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Starting in selected “Pathfinder” areas from April 2013, Universal Credit (UC) will begin to replace a range of means-tested benefits and tax credits for working age families. The intention is to simplify and streamline the benefits system for claimants, making it easier for people to understand; to reduce the financial and administrative barriers to work; to tackle in-work poverty; and to bear down on fraud and error. Further background can be found in Library briefing SN06469, Universal Credit: an introduction.

The Welfare Reform Act 2012 provides the framework for UC, but the detailed rules for the new benefit are to be set out in regulations. On 10 December 2012 the Draft Universal Credit Regulations 2013 and the Draft Universal Credit (Transitional Provisions) Regulations 2013 were laid before Parliament. Both are affirmative instruments and, if agreed, will come into force on 29 April 2013. The Draft Universal Credit Regulations cover the detailed rules on entitlement to UC, the individual UC elements and their amounts, how awards are to be calculated, the treatment of income and capital, the benefit cap, claimant responsibilities, sanctions and hardship payments. The Transitional Provisions Regulations provide for the introduction of UC for a limited range of claimants in the Pathfinder areas in North West England from April 2013.

How claims for UC are to be made and how people will be paid are to be covered in separate Claims and Payments Regulations. These have not yet been laid, although in December DWP published a “near final” draft.

Other, largely technical matters concerning the administration of UC are covered in the separate Draft Universal Credit, Personal Independence Payment, Jobseeker’s Allowance and Employment and Support Allowance (Decisions and Appeals) Regulations 2013. Provision for advances of benefit and budgeting advances for UC claimants – following the abolition of the discretionary Social Fund – is made in the Draft Social Security (Payments on Account of Benefit) Regulations 2013.

This note looks at issues and concerns raised by welfare rights groups and others about the detailed rules for UC, other than those in relation to housing. A separate Library briefing looks at The housing element of Universal Credit.

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