Although the Chancellor’s autumn budget included widely expected benefit increases, there were some unexpected elements.

In particular, caregivers who also earn money will be able to earn more without jeopardizing their eligibility for government assistance.

Universal Credit claimants in debt could also see their net benefits increase.

Here we detail the key welfare changes announced in today’s speech and how they could affect you.

Pension benefits and credits will increase

Working-age benefits are expected to increase by 1.7% (in line with the September inflation rate) in April 2025.

This is expected to enable around 5.7 million families on Universal Credit to earn £150 a year on average in 2025-26.

Pension credit is extra money to help people over state pension age (currently 66) and on low incomes to cover housing costs such as ground rent or service charges.

It is separate from the state pension and is means tested, currently increasing your weekly income to £218.15 if you are single, or your joint weekly income to £332.95 if you live with a partner.

From April 2025, these amounts are set to increase by 4.1% and are expected to mean an annual increase of £465 for single pensioners eligible for the benefit and £710 for couples.

• Learn more: How Universal Credit works
  
• Learn more: Pension credit explained

Carers can earn more while still receiving Carer’s Allowance

Carer’s Allowance is a benefit given to people who look after someone who is in receipt of certain benefits due to a disability or illness.

It’s currently £81.90 per week. To be eligible, you must spend at least 35 hours a week caring for someone and earn no more than £151 a week.

The government has announced it will increase this earnings cap to £196 from April 2025. At the National Living Wage, this would equate to 16 hours of work.

The government says this is the biggest increase in the earnings limit since the Carers Allowance was introduced in 1976, and will allow more than 60,000 additional carers to access the benefit.

• Learn more: Carer’s Allowance

Reduction of Universal Credit debt deductions

Universal Credit is a benefit for those who are unemployed or on low income. Currently, the standard monthly allowance is £393.45 for single people, or £617.60 for couples aged 25 or over.

However, deductions can be made if you owe money, for example fines, rent or taxes or energy payments.

Currently, the maximum of these monthly reductions can be 25% of the amount of benefits paid. Today, Rachel Reeves announced a new ‘fair reimbursement rate’ – which will come into effect in April 2025.

This will reduce the cap from 25% to 15%, allowing claimants to keep more of their payment where they are in debt.

It is estimated that this will benefit around 1.2 million households, saving them an average of £420 a year.

• Learn more: What is Universal Credit?

Extension of the Help to Save system

Help to Save is a kind of savings account that pays a bonus of 50% of what you save each month.

You can save between £1 and £50 each month, with bonuses paid at the end of the second and fourth years, after which the account is closed.

Currently, Help to Save is available to those in receipt of Working Tax Credits, Child Tax Credits (who are entitled to Working Tax Credits) or those in receipt of Universal Credit and have a take-home pay of at least £793.17.

From next April, the Government will extend the availability of the scheme to all Universal Credit claimants earning £1 or more. This is expected to make the program accessible to an additional 3 million people.

You can request a Help to Save account on the the government website.

Plans to modify the work capacity assessment

The government is also carrying out reforms with the aim of making savings in the social budget and putting more people to work.

In his speech, Reeves confirmed his intention to pursue changes to the work capacity assessment, which is likely to raise the threshold at which hundreds of thousands of people currently claiming disability benefits are entitled to benefits. payments.

Learn more about the benefits

• To find out more about benefits or support you may be entitled to, see our complete guides.
• You can also consult our guide to devices to assist you in pay your energy bills.