DWP claimants face urgent action as Universal Credit rollout intensifies

Thousands of benefit recipients are being warned that their payments could be halted if they don't take action. Universal Credit, which has been gradually rolled out across the UK to replace six older forms of benefits and tax credits - also known as legacy benefits - requires those affected to actively apply at the right time or risk having their payments abruptly stopped.

The Government is urging those who have not yet transitioned to Universal Credit to do so or face losing their benefits.

The process of transferring claimants is accelerating, with the Government now in the 'managed-migration' phase. This involves sending out 'Migration Notice' letters to everyone still claiming legacy benefits, including tax credits.

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If a person receives one of these letters, they must apply for Universal Credit by the date indicated on the letter or they will lose their financial support.

According to figures from the DWP, 184,120 individuals have already lost their benefits after failing to respond to migration notices received between July 2022 and March 2024. Those still on legacy benefits are urged to stay alert as their letters will be dispatched next month.

Universal Credit has been gradually introduced across the UK to replace six older types of benefits and tax credits, including Child tax credit, Working tax credit, Housing benefit, Income Support, and Income-based Jobseeker's Allowance (JSA).

It also takes in Income-related Employment and Support Allowance (ESA). Other benefits, such as Personal Independence Payment (PIP), will remain the same.

The Government has plans to transition all households claiming these older benefits to Universal Credit by the end of 2024. This July, approximately 90,000 letters will be dispatched to individuals currently receiving the Income-related Employment Support Allowance with Child Tax credits.

Letters will also be sent to anyone of pension age who currently receives tax credits. These individuals may be moved to either Universal Credit or Pension Credit, depending on their personal circumstances.

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From August, around 20,000 people on Income-based Jobseekers Allowance will start receiving letters. Then, from September, 800,000 households will begin to receive letters explaining how to transition from ESA to Universal Credit.

Claimants will have a three-month window after the letter arrives to apply for Universal Credit. If they miss it, their payments will cease.

The amount of Universal Credit someone would typically receive depends on their circumstances, such as their earnings, whether they have any savings, whether they have children or other dependents, are disabled or have a health condition, care for a disabled person or need assistance with housing payments.

In April 2022, the DWP estimated that 55 per cent of the remaining households on legacy benefits would have a higher entitlement on Universal Credit, and 35 per cent would have a lower entitlement.

Individuals with a lower entitlement are set to receive 'transitional protection payments' a top-up designed to bridge the gap if their Universal Credit entitlement falls short of their previous tax credits or benefits.

To be eligible for this extra payment, claimants must have received a Migration Notice and apply by the deadline specified in their letter.

The Government is facing calls to provide more robust support for benefit recipients transitioning from the old "legacy" benefits to the new Universal Credit (UC) system.

A recent report from the Public Accounts Committee (PAC) has pressed the Department for Work and Pensions (DWP) to facilitate a smooth transition for claimants, while also highlighting concerns about fraud and error rates and questioning the anticipated economic advantages of UC.

Dame Meg Hillier MP, chair of the committee, commented: "If the transition from legacy benefits to UC fails even an apparently small proportion of people, it will lead to real world misery for thousands."

"The DWP must make sure that people are not cast into financial hardship due to a bureaucratic change, and that robust support is in place for those vulnerable claimants who need it most."