Benefits cap; letter from DWP

Local Authority Chief Executive

19 September 2016

Dear Chief Executive

I previously wrote to you on 21 July to confirm that the benefit cap changes will start to be implemented from 7 November 2016 and that we were consulting with the Local Authority Association Steering Group (LAASG) about the most appropriate way to implement the benefit cap changes.

The position we have reached is that for current capped cases the reassessment of the lower cap level will be automatic, so that all currently capped households will move to the new cap levels on 7 November 2016, when the legislation comes into force. This may well mean that your local authority is contacted by some of these affected claimants shortly after that date.

For the current benefit cases that would not be capped at the existing levels but where the revised cap levels would apply, you will be aware that we will need to undertake clerical processing of the cases over several weeks. The preferred implementation approach over this period agreed with the LAASG is ‘low to high’ – i.e. those local authorities with the lowest volume of new cases will be processed first; and those with the highest volumes at the end. We believe this should take place in a 12 week period. This is the same approach that was applied previously and the one that best accounts for any potential risk.

At this stage the indication is that your local authority will receive these new cases (ie the ones going through clerical processing) in week commencing 31 October 2016 and that you will get all those cases within one week. However, you will be aware of the number of factors in play during a major implementation and the consequent level of risk. Your Jobcentre Single Point of Contact will confirm your start date nearer the event, but for the moment I suggest that while you plan on the basis of this indication, you also prepare for implementation a week on either side

Our aim is to ensure that wherever possible claimants affected by the benefit cap take the opportunity to adjust their circumstances, including moving into or increasing employment if they can. To support this we will continue to work with you and your teams to ensure that households who may be impacted are informed of the changes and advised of the support available to help them.

As you are aware in May-June 2016 DWP shared a scan of those who might be affected by the changes and sent notification letters to claimants. Since then DWP Jobcentre staff have been offering additional employment assistance to those who are not already fully supported in looking for work, and this activity will continue.

DWP have since arranged for a further scan of the relevant systems to be run, to identify those (non-Universal Credit) claimants who may currently be impacted by the benefit cap changes. As before details from this scan have been shared with local authorities.

From 19 September 2016 we will begin sending further letters to claimants in receipt of current benefits (Jobseekers Allowance, Income Support and Employment Support Allowance). These will provide claimants with a greater level of detail than the initial letter issued in May/June. It will include details of the date from which activity to apply the cap will commence and include a ‘bandwidth’ figure which will indicate how much the claimant’s benefit may be reduced by each week.

From 3 October 2016 current Carer’s Allowance and Guardian’s Allowance claimants will receive a notification explaining that they will be exempt from the benefit cap from 7 November 2016.

Universal Credit claimants will also be notified of the changes in September 2016. The Universal Credit notifications ask the claimant to speak to their Jobcentre Plus work coach if they have a managed payment to the landlord (MPTL) in place so that the work coach can explain how the benefit cap interacts with the MPTL. In some cases this discussion may lead to the claimant asking for the MPTL to be stopped by DWP, so that they can apply for a Discretionary Housing Payment. If the claimant chooses to do so, the direct payment to landlord can be reinstated at a later point, though the landlord cannot ask for the MPTL to be reinstated unless the benefit cap no longer applies. If your colleagues have any queries about this, just as for all other Universal Credit queries, if it is a general query they should speak to their Partnership Manager and if it is about a specific case t they should contact the Service Centre.

Copies of these letters have already been shared with local authorities. Guidance for HB processing staff has been developed by DWP and will be published later this month.

You can, of course, contact me about all matters relating to the benefit cap and my contact details are on this letter. In addition, as mentioned in my previous communications, we have established a dedicated e-mail address to receive benefit cap enquiries from those in your authority who are responsible for managing the changes.

I would like to thank you for your continuing support over recent months and look forward to working in partnership with you throughout the introduction of the new benefit cap levels.