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DWP Universal Credit change may give additional money to some households

The DWP is overhauling some benefits in the spring as the start of the new financial year marks the start of Labour’s benefit revamp

Family struggling to budget
Universal Credit claimants will see a lower uplift this April than last year(Image: GETTY)

Families with children might be able to have more of their childcare costs covered by Universal Credit this year after an April increase in benefit payments. Additionally, people with disabilities are facing major changes to their own Universal Credit claims this year.

The annual rise in benefit payments saw Universal Credit surge by 6.7% in April 2024, however, this year’s annual uplift may not meet many people’s expectations. Benefits will rise by 1.7%, as confirmed by Chancellor Rachel Reeves last October, in line with inflation rates at the time. However, some claimants will be eligible for additional support.

The Department for Work and Pensions is set to overhaul some benefits in the spring, marking the beginning of Labour’s benefit revamp with the new financial year. From April, Universal Credit recipients who have deductions, such as debts being paid off their benefits before they even receive the money, are likely to see a significant improvement as the deduction cap is reduced by 10%.

Family struggling to budget
Changes to childcare hours and costs covered by Universal Credit will also be changing later in the year(Image: GETTY)

This means that instead of potentially losing up to 25% of their standard allowance to deductions. Only 15% of their standard allowance can be deducted in an attempt to help benefit claimants control their debt and get back on their feet.

Moreover, from September, the Government will increase the number of free childcare hours, with additional support available for parents on Universal Credit to cover extra costs. For those with disabilities, their benefits will undergo significant changes as part of Labour’s plan to encourage more benefit recipients into work.

Consequently, the limited capability for work and work-related activity elements will be removed and a new health element introduced. Claimants will face a revised Work Capability Assessment while existing limited capability claimants will be offered a Chance to Work Guarantee.

Universal Credit app
Universal Credit is included in the controversial two-child benefit change(Image: GETTY)

Families with disabled children will experience slightly larger financial increases. The higher disability rate for children receiving enhanced care under Disability Living Allowance (DLA) or Personal Independence Payment (PIP), will rise from £487.58 to £495.87 monthly, according to Mirror.

The lower rate for disabled children will also increase, from £156.11 to £158.76 per month. More details on the upcoming benefit changes can be found on the Gov.uk. website. However, arguably the most contentious aspect of Labour’s benefits reforms is the continuation of the two-child limit on Universal Credit.

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The Gov.uk. website has stated for those transitioning from legacy benefits to Universal Credit with more than two children: “If you currently claim benefits or tax credits and aren’t moving to Universal Credit until a later date, you’ll continue to be paid an additional amount for each child you look after as long as you remain responsible for the same children and your circumstances remain the same.”