Welfare Reform from 2013

From April 2013 the Housing Benefit system changed. This means that some people will have their Housing Benefit reduced.

The Government has made changes to Housing Benefit which means that many people will have their Housing Benefit reduced. This means people will have to pay the difference between their Housing Benefit and their rent.

These changes only apply to people of working age claiming Housing Benefit.

Size Criteria - How many ‘spare’ bedrooms do you have?
Housing Benefit changed from 1 April 2013 for people who rent from a social landlord (local authority, registered housing association or other registered social landlord).

From April 2013, your Housing Benefit may be reduced if you have one or more ‘spare’ bedrooms in your home. The new rules restrict the size of accommodation you can receive Housing Benefit for, based on who is in your household.

  • One bedroom will be allowed for:
  • Each adult couple
  • Any other person aged 16 or over
  • Two children of the same sex aged under 16
  • Two children under the age of 10 regardless of their sex
  • Any other child
  • A carer (who does not normally live with you) but provides you or your partner with overnight care
  • A foster child – a room for one foster child can be included (if certain conditions are met) 
  • A severely disabled child who is unable to share a bedroom with a sibling that they would ordinarily be expected to share with (if certain conditions are met)
  • Parents with adult children deployed on operations in the Armed Forces (if certain conditions are met)

 The new rules apply even if:
• You and your partner need to sleep apart because of a medical problem
• You have a spare room for a child whose main home is elsewhere

If you have more bedrooms than what has been decided you need for your household, your Housing Benefit will be reduced by:
• 14% of the rent and eligible service charges for one spare bedroom
• 25% of the rent and eligible service charges for two or more spare bedrooms

(There is no definition of a minimum bedroom size in the regulations. We will therefore take into account all bedrooms even if they are small (classed as box rooms) or used for another purpose (e.g. study/office)).

Karen lives alone in a 2 bedroom flat and her Housing Benefit is based on an eligible rent of £95.00. As she is only eligible for 1 bedroom, a 14% cut will be applied to her eligible rent, making her new eligible rent £81.70. If Karen is on maximum Housing Benefit she will have to pay £13.30 per week. If Karen is only entitled to some Housing Benefit to help pay her rent, this will be reduced by £13.30 per week.

Richard and his partner live in a 4 bedroom house with their two sons, aged 15 and 13 and have their Housing Benefit based on an eligible rent of £123.00. As their sons will be expected to share a bedroom, they will only be eligible for 2 bedrooms. Applying the 25% cut will make their new eligible rent £92.25. If Richard is on maximum Housing Benefit he will have to pay £30.75 per week. If Richard is only entitled to some Housing Benefit to help him pay his rent, this will be reduced by £30.75 per week.

If your Housing Benefit is cut you will have to pay your Landlord the difference between your Housing Benefit and your rent.

Who is not affected?

  • Any customer over state pension credit age or with a partner over state pension credit age (61½ years for both men and women at April 2013)
  • Shared ownership cases
  • Those liable for mooring charges for houseboats and site charges for caravans and mobile homes
  • Those placed in temporary accommodation under homelessness legislation
  • Those in supported “exempt” accommodation (accommodation where the customer is also provided with care, support or supervision)

Non-standard cases:

  • Joint tenants  
  • Boarders & Lodgers – are taken into account when determining how many rooms are required
  • Shared care of children – are taken into account if that parent is treated as responsible for them and provides their main home
  • Young persons away at University –are taken into account if property remains their main home and they return to it for holidays and breaks in study

 If you think you are one of the non-standard cases please contact the Benefits Section for more information.

Benefit Cap - How much do you receive in benefits?
From April 2013 the Government introduced a Benefit Cap which means that your Housing Benefit may reduce if the overall amount of benefit you receive is above a certain amount.

If you are out of work, the maximum amount of benefit you will be able to receive will be:
• £500 per week for lone parents and couples with or without children
• £350 per week for single people without children

If the total amount of benefit you receive comes to more than the maximum amount allowed, your Housing Benefit will be reduced.

A range of benefits are included in the calculation of the Benefit Cap. These are:

  • Bereavement Allowance, Widowed Parents Allowance & Mothers Allowance
  • Carers Allowance
  • Child Benefit
  • Child Tax Credit
  • Employment Support Allowance (except where the Support component has been awarded)
  • Guardians Allowance
  • Housing Benefit
  • Incapacity Benefit
  • Income Support
  • Maternity Allowance
  • Jobseekers Allowance
  • Severe Disablement Allowance
  • Widows Pension

Steve and Sarah have five children and are receiving Housing Benefit. They get Job Seekers Allowance of £111 per week, Child Tax Credit of £230 per week and Child Benefit of £73 per week, making their total income £414 per week. They are currently eligible for £160 per week Housing Benefit to cover their rent, giving a total benefit income of £574 per week (£414 + £160).
Applying the £500 cap will mean their Housing Benefit is reduced to £86, a loss of £74 per week.

If your Housing Benefit is cut you will have to pay your Landlord the difference between your Housing Benefit and your rent.

Receipt of the following benefits will exempt you from the cap:

  • Entitlement to Working Tax Credit
  • Attendance Allowance
  • Support component of Employment Support Allowance
  • Disability Living Allowance (or its replacement Personal Independence Payment)
  • Industrial Injuries Benefit
  • Armed Forces Compensation Scheme payments
  • War Pension Scheme payments (including war widows/widowers pension and war disablement pension)

The benefit cap will not be applied for 39 weeks for those customers who have been continuously in work for the previous 12 months.

Discretionary Housing Payments

The Government has provided additional funding through Discretionary Housing Payment (DHP). This is to support those customers affected by Welfare Reform who, as a result of a number of complex challenges, cannot immediately move into work or more affordable accommodation. These payments are only intended to cover transition into work or cheaper accommodation and are time limited.

If you would like to make a claim, please see the link to a claim form at the bottom of this page.

Other Changes

There are a number of other benefit changes taking place:

Universal Credit
Universal Credit is a new simpler, single monthly payment for people in or out of work, which will eventually join together some of the benefits and tax credits that you might be getting now.

Who will it affect?

It will only affect a few people at first. From 21st September 2015 single jobseekers in Winchester, who are making a new claim, may be required to apply for Universal Credit. This will happen if:

•You are making a new claim for a relevant benefit. At the moment this is Jobseekers Allowance only
•You are aged 18 to 60
•You do not have any children or other dependents
•You do not have a disability or a long term illness

There is information on www.gov.uk so you can check to see if you need to claim Universal Credit.

How to claim?

You will be expected to make your Universal Credit application online at www.gov.uk/apply-universal-credit.

Universal Credit does not include help to pay your council tax. You will still need to claim Council Tax Reduction from the Council.

Disability Living Allowance
Disability Living Allowance (DLA) will not form part of the new Universal Credit or fall under the Benefit Cap. However, it will be changing from April 2013 to the new Personal Independence Payment (PIP) for all new claimants. If you already receive DLA you will be reassessed under the PIP criteria when your current DLA is up for renewal (unless you are over 64 or under 16). You will probably have to complete a claim and attend a consultation with an independent assessor.

Further information:
Gov uk – the new place to find government services and information – www.gov.uk

Citizens Advice Bureau
- Winchester Branch on 01962 848 000 or Bishops Waltham Branch on 01489 896376 or visit there website at www.winchesterdistrictcab.org.uk

Money Advice Service - An independent service, set up by government to help people make the most of their money, giving free, unbiased money advice to everyone across the UK. Call 0300 500 5000 or visit www.moneyadviceservice.org.uk

Turn2us - A national organisation that provides advice to people in financial need. Call free on 0808 802 2000 or visit www.turn2us.org.uk