The Department for Work and Pensions (DWP) plans to eliminate four old benefits by the end of the 2024-25 financial year. This move is part of a bigger effort to shift everyone who currently gets Working Tax Credit, Child Tax Credit, Jobseeker’s Allowance, or Income Support over to Universal Credit.
The goal is to simplify the benefits system, make it work better, and cut down on administrative expenses. However, this change will have a big impact on many people and families who rely on these benefits.
Affected Benefits
The DWP’s new plan will impact several benefits:
- Working Tax Credit: Helps people and couples with low earnings.
- Child Tax Credit: Provides financial support to families with children.
- Jobseeker’s Allowance (JSA): Offers benefits to unemployed people who are looking for work.
- Income Support: Assists people with low income, including carers and single parents.
By the end of May 2024, about 500,000 households receiving these benefits will need to switch to Universal Credit. If they don’t, they might lose their payments.
Transition Timeline
The DWP has planned out a timeline to make this transition as smooth as possible:
- April 2024: Notices will go out to working-age households on Income Support and those getting Tax Credits with Housing Benefit.
- June 2024: People who only receive Housing Benefit will get their notices.
- July 2024: Notices will be sent to those on Employment Support Allowance who also get Child Tax Credits.
- August 2024: If you’re claiming tax credits and are over State Pension age, you’ll be contacted about applying for Universal Credit or Pension Credit, based on your situation.
- September 2024: Jobseeker’s Allowance claimants will receive their notices.
This schedule is designed to keep everything running smoothly and reduce any disruption.
This step-by-step plan is designed to make the switch easier, giving households enough time to get used to the new system.
Support and Adjustments
Understanding that this change might be tough, the government is committed to providing extra help. Employment Minister Jo Churchill has assured that the DWP is carefully watching feedback to quickly fix any problems. The aim is to make the transition as smooth as possible, causing as little disruption as possible for claimants.
For those still getting tax credits, HMRC has announced the final payment increases before the full switch to Universal Credit. Here are the new payment amounts:
Working Tax Credit:
| Element | New Payment Level (2024) | Previous Payment Level (2023) |
|---|---|---|
| Basic element | £2,435 | £2,280 |
| Couple and lone parent element | £2,500 | £2,340 |
| Disabled worker element | £3,935 | £3,685 |
| Severe disability element | £1,705 | £1,595 |
| Childcare costs for 1 child | £175 | £175 |
| Childcare costs for 2 or more children | £300 | £300 |
Child Tax Credit:
| Element | New Payment Level (2024) | Previous Payment Level (2023) |
|---|---|---|
| Family element | £545 | £545 |
| Child element | £3,455 | £3,235 |
| Disability element (disabled child rate) | £4,170 | £3,905 |
| Disability element (severely disabled child rate) | £1,680 | £1,575 |
These are the last changes to tax credits before switching to Universal Credit.
Why the Change?
The government is ending certain benefits to make the welfare system simpler and cheaper to run. By combining various benefits into one payment through Universal Credit, they hope to cut down on confusion, errors, and fraud. This change is also expected to save taxpayers money by shutting down outdated systems like the tax credits managed by HMRC and other old benefits managed by the DWP.
Although Universal Credit aims to make things more straightforward, it will mean big changes for many people. Some might see differences in the support they get, and adjusting to the new system might be tricky.
The DWP is working hard to help people through this transition, but it’s important for everyone to stay updated and take action to avoid any problems with their benefits. As the switch to Universal Credit gets closer, the goal is to make sure everyone who’s eligible successfully makes the move and continues to receive the support they need during these changes.
FAQs
What are the changes in DWP 2025?
The Work Capability Assessment (WCA) for people already receiving benefits won’t change, but starting in 2025, new claimants of Employment and Support Allowance (ESA) and Universal Credit (UC) will have to go through a new test.