Next year, significant adjustments to Universal Credit are on the horizon that could impact a large number of recipients.
Universal Credit, a benefit program administered by the Department for Work and Pensions (DWP), is utilized by over eight million individuals in the UK.
The changes entail an increase in the standard allowance, the foundational amount received in Universal Credit before any extra payments or deductions are applied.
However, there are also upcoming reductions in the health-related component for new claimants of Universal Credit.
The majority of older benefits are being replaced by Universal Credit, with the transition expected to be completed by March 2026.
Individuals moving to Universal Credit will receive a “migration notice” via mail, providing a three-month timeframe to initiate their Universal Credit claim.
The standard allowance in Universal Credit is set to increase by 6.2% from April, surpassing the inflation rate. For single individuals aged 25 and above, the standard allowance will rise from £92 to £98 per week.
Couples will see their standard allowance climb from £145 to £154 weekly. Projections by the DWP indicate that by 2029, above-inflation increments will enhance the average standard allowance by £775 in cash terms.
The Limited Capability for Work and Work-Related Activity (LCWRA) in Universal Credit provides additional monthly payments for individuals with health conditions or disabilities that restrict their work capacity.
New claimants granted LCWRA from April 2026 will receive £50 per week, down from the current £97, with the amount frozen until 2029/30.
Existing claimants will retain the £97 top-up weekly until 2030, without any annual increments. Ultimately, by 2030, the LCWRA element will be phased out and substituted with a new health component linked to PIP.
In April 2026, a new subgroup under the LCWRA, the Severe Conditions Category (SCC), will be introduced for individuals with severe, lifelong disabilities and illnesses. Those under SCC will receive the current higher rate of the LCWRA element and will be exempt from routine reassessments, focusing on the impact of their conditions rather than the conditions themselves.
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