Digital - or what some call 'Full' service - UC - is currently being rolled out across the UK.
It brings many challenges - one of which is making sure people are not being made financially worse off - by being told they have to claim UC when they don't.
As an area goes onto the 'Full'/Digital service anyone of working age can make a claim. When they make their claim for UC any legacy benefits* that they are entitled to will be brought to an end, and new claims for legacy benefits* will then be closed off^ to them - ie there's no going back!
Many people are financially worse off on Universal Credit. In addition to the financial loss they can find themselves: subject to conditionality or harsher conditionality, having to budget monthly, having to pay back any Hardship Payment...... and so on.
For these claimants if they don't have to claim Universal Credit, then they are better off not claiming it.
Click here to find out who can be worse off on Universal Credit.
But what if they are told it is their only option? Or they are advised to claim UC when they don't actually need to? Or their new landlord doesn't explain that moving home will make them significantly worse off?
Once a UC claim is made, it can be withdrawn before it is decided. and as long as any legacy benefits the claimant was on have not been terminated - they could continue on those benefits. But the legacy benefit claims are closed down pretty quickly and so for many it is too late.
Who is being given wrong advice?
Many people being given the wrong advice - we have heard of:
- Lone parents starting work being told they have to claim UC.
- Tenants on HB moving home within a LA area being told that they have to claim UC.
- And mixed age couples, when one finished work being told their only option is UC.
But UC may not be their only option - and they could be significantly worse off if they claim it!
The only people who have to claim UC are claimants of working age who are looking to make a new claim for a legacy benefit (which would now be a new claim for UC instead).
Who doesn't need to claim UC? Examples include:
- Lone parents already on Child Tax Credit can be awarded Working Tax Credit when they make the move into work by reporting their change in their circumstances - they do not need to make a new claim for WTC.
- Tenants on HB moving within a LA area just need to report a change of address - there's no need for a new claim for HB.
- Mixed age couples have the option of claiming Pension Credit - which is significantly more generous than UC.
Take a look at the examples on this page of the website - which one of the claimants would be £120 a week worse off if they claimed UC?
So what can landlords do?
- Ensure their staff are aware of the rules - particularly lettings staff.
- Get the message out there - that tenants should seek advice before making a claim for UC.
- Highlight any misleading advice given by DWP staff to their DWP Partnership Manager.
- If someone is advised incorrectly - see if there is a way back onto legacy benefits - and if not, advise the tenant to claim compensation from the organisation who advised them that Universal Credit was there only option.
* Legacy benefits = Income-Based JSA, Income-Related ESA, Income Support, Child Tax credit, Working tax Credit and Housing Benefit.
^ Apart from HB for those living in specified accommodation.