On 18 January, local councillors met with managers from the Department for Work and Pensions ahead of the move of Tax Credit and Legacy benefit claimants Universal Credit, which will start in Merseyside on 22 January 2024.
Universal Credit was launched in 2013 and replaces six ‘legacy’ benefits and tax credits for working-age households.
The Department for Work and Pensions currently expects all households claiming legacy benefits and tax credits to have been notified of the need to move across to Universal Credit by the end of 2024. The exception is Employment Support Allowance which will start in 2028.
In the Birkenhead constituency, the latest figures show there are 4,673 households estimated to still be receiving legacy benefits and tax credits such as:
- Working Tax Credits
- Child Tax Credits
- Jobseekers Allowance
- Income Support
- Housing Benefit
Nationally, there are around 1.4 million households receiving legacy benefits and tax credits who are estimated to be better off with Universal Credit. This is particularly the case for tax credit claimants, with analysis estimating around two-thirds of them would benefit.
It is important for current recipients to satisfy themselves that they would be better off on Universal Credit using independent benefit calculators before moving voluntarily, as once the claim is made, recipients cannot revert to tax credits or legacy benefits.
For those with a lower calculated award in Universal Credit than in their legacy benefits, transitional protection will be provided for eligible households. This means they will see no difference in their income at the point they are moved to Universal Credit, provided there is no change in their circumstances during the migration process.
At a minimum, claimants should consider the following before choosing to move to Universal Credit:
- Check that you are eligible to claim Universal Credit
- Check your savings. Anyone with over £16,000 in savings or capital is not eligible for Universal Credit and should not apply. If you or your partner have over £6,000 in savings or capital, your Universal Credit payments will be lower.
- Check how Universal Credit recovers any outstanding debts you may have
By the end of March 2025, all those receiving legacy benefits will have been notified of the need to apply for Universal Credit instead. If you receive legacy benefits and are notified of a switch to Universal Credit, there is a guide on what you should do.
In April 2024, monthly basic Universal Credit for single adults aged 25 or above will rise to £393.45. A full list of the increase rates for all benefits and pensions can be found here
