Increases to benefits in 2014

Benefit and tax credit increases used to be calculated using the Consumer Prices Index (CPI). The majority of working age benefits would have been due to go up by 2.7% from 6 April 2014. But in March 2013, the Welfare Benefits Up-Rating Act 2013 came into effect, limiting annual increases to these benefits to 1% for the next two years, following a 1% limit in 2013-14.

The government argues that, with public sector pay rises capped at 1%, a similar limit should apply to working-age benefits. The benefits affected are:

• Jobseeker’s Allowance;

• Employment and Support Allowance;

• Income Support;

• Elements of Housing Benefit;

• Maternity Allowance;

• Sick Pay, Maternity Pay, Paternity Pay, Adoption Pay;

• Statutory Sick Pay; and

• Couple and lone parent elements of Working Tax Credit and the child element of the Child Tax Credit.