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Budget Oct 2021 - benefit related announcements

 

The 2021 budget was announced in parliament on 27th October. Here are the key things you need to know –
 

Universal Credit taper rate reduced from 63p to 55p by 1st December 2021
This means a claimant’s award will be reduced by 55p, rather than 63p, for every £1 of net earnings above any work allowance. (with an increase in the work allowance of £500 pa which is just to make sure that people getting a work allowance benefit as much from the reduction in the taper as people without i.e. so they have roughly the same number of pounds affected by the decrease in taper).
 

The surplus earnings de minimis threshold will stay at £2,500 until 31st March 2023
The threshold was expected to drop to £300 in April 2022 but is being kept at the higher figure for a further 12 months. This will avoid an increase in the number of claimants being affected by the complicated surplus earnings rules.
 

Victims of domestic abuse and modern slavery are exempt from the Shared Accommodation Rate (SAR) from October 2022
This exemption was expected to be brought in from October 2023 but has been implemented 12 months early. It means that single claimants under 35 whose help with housing costs is based on the Local Housing Allowance (e.g. those living in private accommodation) will be excluded from the Shared Accommodation rate and have their HB assessed using the one bedroom rate instead if they have experienced domestic abuse or modery slavery.
 

The planned merger of Pension Credit and Housing Benefit has been pushed back to April 2025
The government had been planning to create a new element of Pension Credit to replace pension age Housing Benefit from April 2023. This has been pushed back by 2 years to account for delays to the full rollout of Universal Credit. This suggests they plan to have UC fully rolled out by April 2025.
 

Extension of ‘Special Rules for Terminal Illness’ (SRTI) to people who are reasonably expected to be in their final 12 months of life
Currently, claimants who are terminally ill and whose death can be reasonable expected within 6 months can make fast-tracked claims to a number of disability benefits and are automatically found to have a Limited Capability for Work and Work Related Activities for UC and ESA. This will be extended to include terminally ill claimants whose death can reasonably be expected within 12 months.
Note – it is not clear when this will come into effect.
 

Cohabitees with children will be entitled to Bereavement Support Payments (and Widowed Parents Allowance) from around September 2022
These benefits are currently only available where the couple were married or in a civil partnership. It will come into effect after it has been approved by parliament – expected to be around September 2022. Some claimants will receive backpayments to August 2018.

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