New proposals for better supporting people on benefits after the loss of a spouse or civil partner are set out by the Minister for Welfare Reform Lord Freud today.
The proposals and the publication of a Command Paper, Bereavement Benefits for the 21st Century: Government Response, addresses concerns that the current system is too complex and out of sync with the needs of bereaved people. Under the current system, some people qualify for a lump sum payout, while others receive regular payments for up to 20 years with no encouragement or support to return to work - essentially abandoning them to a life on benefits following bereavement.
The Government remains committed to providing financial support after spousal bereavement, but Ministers believe that the payment should provide immediate support, instead of longer term income replacement, which can discourage rehabilitation into mainstream life, and harm long term job prospects.
Lord Freud said:
Losing a spouse or civil partner is a life changing event emotionally, socially and economically - so it’s really important that we offer immediate financial support to people whilst they readjust. But the current system can lead some people into a lifetime of dependency.
We have, in consultation with wider groups, looked at the rules again and taken the view that future claimants of bereavement benefits should be supported back into mainstream life and helped back into the labour market after a time of recovery.
The Bereavement Payment is expected to be set at around £9,800 for a bereaved spouse or civil partner with children and £4,300 for those without children and will be paid in a lump sum, followed by instalments over 12 months. The payments will also be disregarded from Universal Credit and the Benefit Cap for a period of 12 months.
This period is not intended to reflect the time required for ‘recovery’, but instead to provide a buffer for the immediate financial impact of bereavement.
Ongoing financial need will be addressed through contributory Jobseekers Allowance, Employment and Support Allowance or Universal Credit, depending on circumstances.
The new rules will come into force for new claimants after the next general election.
Notes to editors:
The consultation response is published at: dwp.gov.uk/consultations/2011/bereavement-benefit.shtml
Under the new rules:
- Contribution conditions will be simplified and people will be entitled to receive the full payment as long as their late spouse or civil partner paid National Insurance contributions at 25 times the Lower Earnings Limit for any one year prior to their death.
- Recipients of the Bereavement Support Payment, who also receive Universal Credit, or contributory JSA or ESA, will be able to access Jobcentre Plus support on a voluntary basis from three months after bereavement. They will not be subject to conditionality for a further three months.
- Payments made under the War Pensions Scheme or Armed Forces Compensation Scheme will not be affected. These measures will not impact those already in receipt of bereavement benefits at the point at which a new scheme is introduced.
- The Government is clear that the primary aim is to improve an out of date system that ensures existing recipients are protected, and that those who claim the new Bereavement Support Payment get the help that they need when they need it most.
- Claimants will be paid over 12 months to avoid the risks associated with making a large lump sum payment.
Under the Current Rules:
- Bereavement benefits support people after the loss of a spouse or civil partner.
- Currently the government pays £600 million in bereavement benefit payments each year.
- Around 40,000 bereaved husbands, wives and civil partners make new claims each year.
- The current award for lump sum Bereavement payments is £2,000.
- The current average award for Bereavement Allowance is £80.61 a week.
- The current average award for widowed Parent’s Allowance is £103.13 a week.