ESA claimants to migrate to Universal Credit by 2026

The Budget statement on 30 October 2024 confirmed that the government intends to continue with the accelerated migration of all Employment and Support Allowance claimants to Universal Credit by 2026, instead of by 2028¹. The same statement confirmed working-age benefits rates will increase by 1.7% in April, in line with price inflation but under half the 4.1% increase for pensioners¹.

The migration timetable was described as a continuation of a recent Department for Work and Pensions announcement rather than a new decision. The previous government had first slowed down and then sped up the process, so it is debatable whether it is accelerated at all¹. Universal Credit is now more than 11 years old, and the hardest part of moving people onto it has been left to last¹. Statistics due on 12 November should show how well the DWP is progressing with moving legacy benefit claimants across, and the third of Tax Credit claimants who failed to move to Universal Credit should act as a warning¹.

The Budget also confirmed the end of pension-age Housing Benefit, with all new claims for housing costs from 2026 to be administered with Pension Credit¹. The measure is intended to help with benefit take-up, so that pensioners who claim one benefit do not miss out on the other¹. It means local authority benefit departments will provide help with housing only to people in temporary and supported accommodation, while maintaining large IT systems¹.

Other working-age measures in the statement include an extension of the Household Support Fund and a limit on the amount deducted from benefits to pay for outstanding debts¹. The earnings limit where Carer's Allowance eligibility ends will be set at the amount earned by someone working 16 hours a week on the National Living Wage, rising by £45 in April to £196 per week¹. A working-age person on benefits will see their income increase by around £1.50 a week in April, with the standard personal allowance rising to £92 a week, while the full-rate basic pension rises by £9 a week to £230 a week¹.

Plans to move the High Income Child Benefit Charge to a household basis have been shelved. The Chancellor baulked at the estimated cost of £1.4 billion to double the income threshold, which would have been needed to stop large numbers of households being affected¹. The charge currently starts to remove Child Benefit from households where one member earns £60,000 a year, but does not affect couples where both earn £59.000 a year¹.

Why it matters for households

People claiming income-related ESA will receive a migration notice and move to Universal Credit by 2026 rather than 2028, two years sooner than previously planned¹. The move changes how awards are calculated and paid, and the transition process has already seen a third of Tax Credit claimants fail to move across¹. Working-age benefit rates rise 1.7% in April, around £1.50 a week for a single person on benefits, against 4.1% for pensioners¹. The Carer's Allowance earnings limit rises to £196 a week in April¹. From 2026, new claims for help with housing costs from pension-age households will be handled through Pension Credit rather than Housing Benefit¹.

What happens next

Statistics on the DWP's progress in moving legacy benefit claimants to Universal Credit are due on 12 November¹. The 1.7% benefit uprating, the £45 Carer's Allowance earnings limit increase and the £9 a week rise in the full-rate basic pension take effect in April¹. The end of pension-age Housing Benefit and the ESA migration both take effect in 2026¹.