The Department for Work and Pensions (DWP) is set to discontinue four legacy benefits by the end of the 2024-25 financial year, urging claimants to act quickly to avoid any disruption in payments.
The benefits affected include Working Tax Credit, Child Tax Credit, Jobseeker’s Allowance, and Income Support, all of which will be integrated into the Universal Credit system.
This change is part of the DWP’s broader effort to simplify the welfare system, making it more efficient, cost-effective, and easier to navigate. As the transition deadline approaches, current beneficiaries must stay informed and manage their claims proactively to ensure a smooth switch to Universal Credit.
Cancellation of Four Benefits
The four benefits that will be scrapped and integrated into Universal Credit are:
- Working Tax Credit
- Child Tax Credit
- Jobseeker’s Allowance
- Income Support
By moving these benefits into a single system, the DWP aims to provide a more seamless service, reducing the potential for errors and ensuring claimants receive the correct financial support without delay.
Why Legacy Benefits Are Ending
The DWP’s decision to cancel these traditional benefits in favor of Universal Credit stems from several key reasons:
Simplification
The old system of managing separate benefits was complex, often leaving claimants confused about what they were entitled to and how the process worked. Universal Credit merges all these benefits into one, streamlining the system for both claimants and administrators.
Cost Efficiency
Running multiple benefit schemes is expensive. Universal Credit consolidates everything into a single system, reducing administrative costs and the resources needed to manage these separate payments.
Responsive to Change
Universal Credit adjusts faster to a claimant’s changes in circumstances, such as fluctuations in income, meaning that support can be more accurately calculated and delivered without delays.
Fraud Prevention
The old system made it easier for errors and fraud to slip through the cracks. A single unified system minimizes these risks, ensuring benefits reach those who genuinely need them.
Encouraging Employment
One of the main features of Universal Credit is that it’s designed to make work more rewarding. Benefits taper off as income increases, creating stronger incentives for individuals to return to or increase work hours.
Transition Timeline
The DWP has a clear timeline for when each group will transition to Universal Credit. Claimants will receive official notices informing them of the steps they need to take.
| Benefit | Description | Transition Date |
|---|---|---|
| Working Tax Credit | For individuals with low earnings | By May 2024 |
| Child Tax Credit | Financial aid for families with children | By May 2024 |
| Jobseeker’s Allowance | For unemployed individuals seeking work | September 2024 |
| Income Support | Support for low-income individuals, carers, and lone parents | April 2024 |
Detailed Notification Schedule
| Month | Group Notified | Details |
|---|---|---|
| April 2024 | Income Support and Tax Credits with Housing Benefit | Initial migration notices issued |
| June 2024 | Housing Benefit-only claimants | Follow-up notices |
| July 2024 | ESA claimants with Child Tax Credits | Specific notices for combined benefits |
| September 2024 | Jobseeker’s Allowance claimants | Final round of notifications |
| August 2024 | Tax credit recipients over State Pension age | Special instructions for older citizens |
Financial Impact on Claimants
As the legacy benefits are phased out, HMRC has adjusted the payment levels for tax credits. These amounts represent the final payments before Universal Credit fully replaces them.
Working Tax Credit Changes
| Element | 2023 Amount (£) | 2024 Adjusted Amount (£) |
|---|---|---|
| Basic element | 2,280 | 2,435 |
| Couple and lone parent | 2,340 | 2,500 |
| Disabled worker element | 3,685 | 3,935 |
| Severe disability element | 1,595 | 1,705 |
Child Tax Credit Changes
| Element | 2023 Amount (£) | 2024 Adjusted Amount (£) |
|---|---|---|
| Family element | 545 | 545 (unchanged) |
| Child element | 3,235 | 3,455 |
| Disabled child rate | 3,905 | 4,170 |
| Severely disabled child rate | 1,575 | 1,680 |
What to Expect
The DWP’s transition to Universal Credit marks a significant change for millions of claimants. Although the reform is intended to simplify the system, it’s essential that current beneficiaries remain vigilant and responsive to any communication from the DWP.
Missing a notice or delay in acting could lead to disruptions in financial support, so it’s vital to stay on top of this transition process.
The overall aim is to create a more modern, efficient, and cost-effective welfare system. However, navigating this change will require coordination and understanding from both the DWP and claimants.
As the deadline nears, being proactive is key. Claimants should familiarize themselves with Universal Credit and understand how the new system may affect their payments.
FAQs
Which benefits are being scrapped?
Working Tax Credit, Child Tax Credit, Jobseeker’s Allowance, and Income Support.
When will the benefits end?
They will phase out by the end of the 2024-25 financial year.
How does Universal Credit differ from these benefits?
It combines multiple benefits into one, simplifying the system.
What happens if I don’t transition?
You risk missing out on payments, so act before the deadline.
Are payment amounts changing during the transition?
Yes, tax credit payments have been adjusted before switching to Universal Credit.
