Health in Pregnancy Grant
A one-off payment of £190 paid to pregnant women to help prepare for the birth. Not means tested so is available regardless of income and capital.
Abolition follows a move by the Government to restrict availability of universal benefits.
See also changes to Child Benefit discussed in this document.
Child Trust Fund
The Child Trust Fund was a savings and investment scheme started in 2002 to encourage parents to save for their child’s future. The Government plan to introduce a Junior ISA scheme in Autumn 2011 but no money will be provided.
Educational Maintenance Allowance
Change: No new applicants in England. See our Education Maintenance Allowance information guide for more information.
Support for Mortgage Interest
Change: temporary changes to the Support for Mortgage Interest Scheme which were due to come to an end in January 2011 will be extended until January 2012. These include a reduced waiting period of 13 weeks and an increase in the eligible mortgage capital limit to £200,000.
Employment and Support Allowance
Change: From 28 March new rules will apply to all assessments and the ESA50 form will be changed to reflect this. Those who had been sent an ESA50 based on the previous rules will be assessed using the previous rules as long as their form is received by 28 September 2011.
Change: Child Benefit rates frozen for three years
Disability Living Allowance
Change: there is a new qualification criteria for the higher rate mobility component of Disability Living Allowance to cover those with a severe visual impairment
Baby element of family premium will no longer be available
Non-dependant deductions (NDD) to be increased (uprated) on the basis of prices using the Consumer Prices Index. The rate of deduction made from a claimant’s Housing Benefit award if they have a non-dependant living with them had been frozen since 2001. The plan is that by April 2014, by gradual increases, NDD rates will reach the level they would have been at if they had not been frozen.
Local Housing Allowance (LHA) restricted to four-bedroom rate regardless of household size. About 8,000 households will be affected by this limit, according to the Department for Work and Pensions (DWP). Applies to new claimants. Existing claimant’s will have their LHA rate reduced on the anniversary of their claim.
£15 excess rule will be removed. This is the rule that if a person's LHA rate is higher than the rent they are paying, they can keep the difference up to a maximum of £15 a week.
An extra room will be allowed in the ‘size criteria’ used to determine LHA if a person has a disability and requires over night care from a non-resident carer.
New maximum LHA rate based upon property size – £250 for one bedroom, £290 for two bedrooms, £340 for three bedrooms, £400 for four bedrooms. This will apply to all new claimants. There will be up to nine month's transitional protection for most existing claimants to give them more time to find a new home if they cannot afford their existing one because of the benefits changes.
LHA rates are set at a value where 50% of the rents in an area fall below it, and 50% are more expensive. This is to be reduced so that LHA rates will be at a value where only 30% of the rents in an area are below it and 70% are above it. This will apply to all new claimants. There will be up to nine month's transitional protection for most existing claimants to give them more time to find a new home if they cannot afford their existing one because of the benefits changes.
Existing claimants and those who claim Housing Benefit before 1 April 2011 will receive transitional protection from the maximum rate and 30th percentile changes (see above) if they would be made worse off. This means the existing amount of Housing Benefit they are receiving won’t be changed until nine months after the anniversary date of their claim, or nine months after the date their rate is reviewed if they require more bedrooms after these changes come into force, but before the anniversary date of their claim. The protection doesn’t apply for people where their rate is reviewed because they need fewer rooms (except if due to a death) or those who move address.
Discretionary Housing Payments (DHP) budget is to be £30 million for 2011/12 (an increase of £10 million) to offer some assistance to those most affected by the cuts to Housing Benefit.
For more information on Housing Benefit, see our Help with Housing Costs section.
Change: Some Jobseeker's Allowance claimants may have to do unpaid work, or work-related activity, for up to four weeks in order to continue receiving their benefit. The Personal Advisers at Jobcentre Plus will decide which claimants will benefit from being referred onto this scheme which will be delivered by a range of organisations from the private, voluntary and third sector.
Change: maximum Pension Credit Savings Credit award to be frozen for four years
State Retirement Pension
Change: the State Retirement Pension rate will be increased through a ‘triple guarantee’ – which means that the pension will be increased each year by the highest out of the earnings inflation rate, the prices inflation rate (using the Consumer Price Index) or 2.5%.
Sure Start Maternity Grant
Change: Sure Start Maternity Grant will only be available for the first child, unless it is a multiple birth or the new child is the only one in the family under 16.
There will also be a slight increase in the rate at which Tax Credits are withdrawn as a person’s income increases. They will lose 41p from their maximum entitlement for every £1 of income over the relevant threshold
If your income rose by £25,000 during the award year this would not affect your award, now they will only ignore increases of up to £10,000. This is likely to lead to more Tax Credit overpayments
The baby element will be removed from Child Tax Credit (CTC)
There will be some changes to the way the family element of Child Tax Credit is awarded, claimants with incomes over £40,000 will be affected
The child element rate is to be increased by £255
The percentage of childcare costs that parents can claim through the childcare element of Working Tax Credit (WTC) will be reduced from 80% to 70%
The basic and 30 hour elements of WTC will be frozen for three years
People aged 60 or over will be eligible for Working Tax Credit by working 16 hours, the rule had previously been 30 hours
Change: Consumer Price Index (CPI) will replace Rossi and Retail Price Index (RPI) as the tool used to decide benefits increases in April each year (also known as uprating). The Government’s reasoning for this change is that CPI is a better measure of inflation and a more appropriate measure for benefit claimants as it does not take account of housing costs. This change is expected to result in £6billion savings per year by 2015.
Institute for Fiscal Studies (IFS) analysis found that only 23% of claimants will be protected by this change, the rest will be paying for things not covered by CPI so there will be a real loss of income over time. This change saves the Government the most money out of all things announced. CPI was just 3.1% in September 2010 and this is the figure that will be used for uprating benefits in April 2011, at that time RPI was 4.6%.
Change: the tax-free personal allowance will rise from £6,475 to £7,475 for people under 65. The basic rate limit will be reduced so that higher-rate payers don’t benefit from the increased personal allowance. For 65-74 year olds the allowance will be £9,940 and for over 74 year olds it will be £10,090
Change: The government proposed to introduce a change this month which would mean to claim Income Support as a lone parent your youngest child must be under 5. Many lone parents would have to claim Jobseeker's Allowance unless they qualify for Employment and Support Allowance or Income Support for another reason. This would then affect existing claimants from April 2012.
This change did not come in to place in October 2011, a date remains unconfirmed. Check our benefit changes timetable regularly for updates.
To encourage parents to save for their children, the Treasury is to offer a tax-free children's saving account from 1 November 2011.
Available in cash or stocks and shares, the 'Junior ISA' will be a replacement for the Child Trust Fund, which was abolished on 1 January 2011. However, the Government will not provide any money to put in the account.
Winter Fuel Payment
Change: Winter fuel payments will be reduced for the winter of 2011/2012.
The payments for people who have reached female state pension age were temporarily increased in 2008 from a maximum of £200 to £250 and, for people aged 80 and over, from a maximum of £300 to £400. This increase was renewed in subsequent Budgets until this year which means the payments will return to the £200 and £300 level.