Seven significant changes to benefits will take effect from April under new reforms laid out by the Department for Work and Pensions (DWP). Benefits linked to inflation will see a rise of 1.7% – inflation-linked benefits administered by HMRC will also rise.
The Secretary of State for Work and Pensions reviews the level of benefits and State Pensions each year as the Labour government plans to overhaul the system in 2025.
This will be seen largely as a pay increase for claimants across the UK.
April 5 will see the end of Tax Credits which will be replaced by Universal Credit (UC). Claimants of Tax Credits will be transitioned to UC by the end of the same month.
Universal Credit
The standard allowance for UC, the basic amount before any deductions or additional payments, will rise from £311.68 a month to £316.98 a month for single individuals under 25. For those aged 25 or over, it will rise from £393.45 a month to £400.14 a month. Joint claimants under 25 will see their monthly pay increase from £489.23 to £497.55, while those aged 25 or over will have their payments boosted from £617.60 a month to £628.10 a month.
Limited capability for work (LCW):
Those with limited capability for work will see an increase from £156.11 a month to £158.76 a month, and those with limited capability for work or work-related activity will see a rise from £416.19 a month to £423.27 a month. Carer elements will increase from £198.31 a month to £201.68 a month.
The higher rate work allowance will rise from £673 a month to £684 a month, and the lower rate from £404 a month to £411 a month. The childcare cost element will increase from £1,014.63 a month to £1,031.88 a month for one child, and the maximum for two or more children will rise from £1,739.37 a month to £1,768.94 a month.
Child element rates:
For the first child born before April 6, 2017 the allowance will rise from £333.33 a month to £339 a month. For the first child born on or after April 6, 2017 or second and subsequent children, rates will increase from £287.92 a month to £292.81 a month. The lower rates for disabled children will go up from £156.11 a month to £158.76 a month, while the higher rates will rise from £487.58 a month to £495.87 a month.
Attendeance Allowance
Attendance Allowance is available for those over the state pension age who need help or supervision with personal care due to illness or disability. The lower rate will rise from £72.65 a week to £73.90 a week, and the higher rate will increase from £108.55 a week to £110.40 a week.
Carer’s Allowance
The Carer’s Allowance will increase from £81.90 a week to £83.30 a week. If you spend at least 35 hours a week caring for someone with an illness or disability, you may be eligible for this allowance.
Other eligibility criteria include earning less than £151 per week (after deductions), the person you care for receiving a disability benefit, being aged 16 or over, not being in full-time education and meeting UK residence, presence and immigration conditions.
Disability Living Allowance (DLA)
DLA is being replaced by Personal Independence Payment (PIP) for those with a disability.
DLA applications are only open to under 16s living in England or Wales, while those in Scotland can apply for Child Disability Payment.
DLA care component rates are set to rise from £108.55 a week to £110.40 a week at the higher rate, with the middle rate increasing from £72.65 a week to £73.90 a week and the lowest rate going up from £28.70 a week to £29.20 a week. DLA mobility component rates will also see an increase, with the higher rate moving from £75.75 a week to £77.05 a week and the lower rate rising from £28.70 a week to £29.20 a week.
Personal Independence Payment (PIP)
Personal Independence Payment (PIP) daily lower rate is set to rise from £72.65 a week to £73.90 a week, with the higher rate increasing from £108.55 a week to £110.40 a week. Mobility rates will also increase from £28.70 a week to £29.20 a week at the lower rate and £75.75 a week to £77.05 a week at the higher rate.
Pension Credit
Pension Credit and state pension standard minimum guarantee will rise from £218.15 a week to £227.10 a week for single people, and £332.95 for couples. Men born on or after April 6, 1951, or women born on or after April 6, 1953 can claim the new state pension.
State pension
The full new state pension will rise from £221.20 a week to £230.25 a week and the full old basic state pension will increase from £169.50 a week to £176.45 a week. This applies to men born before April 6, 1951, or women born before April 6, 1953.
