The Government has introduced a number of changes to the welfare benefit system.  The main changes that have been or are due to be introduced from 1 April onwards are explained below.

Council Tax Reduction Scheme

The Council Tax Reduction scheme replaced Council Tax Benefit from 1 April 2013.  In Wales responsibility for the scheme has been devolved to the Welsh Government and will be administered by local authorities.  The rules for the new scheme are broadly the same as Council Tax Benefit and for 2014/15 entitlement will continue to be based on 100% of the charge.

New rules for tenants under-occupying their property

On 1 April 2013 new rules were introduced that set out the number of bedrooms Housing Benefit will pay for people of working age who live in accommodation provided by a Housing Association, for example Monmouthshire Housing Association, Melin or Charter.

Tenants who under-occupy their property have had their Housing Benefit cut by 14% for one spare bedroom and 25% for two or more spare bedrooms.  Under the rules one bedroom is allowed for

  • every adult couple (married or unmarried)
  • any other adult aged 16 or over
  • any two children of the same gender aged under 16
  • any two children aged under 10
  • any other child (other than a child whose main home is elsewhere)
  • a carer who provides you or your partner with overnight care (providing you have a spare bedroom for this purpose).
  • a foster child/foster children (only one bedroom is allowed providing you have a spare room for this purpose. The foster-carers must be approved).
  • any non-dependant in the armed forces who is temporarily absent from their home (as long as they intend to return home) e.g. grown up son or daughter living with their parents who is away on operations.
  • a disabled child who is unable to share a bedroom because of their severe disabilities as long as certain criteria are met. Please ask us for more information.

Important concessions were recently announced by the Department for Work and Pensions. Foster carers will now be allowed an additional room as long as they have fostered a child or become a registered carer in the past 12 months. Adult offspring in the armed forces who are away on operations will be counted as continuing to live at home, as long as they intend to return home. In addition, in some cases disabled children will be allowed separate rooms under the criteria but the Council may need supporting evidence to confirm the circumstances.

The Benefits Cap

In the Summer of 2013 a benefit cap was introduced on the maximum amount of benefit that can be claimed by a household (claimant, partner and dependant children).

The level of the cap will be:

  • £500 per week for couples (with or without children) and lone parents
  • £350 per week for single adults.

This will help ensure people are not given more money when they are out of work than they could reasonably be expected to receive in work.

If anyone in the household is in receipt of or entitled to or in receipt of Working Tax Credit or is in receipt of Disability Living Allowance, Attendance Allowance, Personal Independence Payment  the Support Component of Employment and Support Allowance or War Widows /Disablement Pension the cap will not apply. In addition it won’t affect pensioner households.

At first the cap will be applied by the council by reducing a person’s Housing Benefit entitlement. In the longer term the cap will be applied as part of the new Universal Credit system.

A Benefit Cap Calculator  is available on the government website. This can be used to get an estimate of whether someone will be affected by the cap and if so the possible effect on their Housing Benefit entitlement.

Universal Credit (UC)

UC is a new simpler benefit that will replace Income Support, Income Based Job Seekers Allowance, Employment and Support Allowance (income-related), Housing Benefit, Child Tax Credit and Working Tax Credit. This means that only one claim will need to be made and only one payment will be made. The majority of claims will be made online rather than by telephone or face to face.

UC is currently being introduced on a limited scale in certain geographical areas of the UK so that it can be fully tested before it is introduced nationally. Current plans will see new claims to existing benefits closed during 2016. This will mean that all new benefit claimants across the country will claim UC instead of the benefits it replaces. Most existing benefit claimants will be moved over to UC during 2016-2017.

In most cases UC will be paid directly to the claimant monthly in arrears. This means that under UC housing costs will no longer be paid to the landlord and the tenant will be responsible for paying the rent to their landlord. Although there will be some exceptions for vulnerable people, it is essential that all tenants have a bank account so that can receive the benefit payment and make arrangements to pay their rent as soon as they receive their payment.

Further information on Universal Credit is available on the governments website.