It’s a huge challenge: balancing family life and finances can seem overwhelming, and changes to the benefit system are confusing and frightening, but help is available at West Swindon Family Centre, 15 Gainsborough Way, Freshbrook.
Many people claim some form of benefit, about 53 per cent of the population. Benefit payments account for 30 per cent of Government expenditure; 60 per cent in pensions, 40 per cent in welfare. Nearly 6 million people in work are affected by the recent vote in Parliament to limit the uprating of benefits to 1 per cent. Most people will be either directly affected by welfare reform or are related to someone who is.
So what is going to happen to you asks welfare advice specialists Christian Sweeney, right, and Richard Stacey, below. They explain some of the detail of the profound changes in the welfare system during 2013.
Child Benefit has been stealing the headlines. Where one member of a couple with children earns more than £50,000 the Child Benefit starts to reduce. If they earned more than £60,000 in the last tax year they will repay the Child Benefit via their tax bill.
Government has predicated the calculation of earnings on one partner’s pay cheque rather than the total household income. As a consequence we have a reform that allows a couple to earn £98,000 per year each yet retain the benefit. However a couple where one person earns in excess £50,000 are not so lucky.
The benefit cap starts in London in April and will be rolled out across the country from the summer. Total income from benefits will be capped at £500 per week for a couple or lone parent, and £350 for single adult households.
Housing Benefit will be reduced by the difference.
This simple pay cut will be a near catastrophic threat to the family home. Housing charity Shelter reported on 4 January that 1.4 million Britons are falling behind with rent or mortgage payments, with over 1 million people using payday loans to pay these costs. They also report that 2.8 million people use an unauthorised overdraft to pay their rent or mortgage, with 10 per cent doing so each month.
Empty bedroom tax
Aligned with this reform is the empty bedroom tax, which comes into force in April 2013. This is targeted solely at tenants of social landlords.
If you are considered to under occupy your home, your Housing Benefit will be reduced. If you have one bedroom too many, the reduction is 14 per cent; with two or more bedrooms, the reduction is 25 per cent.
Disability Living Allowance (DLA)
From April, Disability Living Allowance (DLA) for adults under retirement age will be phased out. Personal Independence Payment (PIP)will take its place, introduced first in Bootle and rolled out nationally over the summer. Existing claimants of DLA will be selected for PIP assessment from October 2013.
Universal Credit is the great vision for simplifying the benefits system – to replace income based JobSeekers Allowance, Income Support, income based Employment Support Allowance, Housing Benefit, Child Tax Credit and Working Tax Credit.
It is to begin in the North West in April. In October all new claims for out-of-work support will be under Universal Credit.
The transfer will then begin for existing claimants, to be completed by April 2014. At this time no new Tax Credit claims will be accepted and the transfer process is likely to continue until 2017.
Council Tax Benefit is being abolished altogether, to be replaced by a local authority run benefit. Swindon Council currently pays £13 million in Council Tax Benefit, which is later reimbursed in full by the Government.
However, the amount available from the borough’s fund in the next financial year will be approximately £11 million, leaving a shortfall of £2 million. It is envisaged that everyone will have to pay something towards the council tax bill.
If the changes in welfare system affect you, advice is available about benefits, debt, employment, housing, tax credits, DLA or family law or have any concerns about the changes, contact West Swindon Family Centre.
Richard Stacey and Christian Sweeney offer free welfare advice to families with children aged 0 to19 years who live in West Swindon.
Appointments can be booked from 9am to 4pm on weekdays and Richard or Christian are available to discuss welfare issues on a drop-in basis every Wednesday from 9.15am to 10.15am and 2.15pm to 2.45pm.
To book an appointment call 01793 871303 or mail: email@example.com