Families with children may be able to get more childcare costs covered by Universal Credit. And those receiving enhanced rates for disabled children in their care could also be getting a boost amid the ongoing cost of living crisis.
The annual rise in benefit payments saw Universal Credit jumping up by 6.7% in April 2024, however, this year the annual uplift may not be as high as many had hoped. Benefits will be increasing by 1.7%, as confirmed by Chancellor Rachel Reeves last October in alignment with the inflation rates at the time.
However, some claimants will be able to get extra help. The Department for Work and Pensions is overhauling some benefits in the spring as the start of the new financial year marks the start of Labour’s benefit revamp.
From April, people on Universal Credit who have deductions, for example debts that are being paid off their benefits before they even receive the money, will likely see a substantial improvement as the deduction cap is dropping by 10%. This means instead of potentially losing a maximum of 25% of their standard allowance to deductions, only 15% of their standard allowance can be taken away.
Additionally, from September the Government is upping the number of free childcare hours, which parents on Universal Credit can get further support on to cover additional costs. For claimants with disabilities, their benefits will be changing significantly as part of Labour’s plan to get more benefit recipients into the workforce.
As a result, the limited capability for work and work-related activity elements will be removed and a new health element will be introduced. Claimants will be subject to a revised Work Capability Assessment while existing limited capability claimants will be offered a Chance to Work Guarantee.
Families with disabled children will see slightly higher financial increases. The higher disability rate for children receiving enhanced care under Disability Living Allowance (DLA) or Personal Independence Payment (PIP), will increase from £487.58 to £495.87 monthly, according to Mirror.
The lower rate for disabled children will also rise, from £156.11 to £158.76 per month and more information on the benefit changes due this spring can be found on the Gov.uk website. However, arguably the most controversial side of Labour’s benefits reforms is the two-child limit which will continue to apply to Universal Credit.
For people moving over from legacy benefits to Universal Credit that may have more than two children, the Gov.uk website noted: “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.”