09 April 2018
Social Security Minister, Deputy Susie Pinel, has announced proposals for an increase in benefit rates for all Income Support households with a new supplement providing extra help to families with children.
Income Support components increase
If approved, most income support components will rise by 3% from 1 October this year and a new family supplement worth more than £260 a year will be added to claims that include a child from 1 January 2019.
Changes to the Income Support Regulations are being lodged earlier than usual due to the timing of the forthcoming election. The new States Assembly will need to debate the proposals before the summer recess so that benefits can be increased in October.
Income support provides financial help for individuals and families with low income; including pensioners, carers and people with a disability or long term health condition.
Minister for Social Security
Speaking about the proposed uprate, Deputy Pinel said: “It is heartening to see the number of families claiming income support fall as the economy picks up and our job market improves. But the improved economy has also meant an increase in inflation. I have set the increase in components in line with the inflation forecast given by the Fiscal Policy Panel for 2018. This will help to support low income families.
“I am especially pleased to be able to announce the family supplement which will be available from the beginning of 2019. This will give extra help to new parents who are just starting a family. We know that having a child, particularly a first child, brings added costs for families, and this increase is a way of acknowledging and addressing this.”
Increased cost of living
The Minister considers that it is important that components are increased to reflect the increased cost of living this year, particularly as Retail Prices Index (RPI) increases are now running at a higher level than in 2015 and 2016. The RPI figure for March 2018 will be published in May and the next Minister may wish to adjust the component levels in light of the actual increase in RPI.
Low income families
The Council of Ministers is committed to supporting families and low income families who will receive extra support under three separate Income Support initiatives, which are:
- single parent component: A single parent component will be provided to all single parents receiving income support at the rate of £40.39 per week from 1 June 2018. The cost of this component is being met from underspends during 2018 and 2019.
- other income support components: A 3% uplift in all other income support components from 1 October 2018. These cover: adult, child, household, carer, personal care, clinical cost, mobility and accommodation (owners and private sector rental). The 3% increase is in line with the Fiscal Policy Panel’s (FPP) recently published economic assumptions for RPI for 2018 and follows an increase of 2.9% made in 2017. This is estimated to cost £2.4 million a year.
- family supplement: The Medium Term Financial Plan (MTFP) published in 2015 included a proposal to create additional support for families in the latter half of the MTFP period. Within the budget allocated as part of the MTFP process, an additional component will be allocated to every income support household that includes at least one child under school leaving age at an estimated cost of £0.5 million a year. Subject to States approval, this component will be available from 1 January 2019.