Universal Credit - Are You Ready?

Welfare Reform

The Government is changing the way benefits are paid. These changes will affect our customers in different ways depending on such things as age, household composition and the types of benefit received. What follows is an explanation of each change together with useful online links.

If you have any queries you can also telephone Tai Gwalia’s Income Management Team on 0800 012 1080.

Universal Credit

Universal Credit is a new benefit designed to support people who are on a low income (including employment) or out of work. It will replace six existing benefits and is currently being rolled out across the UK.

What Universal Credit replaces

Universal Credit will replace:

Universal Credit will not replace:

  • Income-based Jobseekers Allowance
  • Income-based Employment and Support Allowance
  • Housing Benefit
  • Working Tax Credit
  • Child Tax Credit
  • Income Support
  • Child Benefit
  • Carer’s Allowance
  • Disability Living Allowance
  • Personal Independence Payment
  • Help to pay your Council Tax*


*This means that if you apply for Universal Credit you must apply separately for help to pay your Council Tax. Please contact the local authority in which you have your tenancy as local schemes apply.

Which Tai Gwalia Cyf tenants are currently affected?
Universal Credit was rolled out in Neath Port Talbot in April 2015. Since then all local authorities in which Tai Gwalia has general needs housing have gone live with Universal Credit – Swansea, Carmarthenshire, Powys, Pembrokeshire, Rhondda Cynon Taff and the Vale of Glamorgan. Currently Universal Credit is restricted to single, recently unemployed people under the age of 60 and a half. Universal Credit will be rolled out to other groups, including couples and families, in the near future.

How is Universal Credit Paid?
Universal Credit will be paid in to your bank, building society or credit union account monthly in arrears. You will have to wait five weeks for your first payment and you may not be paid anything for the first week. Your monthly payment will include two “elements”.

Your “personal element” will replace your state benefit, for example, Jobseekers Allowance.

Your “housing element” will replace your Housing Benefit.

IMPORTANT: If you receive Universal Credit it is your responsibility to pay the whole of your rent to Tai Gwalia Cyf.

How to claim Universal Credit
Applications for Universal Credit will be expected to be made online. It takes approximately 40 minutes and must be completed in one go. After you have submitted your claim you will be contacted by telephone to visit your local jobcentre for an interview with your Work Coach. You will be expected to take with you proof of your rental liability – tenancy agreement, latest rent increase letter and statement of your rent account.

If you do not have these please contact the Income Management Team on 0800 012 1080 and we can send them to you.

At the interview be honest about any rent arrears and debts you have. It might be possible to have an Alternative Payment Arrangement – a more frequent payment, an advanced payment, a payment split between partners or payment of the “housing element” direct to your landlord.

Before Universal Credit can be paid you will be expected to have a bank/building society/credit union account and an e-mail address, register for Universal Jobmatch and create an up-to-date CV.

What do I need to do?
•    Think about what you will live on for the first 5 weeks
•    If you have not already done so open a bank/building society/credit union account
•    If you do not have the skills to make an on-line application seek advice about training
•    Sign up to an e-mail provider
•    Manage your household budget using a planner
•    Keep proof of any debts you have
•    If your rent account is not at least one week in credit make additional weekly payments until it is
•    Contact the Income Management Team on 0800 012 1080 for advice

Go online for more information
Apply online for Universal Credit: www.gov.uk/apply-universal-credit
Government Universal Credit pages: www.gov.uk/universal-credit
An Introduction to Universal Credit video: http://youtu.be/E7GUu7Xa7Nw
Your Benefits Are Changing information: www.yourbenefitsarechanging.co.uk
Budget Planner available here: www.moneyadviceservice.org.uk/en/tools/budget-planner
Check benefit entitlement: www.turn2us.org.uk
Money Advice: www.moneymadeclearwales.org;    www.moneysavingexpert.com  

Need an e-mail address? Go to mail.google.com or www.outlook.com. Both come with a range of helpful features

Choosing a bank account for your benefit payments:
www.moneyadviceservice.org.uk/en/articles/choosing-a-bank-account-for-your-universal-credit-payment

You can also telephone the Income Management Team on 0800 012 1080 or the Government Universal Credit helpline on 0345 600 0723 (text phone 0345 600 0743).

Shared Accommodation Rate

The Shared Accommodation Rate will apply to all new tenancies granted from 1 April 2016 to single people under the age of 35 and will come into effect from 1 April 2019.
This will limit the amount Housing Benefit will pay towards the rent to that of a single room or bedsit within a property.
These rates differ between local authority areas and can be found at:https://lha-direct.voa.gov.uk/search.aspx

Under “Shared Accommodation Rate” when you have chosen the relevant local authority from the drop down menu.

For example, if you rent a flat in Swansea for £70.00 per week entitlement to  Housing Benefit will be assessed on £70.00 per week until 31 March 2019 and then on £57.34 per week from 1 April 2019.
This means that someone receiving Housing Benefit, in this case, will have to find an additional £12.66 per week towards their rent.

We will explain this benefit change to any new tenants meeting the criteria before the offer is made and, if accepting the tenancy, the tenant will be requested to sign a form to confirm that they understand the impact of this change.

What do I need to do?
•    If you are receiving Housing Benefit/Universal Credit think about how you are going to pay the shortfall in your rent from April 2019
•    Manage your household budget using a planner
•    Contact the Income Management Team on 0800 012 1080 to discuss any help you need with money matters

Go online for more information
Government Shared Accommodation Rate pages: www.gov.uk/housing-benefit/eligibility
Budget Planner available here: www.moneyadviceservice.org.uk/en/tools/budget-planner
Check benefit entitlement: www.turn2us.org.uk
Money Advice: www.moneymadeclearwales.org   www.moneysavingexpert.com     

       
Local Housing Allowance

The Local Housing Allowance, which previously only applied to privately rented properties, will apply to all new social housing tenancies, regardless of family composition and age, granted from 1 April 2016 and will come into effect from 1 April 2019. This means it will also apply to pensioners, who are currently exempt from the Spare Room Subsidy (“Bedroom Tax”) and to tenants in sheltered and supported accommodation. This will limit the amount Housing Benefit will pay towards the rent based on the Local Housing Allowance for the particular Local Authority area and relates to the number of bedrooms the tenant needs rather than has.

These rates differ between local authority areas and can be found at:https://lha-direct.voa.gov.uk/search.aspx

For example, if a single person (over the age of 35) or a couple move in to a 2 bedroom property, after 1 April 2016, in Carmarthenshire, with a rent of £80.00 per week Housing Benefit will be assessed on £80.00 per week until 31 March 2019 and then on £72.98, the one bedroom rate, from 1 April 2019, as the tenants only need one bedroom. This means that someone receiving Housing Benefit, in this case, will have to find an additional £7.02 per week towards their rent.

We will explain this benefit change to any new tenants meeting the criteria before the offer is made and, if accepting the tenancy, the tenant will be requested to sign a form to confirm that they understand the impact of this change.

What do I need to do?
•    If you are receiving Housing Benefit/Universal Credit think about how you are going to pay the shortfall from April 2019
•    Manage your household budget using a planner
•    Contact the Income Management Team on 0800 012 1080 to discuss any help you need with money matters

Go online for more information
Government local housing allowance pages: https://www.gov.uk/guidance/local-housing-allowance
Budget Planner available here: www.moneyadviceservice.org.uk/en/tools/budget-planner
Check benefit entitlement: www.turn2us.org.uk
Money Advice: www.moneymadeclearwales.org   www.moneysavingexpert.com  

Benefit Cap

In 2013 the Government introduced the benefit cap to limit the maximum amount of benefit a family can receive.

From 7 November 2016 the benefit cap for a couple or a person(s) with children, living outside London, will be reduced from £500 per week, including Housing Benefit, to £384.62 per week including Housing Benefit.

For single people with no children, living outside London, the benefit cap will be reduced from £350 per week, including Housing Benefit, to £257.69 per week, including Housing Benefit.

Which benefits count for the purpose of the Cap?
The following benefits are included when calculating whether your household income exceeds the cap:
•    Child Benefit
•    Child Tax Credit
•    Employment and Support Allowance (except when in the support group)
•    Housing Benefit
•    Incapacity Benefit
•    Income Support
•    Jobseekers Allowance
•    Maternity Allowance
•    Severe Disablement Allowance
•    Universal Credit (unless you have an in-work exemption)
•    Widowed Parent’s Allowance

Which benefits do not count for the purpose of the Cap?
The following benefits are not included when calculating whether your household income exceeds the cap:
•    Bereavement Payment
•    Carers Allowance
•    Carers Element of Universal Credit
•    Childcare Element of Universal Credit
•    Council Tax Support
•    Discretionary Housing Payment
•    Guardians Allowance
•    Housing Benefit for “specified accommodation”
•    State Retirement Pension
•    Statutory Sick/Maternity/Paternity/ Adoption Pay

What do I need to do?
Any tenants affected by the Benefit Cap will have been contacted by the Department for Work and Pensions in May, with follow up contact in June with the offer of advice and support, including moving into or increasing employment.

A further letter is to be sent to those who will be affected to indicate how much the claimant’s benefit may be reduced by each week.

Local Authorities have agreed to notify Tai Gwalia of the tenants to be affected. We will contact each tenant to ask if they need any assistance in managing their finances.
If you are affected you can also contact the Income Management Team on 0800 012 1080.

Go online for more information
Government benefit cap pages: www.gov.uk/benefit-cap
Budget Planner available here: www.moneyadviceservice.org.uk/en/tools/budget-planner
Check benefit entitlement: www.turn2us.org.uk
Money Advice: www.moneymadeclearwales.org  www.moneysavingexpert.com