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Welfare Reform Act 2012

Background and Summary

3.In July 2010 the Government published a consultation document 21 st Century Welfare (Cm 7913). This set out a range of options for reform of the welfare system. Over 1600 responses were received, from external organisations, individual members of the public and Department for Work and Pensions staff. At the end of the consultation period, in November 2010, a White Paper Universal Credit: welfare that works (Cm 7957) was published, alongside the Government’s responses to the consultation (Consultation responses to 21st Century Welfare (Cm 7971)). The White Paper set out the Government’s proposals for welfare reform, which aim to improve work incentives, simplify the benefits system and make it less costly to administer. Not all the measures in the White Paper will require primary legislation, but this Act gives effect to those proposals that do.

4.The major proposal for reform is the introduction of a new benefit, to be known as universal credit, which will replace existing in and out of work benefits. The Act also makes provision for a new benefit, personal independence payment, which will replace the existing disability living allowance.

5.The Act consists of 7 Parts:

  • Part 1 – Universal credit

  • Part 2 – Working-age benefits

  • Part 3 – Other benefit changes

  • Part 4 – Personal independence payment

  • Part 5 – Social security: General

  • Part 6 – Miscellaneous

  • Part 7 – Final

6.The following paragraphs summarise those Parts, and are followed by detailed explanations of the individual sections and Schedules.

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Explanatory Notes

Text created by the government department responsible for the subject matter of the Act to explain what the Act sets out to achieve and to make the Act accessible to readers who are not legally qualified. Explanatory Notes were introduced in 1999 and accompany all Public Acts except Appropriation, Consolidated Fund, Finance and Consolidation Acts.


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