Universal Credit: Monthly allowance looks set to equal daily allowance in House of Lords | Personal Finance

Universal Credit is a six-in-one benefit which is replacing the legacy benefits: Child Tax Credit, Housing Benefit, Income Support, income-based Jobseeker’s Allowance (JSA), income-related Employment and Support Allowance (ESA), and Working Tax Credit. It may be that a person is able to claim the payment if they are on a low income or they are out of work.

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This week, MPs voted to end the benefits freeze which was announced in 2016, meaning Universal Credit is among a number of payments set to rise in April 2020.

The increase will be 1.7 percent, in line with inflation.

Meanwhile, the House of Lords looks set to receive a tax-free pay rise this April, of an inflation-busing 3.1 percent.

Should it be confirmed, peers’ daily allowance will increase from £313 to £323.

Members of the Lords who are not paid a salary may claim the flat rate attendance allowance of £313, or a reduced amount of £157, or they may choose to make no claim for each sitting day they attend the House.

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Universal Credit sign and House of Lords in pictures

Universal Credit UK: Some have taken to Twitter to compare the different payments (Image: GETTY)

This would mean an annual tax-free income of more than £48,000 for a member attending for the typical 150 days the Upper House sits each year.

The Independent Parliamentary Standards Authority (Ipsa) is to confirm the increase at the start of next month.

The TaxPayers’ Alliance told MailOnline that the rise “looks like a plum deal for the Peers, but a rum deal for the taxpayer”.

However, a House of Lords spokesman said: “Between 2010 and 2018 the daily allowance for members of the House of Lords was frozen.

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“In April 2018 it was agreed to link increases to the daily allowance to the figure used by Ipsa for increasing the salaries of MPs, which itself is linked to public sector pay awards.

“In the last decade the House of Lords daily allowance has increased by 4.3 per cent. In that same period the salaries of MPs went up by more than 20 per cent.

“By linking the daily allowance increase to Ipsa’s method it ensures that any increase is set by an independent body and members are no longer setting their own allowance levels.”

Amid the news, a number of people have taken to Twitter to remark on how the daily allowance in the House of Lords compares to other payments.

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Universal Credit UK: The benefits system is replacing six legacy benefits (Image: EXPRESS)


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This includes highlighting the monthly allowance for Universal Credit, the full new state pension amount, and the minimum wage weekly salary before tax.

How much is Universal Credit?

Currently, the standard monthly allowance for a single person who is over 25 is £317.82 – although this is set to increase to £323.22 in April.

This would mean, should the rise to the daily allowance in the House of Lords go ahead, it would more or less equal the monthly allowance for a single person over the age of 25.


Universal Credit UK: Houses of Parliament in pictures

Universal Credit UK: The standard monthly allowance depends on circumstances (Image: GETTY)

For a couple in which one member is over the age of 25, the monthly amount for both people will rise from £317.82 to £323.22.

For a single person under the age of 25, the monthly standard allowance is £251.77, and this is £395.20 for couples in which both people are under 25 – with both of these set to rise by 1.7 percent in April.

It may be that a person is able to get more money on top of the standard allowance if they’re eligible.

This may be if the claimant has children, has a disability or health condition, or they care for a severely disabled person.