The second in a series of blogs introducing Universal Credit (UC) . Here we look at the latest timetable for the gradual roll out of UC , When am I affected by UC? Are all new claims for UC now? How will I switch to UC - the two types of migration? When do I actually have to switch to UC? What is the extra protection for the severe disability premium?
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Welcome back to Part 2 of this series of blogs blog looking at Universal Credit (UC).
In Part 1, we looked at what Universal Credit (UC) is, the six "legacy benefits" that UC eventually replaces, why UC is deliberately intended to be rather different, how UC will have some affect for people of “pension age”
Here in Part 2 - we look at the gradual timetable for claiming UC and what that means for both those who might be seeking income-related assistance for the first time and those who are already getting one of the six "legacy benefits" that UC will eventually replace entirely. There are two different ways of moving over to UC and we look at the major difference that how you switch makes. As a result the DWP has been in the Courts over one big potential loss that could be relevant to many people affected by cancer. So we will take a look at the additional protections that have come out of that.
We then get onto Universal Credit proper itself: How do I claim UC? What happens next? How do I get paid UC? And some key differences in the way UC works for people who are too unwell to work and people who are taking time out as carers? We will explore some of the practicalities and pitfalls for people affected by cancer in a little more detail a further blog.
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The latest timetable for UC
There have been many planned timetables . Early teething troubles meant several changes to the plan but all insisting that UC would have been fully rolled out by October 2017. However it became clear that the first IT system was not going to go much further and the whole project came under a recue mission, involving starting again from scratch/ Timetables were abandoned until the things were "good and ready" . Regardless of the timings, UC has stuck to three main phases in rolling out UC. These are listed below along with their implications for people affected by cancer:
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Phase 1: an interim "Live Service UC" open to jobseekers only
This started in all parts of the UK - except N. ireland – from April 2013. Originally planned to be rolled out by April 2014, the "accelerated roll out of Live Service UC” took place between Feb 2015 and March 2016.
- "Live Service" UC could only be claimed by people who were unemployed; i.e who were available for, and actively seeking, work. You also had to have fairly straightforward circumstances that the system could cope with.
- the computer was only used to make the claim. All further contact was by traditional phone calls and letters.
- this phase had little impact on people affected by cancer, unless you happened to be a UC jobseeker when cancer came in your life. At that point, the DWP liked people to stay with UC, but you were free to switch over to "legacy benefits" instead. Some were better off staying with UC, some were better off switching.
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Phase 2: the "transition" to "Full Service" Uiversal Credit.
The new IT system, allowed the gradual introduction of Full Service UC, where UC claims were open to almost everyone who might claim it, while new applications for "legacy benefits" were mostly closed down. This mainly took place between October 2017 and December 2018. In N.Ireland, UC came appeared for the first time as Full Service UC. As each area strted - or transitioned over to - Full Service UC it meant that:
- that UC opened up to all groups who might claim it, including those affected by cancer who might be claiming as too unwell to work, as carers or as workers on a low incomes.
- at the same time, the "legacy benefits" closed their doors to new claims in most cases
- the new computer is not just for claiming. You carry on with an online account for much of your ongoing business with UC : to keep in touch with UC, report changes, send documents, see your monthly statements etc
- those who were on Live Service UC switched over to the new system. The last person switched by April 2019
- those already getting a "legacy benefit" stay as they are. Unless they either choose to claim UC instead or have a change of circumstances of a kind that needs a new claim under the legacy system. As in most cases, you cannot make such a new claim, you claim UC instead. This is called a "natural migration". Do get advice before making a UC claim, whether off your own bat or whether you are told you now have to do so. You may do better under UC, you may do worse, but once done there is no going back "once on UC, you stay on UC" . So you need to look before you leap and double check tofficial advice that you have to switch, as it may not always be correct.
- If you are a winner in the UC sums, then you may want to go for it straigtaway. But if you are a "loser" in the switchover games, then you do not usually get any protection from the losses. in this phase.
So phase 2 has made Universal Credit much more relevant to people affected by cancer. It will usually be where you make a new claim for means tested benefits if you are of "working age". Older people stay with Pension Credit (PC) right through these phases and after UC is rolled out, apart from the big change for mixed age couples mentioned in Part 1.
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A firebreak until Phase 3
This is where we are now . This "firebreak" is
- partly to test the system under a steady load of new claims coming in, before adding the pressure of moving people over from "legacy benefits" to UC under Phase 3.
- but this quieter time is also when the DWP planned to make some changes to open up UC fully to all the groups intended. It has also been a time when they have come under pressure to make some unplanned improvements.
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Phase 3 – Managed Migration from legacy benefits over to UC .
This is when DWP will start contacting everyone on legacy benefits, requiring them to claim UC instead.
- This has sort of started from July 2019, but only as a limited pilot in the Harrogate area. The pilot is to trial out different ways of easing some perhaps very vulnerable people over to UC, to make the process as painless as possible and not to leave anyone behind. Only after a pilot has proved successful - and lessons learned for the plans ahead - will Parliament approve the powers for the main migration.
- Phase 3 proper is now expected to start in late 2020 and the DWP hope to complete this by December 2023. As a precaution, HMRC are keeping tax credit capacity open until 2025 and the end of 2025
- If you lose out in a "managed migration" you will get "transitional protection" to cushion that drop
Once the last person has left the “legacy benefits” building, the lights will be turned off and legacy benefits will be abolished. However, currently only 2 million out of UC’s eventual caseload of 7.5 million are on UC, so legacy benefits - and any changes within those benefits – will remain important for a while yet.
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So when will I get to meet Universal Credit?
The fact that all areas now operate Full Service UC means that:
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for entirely new claims for "working age" means tested benefits:
- you will claim Universal Credit rather than one or more legacy benefits
- the only exception is that if you live in designated supported accomodation or temporary accommodation, then you will still claim Housing Benefit (HB for the rent, rather than doing this through your UC claim. This is because UC is not able to deal with the speed and flexibility essentil to keep these kinds of accomodation going.
- there is no longer a bar for larger families, but there is on -for some people already getting a "legacy benefit" .
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If you are already getting a legacy benefit:
- nothing changes immediately; you stay with that benefit for the time being
- You are free to claim UC instead at any time - but do get advice first. You may do better under UC but want to make the switch as smoothly as possible. But you may also do worse. At the moment there is no protection against any losses, and there is no way to switch back if you have switched unwisely.
- At some point though, you will have move over to UC. This will happen in one of two ways of "migrating" over to UC, and which one applies can make a rel difference to the amount you will get under UC.
- only one of those ways is in operation at the moment and there is some confusion around whether you need to swap to UC if circumstances change. You do not always have to swap when you are asked to by benefits officials. They may well be right, but not always. Read on and get advice.
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The two types of "migration" to Universal Credit (UC)
This “migration” to UC can happen in one of two ways:
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“natural migration”
This is when certain changes of a circumstances occur that would have needed a new claim under the old "legacy benefits" system. Because you can’t usually make such a new claim you “naturally migrate” to UC, by claiming UC instead.
However, many changes would not need a new claim and can be sorted out by an adjustment within your current benefit. These "natural migrations" have been happening since your area became Full Service UC and will keep doing so right up until everyone has moved over to UC
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“ managed migration”
these will be where DWP write to you setting a date for you to switch over to UC. These have only just started happening , but only in a pilot area iin Harrogate from 24th July 2019. Once the pilot is evaluated, it will then be up to MPs to grant the powers - or require changes first - for the Department of Work and Pension (DWP) to press on across the UK. The DWP are currently saying they anticipate starting this process in late 2020 and aim to finish it by the end of 2023.
Which one will apply for you, depends on which comes your way first. “Natural migrations” have rather a head start . Indeed, the DWP have long estimated that, as a result of managed migration being held back until it is well tested and proven, many more people will actually switch by a natural migration. In fact now it is going to be the majority that switch to UC that way.
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Does it matter which way i switch?
Given that you will need to switch at some point, does it really matter how? The answer is “Oh, yes, it very well might ” . And the reason why, is summed up in two words of jargon: “transitional protection”. Managed Migrations come with added “transitional protection” - for those who might lose out under UC rates- while Natural Migrations do not.
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What is "transitional protection"?
Inevitably, even at times when no overall cuts are intended in switching people to a new benefit, some people “win" under the new way of doing the sums and some people “lose” . The time-honoured precedent – until now – is that transitional protection means that “no-one loses out at the point of change”. Normally then:
- "Winners" under the new sums - get any extra amounts straightaway. For them, the challeng of UC is getting used to its different and new ways of doing benefits. With preparation for these changes, they might well want to opt into UC early, rather than wait until they are called.
- "Losers" in the sums game - get an extra “transitional element” that tops up the amount the standard UC sums would give you to the level you were getting under the under the old "legacy benefits". So, UC would, in its first monthly payment, match the monthly equivalent i.e. what you had in your last month under the "legacy benefits".
- However, you are frozen at this rate - with no annual increases - until the normal UC rates catch up. So over time transitional protection oftens the drop down to the new rates by iphasing it in gradually. You don't experience a drop straightaway, but little by little the value of your benefit gets eaten away.
Under UC, there are three main limits on the extent of this transitional protection:
- it's not just annual increases that nibble away at that "transitional element". Any increase in entitlement - apart from increased help with childcare in work - will eat into that transitional element
- there are quite a few ways that you can lose that transitional element.
- And anyone who volunteers to swich over or goes through a natural migration to UC does not get any transitional prtection in the first place. If you lose in the sums, you will drop straight down to the standard UC rate.
A natural migration, then could be rather bad news, whether you do so, because:
- you felt like switching anyway, but hadn’t realised you might lose out; or
- were encouraged to switch over now by over enthusiasm or being mistakenly told you have to switch a too enthusiastic staff member at DWP; or
- had a change in circumstances – whether avoidable or not – that does mean that you need to switch to UC.
The main point is that once you have switched to UC, you cannot switch back . So if you know that you are going to lose out, you ideally want to hang on where you are, if at all possible, until you can have a "managed migration", that will come with that very important transitional protection.
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What changes of circumstances cause a natural migration?
This is an area of some confusion. Some local DWP managers have been telling staff and stakeholders that "Any change - even a change of phone number causes a natural migration to UC" . It does not.
The golden rule is: Would the change of circumstances mean that you would need to make a new claim under the old system? . If it does then it may well mean you hve to switch - but see below. If a new claim wouldnt be necessary than you do not have to switch. For example:
- Janet needs is living in a private rented flat when the added medical points from her cancer means that she is offered a Housing Association property in the same area. Everyting may be changing - address, phone number, landlord - but this can all be handled within her existing Housing Benefit (HB) claim. She does not have to switch to UC
- John has moved back to be near his friends and family. He has his own place and claims HB from the local council. A new treatment is offered but he has to be near the hospital in London, so John moves. He now has to claim HB from a new local council there and he cannot usually do that. So normally this means a natural migration to UC . UC takes over not only help with rent but any other means tested benefits that John gets.
So the key is whether the move requires a new claim or not. However, what looks like a new claim, isn't necessarily a new claim:
- Ali is getting old style Contributory Employment and Support Allowance because he is too unwell to work following a cancer diagnosis. He doesn't get any top up yet from Income-related ESA. His Benefits Advisor, helps him claim Personal Independence Payment (PIP) as well. As a result 3 months later, Ali gets a backdated award of PIP. He is now entitled to an extra premium in the sums for Income-related ESA. At first he thinks he can't have it, as this looks like a new claim. But ESA is all one benefit, so adding on some Income-related ESA is adding an extra part to his current claim, not making a new claim.
- Bethan is a lone parent recovering from cancer treatment. She has been getting Child Tax Credit for her son Lachlan right through her treatment. She is now ready to start part time work and to come off her Income-related ESA. She is looking for "in work" support from Working Tax Credit instead. Again this looks like a new claim. But as with ESA the two tax credits are part of one common claim. So Bethan can have the WTC part added on to her existing Child Tax Credit.
So:
- natural migration is only triggered if you would need to make a new claim (but see below for an important exception) .
- Many small changes and som rather big ones - such as moving house in the same area - can all be sorted within an existing claim.
- And what might look like a new claim - to add on Income-related ESA or get the other tax credit when you are getting one - isn't technically a new claim.
There are, then, times when you might wrongly think you have to switch or be told by a benefits official that you have to when you do not.
If in doubt, get advice first. If you stand to gain from a switch it doesn't matter. But if you stand to lose, then you will lose straightaway. - with no protection and no going back. After much hurrumphing that staff could ever make such a mistake, the DWP have promised to compensate anyone who was misadvised by their staff and lost as a result.
An added protection for many people with cancer
One particular area of concern relevant to people with a cancer diagnosis, centres around an extra amount within legacy benefits called the “severe disability premium” (SDP). Across the UK - and across many different health conditions - some 500,000 people get this extra premium within one or more of their legacy benefits. And that includes many Maggie's Centre visitors. And they stood to lose significantly
So, do check whether you are one of them. You can find out more about the SDP premium - and who may or may not get it - in the blogs about the legacy means tested benefits – see in the list of links below. The simplest question then is "Am I getting an SDP?" , but the next question might be “I see that I am not, but should I be? “
Do check both out with a Benefits Advisor, if you are in any doubt. Many people have missed out on the little bit of extra paperwork needed to get that useful premium added to e.g their Income-related ESA. If so, that can be sorted while you are still on your legacy benefit, giving you some very useful extra money for now. And also some extra protections come the switch over to Universal Credit.
The problem is that Universal Credit has no direct equivalent to the SDP or indeed the other two disability premiums in legacy benefits. The loss from switching over to UC without any transitional protection can vary from £185 to £280 a month if you are single and into the £500s a month if you are in a couple where you can both get an SDP
And that is exactly what happened to a brave, real life, "John" and Maggie's Centre visitor. He moved back to London to receive specialist treatment, lost some £42 a week in a correct "natural migration" and was upset for both himself and others. So he was put in touch with a leading firm of solicitors who took the DWP to Court...and won.
The very different way "John" would have been treated under a managed migration and had he switched under a natural migration amounted to unlawful disability discrimination. The judge was scathing and the dwp were keen to appeal, but did agree to implement the judgement. And that has resulted in two key changes for those getting a "severe disability premium" :
- From 16th January 2019, you cannot claim UC until you can be offered a “managed migration” (with that important transitional protection). So, if your circumstances change and you would need to make a new claim under legacy benefits, you do that rather than claim UC.
- Those involved in the court case stayed on UC but were compensated in full.
- The DWP were going to announce compensation for everyone else who had switched to UC and lost out before 16th January alongside the rules for managed migrations and how transitional protection works
- Ironically in a document that explained how to to do the sums, what could be seen as their first sum didn't add up. So it was back to Court
- A new set of sums does a bit better but still does not cover the full loss. The DWP are paying out on this, but it will be going back to the Courts
So, if you are getting a "severe disability premium" (SDP) within your legacy benefits you cannot claim UC for now. If you need to make a new claim because of a change in circumstances - then you can still claimn SDP you cannot claim UC for now and if circumstances change so that you can still make new claims under the “legacy benefits” , then you can do just that. For the 10,000 or so that had already switched and lost out, compensation you may get compensation. However, a surprising amount of effort is being put into not quite paying you the full amount, but we await the latest Court judgement on this.
This protection only applies to the severe disability premium. You are still at risk of losing any other amounts for disability: such as the "disability premium" (within IS and HB) or the "enhanced disability premium" (within all except tax credits) and the adult "disability elements" in Working Tax Credit.
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Next Time
In Part Three we move on from the complications around whether to claim UC or not and when to do so. Things get a little simpler as we look at: How to go about claiming UC? When you will get a first payment? and What help you can get while you wait for that first payment?
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Further reading and links
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In this series:
UC3 - How to claim UC and New-style ESA
UC4 - How does UC deal with sickness from work and carers?
UC5 - The sums: How much UC might I get?
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Other relevant blogs:
Means teted benefits - a series looking at the legacy benefits - starting here