Warning! Big benefit payments shake-up: frequency and pay-day will change for most

Former_MSE_Natasha

Monday 6 April 2009

Update Tuesday 5 May 2009: A few weeks ago we warned about a new benefits payments shake-up, where the frequency and payment dates will alter for most people receiving certain benefits; possibly meaning a one-off three-week gap of payments when the changes take effect.

However the Department of Work and Pensions (DWP) press office has assured us that no one will experience a gap of three weeks when the new payment procedures take effect, as the three changes involved will not happen simultaneously but at various stages over the next two years.

The longest point you will go without payment is a week, though as explained below in the original note you can take out a repayable loan for this. This post has been updated to reflect the new information though, sadly, the details aren't available on the DWP or Job Centre Plus websites at present.

What's this about?

This April sees the beginning of a big benefits payments procedural shake-up, between now and March 2011.

If you receive jobseekers allowance (JSA), incapacity benefits, income support, severe disablement allowance, bereavement benefit or widows benefit, your payment day and frequency will be altered at some point during the two-year roll out.

Those getting attendence allowance, disability allowance or carers allowance won't be affected.


What are the changes?


There are three stages to the changes:

• Stage 1: If you're paid weekly in advance, your payments will change to weekly in arrears. But as this means you’d be going without your usual money for a week, for the payment before the change happens, you’ll get double the amount of benefits – one set you’re due and another that you WON’T have to pay back.

• Stage 2: At a later date it’ll change again, to fortnightly in arrears. This means there WILL be a week where you’ll be without usual funds, but you’ll be offered a loan, worth one week’s benefits, to tide you over.
  
  If you're already paid weekly in arrears (some people who started receiving benefits after 1995 will be), the first change will be to move you to fortnightly in arrears. Again you’ll be offered a loan worth one week’s benefit to help with the change.

• Stage 3: For everyone, the day of the week you get paid may change too as your national insurance (NI) number will be used to determine which day you should be credited with funds. If you’re already receiving benefit payments fortnightly in arrears (there are a few people who are), than this is the only change that’ll affect you.
  
  If the final two digits of your NI number ends between...
  
  00 and 19, your payment day will change, at some point, to a Monday
  20 and 39, to a Tuesday
  40 and 59, to a Wednesday
  60 and 79, to a Thursday
  80 and 99, to a Friday
  
  Thus if you're usually paid on a Monday but your NI number ends between 80 and 99, there''ll be a one-off gap of four days when this changeover takes effect. For others with different payment days, the gap will be less.

Don't get caught out

You’ll receive a notification outlining the changes in advance. Then the Job Centre will send out a warning letter four weeks before you'll be personally affected. The info will include how to apply for an interest-free loan from the DWP if you think the one-off week gap between changing from weekly to fortnightly in arrears will cause you hardship.

But you must apply for the loan - it won't be given automatically. It'll cover a full week’s missing benefit amount but will have to be repaid in six fortnightly payments, debiting directly from future benefit payments.

To prepare your finances in advance, use the Free Budget Planner to limit the disruption.

Related Guides: Five-Minute Benefits Check-Up, Grant Grabbing




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HAPPYJACK_4

Maybe it's me! but I thought change like this should be made public more clearly. i.e. Print in Newspapers etc and through the media. Until I read your story, I had never heard these changes. How many others like me who rely on monies coming through on a certain day and made arragements like standing orders. This now means I have to go and change every thing or get nasty letters saying I haven't paid bills. Would our M.P.s like to have there systems altered by just a letter a fews weeks before they get there expensis, saying it will now be paid 2 or 3 weeks later than they do now?
Thanks again Martin. You give so much more information than any site I know of and it's always been usfull. No. I'm not sucking up. People like me that are disabled need to know these things, not that I'm saying others not in my predicament don't benefit.

lilykim

Many thanks for this information. My DD gets IB due to having two chronic lifetime illnesses. She is very astute and normally would have picked up on this had it been advertised clearly!!

Once again many thanks

Zara33

did nobody get a letter then...because i certainly did.

MSE_Martin

Zara33 wrote: »

did nobody get a letter then...because i certainly did.

This is being rolled out over two years, getting a letter so soon means you're one of the first.

Rainbowend

Can you tell me the official government web site this info came from, as I work with people who are on low incomes and on benefits and need more info.

Thanks

thefenman

Oops! I just deleted a post having a go about pensions, but I see this change is about benefits, not pensions.

Mind you, some years ago, when I applied for Carers' Allowance when my wife was ill, having given up a part-time job as a taxi driver, I was told that I couldn't have any because my benefits were already more than the allowance. The "benefits"? My State Pension.

They change the definition to suit themselves so I'm not holding my breath!

thefenman

Rainbowend wrote: »

Can you tell me the official government web site this info came from, as I work with people who are on low incomes and on benefits and need more info.

Thanks

I can find nothing about it on

http://www.direct.gov.uk

Why?

bestpud

In fariness, that do write at least a month before they are going to start changing it over.

I had a letter a good few weeks ago saying it was on its way and I received on two weeks ago saying the changes will be happening in May.

It outlines what we be paid and when, and includes a form to ask for the loan (you simply sign and return it) and exactly how teh loan will be repaid.

A loan for £60 will be repaid over 6 benefit payments (so 12 weeks and starting at the end of May), so it's hardly crippling!

It is on top of any other loan repayments though, so perhaps more difficult for those repaying crisis loans for example.

I'd be the first to argue against this if it was just slapped in place at a moments notice, but that has not been the case, for me at least!

Former_MSE_Natasha

thefenman wrote: »

I can find nothing about it on

http://www.direct.gov.uk

Why?

The 'official announcement' of the changes is on the Job Centre Plus website.

KimYeovil

Being on benefits does not mean you are !!!!!! or incompetent. You can manage your affairs if you like.

And if you choose not to manage things then you are used to regularly spending all your money the day you receive it. Living on nothing for six days is not significantly different from living on nothing for thirteen or twenty days.

There is no story. There is nothing to see here. Move along.