Welfare reform and changes to benefits

The benefit cap limits the total amount of benefit that working age people can receive.

The maximum total benefit cap is:

Before April 2023:

• £384.62 a week for couples or single parents with children
• £257.69 a week for single people.

From April 2023:

• £423.46 a week for couples or single parents with children
• £283.71 a week for single people

How the benefit cap works

If, after adding together your total income from the following benefits your income is over the benefit cap, then your Housing Benefit will be reduced to bring your total benefits income down to the level of the cap. This will be shown on your Housing Benefit notification letter.

• Bereavement Allowance
• Child Benefit
• Child Tax Credit
• Employment and Support Allowance (ESA) (except where it is paid with the support component)
• Housing Benefit
• Incapacity Benefit
• Income Support
• Jobseeker’s Allowance
• Maternity Allowance
• Severe Disablement Allowance
• Widowed Parent’s Allowance
• Widowed Mother’s Allowance
• Widow’s Pension
• Widow’s Pension Age Related
• Universal Credit (unless you’ve had a work capability assessment and aren’t fit for work)

If your amount of benefit over the cap is less than the amount of Housing Benefit you get, it will be deducted from your Housing Benefit so that you will receive less Housing Benefit.

For example: Your family receives a total of £450 a week in benefits, of which £150 is Housing Benefit. Your cap is £423.46, so you are £26.54 over which will be deducted from your Housing Benefit. You will receive only £123.46 Housing Benefit as part of your overall income of £423.46 (£150 Housing Benefit, less £26.54 ‘excess’ = £123.46 Housing Benefit).

If your amount of benefit over the cap is more than the amount of Housing Benefit you get, your Housing Benefit will be reduced to a set nominal sum of 50p a week.

For example: Your family receives a total of £600 a week in benefits, of which £150 is Housing Benefit. Your cap is £423.46, so you are £176.54 over which should be deducted from your Housing Benefit. But, as you only get £150 Housing Benefit, your Housing Benefit would be reduced by £149.50 to the set nominal amount of 50p.

Exemptions

You will not be affected by the cap if you, your partner or a dependent child who is living with you:

• receive any of the following benefits:
  • Attendance Allowance
  • Carer’s Allowance
  • Disability Living Allowance
  • Personal Independence Payment
  • Guardian’s Allowance
  • Industrial Injuries Benefits
  • Employment and Support Allowance, if paid with the support component
  • War Widow’s or War Widower’s Pension
• work and receive Working Tax Credit.

If you have been in employment for 52 weeks or more when you claim benefit you will be exempt from the cap for up to 39 weeks.

Find more about the benefit cap on the GOV.UK website

The government has introduced a ‘size criteria’ which limits how many bedrooms you will get Housing Benefit for if you are renting from:

• a local authority
• a registered housing association, or
• any other registered social landlord.

You are affected if you:

• live in a council or housing association property, and
• have more bedrooms than you need under the rules, and
• are of working age (under state pension credit age)

The benefit ‘size criteria’ allows one bedroom for:

• a couple
• a person over 16
• two children of the same sex aged under 16
• two children of any sex who are younger than 10
• any other single child under 16
• a member of a couple who cannot share a bedroom because of severe physical or mental disability, but only where an additional bedroom exists within the home
• a child who cannot share a bedroom because of severe physical or mental disability, but only where an additional bedroom exists within the home
• a member of the armed forces who is away on operations and who intends to return to the home

You may also be allowed an additional bedroom if:

• a non-resident overnight carer where the claimant, the claimant’s partner, a foster child or any other person occupying the dwelling as home is a person who requires overnight care subject to prescribed restrictions
• you are an approved foster carer and either have a foster child or children living with you or you are waiting for a child/children to be placed with you (for those between placements or awaiting for their initial placement we can award an additional room for up to 52 weeks)

Please note if you have an adult child or children who are away from home serving as a member of the Armed Forces, a bedroom will continue to be allowed for them as long as they have an intention to return to your property.

If you have more bedrooms than you need

If you have more bedrooms than the government say you need, your Housing Benefit is reduced. This will be shown on your Housing Benefit notification letter.

The amount allowed for rent and any service charges is reduced by:

• 14% if you have one extra bedroom, or
• 25% if you have two or more extra bedrooms.

Who isn’t affected?

The change only applies to people of working age so people of pension age are not affected. If you or your partner are of pension credit age, the changes don’t affect you. You can use the Pension Credit age calculator to see if you are of pension age.

Exemptions

There are some circumstances where the size criteria rules are not applied.

Non-mainstream accommodation

These are mooring charges for houseboats and site charges for caravans and mobile homes as well as various ‘excluded tenancies’ such as regulated tenancies.

Temporary accommodation

Any claimant who is placed in temporary accommodation by the council because they are homeless or to prevent homelessness.

Exempt accommodation

The size criteria rules are not applied to those in supported ‘exempt’ accommodation. This is a particular type of supported accommodation.

I share care of my children with my ex-partner, are we both entitled to a room for them?

Where parents who don’t live together have shared care of their children, the children are treated as living with the parent who is treated as responsible for them and provides their main home.

For someone to be treated as responsible for a child or young person, the child or young person must normally be living with them. If a child or young person spends equal amounts of time in different households, or there is a question as to whom they normally live with, they are treated as living with the person who is receiving Child Benefit for them.

The parent who is not considered to provide their main home is not entitled to receive Housing Benefit for an extra room for their child/children. If this applies to you, and you wish to remain in your current property then you will need to make up the shortfall in rent yourself. You may be able to apply for a discretionary housing payment to help with the shortfall.

I share the house with someone else, how is my room allowance worked out?

If you occupy your property jointly with someone else, the size criteria rules take into account everyone living in the property when deciding whether you are under-occupying for Housing Benefit purposes.

My house has been adapted to help with my disability. Am I included in the size criteria rules?

Other than the cases stated above there are no exceptions to the size criteria rules. If there is a reason that an extra room is needed you may be able to apply for a discretionary housing payment.

My child has a disability and is not able to share a room; will I be allowed an extra room for them?

If your children are unable to share a bedroom because of severe disabilities, we assess your individual circumstances and decide whether it is inappropriate for the children to be expected to share a room.

My child is away at university, can I keep their room for when they are home in the holidays?

The size criteria rules do not allow for this, unless the absence is temporary (less than thirteen or 52 weeks for students) and the young person concerned intends to return home.

Universal Credit is a part of the government’s welfare reform changes. Universal Credit will eventually replace the following existing benefits and tax credits, which will instead be paid to you in a single monthly payment:

• Income Support
• Income-based Jobseeker’s Allowance
• Income-related Employment and Support Allowance
• Housing Benefit
• Child Tax Credit
• Working Tax Credit

Find out more about Universal Credit