Welfare Reform Act 2012
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| Long title | An Act to make provision for universal credit and personal independence payment; to make other provision about social security and tax credits; to make provision about the functions of the registration service, child support maintenance and the use of jobcentres; to establish the Social Mobility and Child Poverty Commission and otherwise amend the Child Poverty Act 2010; and for connected purposes. |
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| Citation | 5 |
| Introduced by |
Iain Duncan Smith Lord Freud |
| Territorial extent | England, Scotland and Wales (see section 149 of the Act for Northern Ireland) |
| Dates | |
| Royal assent | 8 March 2012 |
| Commencement | April 2013 |
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Status: Unknown
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| Text of statute as originally enacted | |
| Text of the Welfare Reform Act 2012 as in force today (including any amendments) within the United Kingdom, from legislation.gov.uk | |
The Welfare Reform Act 2012 is an Act of Parliament in the United Kingdom which makes changes to the rules concerning a number of benefits offered within the British social security system. It was enacted by the Parliament of the United Kingdom on 8 March 2012.
Among the provisions of the Act are changes to housing benefit which came into force on 1 April 2013. These changes include an "under-occupancy penalty" which reduces the amount of benefit paid to claimants if they are deemed to have too much living space in the property they are renting. Although the Act does not introduce any new direct taxes, this penalty has been characterised by the Labour Party and some in the media as the "Bedroom Tax", attempting to link it with the public debate about the "Poll Tax" in the 1990s. Advocating the Act, the Chancellor of the Exchequer (George Osborne) stated that the changes would reduce welfare dependency and support working families.
The main elements of the legislation are:
The Welfare Reform Act introduces a new welfare benefit called Universal Credit which is to replace six of the main means-tested benefits and tax credits:
The benefit is to operate as a single payment to claimants and will be available to working people on a low income and the unemployed. Its stated aim is to improve the incentive to work by making it easier for people who have temporary, low-paid work to move in and out of employment without losing benefits, and to simplify the benefits system by bringing together several benefits into a single payment. Through this scheme, it is envisaged that unemployed people will be encouraged to take on more work for any period of time that is available. The system has some similarities to a negative income tax but it is not the same as a basic income guarantee as payments are conditional on availability and means-tested.
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