March 2020 – Universal Credit Update

The Department of Work & Pensions (DWP) has issued new guidance to local authority housing benefit staff in relation to further changes being made to the Severe Disability premium (SDP) process from 2 March 2020.

Natural migration to Universal Credit (UC) from existing means tested benefits provided no transitional protection and risked much lower levels of entitlement for disabled claimants. The SDP Gateway was introduced to prevent claimants in receipt of SDP from migrating to UC from any legacy benefit (such as Income Support or income based Employment Support Allowance).

 The new guidance specifically relates to SDP claimants who have incorrectly claimed universal credit and advises that further changes have been made to ensure that any SDP claimants who have incorrectly claimed universal credit as identified by DWP can have their legacy benefits reinstated.

 While regulations introduced in January 2019 added a gateway condition to universal credit preventing claimants with a severe disability premium (SDP) in a legacy benefit from making a claim for the new benefit, the DWP has recently acknowledged that it has needed to take steps in cases where claimants have inadvertently breached the Gateway.

Responding to a freedom of information request the DWP said it will return such claimants to legacy benefits where the error is identified promptly, prior to any award of universal credit, or returning the claimant is in their best interests (which may include financial interests).

 It should be noted that this protection for SDP claimants is scheduled to end on 27 January 2021. From this date severely disabled claimants will once again be vulnerable to natural migration to UC. Their only protection from losing out will be the availability of any transitional SDP amount.

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