Labour has previously said the the reforms are needed to ‘rebalance’ the benefits system, but critics argue that many of the changes will reduce support for people most in need
The Department for Work and Pensions (DWP) is introducing major changes to Universal Credit from next year with millions of claimants set to be impacted.
This includes increases to the standard allowance and significant cuts to the health-related Limited Capability for Work and Work-Related Activity (LCWRA) element for new claimants.
Labour has previously said the the reforms are needed to “rebalance” the benefits system, but critics argue that many of the changes will reduce support for people most in need.
A record eight million people were claiming Universal Credit in July 2025. Here is a full breakdown of what is coming.
All legacy benefits moved to Universal Credit
All legacy benefits will be moved across to Universal Credit by the end of March 2026. Universal Credit is replacing Tax Credits, Income-based Jobseeker’s Allowance, Income Support, Income-related Employment and Support Allowance and Housing Benefit.
If you have yet to be moved over, you will receive a “migration notice” in the post. This will give you a three-month deadline to move across to Universal Credit – after this point, your existing benefits will be stopped.
Universal Credit standard allowance to rise above inflation
The Universal Credit standard allowance – the basic amount everyone receives before additional elements are added for children, sickness, or caring responsibilities – will rise above the rate of inflation from next April.
The standard allowance will increase from £91 to £98 a week. This is the standard weekly rate for a single person aged 25 and over. The DWP estimates that by 2029, above-inflation increases will boost the average standard allowance by £775 in cash terms.
Universal Credit sickness payment halved and frozen for new claimants
The LCWRA is the health element of Universal Credit that provides an extra monthly payment for claimants whose health or disability limits their ability to work.
But from April 2026, new claimants awarded LCWRA will only receive £50 a week – and this will be frozen at this level 2029/30. This is down from the current rate of £97 a week.
Existing claimants will see the top up frozen at £97 a week until 2030, with no annual increases. By 2030, the LCWRA element will be scrapped entirely and replaced with a new health element linked to PIP.
This will be automatically awarded to anyone who already qualifies for the daily living element of PIP. This means claimants will no longer have to undergo a separate Work Capability Assessment to access additional health-related support.
But those who do not get a daily living award of PIP will not be eligible for Universal Credit health support
New Severe Conditions Category introduced
A new subgroup within the LCWRA will be introduced in April 2026 for people with the most serious, lifetime disabilities and illnesses. The new Severe Conditions Category (SCC) will receive the higher, current rate of the LCWRA element.
They will also be exempt from routine reassessments for this element. It is understood claimants will not be assessed on what their condition is, but on how it impacts them.
