The Universal Credit (Miscellaneous Amendments, Saving and Transitional Provision) Regulations 2018

Explanatory Note

(This note is not part of the Regulations)

Regulation 2 in these Regulations amends the Discretionary Financial Assistance Regulations 2001 (S.I. 2001/1167), regulation 3 amends the Universal Credit Regulations 2013 (S.I. 2013/376) (the “Universal Credit Regulations”), regulation 4 amends the Jobseeker's Allowance Regulations 2013 (S.I. 2013/378) (the “Jobseeker's Allowance Regulations”), regulation 5 amends the Universal Credit, Personal Independence Payment, Jobseeker's Allowance and Employment and Support Allowance (Decisions and Appeals) Regulations 2013 (S.I. 2013/381) (the “Decisions and Appeals Regulations”), regulation 6 amends the Universal Credit (Transitional Provisions) Regulations 2014 (S.I. 2014/1230) (the “Transitional Regulations”) and regulation 7 amends the Universal Credit (Surpluses and Self-employed Losses) (Digital Service) Amendment Regulations 2015 (S.I. 2015/345) (the “Surplus Amendment Regulations”).

Regulation 3(2)(a), (3), (4) and (5)(b) removes the provisions in the Universal Credit Regulations which apply a 7 day period at the start of certain claims for universal credit in which entitlement does not arise (“waiting days”), previously introduced by the Universal Credit (Waiting Days) (Amendment) Regulations 2015 (S.I. 2015/1362). Regulation 6(11) removes the provision in the Transitional Regulations exempting universal credit claims made by certain individuals migrating from existing benefits from the application of waiting days. These provisions come into force on 14th February 2018.

Regulation (5)(a) and (c) amends regulation 21 of the Universal Credit Regulations and regulation 3(6) inserts new regulation 21A into those regulations to make provision for cases where there is a change in the first date of a claimant's entitlement to universal credit after the assessment period cycle for the award has been established. Where adjusting that cycle retrospectively would cause unnecessary disruption to the administration of the claim, provision is made for the length of the first assessment period to be adjusted as necessary in order that subsequent assessment periods remain as previously fixed. The saving provision in regulation 8(1) applies so that these amendments only have effect in relation to the digital service. These provisions come into force on 11th April 2018.

Regulation 3(7) increases the work allowances specified in the table in regulation 22 of the Universal Credit Regulations. This amendment comes into force on 9th April 2018.

Regulation 3(8) amends regulation 57(2) of the Universal Credit Regulations, which deals with the deduction of income tax and national insurance contributions in the calculation of self-employed earnings. From 14th February 2018 (and in anticipation of the abolition of Class 2 contributions) it substitutes a general reference for the specific references to Class 2 and Class 4 contributions. (Note that from 11th April 2018, for digital service cases only, regulation 57(2) is substituted by the Surplus Amendment Regulations.) The amendments made by regulation 3(8) will continue in effect after that date for cases not in the digital service.

Regulation 7(4) amends regulation 57(2) of the Universal Credit Regulations, as substituted by regulation 3 of the Surplus Amendment Regulations, by substituting a general reference for the specific reference to Class 2 and Class 4 contributions.

Regulation 3(9) amends regulation 66 of the Universal Credit Regulations to allow for foreign state pension income and Pension Protection Fund periodic payments to be taken into account as unearned income in universal credit. These changes mirror the rules which apply in other legacy benefits such as state pension credit. Provision is also made for state retirement pension income to be taken into account in universal credit net of any deductions applied under overlapping benefit rules, in the same way as other unearned state benefits. This comes into force on 11th April 2018.

Regulation 3(10) amends regulation 89 of the Universal Credit Regulations in relation to a claimant who is receiving education and who is entitled to universal credit because they are a member of a couple. Such a claimant will not be subject to work-related requirements if they have student income taken into account in the calculation of their universal credit award. This provision comes into force on 11th April 2018.

Regulations 3(11) and 4 amend regulation 99 of the Universal Credit Regulations and regulation 16 of the Jobseeker's Allowance Regulations respectively. Regulation 99(4) of the Universal Credit Regulations makes provision for work search and work availability requirements to be switched off for claimants suffering ill-health for up to two periods of 14 days in a rolling 12 month period. The amendments apply to claimants who have undergone a work capability assessment and been found not to have limited capability for work or who are treated as not having limited capability for work because they have failed to provide information or to attend a medical examination. In other words, claimants who are, or are treated as being, fit for work. If such a claimant produces evidence that they are unfit for work and the condition referred to in the evidence is the same, or substantially the same, as the condition referred to in the evidence produced before the claimant was assessed/treated as not having limited capability for work, requirements will only be switched off if the claimant has been referred for another assessment as to their capability for work. If such a claimant has not been referred for another assessment, regulation 99(5) is amended so that work search and work availability requirements may still be switched off if it would be unreasonable for a claimant to comply. Similar amendments are made to regulation 16 of the Jobseeker's Allowance Regulations. These amendments come into force on 11th April 2018.

Regulation 3(13)(b)(i)(aa) amends paragraph 4B(1)(b) of Schedule 4 to the Universal Credit Regulations. Paragraph 4A of Schedule 4 to those Regulations makes provision for certain renters aged 18 to 21 to not receive the housing costs element of universal credit and paragraph 4B of that Schedule sets out when paragraph 4A does not apply and where claimants may remain entitled to the housing costs element. The amendment makes provision so that any universal credit claimant aged 18 to 21 who is in receipt of attendance allowance, including armed forces independence payment (which is included in the definition of attendance allowance in regulation 2 of the Universal Credit Regulations), may still be eligible to receive the housing costs element. This amendment comes into force on 11th April 2018.

Regulation 5(2) amends regulation 33 of the Decisions and Appeals Regulations to reduce the time in which a claimant is required to supply information and evidence when making an application for a supersession in relation to a change of circumstances advantageous to the claimant, from one month to 14 days. This comes into force on 11th April 2018.

Regulation 5(3) amends Schedule 1 to the Decisions and Appeals Regulations to create a new default date for new legislative provisions to come into effect for universal credit. The amendment provides that the default date on which new legislation will take effect in relation to supersession decisions arising from a change of legislation will be, where there is an existing award of universal credit, the first day of the assessment period that begins on or after the day on which the change has effect or, in other cases, the date on which the change has effect. This provision comes into force on 14th February 2018.

Regulations 2, 3(2)(c), (12) and (13)(a), (b)(i)(bb) and (ii) and (c) to (h), 6(2)(a), (3) to (6), (7)(c) and (10)(b) and 8(2) and (3) make provision in relation to “temporary accommodation” and these provisions all come into force on 11th April 2018.

Regulation 2 amends the Discretionary Financial Assistance Regulations 2001 to provide that a local authority may award a discretionary housing payment to a person for any universal credit assessment period when the person would have been entitled to universal credit housing costs were it not for the fact that the person occupied specified accommodation (defined in paragraph 3A of Schedule 1 to the Universal Credit Regulations) or temporary accommodation.

Regulation 3(12) amends Schedule 1 to the Universal Credit Regulations to prevent payments for temporary accommodation being classed as rent payments for the purposes of calculating the housing element of universal credit, and makes other consequential changes to that Schedule. Regulation 3(13)(a), (b)(i)(bb) and (ii) and (c) to (h) makes consequential amendments to Schedule 4 of the Universal Credit Regulations to omit references to temporary accommodation which are no longer necessary. Regulation 3(2)(c) makes minor consequential amendments.

Regulation 6(3) inserts a definition of “temporary accommodation” into the Transitional Regulations. Regulation 6(4), (6), (7)(c) and (10)(b) amend various provisions in the Transitional Regulations which allow for dual entitlement to universal credit and housing benefit in respect of claimants occupying specified accommodation, so that they also apply to claimants who are occupying temporary accommodation (and those receiving transitional housing payments under regulation 8(2A) (inserted by regulation 6(7)(b) of these Regulations)). Regulation 6(5) inserts new regulation 5A into the Transitional Regulations. The new regulation provides that where in a universal credit assessment period a person is entitled to universal credit (without the housing costs element) and is also entitled to housing benefit for temporary accommodation, the person is to be treated for the purposes of work allowances in universal credit as though the person were entitled to universal credit with the housing costs element.

Regulation 8(2) and (3) makes saving in respect of the amendments in these Regulations concerning temporary accommodation. The amendments will not apply to an award of universal credit that exists on 10th April 2018 which then includes the housing costs element for temporary accommodation until the claimant's liability to pay rent or service charges changes or the award ceases to include the housing costs element, whichever occurs first.

Regulation 6(7)(a) and (b) provides for a transitional housing payment for claimants who migrate to universal credit when they are in receipt of housing benefit. The new paragraph (2A), which is inserted into regulation 8 (termination of existing benefits), allows a housing benefit award to continue for a period of two weeks beyond the day on which the person becomes entitled to universal credit. Regulation 6(8) also inserts a new regulation 8A which provides that, pending the decision on the claim, the claimant is treated as entitled to universal credit for the purposes of the housing benefit award, and where the claimant makes a claim for universal credit because they have moved home, housing benefit will be paid directly to the claimant for the period of two weeks beginning with the day on which they become entitled to universal credit. Regulation 6(2)(b) and (10)(a) makes minor consequential amendments. These provisions come into force on 11th April 2018.

Regulation 6(9) amends regulation 11 of the Transitional Regulations to enable a tax credits claimant who makes a late declaration under section 17 of the Tax Credits Act 2002 (c. 21) to be treated in certain circumstances as entitled to a tax credit with effect from the start of the tax year. This comes into force on 14th February 2018.

Regulation 7 amends the Surplus Amendment Regulations (with a coming into force date of 14th February 2018)—

— Paragraph (2) substitutes a new coming force date for the Surplus Amendment Regulations of 11th April 2018.

— Paragraph (3) substitutes a new regulation 54A to be inserted into the Universal Credit Regulations. Regulation 54A (as inserted by the Surplus Amendment Regulations) provides for surplus earnings in the assessment period where an award of universal credit terminates, or in any of the following 5 months, to be carried forward as earned income in relation to a new claim. The main change in the substituted regulation 54A is that the calculation of surplus earnings will only take account of earned income in a month for which universal credit is claimed. There are also some changes to the calculation of surplus earnings where couples separate or form.

— Paragraph (4) amends regulation 57A, to be inserted into the Universal Credit Regulations. The main change is the removal of the restriction which only allows losses from 11 previous assessment periods to be taken into account. The other change (corresponding with the amendments to regulation 54A) is that losses incurred during the 6 month period between awards are only available in relation to a month in respect of which a claim has been made.

— Paragraph (5) makes amendments which are consequential on the new coming into force date for the Surplus Amendment Regulations. Those amendments will only affect surpluses or losses arising in assessment periods beginning on or after 11th April 2018.

— Paragraph (6) inserts a new transitional provision into the Surplus Amendment Regulations. This increases the £300 de minimis amount (applied in the calculation of surplus earnings) to £2,500 for the 12 months from the coming into force of regulation 54A of the Universal Credit Regulations. That period may be extended by the Secretary of State in order to safeguard the efficient administration of universal credit.

An impact assessment has not been produced for this instrument as it has no impact on business or on civil society organisations. This instrument has no impact on the public sector.