The Department for Work and Pensions (DWP) has announced an increase in payment rates for Universal Credit (UC) and Jobseeker’s Allowance (JSA) starting in April 2025. The adjustment, based on the September 2024 Consumer Price Index (CPI) of 1.7%, is aimed at helping millions of recipients cope with the cost of living. Critics, however, contend that the higher inflation rate of 2.2% should have been applied for a more substantial uplift.
Universal Credit is a monthly benefit provided to:
Individuals who are unemployed and actively seeking work.
People working but on low income.
Individuals unable to work due to health or disability.
UC aims to simplify the welfare system by consolidating six previous benefits, including Income Support and Housing Benefit, into one payment. Currently, over seven million people in the UK rely on UC for financial assistance.
What Is Jobseeker’s Allowance (JSA)?
Jobseeker’s Allowance (JSA) provides financial support to individuals actively seeking employment. It exists in two forms:
Contribution-Based JSA (New Style JSA): Available to those with sufficient National Insurance contributions.
Income-Based JSA: A means-tested benefit that is being phased out and replaced by Universal Credit.
Approximately 96,000 individuals currently claim JSA, with the income-based version set to transition to UC by 2025 fully.
New Payment Rates for Universal Credit and Jobseeker’s Allowance
The updated payment rates for Universal Credit and Jobseeker’s Allowance, effective from April 7, 2025, reflect a 1.7% increase. Below are the detailed changes:
Universal Credit Payment Rates (Monthly)
Standard Allowance
Single, under 25: £316.98 (up from £311.68).
Single, 25 or over: £400.14 (up from £393.45).
Couple, both under 25: £497.55 (up from £489.23).
Couple, one or both 25 or over: £628.10 (up from £617.60).
Child Amounts
First child (born before April 6, 2017): £339.00 (up from £333.33).
First child (born on or after April 6, 2017)/Subsequent children: £292.81 (up from £287.92).
Disabled Child Additions
Lower Rate: £158.76 (up from £156.11).
Higher Rate: £495.87 (up from £487.58).
Incapacity Payments
Limited Capability for Work (LCW): £158.76 (up from £156.11).
Limited Capability for Work and Work-Related Activity (LCWRA): £423.27 (up from £416.19).
Carer Element: £201.68 (up from £198.31).
Childcare Costs
Maximum for one child: £1,031.88 (up from £1,014.63).
Maximum for two or more children: £1,768.94 (up from £1,739.37).
Jobseeker’s Allowance Payment Rates (Weekly)
Contribution-Based JSA
Under 25: £72.90 (up from £71.70).
25 or over: £92.05 (up from £90.50).
Income-Based JSA
Under 25: £72.90 (up from £71.70).
25 or over: £92.05 (up from £90.50).
Lone Parent and Couple Allowances
Both under 18: £72.90 (up from £71.70).
Both 18 or over: £144.65 (up from £142.25).
Dependent children: £84.66 (up from £83.24).
Premiums
Family/Lone Parent: £19.48 (up from £19.15).
Pensioner (Single): £135.05 (up from £127.65).
Disability (Single): £43.20 (up from £42.50).
Why Are Rates Increasing?
The increase aligns with the Consumer Price Index (CPI) recorded in September 2024, which was 1.7%. The annual adjustment ensures that benefits keep pace with inflation, helping recipients manage:
Rising costs of living.
Basic expenses such as food, housing, and utilities.
Critics, however, argue that the higher inflation rate of 2.2% should have been used for more meaningful support.
DWP’s Future Employment Initiatives
The DWP has announced a new “Get Britain Working” initiative to reduce unemployment and boost workforce participation. Key measures include:
Transforming jobcentres into national careers services.
Introducing a Youth Guarantee, providing all individuals aged 18-21 with access to education, training, or employment opportunities.
These measures aim to address economic inactivity and provide pathways for long-term employment.
FAQs
1. Who qualifies for Universal Credit?
Universal Credit is available to unemployed individuals, working on low income, or unable to work due to health conditions.
2. What is the difference between Universal Credit and Jobseeker’s Allowance?
Universal Credit is a broader benefit covering various circumstances, including unemployment, while Jobseeker’s Allowance is specifically for individuals actively seeking work.
3. When will the new payment rates be effective?
The updated rates will take effect during the first working week of April 2025.
4. How is Jobseeker’s Allowance paid?
JSA is typically paid every two weeks, but the personal rates are calculated on a weekly basis.
5. What happens to Income-Based JSA?
Income-Based JSA is being phased out, with recipients transitioning to Universal Credit. Only Contribution-Based JSA, now referred to as New Style JSA, will remain available.
6. How can I apply for Universal Credit or JSA?
Applications can be made online through the official government website: Gov.uk Universal Credit.
I am a passionate technology and business enthusiast. I constantly explore the intersection where innovation meets entrepreneurship. With a keen eye for emerging trends and a deep understanding of market dynamics, I provide insightful analysis and commentary on the latest advancements shaping the tech industry.
