DUWC explains changes to Universal Credit after Chancellor’s mini-budget

Posted by: Laura Hammond

Wed 28th September 2022

Andy Parkes, advisor at Derbyshire Unemployed Worker’s Centre (DUWC), explains changes to Universal Credit announced by the Chancellor on Friday, September 23.

The new Chancellor Kwasi Kwarteng, in his recent mini-budget, has announced significant changes to Universal Credit (UC) that will see a further increase in the UC administrative earnings threshold.

Further measures will include a strengthening of the benefit sanctions regime and an increase in Work Coach ‘support’ for claimants aged 50 and over.

The government was packaging the changes to UC as increasing support and incentives for those claiming UC, by increasing the administrative earnings threshold to 15 hours a week at National Living Wage for a single claimant (and 24 hours a week for couples) from January 2023.

This builds on an increase, which came into effect from September 26, which raised the threshold from nine hours a week to 12 a week for single claimants (and 19 hours a week for couples).

This significant change means that around 120,000 more UC claimants in work and on low earnings will be moved from what is termed ‘Light Touch’ labour market regime (contact with the Jobcentre and requirements to obtain benefit is less frequent) to the ‘Intensive’ Work Search labour market regime. In this group, claimants are required to take intensive action to secure work or more work, attending Work Search Reviews (at least fortnightly) and undertake work preparation, regular work search and other work-related activities.

To reinforce this conditionality, the government announced in the budget the beefing up of the benefit sanctions regime. In return for receiving UC, claimants are notified of their expectations – apply for jobs, attend interviews or increase your hours.

For those who do not fulfil their work search commitments without good reason, the likely outcome is a reduction in their benefits.

Focusing on the over 50s and their requirement to find work, the government announced that it is to provide additional Work Coach Support to new eligible over 50s claimants and – for the first time – to over 50s that are long-term unemployed.

The government says this will mean jobseekers receiving intensive, tailored support at Jobcentres to help them get into and progress in work, boosting their earnings ahead of retirement.

For those who fall foul of the new conditionality regime and receive a benefit sanction with a reduction in entitlement. Hardship Payments are available as a safety net. However, not all claimants will meet the qualifying rules for a payment.

The sting in the tail in these difficult times is Hardship Payments are a loan and have to be paid back.

Anyone needing more information or help should contact DUWC on 01773 832237 or visit the website here.

The DUWC has offices in locations across Derbyshire. The Alfreton office is based at Alfreton House. It’s opening times are as follows:

Tuesday – 9am to 12pm, 1pm to 4pm

Wednesday – 9am to 12pm, 1pm to 4pm

Thursday – 1pm to 4pm

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Derbyshire Unemployed Worker's Centre