Universal Credit migration: changes to legacy benefits explained

Advertisement

Millions of people claiming benefits like Jobseeker’s Allowance and Income Support will be switched to Universal Credit starting May 9th

Around 2.6 million people still claiming legacy or ‘legacy’ benefits in the UK will receive letters urging them to apply for Universal Credit.

Advertisement

Register to our Money Savers Newsletter

This includes those claiming income support, earnings-related unemployment assistance (JSA), tax credits, earnings-related Employment and Assistance Allowance (ESA), and housing benefit.

Millions of people will be switched from legacy assets to Universal Credit starting Monday (Photo: Getty Images)

What are the changes?

Advertisement

From Monday (9 May), the Department for Work and Pensions (DWP) will switch the “managed migration” of people receiving benefits such as Employment and Assistance Allowance (ESA) and employment tax credit back to the new system.

The process has been suspended during the pandemic, but the government hopes to have everyone switched to the new system by the end of 2024.

Advertisement

Initially, only about 500 people will be invited to move, but the DWP will increase the number of people it handles over the coming months to bring everyone from the old welfare system to Universal by December 2024.

A “migration notice” will be mailed to applicants when it is their turn to be switched to the new system, and they will be given three months to claim Universal Credit.

Advertisement

Those who do not apply for Universal Credit within the three months will see their current benefits automatically end after that period.

Once you apply for Universal Credit, old benefit payments are stopped. You then have to wait five weeks for your first Universal Credit payment to arrive.

Advertisement

Which services are replaced?

The following benefits will be replaced with Universal Credit:

Advertisement
  • Labor Tax Credit
  • child allowance
  • Earned Unemployment Assistance (JSA)
  • social care
  • Income-related Employment and Support Allowance (ESA)
  • housing benefit

Most applicants transitioning to Universal Credit receive ESA (1.2 million) or tax credits (1 million), while 200,000 receive Income Support and 100,000 each receive Housing Benefit and JSA.

Will the applicants be better off?

Advertisement

The DWP claims that 1.4 million beneficiaries (55%) will be better off under the new system, 900,000 (35%) would be worse off and 300,000 other beneficiaries will see no change.

A spokesman said: “Over five million people are already being supported by Universal Credit.

Advertisement

“It’s a dynamic system that adjusts as people’s incomes change, is more generous overall than old benefits, and simplifies our safety net for those who can’t work.

“Approximately 1.4 million people with legacy issues would be better off on Universal Credit, with top-up payments available for eligible applicants who are less eligible for Universal Credit.”

Advertisement

But more than 20 charities have urged the government not to switch the transfer of people on older benefits back to Universal Credit unless they can guarantee people’s incomes won’t be cut during the cost-of-living crisis.

Groups have written to Work and Pensions Secretary Therese Coffey, warning that plans to switch old beneficiaries to the new system are “too dangerous to proceed”.

Advertisement

They warn that the incomes of more than 700,000 people with mental health problems, learning disabilities and dementia could be put at risk by the move and that the consequences of a benefit freeze could be “devastating and life-threatening”.

In a written statement submitted to the House of Commons on April 25, Ms Coffey said she was “absolutely committed to making this a responsible and safe transition”.

Advertisement

In the letter to Ms Coffey, the groups wrote: “We believe your approach to getting people who receive older benefits onto Universal Credit risks impoverishing many of them.

“We ask that you consider the devastating consequences for someone who is faced with the challenge of grappling with the process of having their only income cut off, especially during this cost of living crisis.”

Advertisement