Universal Credit Couples AET and Household CET

Tommy_77723

Hi,

I have seen in the budget that the couples AET is being removed:

• Increasing the Administrative Earnings Threshold (AET): the Administrative Earnings Threshold (AET), the minimum amount a person can earn without being asked to meet regularly with their Work Coach, will be increased from the equivalent of 15 to 18 hours of earnings at the National Living Wage for an individual claimant. The couples AET, where a second member of a household may not be asked to look for work if their partner is working, will be removed entirely. These changes are expected to require over 100,000 additional claimants to meet more regularly with a Work Coach and take active steps to move into work or increase their earnings.
• Expanding work search requirements: these changes are expected to encourage over 700,000 lead carers of children on Universal Credit to look for work or increase their hours and will receive additional Work Coach support to do so. Previously they would have had only limited requirements, or no requirements at all.

But there has been no mention of the Household CET being removed?

This was the previous Household CET:
Claimants are placed in the light-touch regime if they are in the All-Work-Related Requirement (AWRR) group and have earnings between the Administrative Earnings Threshold (AET) and the CET.
This includes claimants with:
 individual earnings above their AET
no earnings and in a household with earnings above the AET
earnings below the individual AET but in a household with earnings above the household AET



Questions that I have:

1) Have the Government removed Household CET as well?

2) I earn above the 18 hours NLW threshold - but whilst my wife works, she does not earn above this. We would still above the Household CET if this was still in place. Will she have to increase her hours?

3) We have a 1 year old and a 4 year old - how will this impact things?

4) Is there a timeframe for this change? As there has only recently been an increase to 15 hours at NLW in February 2023.

tifo

It's confusing.

If 1 partner works but the other one has LCW or LCWRA, hence no work search requirements, does the working partner have to work the current AET level of 24 hours a week or work 35 hours a week?

Currently there doesn't seem to be any leeway for 1 partner being on LCW or LCWRA apart from the work allowance but not with hours worked.

It would seem removing the AET will mean the couple is expected to earn the CET level at 35 hours a week at min wage regardless of if 1 or both work.

In contrast, a single claimant will need to work 18 hours a week at min wage.

It seems unfair.

NedS

Answered in bold inline below...

Tommy_77723 said:

Hi,

I have seen in the budget that the couples AET is being removed:

• Increasing the Administrative Earnings Threshold (AET): the Administrative Earnings Threshold (AET), the minimum amount a person can earn without being asked to meet regularly with their Work Coach, will be increased from the equivalent of 15 to 18 hours of earnings at the National Living Wage for an individual claimant. The couples AET, where a second member of a household may not be asked to look for work if their partner is working, will be removed entirely. These changes are expected to require over 100,000 additional claimants to meet more regularly with a Work Coach and take active steps to move into work or increase their earnings.
• Expanding work search requirements: these changes are expected to encourage over 700,000 lead carers of children on Universal Credit to look for work or increase their hours and will receive additional Work Coach support to do so. Previously they would have had only limited requirements, or no requirements at all.

But there has been no mention of the Household CET being removed?

This was the previous Household CET:
Claimants are placed in the light-touch regime if they are in the All-Work-Related Requirement (AWRR) group and have earnings between the Administrative Earnings Threshold (AET) and the CET.
This includes claimants with:
 individual earnings above their AET
no earnings and in a household with earnings above the AET
earnings below the individual AET but in a household with earnings above the household AET



Questions that I have:

1) Have the Government removed Household CET as well?

Not as far as I am aware

2) I earn above the 18 hours NLW threshold - but whilst my wife works, she does not earn above this. We would still above the Household CET if this was still in place. Will she have to increase her hours?

Under the new AET rules, she would also need to earn above the individual AET. I admit I had completely forgotten about the CET, but as you state if your household earnings are above the household CET then both will be Working Enough

3) We have a 1 year old and a 4 year old - how will this impact things?

Nothing changes with respect to children and conditionality. Whilst the youngest is under 3 (but over 1), the AET/CET are irrelevant as they apply to work and there are no work related requirements placed on claimants in the WFI and Work Preparation regimes, so the main carer would still be expected to attend appointments and prepare for work once the youngest child turns 3.

What is interesting is the new mismatch between conditionality hours of 16h/week for the lead carer of a child aged 3-5 and the new AET of 18h/week, so although they are only required to look for 16h/week of work, they will need to achieve 18h/week to avoid continued appointments.

4) Is there a timeframe for this change? As there has only recently been an increase to 15 hours at NLW in February 2023.

Not that I have seen confirmed. A budget document I was reading yesterday (see below) looking at the costings of all the announced measures costed the 18h AET for 2023/24 implying it would be introduced this April?? whereas abolishing the Couple AET was only costed for 2024/25 implying that may not be introduced until the following tax year. There will be cost implications for Jobcentres as they will need more Work Coaches to see more customers

The Government have published costings of the various measures outlined in the budget, and the following document (page 76) shows costs for increasing the AET to 18h in 2023/24 suggesting it may be introduced in April:

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1142902/Web_accessible_Budget_2023.pdf

NedS

Again, answering in bold inline below...

tifo said:

It's confusing.

If 1 partner works but the other one has LCW or LCWRA, hence no work search requirements, does the working partner have to work the current AET level of 24 hours a week or work 35 hours a week?

No. The working partner has to exceed the individual AET of 18h/week

Currently there doesn't seem to be any leeway for 1 partner being on LCW or LCWRA apart from the work allowance but not with hours worked.

See above

It would seem removing the AET will mean the couple is expected to earn the CET level at 35 hours a week at min wage regardless of if 1 or both work.

That's not how I interpret it. The minimum requirement will be for each, individually, to be working 18h/week (as the couple requirement of 24h/week combined will be removed). If one member of the couple earns their CET rate, the other member still needs to work their 18h AET. The couple CET rate is 2 x single CET rate (I think). i.e, both working full time.

In contrast, a single claimant will need to work 18 hours a week at min wage.

It seems unfair.

Regarding the CET, from: https://www.uc-advice.co.uk/further-universal-credit-information/conditionality-regime

The Conditionality Earnings Threshold (CET) ensures that claimants earning above a certain level will not be asked to carry out work-related activity. The CET is calculated on an individual basis, by multiplying the National Minimum Wage (NMW) by the hours a claimant’s Expected hours. The CET for a household is a combination of the individual expected CET of each of the adults (joint claimants or including an ineligible partner of a claimant) in the household and varies between different households. In a couple household, if one of the adults earns above the household CET, both claimants are placed in the working enough regime, regardless of if they are both working or not.

Soconfused14

When will we know how this is going to work and when it will be implemented?

calcotti

Soconfused14 said:

When will we know how this is going to work and when it will be implemented?

No idea. Changes in 2026 at the earliest and much more to continue before that might happen.

Soconfused14

calcotti said:

Soconfused14 said:

When will we know how this is going to work and when it will be implemented?

No idea. Changes in 2016 at the earliest and much more to continue before that might happen.

2016? Sorry not sure what you mean. Do you think it is it likely to happen this year?

marcia_

Soconfused14 said:

calcotti said:

Soconfused14 said:

When will we know how this is going to work and when it will be implemented?

No idea. Changes in 2016 at the earliest and much more to continue before that might happen.

2016? Sorry not sure what you mean. Do you think it is it likely to happen this year?

 2026 probably 

calcotti

Soconfused14 said:

calcotti said:

Soconfused14 said:

When will we know how this is going to work and when it will be implemented?

No idea. Changes in 2016 at the earliest and much more to continue before that might happen.

2016? Sorry not sure what you mean. Do you think it is it likely to happen this year?

Apologies. Typo - meant 2026. Have corrected.

Soconfused14

calcotti said:

Soconfused14 said:

calcotti said:

Soconfused14 said:

When will we know how this is going to work and when it will be implemented?

No idea. Changes in 2016 at the earliest and much more to continue before that might happen.

2016? Sorry not sure what you mean. Do you think it is it likely to happen this year?

Apologies. Typo - meant 2026. Have corrected.

Thank you for replying. So prob wont affect me as starting a job this summer that should take us well over the Household CET.

guysl80

NedS said:

Again, answering in bold inline below...

tifo said:

It's confusing.

If 1 partner works but the other one has LCW or LCWRA, hence no work search requirements, does the working partner have to work the current AET level of 24 hours a week or work 35 hours a week?

No. The working partner has to exceed the individual AET of 18h/week

Currently there doesn't seem to be any leeway for 1 partner being on LCW or LCWRA apart from the work allowance but not with hours worked.

See above

It would seem removing the AET will mean the couple is expected to earn the CET level at 35 hours a week at min wage regardless of if 1 or both work.

That's not how I interpret it. The minimum requirement will be for each, individually, to be working 18h/week (as the couple requirement of 24h/week combined will be removed). If one member of the couple earns their CET rate, the other member still needs to work their 18h AET. The couple CET rate is 2 x single CET rate (I think). i.e, both working full time.

In contrast, a single claimant will need to work 18 hours a week at min wage.

It seems unfair.

Regarding the CET, from: https://www.uc-advice.co.uk/further-universal-credit-information/conditionality-regime

The Conditionality Earnings Threshold (CET) ensures that claimants earning above a certain level will not be asked to carry out work-related activity. The CET is calculated on an individual basis, by multiplying the National Minimum Wage (NMW) by the hours a claimant’s Expected hours. The CET for a household is a combination of the individual expected CET of each of the adults (joint claimants or including an ineligible partner of a claimant) in the household and varies between different households. In a couple household, if one of the adults earns above the household CET, both claimants are placed in the working enough regime, regardless of if they are both working or not.

Thanks for the detailed explanation.

If you consider my situation I always earn 2 to 2.5 times of the AET expected from Jan 2023. Some months I have a nil award or less than £230 due to high income . But my wife is not working and so far she has not been asked to looking for a job.

Even though I earn more than the expected amount will she be asked to look for work once the new changes are implemented.




Thanks