Universal Credit: health element, is my UC going up, above-inflation rise - key claim changes explained

Work and Pensions Secretary Liz Kendall has outlined the Government’s plans to reform the health benefits system in an effort to curb rising welfare costs.

Ahead of Tuesday’s (March 18) announcement, the proposed changes faced widespread criticism, with opponents arguing they would disproportionately impact disabled people.

Read more: Universal Credit and PIP: government reveals major changes and reforms

One of the most notable updates for Universal Credit claimants is a permanent, above-inflation increase.

But was it all good news, and what other changes are coming for those in receipt of Universal Credit? How is the health element affects, and will payments go up? Here is everything you need to know.

Note: While the core structure of Universal Credit is the same across the UK, Scotland and Northern Ireland have some unique policies and adjustments that could affect how the reforms are implemented locally. Check with your local authority for the latest information.

What’s changing with the universal credit health element?

From April 2026, incapacity benefits under Universal Credit will be frozen at £97 per week for existing claimants, meaning they will not rise with inflation until 2029/30.

Existing claimants will see an increase in their UC entitlement in cash terms due to a higher standard allowance - more on that below.

For new claimants, the amount will be reduced to £50 per week from 2026/27. The Government says this reduction will also be offset by the higher standard allowance.

Those receiving the new, lower Universal Credit health element after April 2026 - who have severe, lifelong health conditions with no chance of improvement and will never be able to work - will have their incomes protected through an additional premium.

They will also be exempt from future reassessments.

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Is Universal Credit going up?

Universal Credit is set to increase. The standard rate of Universal Credit for jobseekers will rise above inflation, providing up to £775 extra per year by 2029/30, according to Kendall.

As for the immediate future of the benefit, payments will increase from April, a rise which will benefit millions of people in the UK.

Most social security benefits - which encompass a range of payments provided by the Government to support individuals and families in financial need - will increase by 1.7% from the previous year’s rates.

That’s because each year, benefits are adjusted based on the Consumer Price Index (CPI) inflation rate recorded in the previous September.

While this year’s increases will provide some much-needed financial relief to households across the country as they navigate rising costs, September 2024's inflation rate of 1.7% was the lowest seen in three and a half years.

Read more: Universal Credit: pay rise for millions who claim UC with rates increase of up to £10.50

What else is changing?

The Work Capability Assessment, which currently determines an individual’s ability to work, will be scrapped by 2028.

Instead, eligibility for extra financial support due to health conditions under Universal Credit will be assessed solely through Personal Independence Payment (PIP).

Another key change is that young people under 22 will no longer qualify for the incapacity benefit top-up to Universal Credit.

The Government appears to be aiming to prevent what it sees as a trend of young people moving straight from school onto health benefits.

What do you think about these changes to Universal Credit and the health benefits system? Do you feel these reforms will have a positive or negative impact on claimants? We’d love to hear your thoughts - share your views in the comments.