Welfare Reform
Ray Perry Kent County Council
Introduction
 The next few years will see profound changes to
the welfare system in the UK
 The changes proposed are aimed at making
savings of a staggering £18 billion a year by 2015
 These radical reforms will change the whole
landscape of welfare provision and will have the
greatest impact on two groups
Families with Children
&
Sick and disabled people
The main changes
Reassessment of IB claimants
Disability Living Allowance reform
Universal Credit
Sick and disabled people
 Reassessment of 1.5 million people currently in
receipt of Incapacity Benefit,
Income Support on the grounds of sickness
and Severe Disablement Allowance
 Controversy surrounding the
Work Capability Assessment
 Trials in Burnley and Aberdeen found 30% fit for
work which, if mirrored nationally, would result in
450,000 losing benefit entitlement
 Nationwide rollout started in February 2011 and
will be completed by 2014
 Everyone will be reassessed !
Sick and disabled people
 Does the person have limited capability for work?
 ESA 50 form completion – points scoring!
 Medical with
Atos Origin Health Care Professional
 Decision “fit for work” = Job Seekers Allowance
 Limited capability proven = placed in either
The Support Group or
Work Related Activity Group
 Appeal
 Flawed Work Capability Assessment forwarded to
Disability Living Allowance Unit for review of
entitlement to DLA
Sick and disabled people
 Support from LMBBS via web site
 ESA checklists
 How to complete your ESA 50
 Atos Origin guide to their
Health Care Professionals
 DWP Customer Journey
 Appeal guidance
 My e-mail address
The Personal Independence Payment
 To replace Disability Living Allowance for people
of working age from 2013-2014
 “Fairer , objective assessment”
but 20% cut in expenditure
 Two components and two rates of new
Mobility and Daily Living components
 Six month rather than three month
“qualifying period”
 Client is required to discuss their circumstances
with a DWP approved Health Care Professional
 All awards subject to periodic review
The Personal Independence Payment
 PIPs will be as DLA is at present– non means-tested
non taxable and a passport for other benefits
 “Special Rules” for the terminally ill remain
 Greater duty to report changes in health conditions
with the introduction of legal and financial
penalties if not reported
 Everybody with the exception of
“Special Rules” cases will be re-assessed
 Confused picture not sure if PIPs will replace
DLA for children
Universal credit
 Replaces existing means-tested benefits and tax
credits for people of working age, including IS,
income-based JSA, income-related ESA, HB, Child
Tax Credit and Working Tax Credit
 Basic allowance for adults plus additions for children,
disability, housing costs and caring
 Assessed and paid on household basis
 Reduced by 65 pence for each £1 of net earnings after
applying a disregard
 Entitlement will be automatically adjusted as
earnings vary using “real time” PAYE data
from HMRC
Universal credit
 Universal Credit will be administered centrally by
the DWP with the majority of claims made,
assessed and delivered electronically
 Cap on household benefit payments will mean
that those not in receipt of DLA, War Widows or
receiving WTC will be limited to the median level
of earning of working families
 Limited help with mortgage interest
for those in work
 Council Tax support schemes will be much more
localised and variable from place to place
Universal credit
 Community Care Grants and Crisis Loans devolved
to local authorities
 Current rules that base entitlement to passported
benefits, such as free school meals & prescription
charges on receipt of certain benefits will be replaced
by a system that bases entitlement on an income or
earnings threshold
 Increased conditionality for Jobseekers
 Pilot in October 2013
 For all new claims from April 2014
 Full transfer of all claimants by October 2017
Universal credit
 Introducing Universal Credit will be a huge and
complex undertaking and the Government has
set itself a very tight timescale
 Crucial to the implementation and success of
Universal Credit is the development of two new
IT systems – one for the assessment of Universal
credit and a second system to obtain “real time “
PAYE details
 Universal Credit will be an integrated benefit.
Households who claim will automatically
receive everything they are entitled to
Universal credit
 The objective of a simpler, more transparent
scheme which is easier for claimants to
understand and with clear work incentives
commands widespread support but there is
concern over lack of detail on key elements
 Taper rate of 65% (76% after tax) low enough to
make work pay?
 What about the self-employed?
 How is help with childcare costs to be provided?
 Will UC penalise those with savings?
 Transitional protection
Families with children
 Families face major benefit and tax credit changes
before the introduction of Universal Credit
 Child Benefit frozen for three years and the
Child Benefit clawback for higher rate taxpayers
 Tax Credit changes
 Housing Benefit changes
 Abolition of Child Trust Fund, Health in
Pregnancy grant and Sure Start Maternity for
second and subsequent children
The next few years
 For those who need and rely on state
benefits it’s going to be a very bumpy ride
over the next few years with lots of
uncertainty, change and re-assessment
 The re-assessment of those on Incapacity
Benefits has just started and there is great
concern that many people will be incorrectly
found not to have limited capacity for work.
 Please use the tools and guidance on the
web pages
Any Questions?