Changes to the benefit system
You may have heard that some welfare benefits have been changing in the last few years. Find out on this page how these changes might affect you.
- The introduction of Universal Credit
- Changes to Pension Credit
- Changes to bereavement benefits
- Personal Independence Payment is replacing Disability Living Allowance
- Changes to Support for Mortgage Interest
- Housing benefit reductions and the ‘bedroom tax’
- How the benefit cap could affect you
- What you should do next
The introduction of Universal Credit
Universal Credit has been rolled out nationally and replaces new claims for a number of benefits for people of working age - i.e. people younger than State Pension age. Check what your State Pension age is on the Government website.
You’ll eventually be transferred to Universal Credit if you already claim any of the following:
- Income Support
- Income-based Jobseeker’s Allowance
- Income-related Employment and Support Allowance (ESA)
- Working Tax Credit
- Child Tax Credit
- Housing Benefit
If you’ve reached State Pension age, you may not be affected unless you are part of a couple and one of you is below this age. From 15 May 2019 the rules are changing so that both members of a couple must reach State Pension age to claim Pension Credit- until then, they will have to make a new claim for Universal Credit.
Changes to Pension Credit
Here are some of the things that may change with Pension Credit, although it’s not clear when these changes will take place.
- As Housing Benefit is being abolished, Pension Credit will include a new housing credit to help towards rent. This may not happen until 2023 at the earliest.
- As Child Tax Credit is being abolished, Pension Credit now includes additional amounts for dependent children.
- There may be a new savings limit for Pension Credit. There is currently no savings limit.
Changes to bereavement benefits
Bereavement Support Payment has replaced the old system of bereavement benefits for bereavements from 6 April 2017.
You may be entitled to Bereavement Support Payment if:
- Your husband, wife or civil partner died on or after 6 April 2017
- The deceased person paid National Insurance contributions or died because of an accident at work or a disease caused by work
- When they died the surviving partner was under State Pension age.
Personal Independence Payment is replacing Disability Living Allowance
Personal Independence Payment (PIP) has replaced Disability Living Allowance (DLA) for new claimants.
Here’s how you could be affected if you currently get DLA:
- If you were under 65 on 8 April 2013, you'll be reassessed for PIP at some point in the future
- If you were over 65 on 8 April 2013, you'll continue to receive it for as long as you're eligible.
Changes to Support for Mortgage Interest
Support for Mortgage Interest (SMI) pays towards the interest on a mortgage or other eligible home improvement loans.
From 6 April 2019, SMI loans were introduced. This means that if you claim SMI, you'll need to make sure that you pay interest on your mortgage or home improvement loans, either yourself or using the loan. The loan is voluntary and you have the choice to accept it or not.
Housing benefit reductions and the ‘bedroom tax’
Housing Benefit is reduced if you're considered to have more bedrooms than you need in your home. This has been called the 'bedroom tax'.
This could affect you if the following apply to you:
- you’re under State Pension age and,
- you rent a property from your local authority or a housing association and,
- you have more bedrooms than you need.
- you’re a pensioner with a younger partner, and claim Universal Credit.
How the benefit cap could affect you
There is a cap on the amount of benefits you can claim if you’re not working. The cap is to £23,000 in London and £20,000 elsewhere.
You may be affected if you’re under State Pension age, or if you’re overthis age and live with a spouse or partner below that age and:
- you or your partner claims Income Support, income-based Jobseeker's Allowance or income-related Employment and Support Allowance (ESA)
- you or your partner claims Universal Credit.
The cap won't apply if you receive any of the following:
- Attendance Allowance
- Disability Living Allowance
- Personal Independence Payment
- Working Tax Credit
- ESA support component
- War widow’s pension
Initially the cap reduces Housing Benefit payments, but in future, deductions will be through Universal Credit.
What you should do next
What benefits can you claim?
Do you know what benefits you are entitled to? Age UK's Benefits Calculator can help you, quickly and easily, to find out what you could be claiming.