DWP paying extra amounts of Universal Credit to more than two million claimants

Officials have explained the rules for topping up people's benefits so they don't face an income drop

Thousands of people are being given extra amounts of Universal Credit so they don't face a sudden income drop. The additional sums are above what they would normally be entitled to receive in their monthly payments.

Just under seven million people are now on Universal Credit with the number increasing due to claimants being transferred from older types of welfare support. These legacy benefits include tax credits, Income Support, Housing Benefit, income-based Jobseeker's Allowance and income-related Employment and Support Allowance.

Thousands more people are being moved across this autumn as part of the 'managed migration' in which households are sent letters and given three months to apply to Universal Credit before their existing benefits are stopped. The Department for Work and Pensions has issued a new update explaining the rules for increasing people's Universal Credit as part of this changeover. It says an additional amount known as a transitional element can be paid in certain circumstances and has clarified how this works.

READ MORE:

• DWP asking Universal Credit claimants for 9 pieces of evidence to check payments
• October DWP and HMRC money changes for PIP, Universal Credit, ESA and pensioners

The DWP says the transitional element can be added if someone has received a Migration Notice letter and has moved to Universal Credit by the specified deadline date. Essentially, this element makes up the difference between what people were getting on their old benefits and what they would be due to receive in Universal Credit.

DWP statistics estimate that by the time Universal Credit is fully rolled out at the end of 2025, 2.2 million households will have been given transitional elements to top up their payments so they don't end up with less than they were on before. Another 1.2 million households will be on the same amount, while 3.8 million households will get more money on Universal Credit than they did before.

Officials said in updated guidance: "When a claim is made and verified, the transitional element is calculated using a Universal Credit amount that's based on your known circumstances from the day before your claim. This amount is referred to as the indicative Universal Credit award.

"At this point, the transitional element is the difference between the indicative Universal Credit award and your previous legacy benefit amount. It aims to protect your benefit entitlement at the point of moving to Universal Credit."

The transitional element is calculated from information a claimant gives in their Universal Credit claim. This will include a person's employment status; who they live with; their income, savings and investments; children and childcare costs; any disabilities, health conditions or caring responsibilities; and details of their existing benefits.

Checks are made with data held by DWP, HMRC and (in the case of Housing Benefit) local councils. Once the Department has worked out how much Universal Credit someone is entitled to receive - including any deductions for being above the level of the benefit cap - it will compare that with their old payments and can apply a transitional element to make up the difference if their UC would otherwise be lower.

This transitional element keeps your Universal Credit the same as your old benefits. It remains at this level and this means when Universal Credit goes up every April, your transitional element goes down to keep the overall amount the same as it was at the point of transfer. The DWP also points out: "If your circumstances change after you've made your claim, any transitional protection you receive may stop."

You can get all of today's essential breaking news on the BirminghamLive WhatsApp. Join our dedicated community to receive the latest updates. For more on navigating the cost of living crisis, sign up for our Money Saving Newsletter which is sent out daily with the top stories on benefits, pensions, finances, bills, and shopping discounts.