Housing Benefit sanctions under Universal Credit (Housing Costs Element)

“Part-time workers judged to be doing too little to find full-time work face having their benefit for housing costs sanctioned by the government for the first time under universal credit.”
http://www.insidehousing.co.uk/dwp-housing-benefit-will-be-sanctioned/7002330.article

Housing element can be sanctioned under UC?
“It’s odd this has suddenly been reported now – it has been a feature of UC from the outset.  It is not strictly correct to say that the housing element will be sanctioned…For the same reasons, it could also be said that the child elements of UC can be sanctioned” http://www.rightsnet.org.uk/forums/viewthread/6056/#25437 – 3 March 2014

If the article above is understood correctly the maximum Universal Credit (UC) sanction is equal to the UC Standard Allowance element, which at present is £71.89 per week for a single person aged 25 or over. (£10.27 per day)

Hardship payments
(Claim Form (JSA / ESA) and Guidance )

At present anyone who gets a Jobseeker’s Allowance benefit sanction can claim lower value means tested Hardship Payments, a key difference under UC is that they would be treated as Loans.

Conditions for hardship payments
(Universal Credit)

Regulation 116 – The Universal Credit Regulations 2013

2) For the purposes of paragraph (1)(g) a single claimant or joint claimants must be considered as being in hardship only where—

(a) they cannot meet their immediate and most basic and essential needs

(3) The needs referred to in paragraph (2) are—

  • (a) accommodation;
  • (b) heating;
  • (c) food;
  • (d) hygiene.

http://www.legislation.gov.uk/uksi/2013/376/regulation/116/made

Below are examples to explore this, Sam’s example is based upon not having any UC claim, whereas Jo’s is on a purely speculative basis and shows what could happen under UC, noting that it is at present a pilot, without full in-work conditionality being applied*.

  • Sam aged 40 lives alone in a one bedroom flat in Hammersmith, they have a part-time job and earn £311.55 per month and has been getting £100 Housing Benefit per week for 2 years. Bob is not looking for any additional work or a better paid job. No sanctions can apply to Bob’s Housing Benefit on the basis that they are not looking for more of better paid work.
  • Jo aged 40 lives alone in a one bedroom flat in Hammersmith, they have a part time job and earn £311.55 per month and get £400 per month Universal Credit including the Housing Costs Element. The DWP discovers that Jo has refused to take the offer of a better paid job and gets a UC credit “higher level sanction” lasting 3 months, losing £311.55 per month, leaving just £22.11 per week to live on and pay the rent.

*Universal Credit pilot

As UC is running as a pilot, the full in-work conditionality to look for more or better paid work when in-work as in the case of Jo above has yet to be introduced. The in-work “threshold” is touted as being equal to 35 hours per week at minimum wage and therefore anyone getting UC payments would be required to look for more or better paid work up to that threshold. However, in December 2013 the DWP stated the threshold stood at “£330 a month for a single person and £525 a month for a couple“.

“A conditionality earnings threshold is in place to ensure that claimants earning above a certain level will not be asked to carry out work-related activity. This will normally be 35 hours x NMW). Claimants earning less than the conditionality earnings threshold may be asked to carry out relevant actions to increase their earnings (based on individual circumstances such as health, caring responsibilities etc.). An administrative earnings threshold has been introduced  to ensure that only those claimants who would currently be eligible for the existing out of work benefits will fall into an active labour market regime. The threshold has been set at £330 a month for a single person and £525 a month for a couple (based on gross taxable pay). ” Source: DWP Central FoI Team  – 17 December 2013 https://www.whatdotheyknow.com/request/187486/response/478121/attach/html/3/FOI%205635%20wdtk%20reply.pdf.html

The daily rate of a UC sanctions is set at 40% of the Standard Allowance when:

  • claimant is aged 16 or 17
  • responsible carer for a child under the age of 1
  • adopter, claimant within 11 weeks before or 15 weeks after confinement or responsible foster parent of a child under the age of 1
  • claimant subject to work-focused interview only

The daily reduction rate is nil

  • at the end of the assessment period, the claimant falls within section 19 of the Act by virtue of having limited capability for work and work-related activity

In the case of joint claimants

  • each joint claimant is considered individually for the purpose of determining the rate applicable under paragraphs (1) to (3); and
  • half of any applicable rate is applied to each joint claimant accordingly.

The Universal Credit Regulations 2013: Amount of reduction for each assessment period http://www.legislation.gov.uk/uksi/2013/376/part/8/chapter/2/crossheading/amount-of-reduction/made

This post would not have been written without the research of Paul Hebden, his earlier view about Universal Credit Housing Costs Element (Housing Benefit) sanctions was doubted.

Questions of this sort had been asked before, but deciphering the meaning has taken a while!

“Universal Credit includes a standard allowance to cover ordinary daily living expenses similar to existing income-related benefits plus other elements relevant to personal circumstances such as the housing costs element or the child care costs element.

A sanction reduces a claimant’s Universal Credit award by an amount never more than their standard allowance element entitlement only.
If you have any queries about this letter please contact me quoting the reference number
above ”
Source: DWP Central FoI Team – 13 November 2013 https://www.whatdotheyknow.com/request/183945/response/449659/attach/html/2/FOI%205294.response.pdf.html

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