Support for disabled children cut in half under Universal Credit
In a surprise announcement made in a DWP policy briefing note released at the end of last week, the Government has announced that support for all but the most disabled children, currently provided through the disability element of child tax credit, will be halved under the Universal Credit. Calculations suggest that the loss could amount to substantially more than £20,000 across the childhood of a disabled child.
At present, parents of children with disabilities (in receipt of DLA,) are entitled to a substantial top up of their Child Tax Credit entitlement. This addition is currently worth up to around £2715 (£52.21 per week) for each child in the household who has a disability.
In addition, children with the most severe disabilities (in receipt of the high rate care component of DLA), are entitled to the severe disability element, worth an additional £1095 (£21.06) – meaning they get a total addition worth up to £73.27 per week.
Under the Universal Credit, families caring for a disabled child will instead be entitled to one of two rates of addition to their Universal Credit entitlement, either the lower or the higher addition.
The most severely disabled children will be entitled to an addition worth £74.50 per week – a very slight increase on current rates paid for severely disabled children through child tax credit. (In addition, children with severe visual impairment will be brought into this group, and as a result could gain significantly.)
However, for other children with disabilities, the addition will be £25.95 per week (£1349.40 per year) – less than half the maximum value of the disability element of Child Tax Credit.
This change could cost a family with a disabled child up to £1366 per year. The loss for a family over the course of the childhood of a child born with a disability could amount to substantially more than £20000 – or more than £40000 for parents with two disabled children.
(It should be noted that DLA for children will not be affected by this change since this remains outside of the Universal Credit.)
New claimants will receive the reduced support at the point of claiming Universal Credit. Parents with disabled children who are already in receipt of benefit will receive transitional cash protection on being transferred onto Universal Credit, until the point where this protection is either lost (as a result of a change of circumstances), or is eroded away (since the cash protection is not increased with inflation.)
In our briefing note on this issue Family Action estimates that around 100,000 families with disabled children could lose support as a result of this change. This includes many of the very poorest families, already struggling to make ends meet whilst caring for a disabled child.
The Government is likely to produce its child poverty strategy some time in the next week or so. This change is not likely to contribute to a future free from disabled children living in poverty, and the Government really need to think again about how they ensure that families caring for these children receive the level of support they need.