The accelerated roll out of the government’s flagship welfare reform, Universal Credit, means that by spring 2015, 1 in 3 of the country’s Jobcentres will be taking claims for the new benefit.
As part of the government’s long-term economic plan, Universal Credit merges 6 benefits in to 1 and simplifies the system so the claimants can see they will always be better off in work and off benefits.
From this week (24 November 2014), Universal Credit is being opened up to families – couples with children and lone parents – following the successful roll out to individuals and couples.
Support worth up to 70% of childcare costs will be available regardless of hours worked – in addition to the money they get to help with the costs of bringing up a child. This means that for the first time, parents will receive support for childcare costs under Universal Credit, no matter how many hours they work – giving them more flexibility to work and earn more money.
And because of an extra £400 million the government is investing in childcare, by 2016 this will be increased to 85%, with a monthly limit of £646 for 1 child and £1,108 for 2 or more children.
Work and Pensions Secretary Iain Duncan Smith said:
The welfare system we inherited was broken, trapping the very people it was meant to help into cycles of worklessness and welfare dependency. Universal Credit is bringing welfare into the 21st century by restoring fairness to the system and making work pay in a modern labour market.
We’ve already seen remarkable successes, with Universal Credit claimants moving into work faster and staying in work longer. As part of our long-term economic plan, today sees the next stage of this welfare revolution bringing families on-board with extra childcare support and flexibility for employers. By spring next year 1 in 3 Jobcentres will be offering the new benefit.
Claims from families had started in the north west with 6 Jobcentres going live yesterday with the rest of the nearly 100 Jobcentres going live early next year.
Working families on Universal Credit can claim back 70% of the money they’ve paid out for childcare, with a monthly limit for 1 child of £532 and £912 for 2 or more children.
The Secretary of State announced in September that he would accelerate roll out nationwide to Jobcentres from February 2015.
It is already available to single and couple claimants in over 80 Jobcentres in England, Wales and Scotland and will be available in nearly 100 Jobcentres by Christmas.
Universal Credit is already making a difference, recent research showed that claimants do more to find work and know that working more pays:
- those who are on Universal Credit report that they are working more over a 6 month period – 69% under Universal Credit, compared with 65% under Jobseeker’s Allowance
- 65% of people finding Universal Credit a better financial incentive to work
- people find Universal Credit easier to understand and consider Universal Credit a better reward for additional work
- households on Universal Credit do more to find work – nearly double the number of hours of job search compared to Jobseeker’s Allowance
Last new claims to legacy benefits
The last new claims to legacy benefits will be accepted during 2017.
Following this, the stock of remaining legacy claims will progressively decline, and the department will migrate the remaining claims to Universal Credit. Should there be no change in the labour market outlook or the pace at which claims are migrated, the current business case assumes for planning purposes the bulk of this exercise will be complete by 2019.
More about Universal Credit
Watch our video about the support available to manage your money
A video about the support available to manage your money
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