Universal Credit – Parliamentary Written Answer

Mr Ward: To ask the Secretary of State for Work and Pensions what estimate he has made of the potential savings to his Department of the introduction of housing costs contributions under universal credit. 

Steve Webb: It has long been a feature of the benefits system that someone living in a claimant's home should be expected to contribute towards the rent. This principle will be carried forward into universal credit, although the system will be both simpler and provide improved work incentives. The revised approach is not expected to deliver savings. It is not possible to isolate the impact of the housing cost contribution from the other constituent parts of universal credit. This means that it is not possible to provide an estimate of the financial effects of the housing cost contribution. It is important to note that non-dependants may be better off in universal credit, compared to the current system. For example, a non-dependant working 30 hours per week at the national minimum wage of £6.31 (from October) would be expected to make a flat rate contribution of £68 per month towards the rent under Universal Credit, compared to about £185.90 under current rules.