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A charity has issued a warning that many British citizens who receive consistent benefits from the Department for Work and Pensions (DWP) may have their entitlement reduced starting in April 2024, despite the 6.7% increase mentioned in the chancellor’s recent Autumn Statement.
The CPAG has warned that Jeremy Hunt’s choice to not increase the benefit cap, which is the maximum amount that working-age individuals in need can receive, alongside payment raises as he previously stated in his 2022 statement, will result in the announced increase pushing more individuals above the cap’s limit.
CPAG stated that increasing benefits and providing assistance with rent expenses will positively impact families who are still facing challenges due to the increasing cost of living. However, these changes will not benefit the more than 85,000 households affected by the benefit cap, as they will not receive any additional financial support.
The benefit cap breaks the connection between necessity and eligibility in our social security system. A household’s overall need for assistance will be evaluated, and if it exceeds the cap amount (which is currently £22,020 per year for families with children or £25,323 for families in London), they will receive less than what they actually require.
Households can have varying caps, but the average is £53 per week. This amount is a significant loss for those who are already struggling to survive below the poverty line.
This is all the information you need to understand about the cap.
What is the limit on benefits and what is the amount?
The cap is determined according to an applicant’s circumstances, taking into account their location, whether or not they have children and whether they are applying as a single person or as part of a couple.
If you reside outside of London, the cap is set at the following rates:
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If you are a couple, you can receive £423.46 per week or £1,835 per month.
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If you are a single parent and your children reside with you, you will receive a weekly amount of £423.46 or a monthly amount of £1,835.
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If you are a single adult, you will receive £283.71 per week or £1,229.42 per month.
If you reside in the broader London area, the cap is established at the subsequent amounts:
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£486.98 per week, or £2,110.25 per month if you are a pair.
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If you are a single parent and your children live with you, you can receive £486.98 per week or £2,110.25 per month.
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If you are a single adult, you will receive £326.26 per week or £1,413.92 per month.
To whom does this apply?
The limit usually only affects individuals who are between the ages of 16 and state pension age and are currently receiving any of the listed payments:
- Universal Credit
- Bereavement Allowance
- Child Benefit
- Child Tax Credit
- Employment and Support Allowance
- Housing Benefit
- Incapacity Benefit
- Income Support
- Jobseeker’s Allowance
- Maternity Allowance
- Severe Disablement Allowance
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The benefits for a single parent who has lost their spouse, also referred to as Widowed Parent’s Allowance, Widowed Mother’s Allowance, or Widow’s Pension if received prior to 9 April 2001.
Who is exempt?
The cap does not apply to individuals who have reached state pension age, and it also does not impact those who are below this threshold if they or their partner:
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Get Working Tax Credit
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If you have a disability or health issue that prevents you from working, you may be eligible to receive Universal Credit.
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Get Universal Credit as a caregiver of a person with a disability.
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If they and their partner earn a combined income of £722 or more per month, after taxes and National Insurance contributions, they are eligible for Universal Credit.
Individuals, as well as their significant other and any minors below the age of 18 residing with them, are not subject to the limit if they receive any of the following:
- Adult Disability Payment
- Armed Forces Compensation Scheme
- Armed Forces Independence Payment
- Attendance Allowance
- Carer’s Allowance
- Child Disability Payment
- Disability Living Allowance
- Employment and Support Allowance (if they receive the support component)
- Guardian’s Allowance
- Industrial Injuries Benefits (and equivalent payments as part of a War Disablement Pension or the Armed Forces Compensation Scheme)
- Personal Independence Payment
- War pensions
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Pension for a Widow or Widower of a War Veteran
If the cap affects you, it is important to note that it may not take effect for nine months, depending on your income, due to a “grace period” that is permitted.
If you encounter difficulties with the cap, the government recommends that you promptly reach out to the DWP or your local council for assistance.
To learn more about the benefit cap, please visit the official website of the UK government or consult with Citizens Advice. To determine if it will impact you, utilize the benefits calculator provided by the charity Turn2Us.
Source: independent.co.uk
