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Carers able to earn more and benefits to rise after 2024 Autumn Budget
While the Chancellor's Autumn budget included widely expected rises to benefits, there were some suprises.
In particular, carers who also earn money will be able to earn more without jeopardising their eligibility for government support.
Universal Credit claimants who are in debt could also see their take-home benefits increase.
Here, we break down the key welfare changes announced in today's speech and how these could affect you.
Benefits and pension credit to rise
Working-age benefits are scheduled to rise 1.7% (in line with the inflation rate this September) in April 2025.
This is forecast to see around 5.7 million families on universal credit gain £150 a year on average in 2025-26.
Pension credit is extra money to help those over the state pension age (currently 66) on low income with housing costs such as ground rent or service charges.
It's separate from the state pension and is means-tested, currently topping up your weekly income to £218.15 if you're single or your joint weekly income to £332.95 if you live with a partner.
From April 2025, these amounts are set to increase by 4.1%, and this should mean an annual increase of £465 to single pensioners eligible for the benefit and £710 to couples.
- Find out more: How universal credit works
- Find out more: Pension credit explained
You have to claim pension credit
You may have heard a lot about pension credit recently, after the government announced the Winter Fuel Payment will be restricted to people who receive pension credit, or other means-tested benefits (including universal credit).
Crucially, you have to claim pension credit - it isn't paid automatically.
Carers able to earn more and still get carer's allowance
Carer's allowance is a benefit available to those caring for someone in receipt of certain benefits due to disability or sickness.
It's currently £81.90 a week. To be eligible, you must spend at least 35 hours a week caring for someone and be earning no more than £151 a week.
The government announced it would increase this earnings limit to £196 from April 2025. At the National Living Wage, this would be the equivalent of 16 hours of work.
The government claims this is the largest increase to the earnings limit since the carer's allowance was introduced in 1976 and will allow more than 60,000 more carers to access the benefit.
- Find out more: carer's allowance explained
Universal credit debt deductions reduced
Universal credit is a benefit for those who are out of work or on low income. Currently, the standard monthly allowance is £393.45 for single people, or £617.60 for couples, aged 25 or older.
However, deductions can be made if you owe money, for example fines, rent, or tax or energy payments.
Currently, the highest these monthly reductions can be is 25% of the benefit payment. Today, Rachel Reeves announced a new Fair Repayment Rate - which will take effect in April 2025.
This will reduce the 25% cap to 15% - allowing claimants to keep more of their payment where they're in debt.
This is estimated to benefit around 1.2 million households, saving them on average £420 a year.
- Find out more: What is Universal Credit?
Expansion of the Help-to-Save scheme
Help to Save is a kind of savings account that pays a bonus of 50% of what you save each month.
You can save between £1 and £50 each month, with bonuses paid at the end of the second and fourth years, after which the account is closed.
Currently, Help to Save is available to those on working tax credits, child tax credits (who are entitled to working tax credits), or those who receive universal credit and have a take-home pay of at least £793.17.
From next April, the government will be extending the availability of the scheme to all universal credit claimants earning £1 or more. This is expected to make the scheme accessible to a further three million people.
You can apply for a Help to Save account on the government's website.
Plans to change to the Work Capability Assessment
The government is also making reforms in an effort to find savings in the welfare budget and put more people in work.
In her speech, Reeves confirmed plans to press ahead with changes to the Work Capability Assessment - which is likely to raise the threshold at which hundreds of thousands of people currently claiming for disability benefits qualify for payments.
Learn more about benefits
- To find out more about which benefits or support you may be entitled to, check our comprehensive guides.
- You can also see our guide to schemes to support you in paying for your energy bills.
