(The Secretary of State for
Work and Pensions): Today we publish a summary of
the Universal Credit Full Business Case, signed off by HM
Treasury, which shows that when fully rolled out, Universal
Credit is forecast to incentivise 200,000 more people to take
employment than would have under the previous system and deliver
£8bn of benefits to the UK economy per year.
Universal Credit is the biggest change of the welfare system
since it was created. It is a modern, flexible, personalised
benefit reflecting the rapidly changing world of work.
It has brought together the six main benefits, including tax
credits, providing support in and out of work and assisting
career progression. The Government has used a ‘test and learn’
approach as it rolls out across the country.
The Government has already made a commitment that anyone who is
moved to Universal Credit without a change of circumstance will
not lose out in cash terms. Transitional protection will be
provided to eligible claimants to safeguard their existing
benefit entitlement until their circumstances change.
Today I am announcing four additions to these rules to ensure
that Universal Credit supports people into work, protects
vulnerable claimants and is targeted at those who need it.
In order to support the transition for those individuals who live
alone with substantial care needs and receive the Severe
Disability Premium, we are changing the system so that these
claimants will not be moved to Universal Credit until they
qualify for transitional protection. In addition, we will provide
both an on-going payment to claimants who have already lost this
Premium as a consequence of moving to Universal Credit and an
additional payment to cover the period since they moved.
Second, we will increase the incentives for parents to take
short-term or temporary work and increase their earnings by
ensuring that the award of, or increase in, support for childcare
costs will not erode transitional protection.
Third, we propose to re-award claimants’ transitional protection
that has ceased owing to short-term increases in earnings within
an assessment period, if they make a new claim to UC within three
months of when they received the additional payment.
Finally, individuals with capital in excess of £16,000 are not
eligible for Universal Credit. However, for Tax Credit claimants
in this situation, we will now disregard any capital in excess of
£16,000 for 12 months from the point at which they are moved to
Universal Credit. Normal benefit rules apply after this time in
order to strike the right balance between keeping incentives for
saving and asking people to support themselves.
The process of migrating claimants on legacy benefits will begin
in July 2019 as previously announced. In order to make the
changes to the system it will be necessary to extend the
completion of UC to March 2023. As throughout UC roll out, we
will keep the exact timetable under review to do what is sensible
from a delivery and fiscal perspective.
These changes will form part of the Universal Credit Managed
Migration and Transitional Protection Regulations which we intend
to bring forward in the Autumn.
This Government is committed to delivering a welfare system that
supports claimants and is fair to taxpayers.
