The Department for Work and Pensions (DWP) is making a major change to the benefits system in the UK. By the end of the 2024-25 financial year, the DWP will cancel four old-style benefits: Working Tax Credit, Child Tax Credit, Jobseeker’s Allowance, and Income Support. This change, known as “DWP Cancels 4 Benefits,” is part of a broader plan to move all claimants to Universal Credit. The goal is to streamline the benefits system and save money for taxpayers. However, this shift will bring significant changes for many people and families who depend on these benefits.
DWP Cancels 4 Benefits
Around 500,000 households currently receive one or more of the benefits being canceled. If these households do not apply for Universal Credit by the end of May 2024, their benefits will be stopped. The DWP Cancels 4 Benefits will also affect those on Income Support, Jobseeker’s Allowance, and Housing Benefit, as they will also need to switch to Universal Credit.
Here’s a breakdown of who will be affected by the DWP Cancels 4 Benefits:
| Benefit | Recipients |
|---|---|
| Working Tax Credit | Individuals and couples with low earnings |
| Child Tax Credit | Families receiving help for their children |
| Jobseeker’s Allowance | Unemployed individuals seeking work |
| Income Support | Individuals with low income, including carers and lone parents |
Timeline for Transition
The DWP Cancels 4 Benefits will follow a structured timeline to ensure a smooth transition:
| Date | Action |
|---|---|
| April 2024 | Notices will be sent to working-age households on Income Support and those claiming Tax Credits with Housing Benefit. |
| June 2024 | Housing Benefit-only claimants will receive their notices. |
| July 2024 | Notices will be sent to Employment Support Allowance claimants who also receive Child Tax Credits. |
| September 2024 | Jobseeker’s Allowance claimants will be notified. |
| August 2024 | Tax credit claimants over State Pension age will be contacted to apply for Universal Credit or Pension Credit. |
Support and Adjustments
The government recognizes that moving to Universal Credit can be challenging. To assist with the transition, the DWP is providing additional support. Employment Minister Jo Churchill stated that the department is addressing feedback and issues quickly. The goal is to make the DWP Cancels 4 Benefits transition as smooth as possible for all affected individuals.
Financial Implications for Tax Credit Recipients
As the DWP Cancels 4 Benefits, there will be final adjustments to the payment levels for those still receiving tax credits. Here are the upcoming changes:
| Benefit | Current Amount | New Amount |
|---|---|---|
| Working Tax Credit | ||
| Basic element | £2,280 | £2,435 |
| Couple and lone parent element | £2,340 | £2,500 |
| Disabled worker element | £3,685 | £3,935 |
| Severe disability element | £1,595 | £1,705 |
| Childcare costs for 1 child | £175 | £175 |
| Childcare costs for 2 or more children | £300 | £300 |
| Benefit | Current Amount | New Amount |
|---|---|---|
| Child Tax Credit | ||
| Family element | £545 | £545 |
| Child element | £3,235 | £3,455 |
| Disability element, disabled child rate | £3,905 | £4,170 |
| Disability element, severely disabled child rate | £1,575 | £1,680 |
Why the Change?
The decision to phase out these benefits, known as DWP Cancels 4 Benefits, is part of a strategy to simplify the welfare system and reduce administrative costs. Universal Credit is designed to combine several benefits into one payment, making it easier to manage and reducing the risk of errors and fraud. The transition is also expected to save money by closing outdated systems like the tax credit system managed by HMRC and various old-style benefits managed by the DWP.
Conclusion
The transition to Universal Credit, also known as DWP Cancels 4 Benefits, aims to create a more efficient benefits system. While this change brings significant adjustments for affected individuals and households, the DWP is committed to providing support throughout the process. Staying informed and proactive about these changes is crucial for ensuring continuous financial support during this transition. As the deadline approaches, it will be important for all eligible households to successfully move to Universal Credit to maintain their benefits.
FAQ’s
What benefits are the DWP canceling by 2025?
The DWP is canceling Working Tax Credit, Child Tax Credit, Jobseeker’s Allowance, and Income Support. All claimants will need to transition to Universal Credit.
When will the DWP cancel these benefits?
The DWP will start canceling these benefits in April 2024 and complete the transition by the end of the 2024-25 financial year.
How will this affect current benefit recipients?
Current recipients will need to apply for Universal Credit to continue receiving support. Failure to do so by the deadlines will result in the cancellation of their existing benefits.
What support is available for those affected by the changes?
The DWP is providing additional support and assistance to help people transition smoothly to Universal Credit, including addressing feedback and resolving issues quickly.