Benefits changes in April 2009

The government is quietly shifting the days that millions of claimants will receive benefits. Gary Vaux looks at the implications

Did you know that there was such a word as “periodicity?”

I didn’t, until I heard about the Department for Work and Pensions’ periodicity project. It describes some important changes to the way the DWP pays benefits and allowances. These changes will take place over a two-year period starting on 6 April. The result will be that some claimants may be left for two to three weeks without any benefit income, except for a repayable loan.

The change will affect families and individuals who are receiving income support, incapacity benefits, jobseekers allowance, severe disablement allowance, bereavement benefit or widows benefit. They do not apply to attendance allowance, disability living allowance or carers allowance.

Payments in arrears

People who now receive their benefit weekly will be paid fortnightly instead. Most importantly, all payments will be in arrears.

The day that benefit is paid may also change. From 6 April, Jobcentre Plus will use claimants’ national insurance numbers to decide which day to pay. This means that if the national insurance number ends with the final two digits between:

● 00 and 19 they will normally receive their benefits on a Monday.

● 20 to 39 on a Tuesday.

● 40 to 59 on a Wednesday.

● 60 to 79 on a Thursday.

● 80 to 99 on a Friday.

Jobcentre Plus will write about these two changes to all claimants affected by them. The combined effect could mean some claimants having a one-off gap of nearly three weeks between benefit payments during the changeover period.

The DWP will offer the claimant an interest-free loan while their payments are changing, but these loans will not be provided automatically – the claimant must apply for one. About four weeks before the change, the claimant will receive a letter from Jobcentre Plus, advising them when their benefit payments will change. It will include a loan request, which must be signed and returned. The loan is interest-free and will cover up to 100% of the missing benefit but the claimant will have to re-pay it in six fortnightly payments, by direct deduction from benefit.

No awareness campaign

The DWP is not planning any publicity or awareness campaign to alert claimants to these changes. Claimants who have deductions from their benefit to cover, for example gas or electricity charges, will have those deductions suspended in the week the payday is changed. Jobcentre Plus will write to all companies on the claimant’s behalf.

“Simplicity” for the DWP is being achieved at the expense of claimants, who will not gain from being paid two weeks in arrears until they come off benefit.

There may be extra pressure on social workers, especially from those who do not pay much attention to the “warning” ­letter sent four weeks before the ­­changeover. Of course, some claimants will realise that it’s better to ask their social worker for a non-recoverable ­payment under childcare legislation than it is to apply for a repayable payment from the DWP.

● More information about the changes can be found on the Jobcentre Plus website or e-mail the periodicity and payday project team. Different formats of the information will be available from the website by the end of February.

Gary Vaux is head of money advice at Hertfordshire Council. Contact him through Derren Hayes

This article is published in the 22 January edition of Community Care under the headline “Change to benefit payday may catch claimants unprepared”