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DWP Autumn Statement 2014

The Autumn Statement & DWP – 3 December 2014

New measures to help more parents, young people and individuals with mental health conditions move from benefits into work were announced by the Chancellor in Wednesday's (3 December) Autumn Statement.

He also reminded MPs of previously announced measures including the expansion of Universal Credit, restrictions on migrants' access to benefits and plans to increase employment support for people with health conditions or disabilities.

Welfare Cap

The Office for Budget Responsibility (OBR) provided its first assessment of the Government's performance against the Welfare Cap. The Welfare Cap aims to set an upper limit on spending on benefits and tax credits excluding Jobseeker's Allowance and the State Pension. The OBR's assessment highlighted that:

  • The Government is on track to meet the Welfare Cap in each of the 4 years from 2015-16 to 2018-19;
  • There has been no breach of the Cap. In 2015-16 and 2016-17 expenditure is expected to be within the permitted 2% forecast margin. In 2017-18 and 2018-19 welfare spending is expected to be below the Cap.

The Secretary of State for Work and Pensions has laid a Written Ministerial Statement in Parliament, explaining this position.

Other measures announced in the Autumn Statement which relate to the Department's work include:

Supporting and incentivising claimants to get back into work

  • Extending the New Enterprise Allowance to dependent partners from January 2015;
  • An Intensive Activity Programme for all single young people aged 18-24 who are NEET (Not in Education, Employment or Training) before claiming UC, as well as further trials for those on JSA;
  • Psychological Wellbeing and Work pilots offering integrated mental health and employment support to JSA and ESA claimants with common mental health conditions;
  • Tailored support for older claimants to help them get back into work, via training and work placements.

Reducing fraud and error

Two measures to improve the prevention and detection of fraud and error in the benefit system:

  • the expansion of staff capacity in the Fraud and Error Prevention Service to act upon increasing leads from better use of data like Real Time (Earnings) Information; and
  • a performance improvement scheme including incentive payments to Local Authorities to reduce fraud and error in Housing Benefit.

Making pensions fairer and more flexible

  • Pension Credit Uprating 2015 ('Pass-through'). The Standard Minimum Guarantee in Pension Credit will increase by 1.9% in April 2015, ensuring that the cash increase in the state pension is 'passed through' to PC claimants.
  • A change in the notional income calculation for benefit claimants. Following the Budget 2014 announcement giving individuals greater flexibility over the use of their Defined Contribution pension pots, this change will ensure parity in the way that income is taken into account, regardless of the way in which individuals have decided to access their pension pots.

Increasing the Carer's Allowance higher earnings limit

  • This will increase from £102 to £110 per week.

Universal Credit

  • UC re-award policy. Claimants returning to UC within 6 months due to a reduction in earnings or change in circumstances will retain their existing assessment period.
  • UC Work Allowances. Work Allowances will remain at their current level in cash terms in 2017-18. For subsequent years they will be uprated in line with the Consumer Prices Index.

The Autumn Statement also confirms a number of previously announced measures, including:

Universal Credit

  • UC delivery schedule. As announced in October, UC will be rolled out nationwide to all single claimants of JSA by March 2016.
  • Increasing the rate of childcare support in UC from 70% to 85% from April 2016.

Migrants' Access to Benefits

  • Restricting European Economic Area migrants' access to Jobseeker's Allowance from 6 to 3 months for new claimants, and extending the Genuine Prospect of Work assessment to all existing claimants not previously tested.

Health and Disability

  • Improving the Work Capability Assessment process. DWP has terminated the WCA contract with Atos and brought in a new provider, Maximus, as well as recruiting additional healthcare professionals to help tackle the backlog and support the testing of improvements to the WCA process.
  • A package of ESA measures to improve further the support we offer disabled people and people with health conditions (as announced on November 27th in the Government Response to the Work and Pensions Select Committee Report).
  • Phased roll-out of Personal Independence Payment natural reassessments. The migration of those Disability Living Allowance claimants on fixed term awards, reporting a change of circumstance or turning 16 to PIP began in October 2013. Rollout will continue in a gradual and controlled way.

Bereavement

  • The introduction of Bereavement Support Payment, which will replace the three current bereavement benefits for deaths from April 2017.

For more information please go to Autumn Statement 14.