The UK government has announced a rule change that will benefit many people receiving Department for Work and Pensions (DWP) benefits, including Universal Credit. Starting from April 2026, benefit claimants could see a significant increase in their payments, with some households set to receive an extra £465 a year.
This increase is part of the UK Chancellor’s Autumn Budget and aims to help claimants as the cost of living continues to rise. Let’s take a look at the key details of this change.
What is the Change?
The biggest change in the Autumn Budget 2025 is the increase in Universal Credit payments, which is the most commonly claimed benefit in the UK after the state pension.
Normally, DWP benefits such as Universal Credit increase in line with inflation, which for this year would mean a 3.8% rise based on the Consumer Price Index (CPI). However, the government has decided to offer more than just an inflation increase.
The Increase Explained
From April 2026, the Universal Credit Standard Allowance will see an increase of 6.2%, which is higher than the usual inflation-based rise. This will mean:
| Claimant Type | Annual Increase | Comparison to Inflation-based Rise |
|---|---|---|
| Single claimant (aged 25 or over) | £295 | £110 more than inflation alone |
| Couple (one partner aged 25 or over) | £465 | £180 more than inflation alone |
For a single person aged 25 or older, this will translate into an additional £295 per year, and for couples, the increase will be £465 annually. This is good news for many people who rely on Universal Credit for daily living expenses.
What Other Changes Are Coming?
Along with this increase, there are also significant changes to other aspects of Universal Credit and DWP payments:
- Abolition of the two-child benefit cap: The government has decided to remove the limit on how many children Universal Credit claimants can receive payments for. This will allow families with more than two children to get more financial help.
- Changes to Limited Capacity for Work Related Activity (LCWRA) payments: The government plans to halve the LCWRA payments for new claimants and freeze the existing rate for those who are already receiving them.
Why Is This Happening?
The government has explained that these changes aim to balance the system and encourage people to get back to work. They want to make sure that people who are able to work are not claiming to be unfit in order to get higher benefits.
By increasing the standard allowance, the government hopes to make Universal Credit more fair while reducing the incentive for some claimants to declare themselves unable to work.
What is Universal Credit?
Universal Credit is a means-tested benefit introduced in the UK in 2012 by the Conservative-Liberal Democrat coalition government.
It is designed to help people of working age, whether they are unemployed or working but earning too little to support themselves. This benefit helps people cover the costs of everyday life, from rent to food and bills.
The rule changes announced in the Autumn Budget, including the £465 annual boost for Universal Credit claimants, are designed to provide more support to those in need. While the increase is expected to help thousands of people, there are also new measures intended to ensure the system is fair.
Universal Credit is crucial for many families, and these changes reflect the government’s recognition of the challenges many are facing due to inflation and rising living costs.
The UK government hopes that by making these adjustments, they can offer more financial stability to benefit claimants while encouraging people to get back to work as the best way to reduce poverty.
FAQs
What is Universal Credit?
Universal Credit is a government benefit designed to help people of working age, both those who are unemployed and those who need extra financial support while working.
When will the £465 increase come into effect?
The £465 increase for couples and the £295 increase for single claimants will take effect from April 2026.
What changes are being made to Limited Capacity for Work Related Activity (LCWRA) payments?
The government plans to halve LCWRA payments for new claimants and freeze the existing rate for current claimants.