DWP benefits warning as these payments stop due to Universal Credit shake-up | Personal Finance | Finance

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According to a new report from the National Audit Office (NAO), thousands of families have had their benefits stopped due to recent changes in Universal Credit.

The Department for Work and Pensions (DWP) is currently moving people who claim older benefits such as Tax Credits, Jobseekers Allowance, and Income Support onto Universal Credit.

The NAO has found that up to 350,000 households were told they would need to apply for Universal Credit to keep receiving financial support by the end of 2023.

The shocking bit is, the report also reveals that more than a fifth of people on Tax Credits who were told to switch to Universal Credit didn’t make a claim and so had their benefits cut off. This means out of around 148,700 closed cases, 31,500 homes had their old benefit stopped without moving to Universal Credit.

The report says the “DWP does not fully understand why some people on legacy benefits do not claim universal credit.”

However, earlier studies from the DWP found there were “real and perceived barriers” to claiming. This includes people thinking the change notice did not apply to them, that they wouldn’t be eligible for Universal Credit because of a change in their situation, or that they thought they’d be moved over automatically, reports The Mirror Online.

Gareth Davies, the head of the NAO, stated that the DWP was “on track” to transition legacy benefit claimants to Universal Credit. However, he emphasised the need to ensure that “sure people who have not switched to Universal Credit are receiving the benefits to which they are entitled.”

He further added: “Work to evaluate the impact of Universal Credit on the labour market shows some positive impact. However, DWP cannot demonstrate it is achieving the scale of the benefits set out in the programme’s business case. The department needs to continue to develop its assessment of the impact to provide assurance on value for money and secure the best results when Universal Credit is fully implemented.”

A spokesperson for the DWP responded: “The vast majority of Tax Credit claimants have successfully moved to Universal Credit, accessing the vital safety net provided to millions as they build towards financial independence.”

They also noted: “As the NAO recognised, evidence shows Universal Credit is having a sustained positive impact on the jobs market, and people on Universal Credit are more likely to be in work six months after making a claim. There is also a range of support available to help people move, including extensions for those who need extra support.”

As of March last year, the NAO reported that around 2. 2 million households were still receiving old benefits and by December, about 6.

Three-million people were claiming Universal Credit. The DWP estimates that approximately 900,000 households will be transferred to Universal Credit before the end of December 2024.

What should I do if I receive a managed migration notice?

The DWP is gradually rolling out the move and is currently sending managed migration notices through the post to areas next in line. Most of those claiming legacy benefits are expected to have been moved over by March 2025.

However, people claiming income-related ESA only and not Tax Credits have a slightly longer deadline and will be transferred across by 2028.

Once you receive your notice, you will have three months to put in a claim for Universal Credit – if you don’t, your payments will stop. You can submit your claim online, or over the phone by calling the Universal Credit Migration Notice helpline on 0800 169 0328, or you can also ask your local Job Centre.

After making your claim, you will have to wait five weeks until your first Universal Credit payment and you will continue to receive it going forward – unless your circumstances change. If you claim Tax Credits, your entitlement will end as soon as you claim Universal Credit.

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