Guidance

A8/2023: Housing Benefit uprating for the financial year ending March 2025

Updated 4 January 2024

© Crown copyright 2024

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This publication is available at https://www.gov.uk/government/publications/housing-benefit-adjudication-circulars-2023/a82023-housing-benefit-uprating-for-the-financial-year-ending-march-2025

Who should read

All Housing Benefit staff

Action

For information

Subject

Housing Benefit uprating for the financial year ending March 2025

Revisions

This circular is being reissued: an amendment has been made to the text in the bullet point at paragraph 4. We apologise for any inconvenience caused.

Guidance Manual

The information in this circular does affect the content of the HB Guidance Manual and the HB/CTB Overpayments Guide.

HB Guidance Manual: Please annotate this circular number against paragraph A4 4.750, 4.900, A5 Annex A, BW3 Annex A and BP3 Annex A.

HB/CTB Overpayments Guide: Please annotate this circular number against paragraphs 4.260 – 4.264.

Queries

You can get extra copies of this circular/copies of previous circulars.

If you need to ask about the new layout of this circular, contact: [email protected]

If you need to ask about the distribution of this circular, contact: [email protected]

For queries about the general or technical content of this circular, contact: [email protected]

Crown Copyright 2023
Recipients may freely reproduce this circular.

Introduction

1. In his written statement to Parliament on 22 November 2023, the Secretary of State for the Department for Work and Pensions announced proposals for the social security benefit rates which will apply from April 2024.

2. At the time of writing, the Orders or regulations bringing the changes into effect are still subject to the appropriate parliamentary process. Therefore, this circular advises you of the proposed rates so you can take the appropriate action.

Timing

3. In line with previous practice, the main Housing Benefit (HB) uprating will be introduced in advance of the setting of the main social security benefit rates. To coincide with the week in which many rents change, the 2024 uprating will take effect on:

  • Monday 1 April 2024 for cases to which regulation 79(3)(a)(i) of the Housing Benefit Regulations 2006 (for Working Age customers) and regulation 59(3)(a)(i) of the Housing Benefit (Persons who have attained the qualifying age for state pension credit) Regulations 2006 (for people who have attained the qualifying age for Pension Credit) applies, when rent is paid monthly or at any interval which is not a week or multiples of a week
  • Monday 1 April 2024 for cases to which regulation 79(3)(a)(ii) of the Housing Benefit Regulations 2006 (for Working Age customers) and regulation 59(3)(a)(ii) of the Housing Benefit (Persons who have attained the qualifying age for state pension credit) Regulations 2006 (for people who have attained the qualifying age for Pension Credit) applies, when rent is paid on a weekly basis (or multiple of a week).

4. The main points are:

  • the basic State Retirement Pension and the full rate of the new State Retirement Pension are being uprated by 8.5% in line with the increase in Average Weekly Earnings and the government’s Triple Lock commitment in the financial year ending (FYE) March 2025.
  • the Standard Minimum Guarantee in Pension Credit is being increased by 8.5% this year to match the cash increase in the basic State Pension. The Savings Credit maximum is increased by Consumer Price Index (CPI) at 6.7% in FYE March 2025.
  • premiums paid to pensioner recipients of Working Age benefits will continue to be uprated to match Pension Credit rates.
  • premiums paid to disabled people receiving Working Age benefits and to Employment and Support Allowance claimants in the Support Group, will increase by CPI at 6.7% in FYE March 2025.
  • Working Age benefits (main rates and certain premiums and additions), including the main elements of UC and HB personal allowances will increase by CPI at 6.7% in FYE March 2025.

5. The higher and middle rate invalidity allowances and age additions payable with Incapacity Benefit (IB) will be increased from April 2024.

Uprating of social security benefits: general

6. The following regulations allow you to take account of these rates on 1 April 2024 as appropriate:

a. Regulations 42(8) and 79(3) of the Housing Benefit Regulations 2006
b. Regulations 41(9), 41(10) and 59(3) of the Housing Benefit (Persons who have attained the qualifying age for state pension credit) Regulations 2006.

Note: Associated guidance is set out in HB/CTB Guidance Manual at BP2 P2.790.

7. There is no provision in regulations to uprate a claimant’s social security benefit other than by using the correct amount. Most claimants will know their rates of benefit well before April each year.

8. We are aware that many local authorities’ (LAs’) IT systems apply a percentage increase to uprate income from other social security benefits in the assessment of HB. In previous years we have advised that this method should, in most cases, produce accurate results; providing the LA has satisfied itself as to the accuracy of its method, it should be able to meet its duty to make proper determinations.

9. However, given the fact that in recent years some of the components paid in addition to the main rates of some benefits and the main rates themselves have been uprated by different indices, LAs should consider carefully whether applying standard percentages will result in correct determinations.

10. LAs should also take into account that specific ATLAS (Automated Transfers to LA Systems) uprating notifications are issued for all benefits on CIS (Customer Information System) except for:

  • Attendance Allowance
  • Disability Living Allowance
  • Personal Independence Payment
  • Armed Forces Independence Payment
  • Adult Disability Payment
  • Child Disability Payment
  • Carer’s Allowance
  • State Retirement Pension
  • Incapacity Benefit
  • Severe Disability Allowance
  • Bereavement Benefits
  • Widow’s Benefit

11. Should an LA decide to apply a percentage increase to uprate income, as a minimum, any information subsequently received via ATLAS should be compared with existing LA system data to ensure it matches.

12. Since December 2019, LAs have had the facility to use the automation of the Pensions Strategy Computer System (PSCS) uprating process. This allows LAs to use an Application Programme Interface to look up the PSCS benefit amount when needed, and removes the requirement for LAs to manually apply the uprating increase to the PSCS amount when conducting their yearly uprating review of claimants’ HB claims as the uprating process can be automated.

New benefit rates

13. All the new rates are available on our Proposed benefit and pension rates 2024 to 2025 page on – GOV.UK

Tax Credits

14. Any changes to Working Tax Credit and Child Tax Credit will be effective from 6 April 2024 in line with the start of the new tax year.

15. ATLAS will notify Tax Credit information to LAs. All the current and new Tax Credit rates are available on our Rates and allowances: tax credits, Child Benefit and Guardian’s Allowance page on – GOV.UK

War Pensions

16. The new rates for War Pensions are not yet available and details of the new rates will be issued through a separate HB Adjudication circular once Veterans UK release the figures.

Specific points of interest

Non-dependant deductions in HB

17. The deduction and income bands will increase for the FYE March 2025 and are published on our Proposed benefit and pension rates 2024 to 2025 page on – GOV.UK

Disregards in HB which remain unchanged

18. The childcare disregards in HB in line with Working Tax Credit weekly equivalents, remain at:

a. £175.00 for one child
b. £300.00 for two or more children

19. The additional earnings disregard in HB that can be applied to those entitled to Working Tax Credit is £17.10. See HB Guidance manual BW2 paragraphs BW2.132-2.140

Deductions for ineligible fuel charges

20. The government has decided to freeze the rates for statutory fuel deductions from HB for the FYE March 2025. The rates for statutory fuel deductions are on – GOV.UK

One room rate deduction

21. The formula for the one room rate deduction is set out in HB Regulations 2006 at Schedule 1, part 2, paragraph 6(2)(a) to (c) and (3). Sub-paragraph (3) states the ineligible amount for service charges when the accommodation consists of only one room shall be one half of the aggregate of the amounts specified in sub-paragraph (2)(a), (b) and (c), see Appendices A and B.

State Pension Credit: maximum Savings Credit

22. The amount of the maximum Savings Credit will be £17.01 for a single person and £19.04 for a couple. These figures cannot be used to calculate a likely Savings Credit entitlement from April 2024. Savings Credit is calculated on an individual basis, using the income and capital of that person. In addition, HB (SPC) Regulation 27 states that the Pension Service calculation of income, capital and Savings Credit must be used.

National Insurance contribution rates

23. A full set of rates for the FYE March 2025 will be available on GOV.UK from 6 April 2024.

Establishing eligible rent

24. The calculation of eligible rent for a claimant renting in the social and private sectors is not affected by this circular or by the uprating of benefits overall. It continues to subject to the rules in Part 3 of the Housing Benefit Regulations 2006 and Part 3 of the HB (SPC) Regulations 2006.

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