These are the key relevant announcements in the Chancellor’s autumn statement.
Benefits
- Pension Credit - As set out in Spending Round 2013, the government will remove the Assessed Income Period (For more information see our Pension Credit factsheet) in Pension Credit awards. This means that from April 2016 households on Pension Credit will now need to report all changes in their circumstances that will affect their benefit as they happen. Pensioners aged 75 and over who have an indefinite assessed income period in place will be exempt unless the assessed income period would end under current rules.
- Universal Credit work allowances (disregards) for all claimants will be maintained at their current level for a period of 3 years from April 2014. The disregard is the net income that a claimant can earn prior to their benefit being tapered away. For more information on this see our Universal Credit factsheet.
- Uprating - The basic State Pension will be uprated by 2.7%. This is a cash rise of £2.95 for the full basic State Pension. The standard minimum income guarantee in Pension Credit will rise by the same amount. The Savings Credit threshold will rise by 4.4%. The remaining benefits and tax credits which are not being uprated by 1% (as set out in the Autumn Statement 2012) – including disability benefits, carers benefits, premia, and the Additional State Pension – will be uprated by 2.7% in April 2014, in line with inflation.
- Welfare spending cap - From next year there would be a new cap on total welfare spending. The basic state pension will not be included in the cap and those benefits affected by unexpected heavy demand (such as Jobseeker’s Allowance where there is high number of claimants due to another recession. The cap will be set in the 2014 budget.
- Winter fuel payment - As announced at Spending Round 2013, from winter 2015-16, winter fuel payments will no longer be payable to people living in an EEA country with an average winter temperature higher than that in the warmest region of the UK.
Education
- Requirement that all young people who have not achieved a level 2 qualification in maths and English at 16 should continue studying these subjects until age 19.
- Extension of free school meals to all children in reception and years 1 and 2.
- Remove the cap on university places so more people can go into higher education – it is estimated this will allow 60,000 more young people to go to university every year.
- Provide an extra £40 million to increase the number of people starting higher apprenticeships by 20,000.
Fraud initiatives
- Life Certificates – The government will increase its activity on life certificates to ensure that state pension payments to pensioners living abroad are being made correctly, to shorten the period in which payment may continue erroneously after the person is deceased.
- Bulk data matching – The government will conduct a data-matching exercise for the entire benefit caseload in April 2014, with overpayments identified as a result of the match corrected during the 2014-15 financial year. This will compare information individuals have provided to HMRC for tax purposes with information they have provided to DWP for benefit claims. Any discrepancies will be passed to a fraud investigator.
- Single Fraud Investigation Service – The government will implement from 2014 a single, integrated fraud investigation service to investigate welfare fraud across all benefits administered by DWP, HMRC and local authorities.
- Recovery of benefit debt owed to DWP – The government will increase activity to recover benefit debt owed to government, using debt collection agencies with specialist skills in recovering difficult to collect debt. These contracts are resourced on a payment by results basis.
- Tax credits - Stop Tax Credit payments during the year where, due to a change of circumstance, a claimant has already received their full annual entitlement and expand HMRC’s capacity to collect additional tax debt that has gone repeatedly unpaid.
Into work incentives
- Abolishing employer National Insurance contributions for under-21s earning below £813 per week.
- The government will pilot a new scheme of support for young JSA claimants, under where claimants without level 2 qualifications in English and maths will be required to do up to 16 hours per week of training alongside jobsearch or risk losing their benefits. After 6 months on JSA, claimants will be required to participate in a work experience placement, a traineeship or community work placement.
- The New Enterprise Allowance scheme, which helps unemployed people to set up their own business, will be extended to March 2016.
State Pension age
- It is estimated that the proposal to move State Pension age to 68 will move forward from the current date of 2046 to the mid 2030s and that the State Pension age is likely to increase further to 69 by the late 2040s.
For more on the Autumn Statement go to https://www.gov.uk/government/topical-events/autumn-statement-2013