Disabled people could be £300 a month worse off under universal credit

Written by Oliver Wade
26/10/2018

Universal credit could leave some disabled people more than £300 a month worse off when compared to the previous system, revealed research from Citizens Advice.

In its new report, Universal Credit for Single Disabled People, Citizens Advice found a significant drop in financial support for single disabled people in a range of circumstances, including losses that can be more than £300 a month for working disabled people, due to flaws in the design of the new benefit.

The work allowance is supposed to improve work incentives for disabled people in universal credit.

However, in practice, the work allowance can only be accessed through the work capability assessment, which awards benefits to those unable to work, rather than disabled people who can work. As a result of this, a situation is created by which a worker must be assessed as unfit for work to receive targeted in-work support.

The report illustrated that those working disabled people who do benefit from the work allowance could be more than £200 per month worse. This comes as a result of weaker support from the work allowance when compared to support for disabled workers in tax credits.

Furthermore, disabled people who can only work limited hours have their benefit reduced after working just 6 hours per week at the minimum wage if they have housing costs, rather than 16 hours a week in the previous system. Under the new rules, a disabled worker working 12 hours a week can be over £100 a month worse off.

The latest report from the charity acknowledged that universal credit has brought some improvements by simplifying the benefits system and removing “cliff edges”, which saw some people losing out on chunks of come for working a few more hours.

However, Citizens Advice called on the government to increase financial help and improve work incentives for disabled people and those with health conditions, particularly since it wants 1 million more disabled people in work by 2027.

The four things the charity has identified that government should consider improving in universal credit are; ensure working people receive targeted in-work financial support; allow disabled people to trial part-time work without facing a penalty on their benefits; review the removal of the limited capability for work element and the introduction of personal support package; and introduce targeted financial support through a self-care element for those disabled people who live alone.

Commenting, Citizens Advice chief executive Gillian Guy said: “Some disabled people will be unfairly disadvantaged under universal credit.

“Working disabled people need to prove they are unfit to work to get support meant for them. This goes against the government’s aim to support a million disabled people into work.

“Even when disabled people do get the support meant for them under universal credit, whether they are in work or not, they can be hundreds of pounds worse off a month than the previous system. This is money people desperately need to cover their bills.

“The government needs to address this and increase the financial support disabled people can receive under universal credit.”

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