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COVID-19 Benefits Round-up
Published: 8 Apr 2020
Amidst an unprecedented number of people claiming benefits due to the COVID-19 pandemic, our legal adviser Will Hadwen shares how the benefits landscape has changed. For more information on what you can claim, please visit our dedicated web page on financial support for working families during COVID-19.
There’s never been a better (or maybe worse!) time to be a benefits adviser. The number of people claiming benefits is unprecedented, as people lose their jobs, have less work, or are simply waiting to see if they might be eligible for the government schemes intended to cover at least some of their employed or self-employed earnings.
We know that in the last two weeks of March, 950,000 new claims for Universal Credit (UC) were made. The system wasn’t designed for that level of demand, and whilst more capacity has been found, we also know that it can be difficult to get claims submitted. If that applies to you, please keep trying, and do have a look at the government’s latest page on UC and the coronavirus to understand how things are at least supposed to be working.
In true welfare rights style, I’m going to look at the three types of benefits in turn, starting off with benefits based on your National Insurance (NI) contributions: contributory benefits. The two most likely to be relevant here are contribution-based Jobseeker’s Allowance (JSA) and contributory Employment and Support Allowance (ESA).
I’m not going to discuss the entitlement conditions, because the basics haven’t changed. I’m going to concentrate on what is new. For more information, please follow the links or check gov.uk. The biggest change in JSA (a benefit with which I have my fair share of personal experience…) is that for 3 months from 30th March 2020, you don’t have to look for work or be available for work. That is a pretty huge change in benefits terms, but it’s definitely the right move – now is not the time to have work-related ‘conditionality’ on top of all the other stresses we are facing.
You can claim JSA, and other contributory benefits, regardless of your savings or your partner’s income. And it’s also useful to know that contributory benefits are not public funds.
If you are sick or disabled, though, JSA may not be the right benefit to claim. It could be that you need to look at ESA. The main change there is that you can get it without ‘waiting days’ (you can be entitled from the day you claim) if you’re claiming in connection with the symptoms of COVID-19, being in a household with symptoms, or caring for a child in either of those situations. If that’s your situation, you don’t need a fit note. You can’t claim ESA just because you’re worried about catching the virus, though, or because you are ‘shielding’. However, if you are actually sick or unable to work because of a disability, you can submit fit notes.
So, whilst it’s great there are no ‘waiting days’ for people who actually have symptoms/ whose households have symptoms, there are seven waiting days for everyone else (for example, if you’re a disabled person and you’ve lost your job due to COVID-19). That’s seven days after you claim before you are actually entitled – so you don’t get paid for those seven days.
Another contributory benefit which I’ve been sadly thinking may be relevant is bereavement support payment, which is worth mentioning as lots of people don’t know about this. It depends on your spouse or civil partner’s NI, if they pre-decease you before you reach pension age. Recently, the government lost a court case that means that this benefit really should be payable to unmarried partners with children, too – though they still haven’t clarified how they are going to act on this.
Statutory payments paid by your employer may also be relevant here: statutory parental bereavement pay is a new benefit you may not have heard of. Not a nice thing to talk about at all, and we know children are generally less affected by COVID-19, but for information, this new benefit applies to employees if a child dies on/after 6 April 2020.
And what about statutory sick pay (SSP)? Well, my colleague Elena has already commented on how much our understanding of that changed during the first few days and weeks of the pandemic. We do know now that the regulations changed again with effect from 28th March: it’s clear that SSP now applies either just as it did before (i.e. usually via a fit note after the first 7 days, and with 3 ‘waiting days’), or in circumstances where you or someone in your household has symptoms, for a specified number of days. Oh, and if you’re interested, this bit of law defines the symptoms! A continuous cough and/or a high temperature – meaning that if you’re worried about other symptoms and don’t have these ones, you can’t get SSP without a fit note. SSP may also apply if you have other conditions for which you’re under medical care, and as a result, your GP or a registered medical practitioner has stated that you should not work or should restrict the kind of work you do (for example, only work from home).
Now onto the non-contributory benefits. These are benefits where your NI record doesn’t matter, and which mostly (but not always entirely) ignore your income. They certainly ignore your savings, so they are going to be very important for some people. Child Benefit hasn’t changed so far (and nor has the claw-back through a tax charge for high earners), though there are a lot of calls – including from us at Working Families – for Child Benefit to increase. The disability benefits (Disability Living Allowance, Personal Independence Payment and Attendance Allowance) are unchanged, though the Scottish government has very sadly had to announce a delay to its own version of these benefits. The big news is that no one will be reassessed if they are already getting these benefits, and if you need an assessment, it will be done by phone/paperwork only – you won’t be seen by an assessor.
Carer’s Allowance (available if you spend 35 hours or more looking after someone on certain rates of these benefits) has changed, so that if you already get it, you’ll continue to do so if you can’t care for the disabled person because of infection/contamination with COVID-19 (either you, or the disabled person). That seems only right, and will help if you can’t get to the place you usually provide care for those reasons. In a related ‘easement’, the DWP have said emotional support will count towards those hours.
What about income-related (also called means-tested) benefits? The biggest change is UC, which I’ve already mentioned. The capital limit is £16,000, and that is going to stop a lot of people from claiming – again, there’s pressure on the government to scrap that limit. I’d be surprised if they did, but lots of surprising things have already happened! They haven’t scrapped the ‘5 week wait’, and the advance you can opt for whilst you’re waiting is still repayable.
But you don’t have to look for work, again for three months from 30th March, whatever your circumstances. The standard allowance of UC and the basic element of working tax credit go up considerably (from April 2020, though in both UC and Working Tax Credit, you may not see the increase for a while due to the way it will be administered). Deductions from UC for other DWP debts (but not for advances) are stopping, which is also very welcome.
Sadly, the government haven’t increased the rates of other benefits (including the benefits people claimed before UC came in, like Income Support). We are concerned that might lead people to claim UC instead – the general advice on that is don’t, without checking what you would get. There are all sorts of reasons why you might end up worse off.
You can’t go back to so-called ‘legacy benefits’ if you claim UC, with very few exceptions – so if you’re on Working Tax Credit, Child Tax Credit, Housing Benefit, Income Support, income-based JSA or income-related ESA, please, please check on a benefits calculator (like Entitledto) before you ‘leap’ into the UC pond!
Talking of Housing Benefit, in that and in UC’s housing element: if you rent privately, you’ll get more help with the rent, again from April. That’s because the way in which help with the rent is restricted is being ‘reset’ so that the maximum represents the lowest 30% of rents in your area (still not that helpful, but much better that the position it had slipped down to).
What am I still hoping might happen?
- An end to the benefit cap – this restricts overall benefits if you’re not working or not earning ‘enough’, and doesn’t seem a fair policy in these times (plus it undermines the benefit of increasing UC).
- I also agree that other benefits should be increased to reflect the increase to UC. There’s a huge discrepancy otherwise.
- I’m worried about people moving to UC and not being able to go back (there are pros and cons with the benefit, as most people will have heard by now, and it is possible to end up worse off). An end to the two-child policy, so we no longer have to tell people they won’t get extra income-based benefit for their new baby.
- I’m worried about all the pregnant women, expectant dads and partners, and people hoping to adopt – if they don’t earn enough in a crucial period during that time, they may not be able to get statutory payments (e.g. Statutory Maternity Pay (SMP), etc.). Only SMP has an alternative, Maternity Allowance, which can apply if you don’t earn enough in the calculation period. The others don’t. The result of this is going to disproportionately affect women though, and as a result, children – less money now, less money during maternity leave, more pressure to go back to work? That is all a big concern for us at Working Families and at other charities.
Finally, I am worried about what happens afterwards. Will the government take back all the policies that will help people during the crisis? Will it make benefits harder to claim/less generous because of economic conditions? Hmm…I’ve got to say, I’m glad I’m a benefits adviser and not an economist.
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