The introduction of Universal Credit 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.
Many people are worse off on Universal Credit when compared to the legacy benefits they are on / have been claiming. UC claimants can find:
- They are financially better off on the legacy benefit system.
- They would struggle with the responsibilities of UC ie managing their money monthly / paying their rent themselves.
- They would struggle with the conditionality under UC and would have less work search / work preparation on the legacy benefit system.
- They would have significant deductions being taken from their UC and these would be less on the legacy benefit system.
Note: This is not an exhaustive list
When someone makes 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 generally no going back! (click here for more information.)
So, claimants who don't have to claim Universal Credit and who would be worse off on UC, are better off not claiming it. But, if their only option is UC, then any delay in claiming UC will probably mean that they lose out!
The trouble is, the rules are complicated!
The best thing a claimant can do, if they are told they have no option but to claim UC, is to get specialist advice without delay. If you are not sure whether a claimant needs to claim UC please email us: email@example.com
* 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 or temporary accommodation.
Won't claimants have to go onto UC soon anyway?
The DWP's plan is that all those claimants that need to be on Universal Credit will be moved onto it by the end of 2024 (could be delayed further). So for some claimants this is a long way off.
Additionally, where someone 'opts' to claim UC ie moves onto UC by 'natural migration' they receive the level of UC that they are entitled to. But if they stay on the legacy benefit system and get moved onto UC by 'managed migration' then the government have promised many claimants transitional protection if the level of UC they are entitled to is less than the level of legacy benefits they have been getting.
If someone doesn't have to claim UC yet, many are generally better off not doing so!