Key Welfare reform points

Welfare reform Key points 

Universal Credit  

• Around 2.8 million low to middle income households will be better-off on Universal Credit (UC).
• The average overall gain will be £29.00 per week under UC.
• UC will lift around 900,000 individuals out of poverty, including more than 350,000 children and around 550,000 working-age adults.
• Government will invest an additional £300 million into childcare support under Universal Credit, on top of the £2bn already spent under the current system.
• Removing the hours rule will mean that around 80,000 more families with children will benefit from childcare support for the first time.
• By October 2017; approximately 12 to 13 million tax credit and benefit claims will be transformed into eight million Universal Credit payments.

Benefit cap

• The benefit cap of £26,000 will mean that no family on benefits will earn more than the average salary of a working family (£35,000p.a. before tax).
• 67,000 households will be affected by the cap.
• Benefit cap will provide savings of £290m in 2013/14 and £330m in 2014/15 (cash terms) or £275m in 2013/14 and £305m in 2014/15 (at 2011/12 prices).

Housing Benefit

• We will set Housing Benefit at a maximum of £400 a week so that we no longer have the scandal of families on benefits living in houses that hard working families could never afford.

• Housing Benefit costs over £21bn in 2010/11 [or nearly £23bn this year] and, without reform, would increase to £26bn by 2014/15 (cash terms). The Housing Benefit reforms that we announced in the Emergency Budget and Spending Review will result in annual savings of over £2bn by 2014/15.

• Social Sector Size Criteria will stop the practice of the state paying for rooms that are not being used.

• This will help tackle the social housing shortage that blights many lives in our towns and cities.

• 5 million people in England alone are waiting for social housing.

• In London 70,000 households are getting Housing Benefit for extra bedrooms they do not need – costing the tax payer £80million a year.