There are many changes happening to some of the benefits that people receive both now and over the next few years. These changes are set out in the Welfare Reform Act 2012.
The following is a summary of the changes to explain how these changes may affect you. This is only intended as a guide.
Advice on specific changes:
Size Related Criteria in the Social Sector (The Bedroom Tax/Spare room subsidy)
From 1 April 2013, if you are of working age and you rent from Wellingborough Homes, a housing association or a registered social landlord, your Housing benefit may change.
The changes will only affect those who have 1 or more 'spare' bedrooms.
Changes were announced by the Secretary of State for Work and Pensions on 12 March 2013 regarding bedrooms for Foster Carers and Families with an adult child serving in the Armed Forces. Regulations are due to be laid regarding these changes soon and we will update any awards affected as soon as possible.
Further guidance was also issued regarding bedrooms for severely disabled children. This states that if certain criteria are met, a separate bedroom could be considered for children previously expected to share.
In order to consider if an additional bedroom can be allowed, we will need to consider:
- If there is a medical need for care
- The nature and severity of the disability
- The nature and frequency of the care required during the night
- The extent and regularity to which the disability or care affects the sleep of the child expected to share a bedroom
If you consider that you may be affected by this guidance, please contact us.
What are the changes?
Under the new rules, if you have more bedrooms than the Government say your household needs, your Housing benefit may be reduced.
The rules allow one bedroom for:
- Each adult couple (married or unmarried)
- Any other person aged 16 or over
- Two children of the same sex under the age of 16
- Two children under 10 (regardless of sex)
- Any other child (excluding foster children or children who have a main home elsewhere)
- A carer (who does not live with you) if you or your partner need overnight care on a regular basis.
How will this affect me?
If, under the new rules, you have more bedrooms than is necessary for your household, your benefit may be reduced.
- If you have one spare bedroom, the rent we use to calculate your benefit will be cut by 14%
- If you have two or more spare bedrooms, the rent we use to calculate your benefit will be cut by 25%
This will create a shortfall in the help that you may receive towards your rent and so you need to make arrangements to make up this difference to your landlord to prevent falling into arrears.
You will not be affected if:
- You or your partner are of Pension Age. You can check to see the date when you will reach pension age on the GOV.UK website
- You rent a one bedroom flat or a bed-sit
- You are in a shared ownership property
How will I know if I am affected?
Letters have been issued to all those customers the benefit team believe will see a reduction. These letters will explain how much of a deduction is likely to be taken into account.
However, in some cases, the information held on the benefit system may be out of date. For example, you may have had a child you have not told us about, or someone has moved in or out of your home. If you would like to tell us about any changes, please contact us.
What can I do if I am affected by the changes?
Try to find some paid work, or increase your hours at work to increase your income.
Apply for a Discretionary Housing Payment. This is a short term measure intended to assist people who are actively seeking to improve their financial situation. You can find more information and a form on our Discretionary Housing Payments page. (link)
Make sure that you are claiming all the benefits that you are entitled to. For example, Disability Living Allowance or Tax Credits. You can find a lot of information about benefits on the GOV.UK website.
Get in touch with your housing association to discuss options for transferring or exchanging to a smaller property or taking in a lodger.
Get in touch with your local advice agency such as the Citizens Advice Bureau or your neighbourhood advice centre.
The Government is introducing Universal Credit as a key part of reforming the benefits system in the United Kingdom.
Universal Credit is a new single payment for people who are looking for work or on a low income. The Government believes a single payment, rather than a range of working age benefits, will simplify the benefits system and help claimants and their families to become more independent and prepared for work.
What benefits will it replace?
- Income-based Jobseekers Allowance
- Income-related Employment and Support Allowance
- Income Support
- Child Tax Credit
- Working Tax Credit
- Housing benefit
What is different with Universal Credit?
Unlike the current benefits, both people in and out of work will claim the same type of benefit. Most people will apply online and manage their claim online. When people go in and out of work benefits will not automatically stop, as long as their income is under a certain limit they will get ongoing support.
This will reduce uncertainty for people when they move from benefits to a job, improving the incentive to work.
Housing support will be paid direct to people; not to landlords, housing associations or council rent accounts.
People will receive just one monthly payment, paid into an account like a salary.
When does Universal Credit start?
April 2013 saw the start of a trial in Tameside. The dates for national rollout are subject to change but we expect that October 2013 will see the start of Universal Credit in Wellingborough for new claims. Everyone is expected to be moved over by 2017
Welfare Reform - Benefit Cap
The Government is introducing a Benefit Cap for people of working age which limits the amount of benefits a household can receive. A household without someone working and receiving benefits cannot get more than the average earnings of a working household. There are exceptions to this rule which are listed below.
The Benefit Cap in Wellingborough will be introduced on 15 July 2013.
The maximum amount of benefits per week will be:
- £350 per week for single people without children
- £500 per week for Single parents
- £500 per week for couples with or without children.
What benefits are included?
The following benefits will be included in the Cap:
- Bereavement Allowance
- Carer's Allowance
- Child Benefit
- Child Tax Credit
- Employment and Support Allowance (except where it is paid with the support component)
- Guardian's Allowance
- Housing benefit
- Incapacity Benefit
- Income Support
- Jobseeker's Allowance
- Maternity Allowance
- Severe Disablement Allowance
- Universal Credit (where applicable)
- Widowed Parent's Allowance
- Widowed Mothers Allowance
- Widow's Pension
- Widow's Pension Age-Related.
- Council Tax Reduction, Discretionary Housing Payments, Pension Credit, statutory payments (Maternity/ Adoption and Sick pay), and some other payments will not be included in the calculation.
All of these benefits will be added together and if they exceed the limit of £500 or £350 a week then your Housing benefit will be reduced. The Department of Work and Pensions (DWP) has written to most people they think will be affected by the Benefit Cap.
Will the Benefit Cap affect me?
Working age people in receipt of certain benefits may see their total Housing benefit reduce as a result of the Benefit Cap. People who are of pensionable age will not be affected by the Benefit Cap.
You can use the government's online calculator to see if you are affected.
Benefit Cap exclusions
People receiving any of the following benefits, have partners receiving them or have dependant children receiving them, will be excluded from the Benefit Cap:
- Disability Living Allowance
- Personal Independence Payment (from April 2013)
- Working Tax Credit
- Attendance Allowance
- Industrial Injuries Benefits
- Employment and Support Allowance, if paid with the support component
- War Widow's or War Widower's Pension
- People will also be excluded if they and their partner work 24 hours or more per week, as long as one
- partner works over 16 hours. A single parent needs to work 16 hours or more a week
People who have other adults in their household (i.e. non dependants) receiving Disability Living Allowance are not excluded from the Benefit Cap.
When will it be confirmed if I'm affected or not?
The DWP will keep people informed about the Benefit Cap and when they can expect it to start. Shortly before the Benefit Cap begins the Council will write to those we know will be affected to notify them of how their Housing benefit will change.
Until universal credit is rolled out nationally, only Housing benefit can be reduced as a result of the benefit cap. Other benefits will not be reduced. It will therefore still be possible for a household to continue to receive more than £500 in benefits.
If I'm affected what can I do?
If these changes are likely to affect you, you may want to consider the following options:
- Finding work
- Increasing your hours of work
- Moving to more affordable accommodation / negotiating cheaper rents
- Help with managing your money and debts
You can get more information on the Cap on the GOV.UK website.
If you would like to talk to the DWP you can call them on 0845 605 7064 or text phone 0845 608 8551 for general information about the Cap and details of support available to you. The Helpline is open Monday to Friday 8am to 6pm.
If you think you may be affected but have not received a letter about the Cap please call the DWP on the above number.
Welfare Reform - Help with your Council Tax after 1 April 2013
On 1 April 2013, Council Tax Benefit (CTB), a national benefit, was replaced by a locally operated Council Tax Reduction Scheme (CTRS). All local authorities operate their own scheme, but receive at least 10% less funding from government than was spent on Council Tax Benefit.
Claimants previously receiving council tax benefit will be automatically transferred to council tax reduction and notified of the change.
- Most working age claimants will receive less support from April
- Most pensioners will continue to receive the same level of support
- Second adult rebate will also be removed from people of working age from 1 April 2013 and replaced with alternative maximum reduction for claimants of pension age only.
For full details of the scheme see LINK
Changes to Disability Benefits
Personal Independence Payment (PIP) replaced Disability Living Allowance (DLA) on a nationwide basis from 10 June 2013.
PIP help towards some of the extra costs which come from having a long term condition (this means ill-health or disability expected to last 12 months or longer). It is based on how a person's condition affects them, not the condition they have.
PIP is a benefit that people can get whether they are in or out of work. It is not affected by income or savings and it is not taxable.
It is not possible to get both PIP and DLA at the same time. Existing DLA claimants will be asked to claim PIP at some point from October 2013, but most won't be affected before October 2015.
Who will be affected?
Personal Independence Payment (PIP) will apply to all new claimants aged 16 to 64 and existing DLA claimants who are aged 16 to 64 on 8 April 2013 or who reach the age of 16 after that date.
To qualify for help, claimants will have needed help with extra costs caused by a health condition or disability for three months or more and be reasonably likely to need help for the next nine months.
Claimants must have spent at least two out of the last three years in Great Britain before they can claim PIP. A temporary absence abroad for up to 13 weeks, or up to 26 weeks for treatment, will be allowed.
What are the changes?
PIP will be made up of two components - Daily Living and Mobility. Each can be paid at standard rate, or enhanced rate for those with the greatest needs. There are 12 assessment criteria that consider the individuals' ability to carry out a range of everyday activities.
There are special rules for people who have a terminal illness and are not expected to live for more than six months. The Department for Work and Pension (DWP) will deal with these claims faster and there will not be a need for claimants to attend a face-to-face consultation, or to fulfil the three month qualifying period.
Existing DLA claimants will be asked to claim PIP at some point from October 2013, but most won't be affected before October 2015.
How will PIP affect my Housing benefit / Council Tax Reduction?
DLA is disregarded as income when we calculate your Housing benefit and/or Council Tax Reduction, and this will continue with PIP. However, it is important for us to know if you receive PIP it as it will mean that we can award additional benefit in some circumstances because we are able to award additional premiums. In other words, being in receipt of both DLA and PIP may mean that you are entitled to more Housing benefit and/or Council Tax Support
If your award of DLA ends because DWP have not awarded PIP, this may mean that you lose some of your Housing benefit and/or Council Tax Reduction.
It is therefore important that you return forms to the DWP as soon as possible and that you keep the Benefit Team at Wellingborough Council informed of any changes to your circumstances.
You can find more information about PIP on the GOV.UK website.