The Division for Work and Pensions (DWP) restarted the ‘managed migration’ means of shifting as much as 2.6 million folks at the moment claiming legacy advantages over to Common Credit score (UC) in Could.
5 hundred folks in Medway and Bolton had been initially chosen to undergo the method as a part of the ‘discovery part’ earlier than DWP ramps up transfers to attain its completion deadline by the tip of 2024. It lately introduced folks in Truro and Falmouth shall be despatched Migration Notices from July 25.
DWP is offering ‘transitional safety’ for individuals who are moved to Common Credit score, which suggests their entitlement won't be decrease than it at the moment is on a legacy profit, nevertheless, that is solely the case if they're moved by way of the managed migration course of. However DWP confirmed this week that this safety is “not designed to offer indefinite monetary safety” and may very well be “terminated” following the transfer.
Alliance MP, Stephen Farry, requested DWP when the “plans to stop transitory protections for folks present process managed migration to Common Credit score in 2023-2024” will come into impact.
In a written response on July 20, DWP Minister, David Rutley MP, stated the cost safety “will erode by will increase in different parts of UC or the place new parts (apart from the Childcare Prices ingredient) are awarded to a claimant’s UC award”.
He defined: “Transitional Safety ensures eligible claimants moved by the Division from legacy advantages to UC won't have a decrease entitlement than that they had by way of legacy advantages on the level of their transfer to UC.
“This safety will not be designed to offer indefinite monetary safety.”
He went on to elucidate three adjustments in circumstances the place the safety may very well be stopped following the transfer to Common Credit score.
These embrace:
- when a claimant separates from their companion, which might change nature of declare (joint to single)
- when a claimant varieties a brand new couple, which might change nature of declare (single to joint)
- the place the Common Credit score award ceases
Mr Rutley stated: “It will also be terminated if a claimant experiences a major change of circumstances equivalent to the place a claimant separates from their companion or varieties a brand new couple, or the place the UC award ceases.
“As soon as stopped, a claimant’s transitional ingredient won't usually be reapplied to their UC award, ought to they make one other UC declare.”
Nonetheless, he added that there's an exception to this.
He stated: “The exception is the place the unique Common Credit score declare was stopped on account of a rise in earnings and a brand new declare to Common Credit score is made inside 4 months of the date for which Common Credit score was final awarded.”
Legacy advantages shifting to Common Credit score
- Earnings-Associated Employment and Help Allowance (ESA)
- Earnings-Based mostly Jobseeker’s Allowance (JSA)
- Working Tax Credit score
- Little one Tax Credit score
- Earnings Help
- Housing Profit
Everybody shifting over from legacy advantages can have their entitlement to Common Credit score assessed towards their present claims, with high up funds out there for eligible claimants whose entitlement would have been lowered due to the change - making certain they obtain the identical entitlement as on a legacy system.
These will proceed until their circumstances change.
Migration course of from legacy advantages to Common Credit score
There are 3 ways folks can migrate to Common Credit score, outlined within the DWP’s ‘2022-24 technique for implementing the ultimate part of Common Credit score’ - you possibly can learn it in full on the GOV.UK web site, right here.
These are:
- Pure migration - a change of circumstances triggers a transfer
- Voluntary migration - claimants chooses to maneuver
- Managed migration - DWP triggered
The DWP explains: “Of the two.6 million households remaining on legacy advantages in April 2022, ought to they select to assert UC right this moment, we estimate round 1.4 million (55%) would have a better entitlement on UC, 300,000 would see no change and roughly 900,000 households (35%) would have a decrease entitlement.”
The DWP additionally estimates that of the 900,000 households who would basically be worse off shifting to Common Credit score, round 600,000 would obtain transitional safety by means of the managed migration course of, whereas others will “both depart advantages, migrate naturally earlier than DWP asks them to maneuver or obtain a extreme incapacity transitional cost”.
You possibly can learn the complete information to the DWP's managed migration to Common Credit score on the GOV.UK web site, right here.
Which teams are anticipated to be higher or worse off on Common Credit score?
The DWP estimates ESA claimants who're within the assist group however who don't get the Extreme Incapacity Fee to be higher off on Common Credit score.
Households who get ESA and obtain the Extreme Incapacity Premium and the improved incapacity premium, are anticipated to be worse off.
Extra particulars about which teams may obtain a better or decrease entitlement on Common Credit score might be discovered right here.
DWP estimates on who will obtain greater or decrease entitlements or see no change to the quantity of profit they obtain are summarised beneath.
Larger entitlement after shifting to Common Credit score
- ESA claimants: 600,000
- Tax Credit (Working and Little one) claimants: 700,000
- Whole, together with different legacy advantages: 1.4 million
Decrease entitlement after shifting to Common Credit score
- ESA claimants: 500,000
- Tax Credit (Working and Little one) claimants: 300,000
- Whole, together with different legacy advantages: 900,000
No change after shifting to Common Credit score
- ESA claimants: 100,000
- Earnings Help: 100,000
- Whole, together with different legacy advantages: 300,000
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Transitional safety
The DWP stated that round 400,000 ESA and 100,000 Tax Credit claimants will obtain transitional safety, which suggests they need to not see any discount of their advantages after they switch.
Nonetheless, the worth of this safety shall be eroded yearly as a result of, excluding the childcare ingredient, any annual improve in Common Credit score shall be deducted from the transitional safety.
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