Universal credit: U-turn on two-child cap on benefit

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Amber RuddPicture copyright
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Amber Rudd will make her first main welfare speech on Friday

About 15,000 households now not face having their advantages capped after the federal government carried out one other U-turn over its flagship common credit score.

The work and pensions secretary has ditched plans to increase a advantages cap on households of greater than two youngsters.

Amber Rudd stated these with youngsters born earlier than the system was launched would stay exempt, as she aimed to make sure it was “compassionate and honest”.

The Little one Poverty Motion Group stated the choice was “fantastically excellent news”.

Nonetheless, the group continues to be calling for the two-child cap to be scrapped for all different households.

Ms Rudd additionally confirmed she would once more delay asking MPs to authorise the switch of three million individuals from the previous advantages system.

As an alternative, the federal government will run a pilot involving 10,000 individuals going via the common credit score course of.

BBC political correspondent Ross Hawkins stated Ms Rudd additionally stays underneath stress to shorten a five-week wait earlier than new common credit score claims are paid.

He added that Ms Rudd might ask the Treasury for extra money to implement additional modifications, as soon as the pilot scheme is accomplished.

Ms Rudd informed BBC Radio four’s At the moment programme: “I am making numerous adjustments to our welfare system to make it possible for it delivers on the intent which is to be a security internet and likewise to be a compassionate and honest system serving to individuals into work.”

Forward of a speech on Friday saying the adjustments, she additionally signalled a profit freeze launched in 2016 may not be renewed in relation to an finish subsequent 12 months.

“It was the proper coverage on the time… I sit up for it coming off,” she informed Sky Information.

What’s common credit score?

Common credit score is a profit for working-age individuals, changing six advantages and merging them into one cost:

  • earnings help
  • income-based jobseeker’s allowance
  • income-related employment and help allowance
  • housing profit
  • baby tax credit score
  • working tax credit score

It was designed to make claiming advantages easier, and is being launched in levels throughout the UK.

Confirming she would delay asking MPs to authorise the switch of three million individuals from the previous advantages system, she informed At the moment: “Now we have listened to individuals. We all know they need extra particular person help both with getting funds extra usually or having funds made direct to landlords.”

“These parts, which may assist common credit score work extra helpfully for people receiving it, are what I will be altering.”

On the two-child restrict, she is going to say in her speech later that it was “not proper” for it to use to those that had their youngsters earlier than the cap was introduced.

“These dad and mom made choices in regards to the dimension of the household when the earlier system was the one system in place,” she is going to say.

The “baby component” of common credit score varies, however is value no less than £231.67 a toddler monthly.

Ms Rudd , who grew to become work and pensions secretary in November, accepted there have been issues with common credit score, and promised to “study from errors” and “modify” the system after taking knowledgeable steerage.

Her predecessor Esther McVey had already introduced adjustments to make sure claimants got extra time to change to the profit and wouldn’t have to attend so lengthy for his or her cash.

The system had been the goal of complaints that it was forcing some claimants into destitution and even prostitution.

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Media captionScuffling with common credit score in Hartlepool

Ms Rudd will defend the introduction of the profit by saying: “Common credit score is working for the overwhelming majority of individuals.

“As a nation, I consider all of us need a first rate security internet: if you happen to’re going through a tough second in life, the state needs to be there that will help you.

“However it’s vital that persons are supported by this security internet, not trapped beneath it.”

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Media captionWhat’s the issue with common credit score?

Former Labour MP Frank Area, who chairs the work and pensions committee, stated: “I strongly welcome the secretary of state’s determination to not press forward with what may have been the cruellest profit minimize in historical past.

“On the eleventh hour, she has prevented 1000’s of youngsters from being plunged into poverty by an unjustifiable retrospective coverage.”

Evaluation

By Michael Buchanan, BBC social affairs correspondent

This speech is billed as a reset of common credit score, a transparent acknowledgment from Amber Rudd that additional tinkering with the troubled reform will now not do.

The final two budgets have seen billions spent making an attempt to scale back the issues which have grow to be ever-more apparent, from growing use of meals banks to non-public landlords refusing to take individuals on common credit score.

However this speech demonstrates that Amber Rudd believes a extra elementary evaluation of the profit is required. That makes her the primary work and pensions secretary since Iain Duncan Smith to attempt to take duty for welfare reform slightly than merely managing the present system.

She might want to persuade the Treasury particularly to again her judgement.

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