Benefits changes abound as election race gets underway

Changes regarding savings, school meals and child support bring some good news in the coming months, reports Gary Vaux

Changes regarding savings, school meals and child support bring some good news in the coming months, reports Gary Vaux

General elections are a bit like moving house – in the run-up, you do all those fiddly jobs you’ve been putting off for years. If you’re feeling particularly awkward, however, you also re-decorate the living-room in colours that you can live with, but the new occupants will hate.

Social security policy is no different. One welcome change, especially for many kinship or “friends and families” carers, is that residence order allowances and special guardianship allowances (and their Scottish equivalents) will, from April 2011, no longer count as the clients’ income when housing and council tax benefit is being calculated.

This will help many thousands of families who are raising someone else’s child, where the local authority is providing some financial help and the child isn’t looked-after. The children count as part of the family for benefit and tax credit purposes but, currently, that is offset by the fact that some forms of local council financial help are treated as income.

An immediate change applies to child support. Any maintenance that a person receives will now be disregarded in full from all means-tested benefits – this has been the case for tax credits, housing and council tax benefit but it now applies to income support, income-based job seekers allowance (JSA) and employment and support allowance (ESA) too.

Another improvement concerns access to free school meals. The loss of what could be worth £20-£30 a week was always a very real disincentive to employment. From September families receiving working tax credit who have children in the first two years of education will have access to free school meals at last. Older children will benefit from 2011.

Families with disabled children will also benefit this month from changes to the Child Trust Fund. Extra payments of £100 a year will be paid into the child’s savings account if they received disability living allowance (DLA) at any point in the preceding year, or £200 if they receive the highest rate of DLA Care.

Talking of savings, the government’s flagship Savings Gateway accounts start in July 2010. Given the exceptional rate of interest on offer to low-income savers, this is the equivalent of painting the whole house lime-green just before you sell it.

The Saving Gateway is for people of working age who are on lower incomes. The government will add 50 pence for each £1 saved into Saving Gateway accounts, for people receiving income support, JSA, ESA, incapacity benefit or severe disablement allowance, carer’s allowance or tax credits (but only for the latter if the final award for the 2009-10 tax year was based on a household income of less than £16,040).

But of course, it’s not all good news. Wanting to be seen as tough on benefit claimants, the government has introduced other less family-friendly changes such as the use of harsh ESA assessments and restrictions in JSA entitlement. From October 2010, unemployed lone parents will have to switch from income support to JSA once their youngest child reaches seven. However, from 26 April 2010 lone parents claiming JSA with a youngest child aged 12 or under will have the right to restrict the hours they are available to work to their child’s normal school hours.

Overall, the house is being got ready for sale – what will the new occupants keep and what will they throw out?

Published in the 15 April 2010 edition of Community Care in the Welfare Rights slot

Gary Vaux is head of money advice at Hertfordshire Council. Please send any questions for him to

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