DWP Announces £725 Payment Boost for Millions of Claimants – Here’s What You Need to Know

In a new announcement, the DWP confirmed a £725 payment increase for millions of Universal Credit claimants by 2029. The move will support individuals out of work, with the standard allowance rising annually.

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DWP £725 Payment Boost
DWP £725 Payment Boost. credit : shutterstock | en.Econostrum.info - United Kingdom

The Department for Work and Pensions (DWP) has revealed plans for a guaranteed increase in Universal Credit payments, providing up to £725 annually for almost 4 million households by 2029. 

The adjustment aims to ensure a more consistent income for claimants, with specific increases outlined in the new DWP Bill. The move is part of the government’s ongoing strategy to address social security and poverty.

Context of the Increase

The announcement comes at a time when millions of people across the UK are struggling to make ends meet. Universal Credit, which supports those out of work, is set to see its standard rate rise steadily over the coming years. 

According to the DWP, these changes will benefit individuals who are not disabled or suffering from illness, and the rise will be particularly important for single claimants, who could see a £725 boost by 2029-30.

The policy shift is part of broader welfare reforms promised under Labour, which are intended to address the cost of living crisis.

 As inflation continues to affect household budgets, the increase in the Universal Credit rate aims to mitigate some of the pressures faced by the most vulnerable groups in society. Critics, however, remain divided over the long-term impacts of such measures.

Details of the Payment Increase

The new DWP Bill outlines how the standard allowance will be adjusted annually from April 2026. The proposed increases are as follows: 2.3% for 2026-27, 3.1% for 2027-28, 4.0% for 2028-29, and 4.8% for 2029-30. 

These changes are expected to keep pace with inflation, though they represent a significant rise compared to the standard inflationary increases that have applied in recent years.

The DWP’s forecast suggests that single people could be £250 better off each year by 2029, with a total gain of £725 when compared to what they would have received if the payments were only uprated by inflation. 

According to the Department, this move demonstrates a continued commitment to supporting low-income households through progressive financial adjustments.

Criticism and Opposition

Despite the positive outlook for many claimants, the proposed reforms have sparked criticism from various quarters. Anela Anwar, the CEO of anti-poverty charity Z2K, raised concerns about the long-term impact on disabled people, noting that the reforms could push over a million disabled individuals further into poverty.

Furthermore, the Scottish National Party (SNP) has firmly opposed the Universal Credit reforms, particularly the cuts to disability benefits. According to Shirley-Anne Somerville, Scotland’s Social Justice Secretary, the UK government’s approach fails to protect those most vulnerable, especially in the ongoing cost-of-living crisis.

The government’s strategy, despite its ambition to raise claimants’ income, is also being scrutinised for its long-term viability and fairness.

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