Universal Credit 16k+ savings transistional protection?

debrag

DevilsAdvocate1 wrote: »

My best friend and her husband managed. They were on less than that and had a baby and toddler (around £12K each) when they bought their house. They both work part time. Not only that, they've managed to pay it off. But they live very frugally.

that makes it £24k total not £15k total (without benefits) for the OP

EDIT: I would love £12k for part time work.

zagfles

MissMoneypenny wrote: »

Where does it say that those transferring to UC, will not have a claimant commitment?

TP can only be ended by a change of circumstances. Circumstances staying the same is not a change. Why do you find that so hard to understand?

zagfles

Morglin wrote: »

They are doing some manual claims, but can only cope with single, healthy, childless claimants.

Francis Maude, the Cabinet Secretary, and in charge of projects like this, has red flagged up UC as something, due to rocketing cost and chaos, may be something that will never come to fruition, in it's current form.

Lin

URL? Don't bother with anything in rags like the Mirror

thor

zagfles wrote: »

Err... that's what transitional protection is for, as discussed in this thread. There are plenty of people who'd be worse off under UC but the promise was that TP would make them no worse off in cash terms.

I did say that I was making an assumption as I have not been able to find the fine detail when it comes to tapering down. Are you saying that people with savings will not (immediately)get less than they are already getting under TP? If so how will the amount of benefit diminish with time? If you can give me a link I'll be able to figure it out myself.

thor

MissMoneypenny wrote: »

Benefits are for the sick and temporary help for the poor. If someone is healthy and has savings, then why should they be given benefits?

Uhh you do realise that I am questioning IDS's honesty not the right or wrongs of paying people benefits if they have money stashed away? If I was then I could have a debate about certain members of the Royal family who have done quite well at the expense of the taxpayer.

SkyeKnight

thor wrote: »

I did say that I was making an assumption as I have not been able to find the fine detail when it comes to tapering down. Are you saying that people with savings will not (immediately)get less than they are already getting under TP? If so how will the amount of benefit diminish with time? If you can give me a link I'll be able to figure it out myself.

It will get smaller every year because it will not be uprated by inflation.

There is also the question of what a change of circumstances means. The more things that are defined as a change of circumstance, the more people will be moved off transitional protection each year.

For example, having a child or a child becoming an adult will be one - so claimants with children and savings will gradually leave the system. It would probably also include things like being made redundant, changing job or perhaps a big change of salary. Becoming a couple or becoming single. Maybe savings going over £16k? Or under £6k? I don't think we know yet what is going to be included.

zagfles

thor wrote: »

I did say that I was making an assumption as I have not been able to find the fine detail when it comes to tapering down. Are you saying that people with savings will not (immediately)get less than they are already getting under TP?

Yes, that's the point of TP, no-one loses in cash terms.

If so how will the amount of benefit diminish with time?

In real terms it'll be eroded by inflation, also a circumstance change can end it. There's no taper of TP, ie no cash reduction over the years. It can be reduced eg if income increases.

If you can give me a link I'll be able to figure it out myself.

I posted a link in post #95. It explains things pretty well and links to official DWP documents.

Icequeen99

zagfles wrote: »

Yes, that's the point of TP, no-one loses in cash terms. In real terms it'll be eroded by inflation, also a circumstance change can end it. There's no taper of TP, ie no cash reduction over the years. It can be reduced eg if income increases. I posted a link in post #95. It explains things pretty well and links to official DWP documents.

Although, the guarantee that at the point of transition you won't lose out only applies to those managed migrated across. If you move because of a change of circs then you wont get protection.

We don't know what changes will cause TC claims to end and trigger a new claim for UC when things get going, but my understanding is that it could be a long list and it could include 'positive' changes as well as negative - so things like having a new child.

Those with savings won't get TP if that happens at the point of transition.

My understanding was that changes of circs once in UC with TP could erode TP but only some changes would bring it to an end. So if you had a new child you wouldn't get any extra for them but it would effectively come out of the TP amount. Is that your understanding Zagfles?

IQ

zagfles

Icequeen99 wrote: »

Although, the guarantee that at the point of transition you won't lose out only applies to those managed migrated across. If you move because of a change of circs then you wont get protection.

We don't know what changes will cause TC claims to end and trigger a new claim for UC when things get going, but my understanding is that it could be a long list and it could include 'positive' changes as well as negative - so things like having a new child.

Those with savings won't get TP if that happens at the point of transition.

My understanding was that changes of circs once in UC with TP could erode TP but only some changes would bring it to an end. So if you had a new child you wouldn't get any extra for them but it would effectively come out of the TP amount. Is that your understanding Zagfles?

IQ

Yes. I think this explains it well:

http://www.revenuebenefits.org.uk/tax-credits/transition-to-universal-credit/overview-of-universal-credit/transitional-protection/

So if your award increases, eg lower income, new child, your UC will not increase until the TP is used up. So keeping the promise that people won't be worse off in cash terms while eroding TP.

If your award decreases, eg higher income, your TP will remain the same until UC is zero, and then TP will be tapered at 65%.

Savings causes an anomaly though. People with £16k+ of savings will have TP of the entire amount they get in tax credits, since their base UC award is zero. A drop in income will not increase their UC, so TP would not be eroded. How would an increase be handled? It wouldn't change their base UC award, as that remains at zero. Maybe they'd taper any increase at 65% (like when people without savings pass the zero UC income level?).

Morglin

zagfles wrote: »

URL? Don't bother with anything in rags like the Mirror [/


It was actually in the Telegraph and Independent etc.,

Sorry, can't do a link on an IPad (probably my fault lol), but will put it up when on a PC.

Lin