DWP Cuts Payments for 320,000 – What Went Wrong? DWP Takes Action Who are “Ignoring Orders”

DWP Cuts Payments for 320,000: The Department for Work and Pensions (DWP) has halted benefits payments for 320,000 individuals who failed to comply with instructions to transition to Universal Credit (UC). This development is part of the government’s ongoing effort to phase out six “legacy benefits” and streamline the welfare system under Universal Credit.

Here’s everything you need to know about the migration process, reasons for stopped payments, and how to avoid losing your benefits.

The Switch to Universal Credit

Universal Credit is replacing six legacy benefits to simplify the benefits system and provide a single monthly payment to claimants. The legacy benefits being phased out include:

1. Working Tax Credit
2. Child Tax Credit
3. Income Support
4. Income-based Jobseeker’s Allowance (JSA)
5. Income-related Employment and Support Allowance (ESA)
6. Housing Benefit

According to DWP data:

• 875,000 claimants have successfully transitioned to Universal Credit.
• 318,000 individuals had their benefits terminated for failing to follow migration instructions.
• 164,000 cases are still in progress.

Why Have Payments Been Stopped?

The 320,000 terminated claims primarily belong to individuals who failed to act on the DWP’s migration notice, which is sent as part of the “managed migration” process.

Key Points:

• Claimants are given a minimum of three months and one day from the date of the migration notice to apply for Universal Credit.
• Failure to meet the deadline results in the termination of legacy benefits.
• The majority of stopped payments are from recipients of Working Tax Credit and Child Tax Credit, with nearly 220,000 individuals affected.

What Should Claimants Do?

1. Apply for Universal Credit on Time

Claimants are strongly urged to apply for Universal Credit as soon as possible after receiving the migration notice. Doing so will ensure that:

• They continue to receive financial support.
• They qualify for transitional protection, which safeguards against financial loss during the migration process.

2. Reach Out for Help if Needed

If you need additional time to apply or have questions about the process, you should contact the Universal Credit helpline at 0800 169 0328.

3. Set Up a Bank Account

Universal Credit is paid monthly in arrears directly into a bank, building society, or credit union account. Claimants without a bank account are advised to open one to avoid payment delays.

Guidance from Ealing Council

Ealing Council has provided specific advice for claimants making the switch:

• Migration Notice: Claimants and their partners (if applicable) will receive a migration notice with a deadline to apply for Universal Credit.
• Act Quickly: Applying within the deadline ensures you receive transitional protection and do not lose money.
• Rent Payments: Apply promptly to avoid issues with rent payments.

Key Benefits of Universal Credit

Universal Credit consolidates multiple benefits into one monthly payment, offering several advantages:

• Simplifies the claims process.
• Ensures smoother financial support for those eligible.
• Provides transitional protection during the migration process to prevent sudden financial losses.

However, the switch also comes with significant responsibilities for claimants, such as managing monthly budgets and ensuring compliance with application deadlines.

The transition to Universal Credit is a critical process aimed at modernizing the UK benefits system. However, failing to follow the migration instructions can result in the loss of vital financial support, as seen with the 320,000 claimants whose benefits have been terminated.

If you’ve received a migration notice, it’s essential to act quickly by applying for Universal Credit within the specified timeframe. Contact the Universal Credit helpline for assistance if needed, and ensure you have a valid bank account set up for payments.

This transition is part of the DWP’s broader goal of creating a simplified and efficient welfare system, but success depends on claimants being proactive and compliant with the migration process.

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