12: Welfare and Benefits Flashcards
What is our current system of welfare
A combination of contributory and non-contributory benefits.
What are contributory and non contributory benefits?
Contributory: paid on the basis of previous contributions. Pay when you are young, healthy and in work and draw out benefits when you are old, sick or unemployed. National Insurance: old age pension is dependent on NI contributions and get higher Jobseeker’s allowance if paid NI.
Non-contributory: paid on the basis of need, not dependent on previous contributions. Some depend on income like Jobseeker’s allowance and Housing Benefit and claimants need to do a means test to ensure they need it. Some are universal benefits and paid regardless of income (winter fuel benefit, TV licence for old people). Child Benefit used to be universal but Coalitoon gov made restrictions on people earning more than 50k a year.
What do welfare benefits include?
unemployment benefits, housing, child, child and working tax credits and disability.
What are current benefits?
Jobseeker’s allowance: paid to adults working fewer than 16 hour a week. Higher payment for those with sufficient NI contributions.
- Income support: non-contributory benefit for those on low income and not in full time employment.
-Employment and support allowance and Disability Living Allowance: paid to the sick and disabled. Different rates based on disability.
What did the Welfare Reform Act 2012 do?
2010 Coalition introduced radical reforms to:
-simplify a complex system and ensure that work pays and remove disincentives to work.
-claimants are able to retain more of their benefits as they move into work removing problems of high marginal tax rates.
-Keystone of the Act is Universal Credit replacing six other benefits:
the means test part of Jobseekers allowance
the means test part of employment support allowance
income support
child tax credits
working tax credits
housing benefit
What is the Work Programme?
Designed to help the long-term unemployed into work.
-Claimants may be asked to carry out Mandatory Work Activity to prepare for work.
A scheme called Help to Work requires claimants who are on the programme for more than 2 years to do voluntary work, training or sign on every day.
Benefits can be withdrawn if fail.
Several charities have refused to participate.
What are Benefit Caps?
1012 Act also introduced benefits cap.
-idea is that people on benefits should not get more than a working family.
Ccannot exceed £500 a week.
reduced to 20,000 (23,000 in london)
What is the two-child rule and rape clause?
From 2017, child tax credit was limited to the first two children.
-phased out and replaced by universal credit.
-Exemptions for multiple births and adopted children
-Exemption for child born through non-consensual conception- rape clause.
What are housing benefits?
administrated by local authoritie son behalf of department of work and pensions.
Pays part or all of rent of low income tenants.
Local housing allowance is a set amount of housing benefit paid if you are in private rented accommodation. depends where you live.
The bedroom tax, idea is to free up larger properties for families in the waiting list.
those with spare rooms lose 40£ a month in benefits.
What are pensions?
a contributory benefit paid to people when they retire.
-Increases as population ages
-people live longer
-government gradually rises the age of retirement, 66 in 2020, linking to life expectancy in future.
