A new Universal Credits rule change could see more than 100,000 claimants lose out on their benefits. The Department of Work and Pensions (DWP) has announced that claimants could be required to increase how many hours they work at their existing job, look for better paid work, or risk having their payments reduced.
Former Chancellor Kwasi Kwarteng announced that around 114,000 claimants in part-time work could face a benefit cut if they fail to properly look for more work. Among a range of measures introduced was a significant shake-up of the welfare system, with claimants working up to 15 hours a week on the National Living Wage required to meet regularly with a work coach and to take “active steps” to increase earnings.
The change is linked to the Administration Earnings Threshold (AET). This is a monthly amount that marks if you're in the "intensive work search" category or the "light touch" group. Billed by the Treasury as a gradual expansion, the move will be an increase from the 12-hour threshold for a more intensive work search regime and will take effect from January as part of the Universal Credit system, the Liverpool Echo reports.
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Under the old rules, those working up to nine hours a week at the National Living Wage were in the "intensive work search” group. This means they need to go to the JobCentre regularly and are required to increase their earnings. Those working above the nine hours a week threshold were previously in the "light touch" work group where they have less contact with the JobCentre.
But from September the threshold for when you’re pushed into the "intensive work search" group increased to 12 hours at the National Living Wage.
Mr Kwarteng said that this will rise again to 15 hours from January 2023. Some 114,000 people will be affected by these changes overall. The AET rate has increased from £355 a month to £494 a month, or from £567 a month to £782 a month for joint claims, from September 26. This is the equivalent of an individual working 12 hours per week, or a couple working 19 hours per week between them, the Government said.
If your income is above the AET rates, you will be in the "light touch" work group - but if you earn below these amounts, you will be in the "intensive work search" group. This could mean you may be pressured into finding better paid work or taking on more hours in your existing job, in order to keep your Universal Credit.
Exactly how many more hours you will be expected to take on will vary depending on your circumstances. You can find these details in your “claimant commitment”. If you fail to meet the targets set in your “claimant commitment” then you could have your benefits stopped.
How many hours you are required to spend looking for work depends on your circumstances, including childcare commitments and any health conditions. Those affected by the change will be contacted by the Department for Work and Pensions. Thérèse Coffey, Work and Pensions Secretary, previously said the rule change will "help claimants get quickly back into the world of work while helping ensure employers get the people they and the economy needs". She added: "Helping people get any job now, means they can get a better job and progress into a career.
"Way to Work is a step change in our offer to claimants and employers, making sure our JobCentre network and excellent work coaches can deliver opportunities, jobs and prosperity to all areas of the country."
Some of the work activities that people might be asked to take part in include:
- Carrying out work searches
- Making applications
- Creating and maintaining an online history
- Registering with an employment agency
- Creating and maintaining job profiles – however, you must not be mandated to use particular internet or social media sites (this must be entirely voluntary)
- Seeking references
- Any other actions which reasonably increase the likelihood of obtaining employment
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