Universal Credit pay rises for millions of households confirmed in new DWP plan
Almost four million households will receive an income boost to their Universal Credit standard allowance every year for the next four years
Millions of Universal Credit claimants are set to receive above inflation pay rises starting from next April.
Almost four million households will receive an income boost to their Universal Credit standard allowance every year for the next four years, which will be worth £725 by 2029/30 for a single household 25 or over.
The majority of benefits normally rise every April in line with the previous September rate of inflation. The details of future pay rises were published this week in the new Universal Credit and Personal Independence Payment Bill.
It means by by 2030, the amount a Universal Credit claimant receives will be almost 5% higher than if it had only risen to match inflation. Here is how much the Universal Credit standard allowance is set to rise by:
2.3% for 2026-27
3.1% for 2027-28
4.0% for 2028-29
4.8% for 2029-30
The standard allowance is the basic amount of Universal Credit you get before any additional elements - for example, if you have children or are unable to work due to illness - or any deductions are taken into account.
You may be subject to deductions if you have savings or if you owe the Department for Work and Pensions (DWP) money. The standard allowance is worth £316.98 a month for a single person under 25 and £497.55 a month for couples under 25.
Meanwhile, single people over 25 get £400.14 a month and couples aged 25 or older get £628.10 a month. The DWP has also revealed further details about its plans to reform Personal Independence Payment (PIP).
Under current rules, you need between eight and 11 points to get the standard rate of the daily living component. But from November 2026, you would need a minimum of four points in at least one activity to qualify for the daily living component.
This means claimants would need to show greater difficulty when completing some tasks, such as washing, eating and getting dressed, to be eligible to claim PIP. There are no changes planned for the PIP mobility component.
The DWP this week confirmed there will be a new 13-week transitional period before PIP payments are stopped, for anyone affected by the changes.
The additional protection will apply to existing claimants affected by changes to the PIP daily living component, including those who their lose eligibility to Carers Allowance and the carer's element of Universal Credit.
The majority of assessments for PIP will also be conducted face-to-face, rather than over the phone or through video. "Reasonable adjustments" will still be made for people who cannot attend a face-to-face assessment.
People with health conditions that are permanent or will get worse will not have to be reassessed under the new plans - but other claimants could face more frequent reassessments.
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