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Welfare Reform and Work Act 2016

Contents

Legal background

Full employment reporting obligation

  1. There is no existing legislation on the Full Employment measure.

Apprenticeships reporting obligation

  1. Existing legislation on apprenticeships is the Apprenticeships, Skills, Children and Learning Act 2009 (amended by Schedule 1 to the Deregulation Act 2015).

Troubled Families Programme

  1. There is no specific statutory basis for the Troubled Families Programme. Rather, grant funding to local authorities is provided in exercise of the power contained in section 31 of the Local Government Act 2003.

Children living in low-income households

  1. There is no existing legislation in respect of this section. This is a new statutory duty on the Secretary of State.

Life chances

  1. The relevant legislation is the Child Poverty Act 2010 cited as the Life Chances Act 2010.

Benefit cap

  1. The relevant legislation, as indicated in the policy background section, is sections 96 and 97 of the Welfare Reform Act 2012.

Freeze of certain social security benefits and certain tax credit amounts for four tax years

  1. The relevant legislation is:

    1. the Social Security Administration Act 1992, and
    2. the Tax Credits Act 2002.

  1. Under section 150 of the Social Security Administration Act 1992, the Secretary of State for Work and Pensions is required to review the value of benefits and pensions in light of changes in prices. Where it appears to the Secretary of State that prices have increased relative to the value of those benefits the Secretary of State must make an up-rating order which increases certain benefits by at least the amount by which prices have increased and if the Secretary of State considers it appropriate, having regard to the national economic situation and any other matters the Secretary of State considers relevant, which also increases other benefits by such a percentage as he thinks fit. The Order is subject to Parliamentary approval. The Act provides that, for the four tax years from 2016-17, each of the relevant sums listed in paragraph 1 of Schedule 1 will remain the same as it was in 2015-16.

  2. Responsibility for up-rating child benefit was transferred from the Secretary of State to the Treasury under section 49(3) of the Tax Credits Act 2002. Therefore, the Treasury must review the child benefit rates for Great Britain in each tax year under section 150(1) of the Social Security Administration Act 1992 to determine whether or not they have retained their value in relation to the general level of prices in the United Kingdom. Section 150(2) of that Act provides that HM Treasury has a discretion, where it is considered appropriate, to up-rate the rates of child benefit taking into account the "national economic situation and any other matters" which "are considered relevant". Child Benefit is not devolved and applies to the whole of the United Kingdom.

  3. Responsibility for setting the amounts of tax credits lies with HM Treasury under sections 9, 11 and 65(1) of the Tax Credits Act 2002. The Treasury must review the rates in each tax year under section 41 of that Act to determine whether they have retained their value in relation to the general level of prices in the UK. Section 41 also obliges the Treasury to prepare a report of each review and include a statement of what each amount would be if it had fully retained its value, and to publish the report and lay a copy of it before each House of Parliament. Tax credits are not devolved and apply to the whole of the United Kingdom.

Changes to child tax credit

  1. Responsibility for child tax credit (CTC) lies with HM Treasury under sections 8, 9, and 65(1) of the Tax Credits Act 2002.

  2. Currently, section 8 sets out the conditions for entitlement to CTC and what is meant by a child or qualifying young person for the purposes of child tax credit. Section 9 provides for regulations setting out the elements of CTC making up the maximum rate of CTC and provides that the maximum rate must include:

    1. an element which is to be included in the case of all persons entitled to CTC (the 'family element'); and
    2. an element in respect of each child or qualifying young person for whom the person or persons entitled to CTC is or are responsible (the 'individual element').

  1. Section 9(5) allows regulations to vary the amount of either the family or the individual element and requires that the individual element must be increased in the case of a child or qualifying young person who is disabled and further increased in the case of a child or qualifying young person who is severely disabled.

Changes to the child element of universal credit

  1. Relevant legislation for the child element in universal credit is:

    1. section 10 of the Welfare Reform Act 2012, and
    2. regulations 24 and 36 of the Universal Credit Regulations 2013.

Removing the work-related activity component in employment and support allowance and the limited capability for work element in universal credit

  1. The existing legislation which makes provision for the work-related activity component in employment and support allowance (ESA) and the limited capability for work element in universal credit (UC) is:

    1. for ESA, Part 1 of the Welfare Reform Act 2007; and
    2. for UC, Part 1 of the Welfare Reform Act 2012.

Conditionality for responsible carers in universal credit

  1. The relevant conditionality requirements are set out in the following legislation:

    1. sections 19, 20, 21 and 22 of the Welfare Reform Act 2012; and
    2. regulation 91 of the Universal Credit Regulations 2013.

Loans for mortgage interest etc

  1. The key legislation for the current support for mortgage interest scheme is:

    1. income support – Section 135(1) of the Social Security Contributions and Benefits Act 1992 and regulations 17(1)(e) and 18(1)(f) of, and Schedule 3 to, the Income Support (General) Regulations 1987;
    2. jobseeker's allowance – Section 4(3), (3A) and (5) of the Jobseekers Act 1995 and regulations 83(f) and 84(g) of, and Schedule 2 to, the Jobseeker's Allowance Regulations 1996;
    3. employment and support allowance – Section 4(1) and (2) of the Welfare Reform Act 2007 and regulations 67(1)(c) and 68(1)(d) of, and Schedule 6 to, the Employment and Support Allowance Regulations 2008;
    4. state pension credit – Section 2(2) and (3) of the State Pension Credit Act 2002 and regulation 6(6)(c) of, and Schedule 2 to, the State Pension Credit Regulations 2002;
    5. universal credit - Sections 8(2)(c) and 11 of the Welfare Reform Act 2012 and regulations 23(1)(c) and 25 of, and Schedules 1 to 3 and 5 to, the Universal Credit Regulations 2013; and
    6. payments direct to mortgage lenders - Section 15A of the Social Security Administration Act 1992, regulation 34A of the Social Security (Claims and Payments) Regulations 1987 and regulation 59 of the Universal Credit, Personal Independence Payment, Jobseeker's Allowance and Employment and Support Allowance (Claims and Payments) Regulations 2013.

Expenses of paying sums in respect of vehicle hire etc

  1. The relevant legislation which allows the payment of the benefits to Motability is:

    1. section 5 of the Social Security Administration Act 1992;
    2. regulations 44 – 46 of the Social Security (Claims and Payments) Regulations 1987; and
    3. regulations 62-64 of the Universal Credit, Personal Independence Payment, Jobseeker's Allowance and Employment and Support Allowance (Claims and Payments) Regulations 2013.

Social housing rents

  1. The legislation relating to existing housing and rent policy for private registered providers and local authorities, including changes to end housing subsidy and enable self-financing of local housing authorities, is set out in a combination of primary and subordinate legislation. The current provisions are:

    1. Housing Act 1985;
    2. Local Government and Housing Act 1989;
    3. Housing and Regeneration Act 2008;
    4. Localism Act 2011;
    5. secondary legislation made under the above Acts.

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