The benefits changes to ESA and universal credit, explained
People claiming employment support allowance (ESA) have been urged by the government to take action to avoid losing out on the benefit later this year.
The Department for Work and Pensions (DWP) has issued the warning as part of a wide-ranging overhaul that will see a number of benefits and tax credits integrated into universal credit.
This also includes child tax credit, housing benefit, income support, income-based jobseeker’s allowance (JSA), income-related employment and support allowance (ESA) and working tax credit.
However, claimants' ESA payments will not be transferred automatically, meaning they will have to sign up for universal credit if they want to avoid losing out on their money.
Around 800,000 people who claim ESA are being sent letters telling them to apply, many of whom could otherwise risk losing their payments before the Christmas period.
Read the full article below or click the links to skip ahead
> How much is ESA on universal credit?
> How do you qualify for ESA payments?
> Does everyone on ESA have to go on universal credit?
> What other benefits are being replaced?
What is ESA?
Employment support allowance is a benefit for people with health conditions or disabilities that limit how much they can work.
The payments are intended to help with living costs if people are unable to work and to support people back into work if they are able. People can apply if they are employed, self-employed or disabled.
People on ESA can also claim personal independence payments (PIP), which similarly is aimed at supporting people with long-term physical or mental health conditions or disabilities with living costs.
How much is ESA on universal credit?
The amount you can receive from ESA depends on whether you are claiming the new-style ESA, a contribution-based ESA, or an income-related ESA.
The latter is no longer open for applications, and most people are only able to get the new-style ESA, according to Citizens Advice.
Those on the benefit will get £90.50 each week if they are put in the "work-related activity group" following their assessment by the DWP, or £138.20 each week if they are put in the "support group".
Universal credit carries a standard monthly allowance of £311.68 if you're single and under 25, and £393.45 if you're single and over 25. Partners living together will collectively get £489.23 if they are under 25 and £617.60 if they are over 25.
However, how much you can receive in total varies, as universal credit is a means-tested household assessment based on income and circumstances. You can claim it if you and your partner have £16,000 or less in savings between you.
If someone has "limited capability for work and work-related activity", they could be entitled to an extra monthly amount of £416.19 under universal credit.
Citizens Advice says they will usually start getting this extra money after three months, but they could get it straight away if they are terminally ill with potentially less than a year to live, or if they receive the new-style ESA.
People who move onto the new system will stop receiving disability "premiums" they could claim under ESA, although they may get a "transitional amount" if they are left with less income, according to disability charity Scope.
How do you qualify for ESA payments?
People can apply for the new-style ESA if they are under the state pension age and if they have a disability or health condition that affects how much they can work.
They will also need to have worked as an employee or have been self-employed, and to have paid enough National Insurance (NI) contributions, usually in the last two to three years.
National Insurance credits, which are there to help fill gaps in people's NI records if they cannot work, can also count towards this. You can check your NI record here.
Does everyone on ESA have to go on universal credit?
If you receive ESA, you will have to move onto universal credit when you get a letter from the DWP telling you to claim Universal Credit by a certain date. This is known as a "migration notice".
You may also have to move to universal credit if your situation changes, for example, if you’ve separated from a partner or moved to a different council area.
Ultimately, ESA is set to be phased out, to be integrated with universal credit. The government advises: "Move to Universal Credit if you get a migration notice letter. As one or more of your benefits will be ending soon, you need to move to Universal Credit.
"To continue receiving financial support you must claim universal credit by the deadline date given in your letter. This is three months from the date the letter was sent out."
How long is ESA paid for?
The new-style ESA lasts for 365 days if you're in the work-related activity group, and there's no time limit if you're in the support group.
The situation could be more changeable under universal credit, as it is calculated by a monthly assessment based on your personal circumstances and earnings at the time.
What other benefits are being replaced?
Income support, income-based jobseeker’s allowance (JSA), housing benefit, working tax credit and child tax credit are also set to be phased out and merged into universal credit.
Citizens Advice says that similarly to ESA claimants, anyone on the above benefits will get a "migration notice" letter giving them a three-month deadline to switch to universal credit.
If you claim universal credit, you’ll usually get one payment each month and you usually have to manage your claim online, the organisation adds. It usually takes five weeks to receive your first universal credit payment, but in some cases it can take longer.
Many have had to go through stressful and unnecessary appeals processes for the benefits they are entitled to.
Our research found that 72% of people who go to tribunal over their PIP decisions are given benefits.— Scope (@scope) September 4, 2024
Personal independence payments (PIP) are not included in the list of legacy benefits being phased out, however the payment of around £135 a week could still face some reforms in the future.
The previous Conservative government proposed replacing the cash payment with vouchers, which Scope said would serve to "further demonise disabled people".
After Labour came into power in July, the consultation on these changes continued and has since closed, with the DWP set to review people's feedback.
"We’re hopeful that the consultation proposals will be stopped. We will keep pushing to make sure they are," said Scope. "While there were some positives, most of the changes put disabled people at risk."
