Changes to Benefits
From this autumn, the benefit cap in London is being cut from £500 per week to £442.31 per week for couples, families and single parents, and from £350 to £296.35 for single people. This is £50 a week less cash per household.
This means that if you currently receive more than this new amount, your housing benefit will be reduced to bring what you receive into line with the new cap level. This could cause you problems in paying your bills especially your rent.
Benefits that count towards the cap
- Housing Benefit
- Income Support
- Job Seeker’s Allowance
- Employment and Support Allowance (except where it is paid with the support component)
- Child Benefit
- Child Tax Credit
- Maternity Allowance
- Incapacity Benefit
- Severe Disablement Allowance
- Widowed Parent’s and Widowed Mother’s Allowance
- Widow’s Pension
- Bereavement Allowance
Exemptions from the cap
- Attendance Allowance
- Disability Living Allowance
- Personal Independence Payment
- The support component of Employment and Support Allowance
- Industrial Injuries Benefit and equivalent payments as part of a War Disablement Pension or Armed Forces Compensation Scheme
- War Widow or War Widower’s Pension
- Carer’s Allowance (from Autumn 2016)
- Guardian’s Allowance (from Autumn 2016).
Remember the cap applies to working age claimants, so pensioners are also exempt (provided that in the case of a couple, both members are pensioners).
What can I do about it?
- Finding work: Getting work could bring in some extra cash into your home which would help reduce the effect of the new benefit cap - and if you work enough hours, you will be completely exempt from the cap.
- Applying for working tax credit: If you’re entitled to working tax credit, your benefits won’t be capped. To qualify, you will need to work at least 16 hours per week if you are a single parent; 24 hours per week between you if you are a couple - with one of you working at least 16 hours per week; or 30 hours per week if you are a single person.
- Contacting us: Discuss your situation with the Financial Inclusion Team here at BHP on 020 8937 2790
- Reassessing your weekly budget: If you are only capped by a small amount, you may be able to take a look at your current outgoings and see if there are any savings you could make, such as where you do the weekly shop.
- Getting an exemption from the cap: If you think you may be eligible, apply for one of the benefits that may exempt you from the cap.
Further details on the Benefit Cap are available on the Gov.uk website.
Further information on the Overall Benefit Cap and options that may be available to you locally can be found on the Brent Council website.
The Welfare Reform Act has brought significant changes to those claiming welfare benefits across the UK since it was passed in 2012.
It has been the biggest change to the welfare system for over 60 years and it has introduced a wide range of reforms that aim to make the benefits and tax credits systems fairer and simpler.
What is the purpose of the changes?
- To encourage a back to work culture
- To promote personal financial responsibility
- To ensure that people are better off working, than on benefits
- To discourage and reduce benefit fraud
What does it mean?
The Welfare Reform Act introduces:
- Universal Credit
- Direct payment of housing benefit to tenants
- Changes to non-dependant deductions
- New rules on under-occupation
- New rules on shared accommodation
How will it work?
- Currently your benefits are paid by three different agencies, Department for Work and Pensions, Brent Council and HM Revenue and Customs
- Your housing benefit is currently paid directly to the council
- Universal credit covers most existing benefits and will be paid directly to you monthly in arrears.
What further changes are there?
- From 2016: It will no longer be possible to make a new claim for the six existing benefits - Housing Benefit, JSA (Income Based), ESA (income Related), Income Support, Working Tax Credit, Child Tax Credit, Universal Credit will have to be claimed instead.
- During 2016 and 2017, those still in receipt of the six benefits listed above will be transferred onto Universal Credit.
What should you do next?
- Set up direct debits for rent payments
- Notify the DWP and Brent Revenue and Benefits immediately of any change in circumstances. The Financial Inclusion Team can assist if necessary.
- Set up budgeting plans with utility companies
- Ring Brent Council’s customer services before taking in any documents as they operate an appointment system
- Set up a bank account from which rent and other bills can be paid
- Obtain information about the under-occupation incentive scheme if you want to move to a smaller property.