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Should I be worried about Universal Credit?

calendar06 June 2016

Joseph Allison's avatar Joseph Allison

Should I be worried about Universal Credit?

Do you receive any of the following?

  1. Jobseeker’s Allowance
  2. Employment Support Allowance
  3. Income Support
  4. Child Tax Credit
  5. Working Tax Credit
  6. Housing Benefit

If so, the new system of Universal Credit is going to make big changes to how you receive your benefits. In a nutshell, Universal Credit combines six benefits into one system of monthly payment, like a monthly wage. Applications will be dealt with entirely online and will be paid directly into your bank account.

The aim is to make it simpler but with any shake-ups, there’s always a few teething problems.

Good news: The changes are happening very slowly across the country, one area at a time and if you’re not making a new claim, you’ll be largely unaffected until June 2018. So, you’ve got time to prepare. Check out: Seven things you can do to prepare for Universal Credit.

Universal Credit will be managed online, a big issue if you don’t have access to the internet. However, most Job Centres have in-house computers and offer training. The Department of Work and Pensions are aware this change to on-line is going to be a big issue and the Job Centre will be able to give you support. If in doubt, ask.

Another worry factor could be the monthly payments. Under the old system a lot of benefits like Jobseekers Allowance were paid fortnightly. Universal credit will mean waiting for a month before the next payment and you’ll need to be really careful to ensure you don’t leave yourself short for all the essentials like rent, bills and food.

Should you worry about free school meals as they used to be given depending on the type of benefits you received? No one’s too sure quite what will happen with this but the Department for Education will tell us in due course.

There are concerns about rent, especially. Housing Benefit used to be paid directly to the landlord but, under the new system, most people will get the whole amount and have to pay the landlord themselves. It will seem like a lot of money at the start but it has some key places to go – and you’re in charge of that. There may also be a delay as you move over to Universal Credit. Ask at your Job Centre Plus about any possible delays and keep your landlord in the picture with what’s happening. As this is going to be swapped over area by area, your landlord will likely be having this situation with several tenants if they own more than just your property.

What if you get behind with things? Well, payments will be taken from the Universal Credit automatically. Rent arrears, benefit overpayments, energy arrears, budgeting loans etc can all be taken at source but only up to 40% of the total of the total amount you’d have normally received. Still unsure? Talk to your work coach.

In fact, asking for support is a good idea. It’s up to your work coach to inform you about what help is available. If you need help, ask for it!

Need to learn about budgeting? CAP can help.

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