvement in one of the biggest problems with Universal Credit, :-) However, they will not come in time to save Christmases, but bode much better for the New year .

  - the other - for next time -  is the more routine announcement of the rates for all benefits that will apply from next April, where the news is a bit more mixed. Mostly full protection for older people, some important protections of key aspects for younger people affected by cancer but some real cuts affecting them and others too :-(  

 

1. Help while awaiting your first UC payment

Universal Credit is only in full operation in a minority of areas as i type, but by this time next year it will cover all areas of the UK.  Eventually,  it will cover 7.5 million households and 31% of people in the UK, with some 46% of claimants being in paid work. 

UC only affects small numbers of our Visitors at the moment, but it will soon be a much bigger proportion of peoples benefits queries but all the News about how its been rolling out, though is causing a huge amount of worry for people, who know that at some point they may have to dencounter UC.

So it is is very welcome news indeed to finally see some real action on addressing one of UC's basic design flaws - the assumption made in the bubble that all applicants are coming oto UC with a final month's salary in their pockets and ready to carry on with a month in arrears when they draw benefits.

The arrangements for real people - arriving on to UC from a weekly wage or another benefit is that UC is totally unsafe and unfit for purpose as a new basic "safety net". But of course with serious reform and reality checks it could be.

The basic problem facing all UC claimants - in sickness or in helath, in low paid work or not, carers or parents alike - is that the system is currently not set up to pay you anything for 5 and in many cases 6 weeks (if hit by the additional waiting days- see more below) .

At the end of that wait you get 1 months payment, with one of the missing weeks sort of rolled into your UC timetable and the other permanently missing. And too often there are gaping holes in that first payment too :-(

Yet in all its digital wizardry, UC  can tell you how much you will get the moment you press Submit on your claim. It's more for ideological reasons UC wants to get you into budgeting monthly in arrears to make it more like the world of paid work.

And that's why it won't make make that first payment any  earlier, even though UC probably could. 

 

1.1. Improving Advance Payments

Instead - for those in hardship, there is currently the offer of an Advance Payment - i.e a loan -  of 50% of the amount that is the minimum the law says you need to live on to see you through to that first payment. That loan usually is repaid from your first 6 months of UC, though that is meant to be 12 months in some cases.

Things were slightly improved by making it far clearer that these loans were available, allowing you to receive one much earkier and being more realistic in accepting that people may well be in severe hardship. But that was the Government's firm and final offer on the matter.

This still leaves people with half of what is already a very minimal subsistence level of income, often facing a landlord who wants 100% of their rent :-)

For too many,  the present arrangements have led to debts, borrowing at extortionate rates to survive, rent arrears, repossession notices and in some cases evictions. The huge stress has caused real harm to people's health and in some cases has proved just too much to bear. 

The big change then, comes in from January 2018, when people will be able to get a 100% Advance Payment if needed, with an extended period of up to 12 months to pay that off.

OK, it still means a year pf living on an income sometimes below legal subsistence rates as the loan is deducted, which with UC involving cuts for many people is going to be quite a challenge.

But it can at least stop the hard emotional and financial costs of total financial meltdown that too many have experienced as they stack up high interest debts, or in some cases risk or actually lose their homes. That disruption could take even longer to recover from financially and emotionally. 

So it is a very welcome change and gives UC a chance to restore some credibility as a ‘safety net’ benefit, even if there may be more to do.

It won’t however, help those caught still facing hardship right now under the current arrangements.  UC is still going to ruin too many Christmases this year and create some longer lasting damage for some until the post Budget arrangements are fully in place. 

It is though a great improvement, and gives hope - that under rather strong pressure from MPs from all sides - reality is being allowed into the rather remote world of UC design thinking.   

 

1.2 Abolition of “waiting days”

For no good reason, bar a budgetary saving, the Chancellor’s predecessor had brought in a period of 7 "waiting days" at the start of a new UC claim.

There are some important exceptions , but you have to know them and be firm with Universal Credit to avoid them applying waiting days to your claim wronglywrongly.

So you should not be hit by “waiting days” if e.g. you:
  - are terminally ill
  - are moving over from Income-related ESA to UC
  - have recently been on UC but came off it because of paid work

It is then perfectly possible for someone with a cancer diagnosis or a carer to still be hit by waiting days on starting a UC claim,

Waiting days do two rather wicked things to your UC claim:

  - firstly they push everything back 1 week - your assessment period, claim date and the date of first payment all go back a week, so a previous 5-ish week wait for the first payment becomes a 6-ish . The -ish bit comes because the UC assessment period is calendar monthly, not 4 weekly.

 - secondly,  it's a week for which you will get no UC - the amount you get at the end of this extended period is no greater than before. UC simply does not offer any payment to cover waiting days. 

So it is great good news that will reduce the harm that UC currently does, that those waiting days are being abolished for all new UC claims from February 2018.

Until then they still apply but do check if you are exempt. 

 

1.3. A new “Transition to Universal Credit payment”

This was an unexpected bonus :-), but very helpful.

This will help if you are receiving Housing Benefit under the legacy benefits and are told that a change in circumstances means that you must do a “natural migration” over to Universal Credit.

But first of all, do double check whether the change actually is one that requires a switch to UC, as there is a lot of official misinformation on that.

If it looks as if you must switch , then are there any ways round it and what actually are the financial implications for you ? Some will be better off under UC so a calm organised switch could actually be a good thing for some.

But many will lose, and with a question mark over official advice, do double check via an independent adviser, messaging me or check out charts like the one from Newcastle Welfare Rights available here

But if you do need make a switch to UC - whether this is a good or a bad move - new arrangements - from April 2018 - will mean that your Housing Benefit can run on for 2 weeks, giving you some cash in hand at the start of the UC process.

But welcome though this transition bonus,  it does begin to compensate for the Government's refusal to offer the usual transitional protection  to protect people moving over to UC.

It will eventually offer that protection with the  perhaps more honest "managed migrations" , but these don't start until July 2019 . Meanwhile the unprotected "natural migrations' will carry on right through to 2022.

 

2. Other changes to UC

 

2.1 No charges for calling the UC service Centre

Not a Budget change as such but it has now only come into operation. When you need to ring the UC Service Centre-  which people have had to do far too often in the early days of chaos-  those calls are now free.

The new numbers - in operation from the 29th November are:

  - 0800 328 9344 for queries concerning a Live Service / Gateway UC claim

 - 0800 328 5644 (for queries relating to a Full Service UC claim

Again one day it was totally impossible to make this concession but by the next it was. 

2.2. Changes in the "transitions" timetable

After running the rollout at full speed this Autumn, despite pleas to pause from all sides until UC was safe, and thescheduled break in January, there is going to be a slow down this spring.

This is to allow time for the other Budget changes to be implemented, for stock to be taken and any lessons that UC is willing to learn to be taken on board. 

This means that the full transition of all areas to Full Service UC across the UK is now expected to be completed by December 2018, rather than September.

You can see the revised timetable here

When your area goes Full Service,  you will not feel the earth move :-) Any existing benefits claims will remain exactly as they are. Initially, then,  it just means that most new claims will be for UC rather than the “legacy benefits” . For more datails see the Benefits Blog here

 

2.3 Re-organisation within UC Service Centres

Again not a Budget announcement but some very welcome news shared by DWP officials at a recent Citizens Advice round table.

There is also a very welcome re-structuring going on within UC Service Centres, with a return to some connection between the Centres and the areas they serve.

So for example all calls in Wales will go be routed to the UC Service Centre in Wales. Within that centre,  staff are moving over to working in teams matched to each of the local authority areas., making it easier to build connections and relationships with local DWP staff in down at the JobCentre Plus.

The same is happening across the UK.

You will then,  be far more likely to end up speaking to the same person or at least a member of the team.

And staff are already feeling far happier under these new arrangements, as they felt as lost as many callers. It bodes well for building up their UC knowledge, better joine up with your local UC workcoach and  a more supported team working t

It seems then that some old DWP good practise and common sense is being allowed to emerge, after being rather rubbished by the bright eyed eager young blue sky thinkers in Whitehall:-) . Time will tell, but this minor sounding re-structuring could make a real day to day difference. 

 

2.2 No more Live service / Gateway UC claims

Most of the country is not in a Full Service area yet, but comes under the Live Service/Gateway UC system. Under this version of uC new claims are only taken from the most straightforward simostly single jobseekers.

The gateway keeps out new claims from more complicated ones or anyone else, lest you break the rather nervous Live Service computer.

If though as a UC jobseeker you do become more complicated, get a job, become unwell or start being a carer etc, they will encourage you to stay with UC, even if your claim then has to be managed clerically.

So Gateway UC still has a people in a range of circumstances on its books, it just that you can only start a UC claim in most areas as a simpler UC jobseeker.  

But if you have moved on from jobseeking, you can though weigh up the options and choose to come out of UC if the sums look better for you under the “legacy benefits’. That wouldnt though apply to the 60% who still are simple jobseekers, as the doors of JSA are closed to you at the moment. 

However, the DWP have decided it is not worth spending the small fortune needed to adapt the Live Service/Gateway computer system for the various budget changes,  so there will be no new claims for Gateway UC after January 2018.

Instead those who would have started claims as UC jobseekers will then claim JSA instead, until such time as their area moves over to Full Service UC.

This also opens up the possibility for anyone - including simple case jobseekers - to get off UC if they so wish, in the interval between new claims closing and their area moving over to Full Service. Always though get advice about whether it is worthwhile to do so and timing your withdawal from UC very carefully.

 

And so...

I will finish here to keep this summary more digestible :-).

There is a big change involving some real money and a shift in attitude by the Government to make UC better than it has been. 

Of course there is more that could be done - according to some critics - in the areas the Budget changes are seeking to address. And plenty other UC problem areas to keep things lively in the New Year :-) 

But credit where credit's due - the new arrangements will be a lot better than the old ones. And while there has to be thanks to the Government for starting to listen on UC, the real credit goes to the hard work of campaigners from all sort of groups and MPs from all sides for helping the Government with any hearing difficulties :-) .

Next time, I will report  a more mixed bag of good and less good news , as I pore over the entrails of the annual statement about the benefit rates which would apply next year. Never let a benefits advisor loose with a calculator... 

I promise though to only show my results not frenzied workings :-)

If you have any comments about either of these Budget twins, please do join the conversation here.

And as ever if you want a private word about any of the issues raised above or next time - or indeed anything benefits related - please just message me. 

Best wishes,

Tom :-)

 



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