Martin Lewis explains if you’ll be better off under new Universal Credit benefits shake-up launching today

Martin Lewis explains if you’ll be better off under new Universal Credit benefits shake-up launching today

05/09/2022

MORE than 2.5million people will start to be moved onto Universal Credit from today – and it's estimated that 900,000 people will be worse off as a result.

The Government's plan to switch thousands over from other benefits was halted by the pandemic – but it's now resuming. Here's what it means for you.

Martin Lewis' Money Saving Expert (MSE) website confirmed that millions of benefit claimants will be moved over to Universal Credit – with some better off than others as a result.

The government's aim is to have all benefits claimants moved over by the end of 2024 to replace six legacy benefits, which it says have complex and inefficient systems.

These are:

  • Child Tax Credit
  • Housing Benefit
  • Income Support
  • Income-based Jobseeker’s Allowance (JSA)
  • Income-related Employment and Support Allowance (ESA)
  • Working Tax Credit

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The switch-up was previously paused so that staff could manage the influx of new claims as a result of Covid-19, but the so-called managed migration is now going ahead again.

Some people will be moved automatically, while others have a choice to remain on their current benefits for now – though everyone will have to switch eventually.

According to MSE, the government predicts that 1.4million people will be better off on Universal Credit, and 300,000 won't see any difference at all.

Check if you'll be better off switching to Universal Credit by using a benefits calculator for a rough idea, like the one on MSE.

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Though almost a million people could be worse off.

According to MSE's article, you could be worse off if any of the following apply to you:

  • You're a lone parent who works but doesn't pay rent
  • You have a disability and you're in work, but you don't pay rent
  • You're a self-employed worker earning less than the minimum income floor
  • You have savings over £16,000

It's not all bad though – if you're moved over by the Government you’ll be given "transitional protection", according to Martin Lewis.

This means your new payment will be topped up to meet your previous amount if you receive less money on Universal Credit than on your current benefits.

It's estimated that around 1.4million people will be better off on Universal Credit, including:

  • Most people who work and rent
  • Some people who have higher earning but don't rent

It's worth bearing in mind, though, that these outlines should only act as a rough guide – situations will vary on a case by case basis.

There are concerns, however, that those being moved to Universal Credit could have to wait weeks for their first payments.

Millions of people could be left unable to afford essential bills in the migration.

If you think you'll be better off on Universal Credit, it's best to speak to an adviser to be sure before switching over, as you can't go back once you've moved over.

You can grab free advice from organisations like Citizens Advice or MoneyHelper, which is a free, government-run information service.

An online benefits calculator from charities such as Turn2Us and EntitledTo, may also be useful to help you work out the best route for your circumstances.

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