The UK Government has confirmed that Employment and Support Allowance (ESA) claimants are still able to make a claim for Universal Credit “if they believe that they will be better off” before they are due to be migrated over from the legacy benefit in 2028/29.
The Department for Work and Pensions (DWP) made the statement following a query from Labour MP, Jonathan Ashworth, who asked why managed migration for those claiming income-based ESA and no other benefit is being delayed until 2028/29. In a written response last week, Employment Minister Guy Opperman MP explained that the delay is estimated to reduce costs by around £1 billion over the next five years before the managed migration process begins for those claimants in 2028/29.
However, he added: “Employment and Support Allowance claimants are still able to make a claim for Universal Credit if they believe that they will be better off before they are migrated over.”
By the end of 2024/25 the DWP aims to have completed the move to Universal Credit for all legacy cases with Tax Credits - including those on both ESA and Tax Credits, all cases on Income Support (IS) and Jobseeker’s Allowance (JSA) and all Housing Benefit (HB) only cases.
In a newly published report, reviewing the Discovery Phase of the managed migration process, DWP said the moves in 2024/25 will allow HM Revenue and Customs (HMRC) to close down the Tax Credit system for those of working age and DWP to close down Income Support and JSA, “generating savings for taxpayers”.
Legacy benefits moving to Universal Credit
- Income-Related Employment and Support Allowance (ESA)
- Income-Based Jobseeker’s Allowance (JSA)
- Working Tax Credit
- Child Tax Credit
- Income Support
- Housing Benefit
Everyone moving over from legacy benefits will have their entitlement to Universal Credit assessed against their current claims, with top up payments available for eligible claimants whose entitlement would have been reduced because of the change - ensuring they receive the same entitlement as on a legacy system.
These will continue unless their circumstances change.
Which groups are expected to be better or worse off on Universal Credit?
The DWP estimates ESA claimants who are in the support group but who do not get the Severe Disability Payment to be better off on Universal Credit.
Households who get ESA and receive the Severe Disability Premium and the enhanced disability premium, are expected to be worse off.
More details about which groups could receive a higher or lower entitlement on Universal Credit can be found here.
DWP estimates on who will receive higher or lower entitlements or see no change to the amount of benefit they receive are summarised below.
Higher entitlement after moving to Universal Credit
- ESA claimants: 600,000
- Tax Credits (Working and Child) claimants: 700,000
- Total, including other legacy benefits: 1.4 million
Lower entitlement after moving to Universal Credit
- ESA claimants: 500,000
- Tax Credits (Working and Child) claimants: 300,000
- Total, including other legacy benefits: 900,000
No change after moving to Universal Credit
- ESA claimants: 100,000
- Income Support: 100,000
- Total, including other legacy benefits: 300,000
Transitional protection
The DWP said that around 400,000 ESA and 100,000 Tax Credits claimants will receive transitional protection, which means they should not see any reduction in their benefits when they transfer.
However, the value of this protection will be eroded every year because, with the exception of the childcare element, any annual increase in Universal Credit will be deducted from the transitional protection.
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