Welfare Reform Regulations

Monday 10th December 2012 Written Statements

[The Secretary of State for Work and Pensions (Mr Iain Duncan Smith)]

I am pleased to announce that later today the Department intends to lay and publish the following draft affirmative regulations:

The Universal Credit Regulations 2013;

The Universal Credit (Transitional Provisions) Regulations 2013;

The Jobseeker's Allowance Regulations 2013;

The Employment and Support Allowance Regulations 2013;

The Universal Credit, Personal Independence Payment, Jobseeker’s Allowance and Employment and Support Allowance (Decisions and Appeals) Regulations 2013; and,

The Social Security (Payments on Account of Benefit) Regulations 2013.

Universal credit is the most significant reform of the welfare system for a generation. By removing the barriers and disincentives to work and making the system simpler. Universal credit will make sure work pays—especially for those on the lowest incomes, helping people to live independent lives. This will reduce worklessness, and encourage people to take personal responsibility. Universal credit will act as a “launch pad” for motivating people back into work, fostering confidence and self-esteem and helping to end the dependency culture; and significantly reduce the cost of fraud and error to the taxpayer.

Work can transform individual lives and society for the better and should be encouraged. Earning a wage is the best route out of poverty, but work also has many other benefits beyond an income; it promotes personal responsibility, boosts confidence, self-esteem, and motivation, provides a structure to everyday life, and gives people a sense of being part of a community. There will be continued financial support for individuals who cannot work. But for those who can work, no one should be consigned to living a life on benefits alone if they have the potential and capability to work.

These regulations are being laid to support the introduction of universal credit, following the passage of the Welfare Reform Act 2012. They reflect the financial information provided by my right hon. Friend, the Chancellor of the Exchequer, in his autumn statement on 5 December.

The Universal Credit Regulations 2013—set out provisions for universal credit, including entitlement, elements of the award, calculation of income and capital, and claimant responsibilities. The regulations also make provision for a benefit cap.

The Universal Credit (Transitional Provisions) Regulations 2013—reflect the Government’s decision to introduce universal credit from 29 April 2013 only for a small number of claimants in certain categories. This “pathfinder” will test the core proposition in a defined geographical area in Oldham, Warrington, Tameside and Wigan. The specific postcodes in which the pathfinder will operate will be set out in an order commencing the relevant provisions of the Act. The Government will only expand this scope via further regulations or a commencement order. The Government will bring forward further provisions to provide for periods beyond the pathfinder.

The Jobseeker’s Allowance Regulations 2013—remove income-related rules and provide for an award of jobseeker’s allowance based only on national insurance contributions. The 2013 regulations bring jobseeker’s allowance substantially into line with universal credit work-related requirements, and otherwise the provisions are very similar to the existing rules for contribution-based jobseeker’s allowance under the 1996 Regulations (SI 1996/207). A copy is available on the DWP website http://www.dwp. gov.uk/docs/a11-4001.pdf.

The Employment and Support Allowance Regulations 2013—remove income-related rules and provide for an award of employment and support allowance based only on national insurance contributions. The 2013 regulations bring employment and support allowance substantially into line with universal credit work-related requirements, and otherwise the provisions are very similar to the existing rules for contributory employment and support allowance under the 2008 Regulations (SI 2008/794). A copy is available on the DWP website

http://www.dwp.gov.uk/docs/a13-5101.pdf.

The Universal Credit, Personal Independence Payment, Jobseeker’s Allowance and Employment and Support Allowance (Decisions and Appeals) Regulations 2013—make provision in relation to the administration of these four benefits, in particular the making of decisions where there are disputes, changes in circumstances and doubts about awards; and in relation to rights of appeal. The regulations include a new requirement for claimants to apply to the Secretary of State for a decision to be revised before they can make an appeal. The regulations also make provision for electronic communications.

The Social Security (Payments on Account of Benefit) Regulations 2013—provide for the introduction both of universal credit advances and short-term benefit advances (for claimants of prescribed existing benefits), replacing existing interim payments and some crisis loans, and of budgeting advances replacing existing budgeting loans for some claimants.

The Government are publishing an updated impact assessment for universal credit. This also covers information concerning the Department’s obligations regarding its equality duty. A copy will be made available later today on the DWP website at: http://www.dwp.gov.uk/policy/welfare-reform/legislation-and-key-documents/welfare-reform-act-2012/impact-assessments-and-equality/.

Under section 173(5) of the Social Security Administration Act 1992, the Universal Credit Regulations 2013 do not fall within the requirement to be referred to the Social Security Advisory Committee (SSAC). Nevertheless, given the scope and importance of these reforms, I invited the Committee to undertake a special exercise to scrutinise the regulations.

SSAC undertook a public consultation exercise in June 2012 as part of their review, and included consultation on the Benefit Cap (Housing Benefit) Regulations 2012 (SI 2012/2994) and the Universal Credit, Personal Independence Payment, Jobseeker's Allowance and Employment and Support Allowance (Claims and Payments) Regulations 2013.

I also referred the Employment and Support Allowance Regulations 2013, the Jobseeker's Allowance Regulations 2013 and the Universal Credit, Personal Independence Payment, Jobseeker's Allowance and Employment and Support Allowance (Decisions and Appeals) Regulations 2013 to the Committee under section 172(1) of the Social Security Administration Act 1992. The Committee decided not to hold a formal consultation about these regulations but welcomed representations on any parts of those regulations insofar as they impact on the coherence of the overall legislative programme.

The Department will publish an Act Paper covering the Secretary of State’s response to the SSAC report on these regulations. A copy will be available later today on the Department’s website at: http://www.dwp.gov.uk/policy/welfare-reform/legislation-and-key-documents/welfare-reform-act-2012/welfare-reform-regulations/.

The Department has undertaken extensive stakeholder engagement throughout the development of the regulations. As a result the policies take account of the valued input we have received. This engagement is continuing as part of the development of delivery plans and guidance to support claimants and staff.

The draft regulations laid today and associated explanatory memorandum will be made available in the Vote Office and the Printed Paper Office and can be accessed from: www.legislation.gov.uk or from the DWP website: http://www.dwp.gov.uk/policy/welfare-reform/legislation-and-key-documents/welfare-reform-act-2012/welfare-reform-regulations/.

The Department will also publish today a policy briefing note on the final proposals for transitional protection for claimants moved from an existing benefit to universal credit during later stages of the migration process. A copy will be available later today on the Department’s website at: http://www.dwp.gov.uk/policy/welfare-reform/legislation-and-key-documents/welfare-reform-act-2012/welfare-reform-regulations/.