Universal Credit (UC) is a means tested benefit for people under state pension age who are on low incomes or out of work. From 6 April this went up by £86.67 per month for single people and couples, though not everyone will get all of that. A similar amount will be added to working tax credit. The allowance made to private tenants to cover their rent is also going up, undoing the cuts of the past nine years. But the cap, which restricts the total amount of benefits paid, isn’t increasing, so those already at the cap will get no more.
Universal Credit will now be calculated for the self-employed based on their actual income. Previously they were assumed to earn at least the equivalent of the minimum wage for 35 hours a week – around £305. That “minimum income floor” will not apply during the present crisis, increasing the money people get. As the first UC payment isn’t made for five weeks, people can get an advance of a month’s benefit (to be repaid over the following months). The Government has ruled out making this advance a grant. In England, working-age people on low incomes whose council tax is already reduced will get up to £150 more credit from 6 April. Some will now pay nothing. Local councils have a hardship fund to help others.
Statutory Sick Pay (SSP) of £95.85 a week is now paid by employers from day one of a coronavirus illness, or if you’re absent due to the guidelines on self-isolation or to caring for others – as long
as you earn more than £120 a week. If you earn less or are self employed, you can’t get SSP and have to apply for Universal Credit.
Employment and Support Allowance (ESA) is £74.35 a week for employees aged 25 and over and self-employed people who have paid enough National Insurance Contributions. It’s now paid from day one of illness, not day eight.
NB The measures taken during the crisis may change; this column doesn’t include benefits adjustments announced since 30 March.
Paul Lewis presents Money Box on R4