HUNDREDS of households have been affected by a DWP benefits error, which could leave them out of pocket.
It comes as the government continues to move all two million claimants on legacy benefits to Universal Credit by the end of March 2025 through a process known as managed migration.
As part of this process, households on legacy benefits, including tax credits, receive “migration notices” by post.
These notices provide instructions on how to switch to Universal Credit, as the transition is not automatic.
Households must apply for Universal Credit within three months of receiving their managed migration letter.
Failing to do this can result in benefits being stopped.
However, a “small number” of the 800,000 on income-related employment and support allowance (ESA) have faced a stumbling block when applying for Universal Credit.
ESA provides financial support for those unable to work due to illness or disability.
According to Department for Work and Pension (DWP) rules, ESA claimants should not be required to provide fit notes during the migration process.
Furthermore, those in the ESA support group should not be asked to undertake any work-related activities, as their work capability status should carry over when they migrate to UC.
Despite these clear rules, some DWP staff have asked ESA claimants to obtain fit notes from their GPs.
Others have been incorrectly informed that they need to agree to new work commitments before making the switch.
Claimants have been told that failure to provide fit notes or agree to new work requirements would make them ineligible for limited capability for work and work-related activity (LCWRA) payments.
These extra payments are worth up to £416 a month.
Similar to Universal Credit, legacy ESA claims consist of a standard allowance and an additional component for incapacity for work.
This additional component – either the work-related activity component or the support component – is being replaced by Universal Credit’s LCWRA payments.
Therefore, if you were already receiving these extra components under ESA, you are not required to submit a new fit note or agree to new work requirements to be eligible for LCWRA payments.
Ayla Ozmen, director of policy & campaigns at anti-poverty charity Z2K, said: “It’s very concerning to hear that some disabled people on employment and support allowance who are being moved on to universal credit are being asked to look for work.
“Not only is this unlawful, but it puts disabled people at risk of being inappropriately sanctioned.”
A DWP spokesperson added: “We are aware of an issue where a small number of claimants are still being asked to attend a Claimant Commitment appointment and are currently working to resolve the situation.
“Anyone who thinks they have been affected should contact their work coach.”
Which benefits are stopping?
UNIVERSAL Credit is replacing six benefits under the old welfare system, commonly called legacy benefits. They are:
- Working tax credit
- Child tax credit
- Income-based jobseeker’s allowance
- Income support
- income-related employment and support allowance
- Housing benefit
If you’re on any of these benefits now, you can move over immediately or wait until you receive your migration notice.
You should carefully consider the financial implications of transitioning to Universal Credit before receiving a formal notice, as once you make the switch, there is no option to revert to your previous benefits.
An online benefits calculator, free and easy to use from charities such as Turn2Us and EntitledTo, can help you check.
You may also be moved to Universal Credit if your circumstances change, such as moving home, changing your working hours, or having a baby.
Ultimately, everyone will be transitioned to Universal Credit through the managed migration process, and all legacy benefits will be phased out by 2025.
A WORD OF WARNING
Since July 2022, the Department for Work and Pensions (DWP) has sent nearly 1.14million migration notices.
However, according to the latest figures from the DWP, 284,660 individuals lost their benefits after failing to respond to migration notices received between July 2022 and June 2024.
That’s why it’s vital to ensure that you switch to Universal Credit within three months of receiving your letter.
Failure to do this will stop your current benefit payment.
You will also forfeit transitional protection top-up payments designed to ensure you do not lose money when transitioning to Universal Credit under the managed migration process.
Some 623,310 individuals have since made successful claims for Universal Credit, and another 232,830 are still in the process of transitioning.
HELP CLAIMING UNIVERSAL CREDIT
As well as benefit calculators, anyone moving 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’s 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 citizensadvice.org.uk/about-us/contact-us/contact-us/help-to-claim/.
Will I be better off on Universal Credit?
ANALYSIS by James Flanders, The Sun’s Chief Consumer Reporter:
Around 1.4million people on legacy benefits will be better off after switching to Universal Credit, according to the government.
A further 300,000 would see no change in payments, while around 900,000 would be worse off under Universal Credit.
Of these, around 600,000 can get top-up payments (transitional protection) if they move under the managed migration process, so they don’t lose out on cash immediately.
The majority of those – around 400,000 – are claiming employment support allowance (ESA).
Around 100,000 are on tax credits, while fewer than 50,000 each on other legacy benefits are expected to be affected.
Those who move voluntarily and are worse off won’t get these top-up payments and could lose cash.
Those who miss the managed migration deadline and later make a claim may not get transitional protection.
The clock starts ticking on the three-month countdown from the date of the first letter, and reminders are sent via post and text message.
There is a one-month grace period after this, during which any claim to Universal Credit is backdated, and transitional protection can still be awarded.
Examples of those who may be entitled to less on Universal Credit include:
- Households getting ESA and the severe disability premium and enhanced disability premium
- Households with the lower disabled child addition on legacy benefits
- Self-employed households who are subject to the Minimum Income Floor after the 12-month grace period has ended
- In-work households that worked a specific number of hours (e.g. lone parent working 16 hours claiming working tax credits
- Households receiving tax credits with savings of more than £6,000 (and up to £16,000)
Either way, if these households don’t switch in the future, they risk missing out on any future benefit increase and seeing payments frozen.
