Universal credit: progress and pitfalls

As the rollout of universal credit continues, Charlie Callanan reports on progress and changes to this complex benefit, including a court ruling that is likely to be helpful

As the government grappled last year with its plan to transfer benefit claimants to universal credit (UC), it was forced to pause and rethink its approach.

It has now decided to carry out a limited pilot of the ‘managed migration’ process, instead of the planned ‘big bang’ approach.

This will involve transferring 10,000 people claiming ‘legacy benefits’ to UC between July 2019 and July 2020. All other managed migration will happen from December 2020 until late 2023.

‘Natural migration’ to UC continues to be required for most claimants who have a relevant change in their circumstances. Examples include a when a person becomes unfit for work or a partner moves into or leaves the household.

The rollout of ‘full-service’ UC – where all new claimants for certain benefits have to claim UC online – was completed in December 2018.

Circumstances that would have previously led to a claim for a means-tested benefit legacy benefit, such as income-related employment and support allowance (ESA), housing benefit or tax credits, now mean most claimants have to claim UC.

Exceptions for severe disability

A court decision has protected the income of claimants receiving severe disability premium who were worse off with universal credit

However, there is now an exception to the above, in both natural and managed migration, which is likely to be helpful for many claimants with a learning disability. This exception is where they are or have recently been entitled to severe disability premium (SDP).

“If they are entitled to less under UC, they will be given a ‘transitional amount’ so receive the same amount”

A regulation was introduced in January that prevents people who are receiving SDP (or who had received it within the month before making a new claim) from moving onto UC. The SDP is an element in legacy benefits that is payable to some disabled people.

This follows a legal challenge in the high court by two claimants who had no choice other than to claim UC, but found they were then financially worse off than on their legacy benefits (TP and AR, R (On the Application of) v Secretary of State for Work And Pensions [2018] EWHC 1474 (Admin). This was because there are no allowances payable within UC equivalent to the disability premiums available in legacy benefits.

So, if a recipient of SDP has a change of circumstances, they are able to keep or make a new claim for a legacy benefit as they cannot (for now) claim UC. This means that they retain the amount  they currently receive, including SDP and enhanced disability premium where applicable.

Any client who is receiving a personal independence payment daily living component, a disability living allowance (DLA) care component or attendance allowance (if older) may be entitled to one or both premiums. If they are not getting these or are not sure if they are, they should get a benefit check from an experienced welfare rights adviser.

The government has promised that people moved over to UC through managed migration will not be worse off after transfer. If ‘managed’ migrants are entitled to less under UC than under their legacy benefits, they will receive a ‘transitional amount’ to top up their UC to the previous total.

Many claimants who were in receipt of SDP have already been transferred to UC after their circumstances changed since UC was introduced. The government has stated that all these claimants will be identified and given a lump sum compensation payment and an ongoing monthly transitional protection payment within their UC.

However, those who migrate naturally will not have access to transitional protection, except claimants who have already moved and were previously entitled to an SDP.

Working parents

A positive change has been made around the amount that some households can earn before their UC award is reduced.

This amount, the ‘work allowance’, was increased by £1,000 a year from April 2019. It applies only to households with a child or children or where one person (including a partner) has limited capability for work.

Since February, families with more than two children are no longer able to claim child tax credit and will need to claim UC (apart from where the SDP exception applies – see above). This two-child limit means the benefit calculation for affected families includes only two child elements. In some circumstances, the two child limit is not applied.


There is a change for couples where one partner is aged above and the other is aged below pension credit qualifying age. From 15 May, they will no longer be able to make a new claim for pension credit but will have to claim UC instead.

Mixed-aged couples who are already claiming pension credit can remain on it as long as they continue to satisfy the qualifying conditions.

Contributory benefits

Amid the chaos of the changeover to UC, people may still be able to claim benefits based on their national insurance contributions, including contributory ESA and contribution-based jobseeker’s allowance (now called ‘new style’ ESA and JSA). These may be paid alone or with UC on top to help with a low income or rent or other housing costs.

Charlie Callanan is an adviser and writer on welfare rights

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