Policy Document

Welfare Reform Act 2012

Year

2012

Country

United Kingdom

Topic

Family & Children

Subtopic

Family Allowances

Main implications

The main implication of the Welfare Reform Act for family allowance is the introduction of Universal Credit, which is a benefit payable in accordance to Part I of the act. Universal credit is being introduced to replace certain benefits, among which is the Child Tax Credit, which is described in the Tax Credits Act 2002. Section 10 of the act establishes that the calculation of an award of universal credit is to include an amount for each child or qualifying young person for whom a claimant is responsible. Regulations may make provision for the inclusion of an additional amount if such a child or qualifying young person is disabled. Universal credit may be awarded to a single person or members of a couple jointly, provided basic and financial conditions are met.

Benefits & Requirements

Coverage: Eligible groups or beneficiaries

Single individuals and couples who meet the basic and financial conditions.

Target group

Children

Types of benefits guaranteed by this document

Tax-Benefits

If selected "Other" please specify here

The Act introduces Universal Credit to replace a range of means-tested benefits and tax credits for people of working age, among which the Child Tax Credit, which regulates child benefits as part of family allowances.

Conditions for accessing the benefit stipulated by this document

- Basic conditions: a person meets the basic conditions if he or she: is at least 18 years old; has not reached the qualifying age for state pension credit; is in Great Britain; is not receiving education; and has accepted a claimant commitment. - Financial conditions: the financial conditions for a claimant are that: the claimant’s capital is not greater than a certain amount (£16,000 as prescribed by the Universal Credit Regulations 2013); his or her income is such that, if the claimant were entitled to universal credit, the amount payable would not be less than any prescribed minimum (the prescribed minimum is one penny, as set out by the Universal Credit Regulations 2013). For joint claimants (couples), the basic conditions have to hold for both, and the financial conditions relate to their combined capital and income.

Amount of the subsidy or contribution granted

not specified.

The duration of the benefit is determined by the following specific conditions

not specified

Read the Law

Full Text Source in English

2012, chapter 5

Original full text source in native language

2012, chapter 5

Full text web source in English

http://www.legislation.gov.uk/uksi/2012/1814/pdfs/uksi_20121814_en.pdf

Original full text web source in native language

http://www.legislation.gov.uk/ukpga/2012/5/pdfs/ukpga_20120005_en.pdf

Comments & Clarifications

Universal credit is being introduced in stages. Currently, it may be claimed in the following areas: Bath; Hammersmith (London); Harrogate; Inverness; North-West England; Shotton (Wales).

Secondary Literature & Sources

Secondary literature

- Tarr, A., & Finn, D. “Implementing Universal Credit: Will the Reforms Improve the Service for Users?” Joseph Rowntree Foundation, York (2012). Available at: http://www.socialwelfare.bl.uk/subject-areas/services-activity/poverty-benefits/josephrowntreefoundation/137338universal-credit-benefits-summary.pdf
- Brewer, M., Browne, J., & Jin, W. “Universal Credit: A Preliminary Analysis of Its Impact on incomes and Work Incentives”. Fiscal Studies 33(1) (2012): 39-71.
- UK Department for Work and Pensions. “Universal Credit: welfare that works”. Paper presented to Parliament by the Secretary of State for Work and Pensions, London (2010). Available at: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/48897/universal-credit-full-document.pdf

Author

Ernestina Coast, Ginevra Floridi & Wendy Sigle
London School of Economics and Political Science

Data collected in the framework of the Population Europe Research Finder and Archive (PERFAR)

Cite as

SPLASH-db.eu (2014): Policy: "Welfare Reform Act 2012" (Information provided by Ernestina Coast, Ginevra Floridi & Wendy Sigle). Available at: https://splash-db.eu [Date of access].