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New UC ‘Six Month Earnings’ Rules Will Hit 200000

March 5, 2015

New universal credit rules which could leave 200,000 claimants waiting six months for their benefit have sparked fresh fears over increased tenant rent arrears.

The new regulations, which were quietly laid in parliament last week, have been described by social landlords as likely to lead to increased hardship and evictions.

Currently, the Department for Work and Pensions (DWP) calculates a claimant’s universal credit monthly. If they earn above a certain threshold in that month, their entitlement is reduced or removed. Under the new rules, the DWP will take into account earnings the claimant has made in the six months previously.

This means a person who earns a larger amount in one month, but nothing the following month, may find they are unable to claim universal credit for up to six months. The change only applies to people making repeated claims within six months of a previous claim ending.

The DWP expects up to 200,000 universal credit claimants to be hit by the change after it comes into force on 6 April 2016 – nearly 10 times the number hit by the £26,000-a-year benefit cap.

The change means claimants who receive an irregular income will have to plan and set aside savings for when they are not in work, as they may not be able to fall back on benefit.

In response to a previous consultation on the change, the National Housing Federation said: ‘Any additional delay in tenants’ ability to access the right support will further increase the possibility of poverty.’

London landlord Peabody said an ‘obvious area of hardship’ would be when claimants took up additional seasonal work. The housing association added: ‘With the accruing rent arrears, there is every chance of people facing eviction.’

Community Housing Cymru, the Scottish Federation of Housing Associations (SFHA), Golden Gates Housing Trust and Wheatley Group have also expressed concern.

The government announced last week it had changed the finalised regulations to allow claimants to earn up to £300 more in one month than the next without being hit, halving the number of people estimated to be effected. The change is designed to prevent people who have an option on when they get paid from maximising universal credit.

2 Comments leave one →
  1. March 5, 2015 4:47 pm

    NEW universal credit rules? Did they waste £140milion (or however much) on coding the system, and afterwards decide what the rules were?
    In case I’m not being clear, that’s like having an architect design your house, a builder build it, and then deciding to move the front door

    Incompetence and waste? Or just a refusal to tell us what this system is intended to do. Which appears to be to bankrupt benefit claimants and social landlords and make a fortune for payday lenders.

  2. March 5, 2015 6:03 pm

    Reblogged this on Britain Isn't Eating.

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