Welfare reform sees the introduction of a wide range of changes to the social security system in Northern
NIFHA is supporting its members through the changes introduced as a result of welfare reform. We are engaging with government and departmental officials to ensure housing associations are represented as key partners throughout the implementation process.
A key welfare change is the introduction of Universal Credit. This is a single means-tested benefit which will be paid to people aged 18 to 64 years and replaces a number of existing benefits, including Housing Benefit. Universal Credit has been live in areas of the North West of England since 2014.
The National Housing Federation has produced a video in which staff and tenants from three housing associations talk about their experiences with Universal Credit including online applications, money management and changes they’ve made.
The Welfare Reform (Northern Ireland) Order 2015 came into force on 10 December 2015 and introduced the primary rules for welfare changes such as the Benefit Cap, Universal Credit and Personal Independence Payments (PIP).
Read more about the welfare changes being introduced in Northern Ireland below.Universal Credit
Universal Credit is a single means-tested benefit for working-age people aged 18 to 64 years and is paid to each household. It will replace the following means-tested benefits:
- Income Support
- Income-Based Jobseeker’s Allowance
- Income-Related Employment and Support Allowance
- Child Tax Credits
- Working Tax Credits
- Housing Benefit.
Universal Credit will be paid monthly by default but claimants can choose to receive payments fortnightly. The housing element of Universal Credit will be paid by default to the landlord on a monthly basis.
At the start of a claim for Universal Credit the joint claimants must choose whether payment is made to one single account or whether to split payments across two accounts (there is no default option).
The introduction of Universal Credit will be carried out in two phases:
- Transition phase – new benefit claims commencing from September 2017
- Managed migration – existing benefits claims will transfer to Universal Credit between July 2019 and March 2022
The Department for Communities (DfC) has published a timetable for the transition phase of Universal Credit:
- 25 September 2017 – Limavady
- 13 November 2017 – Ballymoney
- 11 December 2017 – Magherafelt and Coleraine
- 15 January 2018 – Strabane and Lisnagelvin
- 5 February 2018 – Foyle and Armagh
- 19 February 2018 – Omagh and Enniskillen
- 5 March 2018 – Dungannon and Portadown
- 16 April 2018 – Banbridge and Lurgan
- 30 April 2018 – Kilkeel, Downpatrick and Newry
- 14 May 2018 – Bangor, Newtownards and Holywood Road
- 28 May 2018 – Knockbreda, Newtownabbey and Shankill
- 11 June 2018 – Corporation Street, Falls and Andersonstown
- 25 June 2018 – Shaftesbury Square, Lisburn and Larne
- 2 July 2018 – Carrickfergus, Antrim and Ballymena
- July-September 2018 – Cookstown, Ballynahinch and Newcastle
Claims for Universal Credit will be made online, and all subsequent contact regarding the claim will be conducted online.
From May 2016 the Benefit Cap has introduced an upper limit to the amount of benefits a household can receive. The following benefits will count towards the Benefit Cap:
- Bereavement Allowance;
- Child Benefit;
- Child Tax Credit;
- Employment and Support Allowance – Work Related Activity Group;
- Guardian’s Allowance;
- Housing Benefit;
- Incapacity Benefit;
- Income Support;
- Job Seeker’s Allowance;
- Maternity Allowance;
- Severe Disablement Allowance;
- Widowed Parent’s Allowance;
- Widowed Mother’s Allowance;
- Widow’s Pension;
- Widow’s Pension (age related).
If the total comes to more than the maximum amount allowed, the claimant’s Housing Benefit payments will be reduced.
From November 2016 the Benefit Cap limits are:
- £384.62 per week for lone parents or couples (with or without children;
- £257.69 per week for a single person without responsibility for children.
The Benefit Cap will not apply if:
- The claimant receives Pension Credit or Working Tax Credit;
- A member of the claimant’s household is claiming benefits such as, but are not restricted to, Disability Living Allowance, Attendance Allowance, Industrial Injuries Benefits or the support element of Employment Support Allowance.
Supplementary payments, may be available for households, with children, identified as being affected by the Benefit Cap for up to four years until 31 March 2020
Those affected by the Benefit Cap, do not need to apply to receive a supplementary payment. This will be paid directly to the landlord by the Department for Communities.
Supplementary payments for the Benefit Cap will not increase regardless of any change of circumstances as the payment is to cover the loss of the introduction of the Benefit Cap and not any subsequent changes
The age at which the State Pension is payable will increase from the current level of 65 for men and 60 for women to 66 for both. The increase is due to take place between November 2018 and October 2020 with further increases planned for 2026 and 2044.
As a result of the increased pension age, this will result in a greater number of ‘working age’ claimants. The benefits available to working age claimants are much less generous than those paid to those eligible for the state pension.
The social sector size criteria, also known as the Bedroom Tax, is a change to Housing Benefit entitlement in which claimants receive less in Housing Benefit if they live in a property that is deemed to have one or more spare bedrooms.
From January 2017 the new criteria will allow for one bedroom for:
- Each adult couple;
- Any other adult aged 16 or over;
- Any two children of the same sex aged under 16;
- Any two children aged under regardless of gender;
- Any other child (other than a foster child or child whose main home is elsewhere);
- A carer (or team of carers) who do not live with the claimant but provide overnight care.
If the claimant is living in a property that has more bedrooms than required under the social sector size criteria the eligible rent will be reduced by:
- 14% if they have one more bedroom than is required;
- 25% if they have two or more bedrooms than what is required.
The social sector size criteria will not apply to
- Those over State Pension age;
- Those in shared ownership schemes;
- Those in sheltered or supported housing who have support services provided by a not-for-profit landlord;
- Disabled children in receipt of middle/high rate DLA;
- Parents with adult children in the armed forces who normally live with them will be able to retain the bedroom for that adult child whilst deployed on operations;
- Foster Carers – they are allowed one additional bedroom so long as they have fostered a child or become an approved foster carer within the last 52 weeks.
The Northern Ireland Executive has committed to ‘full mitigation of the bedroom tax NIHE and housing association tenants.’ Supplementary payments to mitigate the social sector size criteria will be automatically applied and payments will be made by the Department for Communities direct to landlords. These mitigation payments will remain in place until 31 March 2020. These payments can be lost if a tenant chooses to transfer or exchange their tenancy and they continue to under-occupy at the same or an increased level as their old address.
Currently Rate Relief for housing association tenants is administered by the NIHE. This is applied for through the Housing Benefit application form (HB1) and is credited to their rent account.
Rate Relief for social housing tenants receiving Universal Credit will be moving to Land and Property Services, this will mean that it will have to be applied for separately from Housing Benefit. Payment of rate relief will also be made separately from Housing Benefit.
This change will be introduced in parallel with Universal Credit from September 2017.
PIP is replacing Disability Living Allowance (DLA) for people aged 16 to 64 years. It is a non means-tested benefit, this means that a person’s income or savings are not taken into account. It will help people with a disability or long-term health condition whether they are working or not. DLA will remain for children up to the age of 16 and anyone aged 65 or over.
PIP consists of two components:
- Daily living component – this will replace the DLA care component and will be paid at either a standard or enhanced rate.
- Mobility component – this will replace the DLA mobility component will be paid at either a standard or enhanced rate.
Some people are entitled to receive just one component while others receive both.
The Evason Report envisages the majority of DLA claimants will migrate across to PIP, however it does recognise that the uncertainty surrounding this may cause anxiety to claimants. It is proposed that those claimants who are refused PIP and lodge an appeal should receive supplementary payments equal to their benefit. These payments would cease if an appeal is unsuccessful.
Those who qualify for PIP but at a rate lower than their previous DLA payment should receive supplementary payments if the reduced rate exceeds £10 a week. Payments will be made for one year and at 75% of the loss.
PIP was introduced on 20 June 2016. This was for new claims or when a claimant reports a change of circumstances. All remaining DLA claimants aged 16 to 64 years are being randomly selected for assessment and invited to claim PIP. This will take place between December 2016 and December 2018.
In addition to core benefits, households with adults or children with a disability may be entitled to additional payments. These additional payments are referred to as premiums or elements, these are:
• Disability Premium;
• Enhanced Disability Premium;
• Severe Disability Premium;
• Tax Credits – Disability Element;
• Tax Credits – Severe Disability Element.
In instances where claimants transition from DLA to PIP and see their entitlement reduced, this will affect the disability premium they receive.
In cases where claimants lose this premium or see it reduced, supplementary payments can be made for up to one year to allow for an appeal to be made.
Carer’s Allowance is a non-means tested benefit payable to those who provide care for someone who is ill or has a disability.
To claim carer’s allowance, the claimant must satisfy the following criteria:
- Not be in full-time education;
- Earn less than £110 per week;
- Must be providing at least 35 hours of care per a week.
The person being cared for must be in receipt of one of the following benefits:
- Attendance Allowance;
- DLA care component at the middle or higher rate;
- Constant Attendance Allowance at or above the normal maximum rate with an Industrial Injuries Disablement Benefit, or basic (full day) rate with a War Disablement Pension
- Armed Forces Independence Payment.
As DLA is being replaced by the PIP for working age claimants. Carers who provide care to those affected claimants may have their entitlement to carer’s allowance affected as a result of this transition. Some current recipients of DLA may not be eligible for PIP and therefore eligibility for Carer’s Allowance would also cease.
Supplementary payment can be made to carers who are affected for one year after entitlement ceases. This covers any potential financial loss and allows time for advice to be sought and a fresh claim or appeal to be made if appropriate.
Further information is available to NIFHA members in a downloadable guide available by logging into the Member’s Area.