Starting April 2024, millions of UK residents will see a 6.7% increase in their welfare benefits, including Universal Credit and the State Pension.
Announced by the Department for Work and Pensions (DWP), this adjustment aims to align benefit rates with inflation, helping households manage rising costs.
Here’s a comprehensive guide to the updated rates, affected benefits, and tips for managing the extra income effectively.
UK 5 Benefits to Increase By 6.7% In 2024
The DWP’s decision to increase benefits by 6.7% is based on the Consumer Prices Index (CPI) inflation rate from September 2023.
This annual adjustment ensures benefits maintain their purchasing power amidst inflation, particularly for essentials like food, housing, and energy.
| Benefit Type | Current Rate (2023/24) | New Rate (2024/25) | Increase Amount |
|---|---|---|---|
| Universal Credit (Single) | £368.74/month | £393.45/month | +£24.71 |
| New State Pension | £203.85/week | £221.20/week | +£17.35 |
| Personal Independence Payment (PIP) | £101.75/week | £108.55/week | +£6.80 |
| Carer’s Allowance | £76.75/week | £81.90/week | +£5.15 |
| Attendance Allowance | £101.75/week | £108.55/week | +£6.80 |
Benefits Affected by the Increase
1. Universal Credit
Universal Credit, a lifeline for low-income households, will see increases across various components:
- Standard Allowance (Single Claimants aged 25+):
Rising from £368.74 to £393.45 per month. - Standard Allowance (Joint Claimants aged 25+):
Increasing from £578.82 to £617.60 per month. - Other allowances, such as for housing, children, and disabilities, will also increase.
2. State Pension
The State Pension, crucial for retirees, will rise significantly under the triple lock policy, which guarantees increases based on the highest of:
- CPI inflation,
- Average earnings growth, or
- 2.5%.
New Rates:
- New State Pension: Increasing from £203.85 to £221.20 per week.
- Basic State Pension: Rising from £156.20 to £169.50 per week.
3. Personal Independence Payment (PIP)
PIP supports individuals with disabilities by covering costs associated with their condition. The new rates are:
- Daily Living Component (Enhanced): £108.55 per week (+£6.80).
- Mobility Component (Enhanced): £75.75 per week (+£4.75).
4. Carer’s Allowance
Unpaid carers will benefit from a rise in Carer’s Allowance, which increases from £76.75 to £81.90 per week, recognizing their essential role.
5. Attendance Allowance
For those over State Pension age with disabilities requiring frequent care, Attendance Allowance will increase from £101.75 to £108.55 per week.
Why the Increase Matters
The 6.7% increase reflects the government’s effort to support vulnerable groups amid financial pressures.
Rising inflation has strained household budgets, with essentials such as food, energy, and transportation becoming increasingly expensive.
Examples of Impact
- A single Universal Credit claimant will see an extra £24.71/month, enough to offset a portion of rising grocery or utility bills.
- A retired couple on the basic State Pension will receive an additional £26.60/week, easing energy or healthcare expenses.
- A carer receiving Carer’s Allowance will gain an extra £5.15/week, providing flexibility for transport or caregiving supplies.
How to Prepare for the Increased Payments
With the new rates effective from April 2024, planning ahead can help you maximize the benefit of these increases:
1. Update Your Budget
- Allocate the additional funds to cover rising costs for essentials like food, housing, and energy.
- Use budgeting tools or apps to manage your spending efficiently.
2. Explore Additional Benefits
- Many households may qualify for further financial aid. Use resources like the Turn2us Benefits Calculator to discover other available support.
3. Set Up Direct Payments
- Automate payments for rent, utilities, and council tax to ensure essential bills are prioritized.
4. Build an Emergency Fund
- Consider saving part of the increased payment for unexpected expenses, such as medical bills or urgent repairs.
How to Check the New Rates
You can confirm your updated benefit payments through:
- DWP Notification Letters: Official letters outlining the new rates will be sent to recipients.
- Online Accounts: Check your updated payments via the Gov.uk or Universal Credit portals.
- Contacting DWP: For specific inquiries, reach out to your local Jobcentre or the DWP helpline.
The Government’s Commitment
The 6.7% benefit increase aligns with the government’s goal of maintaining the real value of social support during challenging economic times.
By linking benefits to the CPI inflation rate, the DWP ensures that financial assistance evolves with the rising cost of living, minimizing economic inequality.
