HOUSEHOLDS with six legacy benefits due to be replaced by Universal Credit have been warned after thousands had their payments cut.
New government figures show 180,120 benefit claimants lost out by not switching to Universal Credit within a crucial three-month window.
Social rights groups called the figures “truly worrying” and issued fresh warnings amid fears that hundreds of thousands more claimants risk having their benefits cut in the coming months.
Two million legacy benefit claimants are gradually moving to Universal Credit under a process known as managed migration.
Universal Credit was created to replace legacy benefits and will launch in November 2022 following a successful pilot in July 2019.
As part of the process, eligible households with legacy benefits, including tax credits, are sent “migration notices” in the post telling them how to switch to Universal Credit, as it is not automatic.
It is vital that households apply for Universal Credit within three months of receiving the Managed Migration Letter.
Failure to do so may result in suspension of benefits.
Since March 2024, the Department for Work and Pensions (DWP) has sent out nearly 824,050 migration notices.
However, according to the latest DWP figures, 184,120 people lost their benefits after failing to act on migration notices received between July 2022 and March 2024.
Since then, around 400,940 people have made successful claims for Universal Credit, with another 238,990 still in the transition process.
Ayla Ozmen, director of policy and campaigns at anti-poverty charity Z2K, said: “Despite councils and anti-poverty organizations sounding the alarm repeatedly, the DWP continues to deprive people of the support they are entitled to.
“And far from taking a precautionary approach, from later this year it is accelerating the move of seriously ill and disabled people receiving Employment and Support Allowance onto Universal Credit.
“So if you receive a migration notice it is vital that you act.
“Either make a claim on Universal Credit or tell the department you need more time.
“If you’re not sure how to claim or are worried about how Universal Credit works, find a local advice agency to help you. But whatever you do, don’t ignore it.”
What is managed migration?
TIP from Ayla Ozmen, director of policy and campaigns, at anti-poverty charity Z2K.
The DWP is stopping so-called ‘legacy benefits’ for people of working age.
This means you won’t be able to claim benefits such as income-related employment and support, income support, tax credits or housing benefits (unless you’re in temporary accommodation or supported housing).
You will need to claim Universal Credit instead.
The DWP sends everyone currently receiving these benefits a letter called a ‘migration notice’, giving you three months to claim Universal Credit.
If you don’t claim and don’t claim DWP for a longer time, your legacy benefits can be stopped – even if you don’t also get Universal Credit.
This means you may have nothing to live on and you’ll be at risk of racking up debt on important bills like rent.
If you leave it too late to claim Universal Credit, you won’t be ‘paid’ the gap either.
And you can also skip something called a transition element.
Some people, including many disabled people, get less money on Universal Credit than on legacy benefits.
The transition element means you don’t face a sudden drop when you switch to Universal Credit in a managed migration, but instead it tapers off over time.
But if you ignore your migration notice and later claim Universal Credit, it’s treated as a brand new claim – so you don’t get a bridging element.
Alison Garnham, chief executive of the Child Poverty Action Group, said: “Today’s ‘no claims’ figures are truly worrying. Claimants are losing money they need while the DWP bury its head in the sand.
“The Department needs to slow the managed migration to UC and put in place robust support mechanisms that will allow people to move safely to UC.
“Without action from the DWP, this is a disaster in the making.”
Experts have previously warned that managed migration poses a risk to vulnerable people who face losing money.
Top charity bosses, including Mind, The Trussell Trust, Turn2Us and the Money and Mental Health Policy Institute, said in 2022 around 700,000 people with mental health problems, learning disabilities and dementia could struggle to include in the process.
More than 20 organizations have called on the government to end managed migration to fix flaws in the system that could see those at risk fail.
MANAGED MIGRATION PROGRESS
In January, the government announced the number of migration notices it planned to send out in the next financial year.
Prior to that date, the focus was on sending migration notices to households claiming tax credits only.
However, 110,000 Income Support claimants and another 120,000 claiming Tax Credit with Housing Benefit started receiving their letters in April.
Then in June we will contact over 100,000 applicants for housing benefits alone.
More than 90,000 people claiming Employment and Maintenance Allowance (ESA) along with Child Tax Credit will start being asked to switch from July.
Meanwhile, 20,000 Jobseeker’s Allowance (JSA) claimants will be contacted from September.
The Sun previously reported that from August those who claim tax credits and are over the state pension age will be asked to apply for either Universal Credit or Pension Credit.
Those claiming only income-related ESA were originally planned not to be moved until 2028.
However, the DWP has put forward plans to move these households onto Universal Credit by the end of 2025.
From September 2024, 800,000 households will start receiving letters explaining how to switch from ESA to Universal Credit.
HELP TO CLAIM UNIVERSAL CREDIT
As well as benefit calculators, anyone switching from tax credits to universal credit can find help in a number of ways.
You can visit your local Jobcentre by searching at find-your-nearest-jobcentre.dwp.gov.uk/.
There is also a free service called Help to Claim from Citizen’s Advice:
- England: 0800 144 8 444
- Scotland: 0800 023 2581
- Wales: 08000 241 220
You can also get help online from advisers at Citizens Advice.org.uk/about-us/contact-us/contact-us/help-to-claim/.
Would I be better off with Universal Credit?
Around 1.4 million will be better off with Universal Credit, the government estimates.
A further 300,000 will see no change in payments, while around 900,000 will be worse off on Universal Credit.
Of those, around 600,000 are expected to receive additional payments if they move in a managed migration so they don’t lose cash immediately.
The vast majority of them – around 400,000 – are claiming Employment Support Allowance (ESA).
Around 100,000 are on tax credits, while fewer than 50,000 on other legacy benefits are expected to be affected.
Examples of people who may be eligible for less universal credit according to the government include:
- Households receiving ESA who and the Severe Disability Premium and the Enhanced Disability Premium
- Households with a lower supplement for disabled children on inheritance benefits
- Self-employed households subject to the minimum income floor after the 12-month grace period ends
- Working households who have worked a certain number of hours (e.g. single
- a parent working 16 hours claiming working tax credits
- Households receiving tax credits with savings over £6,000 (and up to £16,000)
- But they could miss out on any future benefit increases and have payments frozen.
Those who move voluntarily and are worse off will not receive these extra payments and could lose money.
Those who miss the deadline and file later may also not receive this transitional protection.
The clock starts ticking with the three-month countdown from the date of the first letter, and reminders are sent by mail and text message.
There is then a one-month grace period during which any claim to Universal Credit is backdated and transitional protection can still be granted.
The latest figures from the DWP show that 61,130 people have made a UC claim and 39,920 have received transitional protection.
Another 40,540 are still in the process of switching to the new benefit.