Welfare benefits: important changes

Personal Independence Payments (PIP)

What is Personal Independence Payment?

Personal Independence Payment replaces Disability Living Allowance for people aged 16 - 64 who have care needs, and/or mobility needs. At the moment the government isn't planning to reassess you if you are over 65 and receiving Disability Living Allowance.

PIP will have two parts - a daily living component and a mobility component. They are paid at different rates depending on need and you may claim one or both components.

How are claims made?

Claims for PIP will be made by phone, on a paper claim form or online. Most people will have to attend a face-to-face assessment of their needs. The Department for Work and Pensions will consider all the information and decide whether you are entitled to PIP, at what level and for how long it should be paid.

What happens to those currently receiving Disability Living Allowance?

If you currently claim Disability Living Allowance you will be informed when you need to claim PIP. This will be sometime between 2013 and 2016.

It is important that you complete the form sent to you as fully as possible and within one month. If you don't return your form within one month without good reason your Disability Living Allowance will stop as well as your PIP claim being turned down.

Temporary Absence for Persons Going Abroad

Although legislation is not yet in place, the Government is proposing to cut the amount of time claimants can stay outside Great Britain before their Housing Benefit will stop.

At the moment, Housing Benefit has a general rule that it will stop after 13 weeks, whether that absence is within Great Britain or overseas. New rules will be introduced to change that period to 4 weeks for people who are absent outside Great Britain. There will be certain exemptions:

For those temporarily absent from the date the new rules are introduced, the old rules will still apply until they return home.

NOTE: the new regulations apply to people absent outside of Great Britain and not the United Kingdom. This means that those temporarily absent in Northern Ireland, the Isle of Man and the Channel Isles will be affected by these new rules.

Equalisation of State Pension Age - April 2016

Plans to bring women's pension age in line with men's pension age will be fast-tracked from April 2016 so that women's pension age reaches 65 in November 2018. Pension age for men and women will then increase to 66 from December 2018 to April 2020.

The Government has also proposed raising the State Pension age from 66 to 67 gradually between 2026 and 2028.

Single Tier State Pension - April 2016

The single-tier pension is being introduced from 6 April 2016. This means all women born on or after 6 April 1953 and all men born on or after 6 April 1951 will reach State Pension age after the introduction of single tier and will receive a single-tier pension.

Local Housing Allowance Rates in Social Housing

For tenancies signed or renewed after 1 April 2016 (or 1 April 2017 for supported accommodation tenancies), the local housing allowance rates will be applied to the eligible rent (this is the rent after ineligible services, such as water rates, have been deducted and any deduction for the under occupancy charge) for those renting from social landlords.

If the local housing allowance rate is lower than the eligible rent, then the maximum Housing Benefit (or the housing element of Universal Credit) which can be paid will be the local housing allowance rate.

This restriction will not be imposed until 1 April 2018, but those people signing tenancies after 1 April 2016 (1 April 2017 for those in supported accommodation) will need to bear this in mind. This will affect particularly young people aged under 35 who will be subject to the shared accommodation rate, as the local housing allowance rate is very likely to be lower than the social housing rent.
The Government has not brought forward any legislation to put this into effect yet, so there is some uncertainty as to exactly who will be affected by this change and by how much.

For further information see Housing Benefit

Benefit and Tax Credit rates changes

Working age benefits and tax credits will be frozen in cash terms for 4 years from April 2016.

Benefits included in the freeze are:

NOTE: Disability benefits, the disability-related elements of tax credits and statutory payments will increase in line with the Consumer Prices Index.

Benefits excluded from the freeze are:

Family Premium

The family premium will not be included in the Housing Benefit applicable amount for new claimants beginning on or after 1 May 2016 or for any existing claimants who have a child or become responsible for a dependent for the first time after 30 April 2016. It will also mean that if a current claimant stops having the family premium included in their claim because they no longer have responsibility for a dependent, then they will not be able to regain access to the family premium if they become responsible for a dependent again.

Claimants who are receiving a passporting benefit (Income Support, income based Jobseeker's Allowance, income-related Employment and Support Allowance or guarantee element of Pension Credit) will continue to be entitled to the family premium.

Those claimants not on a passporting benefit will retain the family premium if they were entitled to it on 30 April 2016 until:

This premium was £17.45 per week in 2015-16.

This change will also be reflected in the Council's local Council Tax Reduction Scheme.