SDP- TRANSITIONAL ELEMENT

Created 02/02/2021

As explained in our January 2021 newsletter, the SDP gateway ended on 27/1/2021. As a result, you are going to see more vulnerable clients with the SDP moving onto UC in the coming months.

It will be important to check that they do receive transitional protection in the form of an extra element as part of their UC. Here's the new law and the explanatory memo. Here's the DWP guidance.

Main features-

Schedule 2 – applies to new UC claimants only (not those already receiving the transitional element or other UC.) . '5.The amount of the transitional SDP element in the frst assessment period is— (a) in the case of a single claimant—

(i)£120, if the LCWRA element is included in the award, or (ii)£285,iftheLCWRAelementisnotincludedintheaward;

(b)in the case of joint claimants—

(i) £405, if the higher SDP rate was payable,

(ii) £120, if paragraph (i) does not apply and the LCWRA element is included in the award in respect of either of them, or

(iii) £285, if paragraph (i) does not apply and the LCWRA element is not included in the award in respect of either of them.'

A 'transitional SDP element' will be considered for those people who had an SDP in their legacy award of either ESA (income related), JSA (income based) or Income Support within the previous month of their move to Universal Credit and it will be paid as part of the claimant’s Universal Credit award as a ‘transitional element’. This transitional element will then be subject to a reduction by the amount of any increase to any other Universal Credit element, other than the child care costs element, or by the amount of any new award of a Universal Credit element other than the child care cost element. Unlike pre January 2021 transitional elements, where a couple separate, both partners are treated equally when being consideredforatransitionalSDPelementwhenmakinganewsingleUCclaim. The rules for a transitional element ending are as follows:

• a sustained (three months) earnings drop below the Administrative Earnings Threshold where the claimant has moved into a more intensive conditionality regime; and/ or

• the formation or separation of a couple;

• the ending of the Universal Credit award. Where this was due to an increase in earnings and a new claim is made within 4 months of the Universal Credit award ending, the claimant will have their transitional element re-awarded as part of their new award of Universal Credit.

Book now- More basic- An Overview of Universal Credit 2021

More advanced- Universal Credit – the Tricky Parts 2021