What’s the benefit?
Changes to the benefits system and how it could affect you
The proposed changes to benefits will be biggest shake up of the system in 60 years. Welfare Reform is one of the government's flagship bills and intends to bring in a new ‘Universal Credit’. This will replace the current system of benefits and credits.
There is a huge amount of detail in the bill and it is still being debated between the House of Commons and House of Lords. The changes have been very controversial but it looks increasingly likely they will go ahead.
Here are some of the key changes that could take place:
As part of the changes, from October 2013 working-age tenants will personally receive the new ‘Universal Credit ‘ paid monthly directly to a bank account. This will include the Housing Benefit element.
Pensioners and vulnerable tenants will continue to have their housing costs paid straight to their landlord.
Overall benefit cap
The government want to limit the total amount of benefits a single person or a couple receive. The government want to set the cap at the same as the average income for a working household. At the moment this is around £500 per week (£26k a year) for couples and lone parents, and £350 per week for single people without children. This cap would include child benefit and housing benefit.
Under the plans the cap would not apply to households receiving Working Tax Credit, Disability Living Allowance or its successor Personal Independence Payment, Constant Attendance Allowance and war widows and widowers.
‘Spare room’ penalty
The government want to introduce a new size limit for housing benefit claims in social housing. This will apply from April 2013 to tenants of working age. The idea is to cut housing benefit for those the government think are living in homes too big for what they need. Those judged to have one extra bedroom would lose about £11 a week, those with two or more extra rooms would lose on average £20 a week. How the decision is made whether you have extra bedrooms is complicated:
Children under 16 of same gender expected to share
Children under 10 expected to share regardless of gender
Disabled tenant or partner who needs non resident overnight carer will be allowed an extra bedroom
How we will support you
Building on our Financial Inclusion and Money Advice services, we are planning a wide range of products and services to help you through these changes so you can make informed choices about your home and your money. If you are likely to be directly affected, we will contact you over the coming months to find out more about your circumstances and advise you about how you may be affected.
We will be looking for residents who are interested in being involved in planning our Financial Wellbeing Strategy and how we communicate key messages about welfare reform, if you are interested please contact Jane Murphy on 01744 670221 ext 7558 email@example.com
Find out more about how these changes could affect you.
- Direct Gov Benefits Calculator