Universal Credit
Internal Use Only
For those who struggle to man-
age a monthly budget, our Job-
centres will be able to offer Per-
sonal Budgeting Support, as well
as Alternative Payment Arrange-
ments
Alternative Payment Arrange-
ments mean that the Universal
Credit payments can be made
more frequently, or that housing
payments can be paid directly to
landlords
Unlike the old system, people
can work as many hours as they
want, and take on temporary
contracts, helping to build up
experience for a more perma-
nent position without having to
end their claim. Claimant earn-
ings are verified digitally in real
time directly from HMRC, simpli-
fying the process for both claim-
ants and employers
Universal Credit is designed to
support people, enabling them
to move closer to the labour
market, be better off in work,
and progress earnings. It replac-
es 6 existing benefits: Jobseek-
ers Allowance, Employment &
Support Allowance, Income Sup-
port, Working Tax Credit, Child
Tax Credit, and Housing Benefit
You apply for Universal Credit
online, and then meet your own
personal work coach who ex-
plains how the benefit works,
offers budgeting advice, and ad-
vises on the journey into em-
ployment. Continuous support is
given by the work coach
throughout the entire claimant
journey
Universal Credit is a single pay-
ment, paid monthly—giving you
more control and responsibility
over your finances and also mir-
rors the world of work
The previous system was com-
plex and created dis-incentives
that prevented people from
moving into work, or increasing
their hours. Universal Credit is
more flexible as your claim re-
mains open, even when you
move into work
Jobcentres are a busy hub for all
types of claimant support. This
includes a presence from em-
ployers with job and training
opportunities, money manage-
ment support from Credit Un-
ion, and specialist support from
many linked providers covering
a wide range of services from
mental health to self employ-
ment
Internal Use Only
Universal Credit: mythbuster
Myth
Claimants have a long wait with no money
Claimants who find managing money diffi-
cult, are left to struggle with organising
their own affairs
People without access to digital services or
those lacking digital skills struggle to make
a claim
No support for families with children or
those with health conditions trying to work
Fact
Waiting days no longer apply and a 100%
Advance is available from day 1
Personal Budgeting Support is available
and offered to all from day 1. Direct pay-
ments to landlords, more frequent pay-
ments, and split payments can be request-
ed for those more vulnerable claimants
needing extra support. Money manage-
ment and debt advice is offered by a num-
ber of our partner organisations who work
alongside us in the jobcentre helping us to
create a network of support
Many claimants successfully make a claim
online and manage their own UC account.
However for those who can’t, Assisted
Digital Support is available through a vari-
ety of local networks and home visits can
also be arranged for vulnerable claimants.
If you start work and are responsible for a
child or have limited capability for work,
you will be eligible for a work allowance. A
work allowance is the amount that you can
earn before your Universal Credit payment
is affected. Parents can also claim up to
85% of childcare costs helping them be-
come better off in work and on receipt of
a job offer upfront childcare costs can be
provided
Internal Use Only
Universal Credit: mythbuster
Myth
Sanctions are imposed on claimants leaving
them without funds
Numbers of people accessing food banks
has increased due to Universal Credit
Rent arrears accrue whilst claimants wait for
their first payment of UC
Some claimants are not capable of manag-
ing their own affairs, for example those with
mental health conditions or learning diffi-
culties
Fact
We provide a tailored service to every in-
dividual, which takes into account personal
circumstances and is delivered via one to
one work coach support. At every oppor-
tunity we make claimants aware of their
responsibilities. Work coach and claimant
mutually agree a Claimant Commitment
which outlines steps to help them pro-
gress. Work coaches can use their discre-
tion, however if a claimant chooses not to
engage with us, it is only as a last resort
and with regret that a sanction would be
applied.
The reasons why people use food banks
are complex, so it’s wrong to link a rise in
use, to any one cause
Housing Benefit is paid for an extra 2
weeks to support claimants whilst making
their UC claim. Claimants who are at risk of
becoming homeless are offered support
from the local authority via the Duty to
Refer process. Claimants in Supported or
Temporary Accommodation continue to
be paid Housing Benefit
For these claimants it is possible to set up
a Personal or Corporate appointee. Visit-
ing officers can make home or hospital
visits. We have external partnerships who
will support these claimants throughout
their Universal Credit journey
Internal Use Only
Universal Credit: mythbuster
Myth
Vulnerable and sick claimants have to agree
to look for work and attend the jobcentre
Claimants are not better off in work under
Universal Credit
Fact
Claimants work together with their work
coach to agree a tailored Claimant Com-
mitment. For claimants with complex
needs or health considerations claimant
commitments can be switched off tempo-
rarily until a time when it is appropriate to
consider taking some small steps. Fre-
quency of attendance at jobcentre meet-
ings is mutually agreed according to
claimant circumstances and one to one
support can continue either by phone or
via the online journal rather than face to
face
The Earnings Taper is more generous,
meaning that households keep more of
the money they earn. Unlike JSA there is
no longer a 16 hour rule which meant their
claim stopped, UC continues and claim-
ants simply report their earnings regard-
less of the hours worked. UC payments will
gradually decrease as claimants earn more.
There was only a £5 earnings disregard
under the old system and then earnings
were deducted pound for pound. With UC,
only 63% of claimants earnings are taken
into consideration and for those with chil-
dren and health conditions this is only af-
ter the work allowance has been applied.
Internal Use Only
Universal Credit: Considerations
18 to 21 Housing Costs
In some circumstances claimants between
the ages of 18 and 21 are not entitled to
help with housing costs under UC. For ex-
ample, where a claimant has not worked
for the previous 6 months, however there
are a vast amount of exceptions
Final Earnings
If a claimant receives final earnings
after making a claim to UC, these are
taken into account. This is unlike JSA
where they were disregarded.
Change in Circumstances Part Way
Through an Assessment Period
UC is paid as per the circumstances on the
last day of the assessment period. This can
impact negatively for claimants, depending
on when they report a change such as
housing which can affect their entitlement.
E.g. moving from rented housing to having
no housing costs
Surplus Earnings
Excess earnings could be carried
over and taken into account
against future UC payments
National Insurance Credits
UC contributes Class 3 NI credits, as op-
posed to Class 1 credits paid on previous
benefits.
Class 3 only count towards your state pen-
sion, whereas Class 1 may help qualify for
other benefits
Double Earnings
Due to the way UC is calculated, there are
some circumstances where claimants
have two wages that fall into one assess-
ment period. This means that they may
receive less financial support
Financially Worse Off
Where a claimant was previously in receipt of
SDP on ESA, or IS, this is not payable under UC.
Where a claimant could previously claim Tax
Credits with over £16k in capital, they would
not be entitled to UC
However these instances should be mitigated
by Transitional Protections