Benefit cap ‘grace period’ confirmed – these Universal Credit claimants not affected
Universal Credit and Child Benefit pay out certain amounts which are dependent on the claimant’s circumstances. Universal Credit will be based on the claimants work and living arrangements while Child Benefit is based on the amount of children being claimed for.
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The benefit cap itself will affect people differently based on where they’re living in the country.
Benefit claimants outside of London will have their payments limited to £384.62 per week if they’re in a couple, £384.62 per week if they’re a single parent and £257.69 per week for single adults.
The cap is raised for people living in the capital with people limited to £442.31 per week if they’re in a partnership or are a single parent or just under £300 a week for single adults.
In recent months however, some have called the appropriateness of this cap as coronavirus continues to wreak havoc on the economy and people’s incomes.
Yesterday, the benefits cap came up in the House of Lords, with Baroness Lister of Burtersett questioning if it should be raised or suspended.
As she queried: “My Lords, welcome as the increase is, many thousands will not benefit because of the cap, which is already causing real hardship and unfairness, as demonstrated by the Work and Pensions Committee, yet it is not realistic or safe at present to expect people to seek work or reduce housing costs to avoid it.
“Will the Government now listen to anti-poverty and faith groups, the IFS and others, and urgently fulfil their statutory duty to review the cap and suspend it, or, if operationally easier, raise it significantly?”
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In response, Baroness Stedman-Scott confirmed that while the cap will not be changed, there are certain “grace periods” in place: “I must be very clear that it is not the Government’s intention to change the current level of the benefit cap.
“What I want to point out is that claimants may benefit from a nine-month grace period, where their universal credit will not be capped, if they have a sustained work record.
“Exemptions will also continue to apply for the most vulnerable claimants who are entitled to disability benefits and carer benefits.
“I finish my answer by saying that the Government have quickly and effectively introduced £7 billion-worth of measures that benefit those facing the most severe financial disruption.”
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The benefit will affect most claimants but here are some circumstances where people will not have their payments changed at all by it.
Any claimants who are over the state pension age will not be affected by the benefit cap.
Benefit claimants will also not be affected by the cap if they or their partner:
- Get Working Tax Credit (even if the amount received it £0)
- Get Universal Credit because of a disability or health condition that stops them from working (which is called a limited capability for work and work-related activity)
- Get Universal Credit because they care for someone with a disability
- Get Universal Credit and they and their partner earn more than £604 a month combined, after tax and National Insurance contributions
The rules concerning the benefit cap can be confusing but thankfully, claimant have plenty of supporting services available to them.
Advice and guidance can be sought from impartial organisations such as the Money Advice Service or Citizens Advice.
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