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What is going on with Universal Credit?

  • 11/01/2019

This article is over a year old

When will you transition? What is managed migration? Will I be worse off?

Whitehall postcode

After another week of Universal Credit (UC) being in the news we would like to clear up a few issues and answer a few frequently asked questions.

What is going on with the roll out of Universal Credit?

The roll out of UC to jobcentres finished last year, meaning it is now available to all new claimants. However, the focus is now on moving people from legacy benefits to the new Universal Credit system.

MPs were due to vote on whether to start transferring people onto UC this week, however this has been pushed back and they will now vote on transferring just 10,000 people over in the summer as a trial.

What’s the difference between ‘natural’ and ‘managed’ migration?

‘Natural migration’ to UC is the process by which a claimant of legacy benefits is obliged to claim UC, through a change of circumstance or by making a new claim, and will consequently receive no transitional protection.

‘Managed migration’ to UC is the process the DWP will use to bring current awards of legacy benefits to an end and allow replacement claims for UC. In other words, you are forced to move over, however these claimants will receive transitional protection.

What is transitional protection?

If you are transferred onto UC you may get transitional protection, which ensures you are not worse off financially when you move over.

I don’t want to ‘naturally migrate’, how can I stay on legacy benefits for longer?

If you are currently receiving one of the legacy benefits and do not want to switch over the UC until the managed migration process, to ensure you get transitional protection, you will need to avoid a ‘change of circumstance’ which would trigger a new claim. A change of circumstance includes:

  • A change in your employment status
  • A partner leaves or joins the household
  • Starting or stopping being a carer
  • Changes to a disability
  • Moving home to a new local authority

See the full list of changes of circumstances.

What next with Universal Credit?

Once the 10,000 person trial of managed migration is over, the Government will start transferring over three million people, this is likely to start in 2020, and end in 2023.

In April the UC Work Allowances will increase for people with children or people with limited capability for work.

In July, the 12-month ‘grace period’ from the Minimum Income Floor will be extended to all gainfully self-employed claimants who are moved over to Universal Credit by managed migration. It will only be extended to new claimants from September 2020.

In October, the maximum rate at which deductions from Universal Credit, to repay an advance payment, will be reduced from 40% to 30% of the standard allowance.

What are the other major problems with Universal Credit?

There are a number of problems with UC that have been highlighted by a number of organisations, think tanks and charities that still need to be fixed, including:

  • The difficult application process
  • The five week minimum wait
  • Assessment periods and payment volatility
  • Issues around childcare payments
  • Concerns with landlords and direct payments
  • The self-employed and the Minimum Income Floor
  • Removal of the Severe Disability Premium
  • One payment per household

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