The Department for Work and Pensions (DWP) has confirmed that claimants of legacy benefits will be transferred to Universal Credit by the end of 2024. Moves from legacy benefit payment schemes are set to continue as of this month. Prior to the pandemic, the DWP had been focused on shifting legacy benefit claimants onto Universal Credit.
However, the overwhelming surge of new benefit claimants coming to the service for support meant that priorities had to change.
The Government’s latest announcement about the payment replacement reaffirms its decision to continue with its prior course of action.
Legacy benefits is the term used to describe DWP payments which applicants can no longer make a claim for.
Among the legacy benefits coming to an end are: Income-Related Employment and Support Allowance, Income-Based Jobseeker’s Allowance, Working Tax Credit, Child Tax Credit, Income Support and Housing Benefit for those of working age.
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According to the DWP, these payments are being replaced because they have “complex and inefficient systems” based on archaic technology.
In comparison, the system for Universal Credit is more accommodating as it uses a digital system which worked efficiently during Covid.
The DWP reports that three million new Universal Claimants claimants were protected from the pandemic’s financial turmoil due to the system.
Universal Credit is a benefit payment which is designed to assist those on low incomes with the cost of living.
It is paid once a month to claimants or twice a month to those who live in Scotland, if they choose to split their payments during the month.
To be eligible for this payment, claimants must be over 16 but under the state pension age, and have £16,000 or less in savings and investments.
Different payment rates for Universal Credit are awarded to claimants depending on their age and relationship status.
Those who are single and under 25 get a monthly allowance of £265.31, while people who are single and 25 or over get £334.90.
In comparison, couples who are both under 25 can claim £416.45 or if either of them are 25 or over they can get £525.72 a month.
It should be noted that the couples payment for Universal Credit is to cover both individuals.
The process to move legacy benefit claimants onto this payment is set to resume on May 9, 2022.
Legacy benefit claimants will have their entitlement to Universal Credit assessed against their current claims.
Thérèse Coffey, the Government’s Secretary of State for Work and Pensions, explained why legacy benefits have been rolled into Universal Credit.
“Over five million people are already supported by Universal Credit. It is a dynamic system which adjusts as people earn more or indeed less, and simplifies our safety net for those who cannot work.
“Parliament voted to end the complex web of six legacy benefits in 2012, and as this work approaches its conclusion we are fully transitioning to a modern benefit, suited to the 21st century.”