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Welfare reform

Welfare Reform DVD owl character

We're committed to supporting our customers through the Government’s Welfare Reforms. Some of the main changes under the Welfare Reform Act are:

Watch our DVD for an overview of how you may be affected.

For details about the changes that happened in April 2013 watch our Creature Comforts style DVD.

Visit our Money Advice page for benefits advice and 'managing your money' factsheets.


Removal of the spare room subsidy (known as 'Bedroom Tax')

The Welfare Reform Act gives the Government the power to introduce what is known as a ‘Bedroom Tax’ for Housing Benefit in social rented accommodation.

This will mean that any working-age household deemed to be under-occupying their home will lose part of their Housing Benefit (implemented April 2013).  If your accommodation is too big, your Housing Benefit will be reduced by 14% if you have one extra bedroom and 25% if you have two extra bedrooms. Use our calculator to find out how your Housing Benefit payments could have been effected.
See our Frequently Asked Questions.

See our Taking in a Lodger Frequently Asked Questions. Could downsizing be an option for you?

Advice is also available from the National Housing Federation and the Department of Work and Pensions.


Universal Credit (UC)

The Government plans to merge a number of means tested benefits including Housing Benefit, Income Support and Job Seekers Allowance into a new single benefit - the Universal Credit. Apart from a small number of exceptional cases, Universal Credit will be paid monthly in arrears as a single payment to the household.

Under these plans the Government wants to see many more customers receiving the money in their hand rather than opting to have their benefit paid direct to their landlord. The Government argues that this will help ease the transition into work by replicating a monthly salary.
See our FAQ on the Universal Credit.

The Money Advice Service have a site to help you prepare for UC. This has all the information for customers to prepare for UC , including how to open a basic bank account and other options (credit union), direct debits, budgeting sheets, managing you rent account on UC and tips on how to make your money go further.

Details of UK online centres where free or low cost computer and internet courses are available for people of all ages.

Advice is also available from the National Housing Federation and the Department of Work and Pensions.


Non-Dependant Deductions

When an adult, other than your partner, lives with you, they are called a non-dependant.
If you have a non-dependant living in your home, your Housing Benefit may be reduced by a certain amount each week.

Non-Dependant: Is an adult (other than your partner) who lives with you. This can be an adult son, daughter or close relative. Any other adult staying with you on a non-commerical basis such as a friend is also a Non-Dependant.
Lodger: Is someone who lives in your home on a commercial basis, sharing living space with you. A close relative cannot be classed as a Lodger for Housing Benefit purposes.
 
Key Differences:

  • A lodger can make their own claim for Housing Benefit but a Non-Dependant cannot
  • Tenants with Non-Dependants in the property will usually have a Non-Dependant Deduction taken from their Housing Benefit award
  • Taking in a lodger will not attract a Non-Dependant Deduction but the payments received from a lodger are classed as an income (currently the first £20 per week is disregarded for all passported benefits)

The deductions were increased in April 2011 and continued to rise significantly in April 2012 and April 2013. See our FAQ on non-dependant deductions.

Advice is also available from the National Housing Federation and the Department of Work and Pensions.


Benefit Cap

The Welfare Reform Act gives the Government the power to cap the total amount of benefit which a single person or couple is entitled to. The cap was introduced in 2013.

The cap is set at the average net earnings for a working household, currently £500 per week for lone parents and couples with or without children, and £350 per week for single people without children.
See our FAQ on the benefit cap.

Advice is also available from the National Housing Federation and the Department of Work and Pensions.


Personal Independence Payments (PIP)

The Welfare Reform Act 2012 scrapped Disability Living Allowance (DLA) and replaced this with a new benefit, ‘Personal Independence Payment’ started in April 2013.

DLA will end for everyone of working age (16 to 64 on the day PIP is introduced) even if they have an indefinite period award. If you get DLA the Department for Work and Pensions (DWP) will write to you to see if you want to claim PIP.

PIP may be more or less than your DLA, or not awarded at all. This could affect other benefits you are entitled to.
See our FAQ on Personal Independence Payment.

Advice is also available from the National Housing Federation and the Department of Work and Pensions.


Tax Credits

There are also changes proposed to the way Tax Credits are assessed, this may reduce the overall award of tax credits to all claimants except those getting their maximum entitlement. Find out more.

Welfare Reform advice is also available from the National Housing Federation and the Department of Work and Pensions.


Council Tax Benefits

From April 2013, national council tax benefit ended and was replaced by a local council tax support scheme. Salford City Council is proposing a new local scheme which has been designed to be as fair as possible within the funding available and although similar to the existing council tax benefit, there would be some key changes for people of working age. Find out more and have your say on the proposed changes.


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