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Universal Credit: what the 2020 changes could mean for you


Universal Credit (UC) is changing next year, with millions of Brits set to get the boost they’ve been waiting for.

The Department for Work and Pensions (DWP) has confirmed in recent weeks that the payments will increase in-line with the inflation figures released earlier in the year.

This marks the end of the five-year freeze on benefit increases and will bring relief not only to the 2.5 million people that claim Universal Credit but to the millions of other Brits that claim benefits to help them get by.

The freeze is set to end in April 2020, at which point Universal Credit payments will increase by 1.7%, with other payments, including pensions, could go up by up to 3.9%.

But what does this mean for how much cash you’ll get?

This will be entirely dependent on how much you get each month already. For example, someone who is receiving a basic £100 will see an increase of £1.70, but those who receive higher will see a bigger boost.

In terms of your state pension, this is now set to rise by as much as £6.60 a week, meaning the maximum allowance will go from £168.60 per week to £175.20. This ties in with the government-branded ‘triple lock’ arrangement, which sees your pension rise with increase of earnings, inflation or 2.5%.

Which benefit payments will be affected by the rise?

The rise will affect both Universal Credit and all other ‘legacy benefits’. Legacy benefits are all the welfare payments that existed before the roll-out of Universal Credit.

This means that payments for job seeker’s allowance (JSA), income support, housing benefit, employment and support allowance (ESA), child benefit, child tax credits and working tax credits will all be affected.

Although you cannot apply for legacy benefits anymore, there are still people in receipt of them due to not having moved to Universal Credit.

However, even payments that weren’t involved in the 2015 freeze, such as disability and maternity benefits, will be privy to the increase.

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Will we be better off?

Whilst the increase will mean more money for many, there have been calls that the boost isn’t enough.

According to think tank charity Resolution Foundation, households have lost an average of around £580 each year since the freeze was put in place. This is because whilst payments stayed the same, the cost of living went up; leaving many struggling to get by.

What to do if you’re struggling to claim Universal Credit?

If you’re struggling with your application for Universal Credit or the payments you receive aren’t enough to cover your living costs. There are things you can do:

  • Get reduced Council Tax

Depending on your circumstances, you may be able to get a discount on how much you pay for your Council Tax. You can find out more about your entitlement to this here.

You may also be able to get Discretionary Housing Payments if you’re struggling to keep up with your rent.

  • Foodbanks

Although we never really want to encourage their use, foodbanks can be a great way to help you top up on essential food and toiletries.

There are local food banks all over the country who will offer you help for absolutely no cost. You can find the one closest to you through the Trussel Trust.

  • Universal Credit advance

This is something that isn’t highly broadcasted, but if you are claiming Universal Credit, you may be able to claim an advance. If you choose this you can get cash within five days to help you rather than having to wait the standard five weeks.

However, it’s important to remember that this is essentially a loan, so you will have to pay it back. This is done by deducting the payments from your future Universal Credit payments before they hit your bank account.

  • Budgeting advance

On the other hand, you may also be entitled to some cash from the government to help cover emergency household costs. Budgeting advances are usually granted for things such as broken-down boilers or if you need help to get a job.

This again will need to be repaid through deductions from your future Universal Credit payments, and it will need to be repaid even if you stop receiving the benefit.

  • Alternative Payment Arrangements (APAs)

For those who are struggling to keep up with their rent, there is the possibility of applying for an APA. This can be done by either you or your landlord and will get your rent paid directly to them.

You may also be able to change the frequency of your payments or split them if you’re one half of a couple.

Alternatively, if you’re struggling with money worries, you can contact us today on 0808 2234 102. Our experts are on hand to work through your debts

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