The Department for Work and Pensions (DWP) has announced a significant increase in Universal Credit payments for millions of claimants, with single individuals set to receive nearly £300 extra over the coming year.
Key Increases in Benefits and Wages
From April 2026, the Universal Credit standard allowance for single people aged 25 and over will rise from £400.14 to £424.90 per month. This increase of £24.76 each month amounts to just under £300 across the full year. The uplift is part of a broader uprating of working-age benefits, which will rise by 3.8% in line with the Consumer Price Index (CPI) inflation rate recorded in September 2025.
In a parallel move to boost incomes, the government has also confirmed a rise in the National Living Wage. From 1 April 2026, it will increase by 4.1% to £12.71 per hour. Younger workers will see even larger percentage hikes, with the rate for 18-20 year olds jumping 8.5% to £10.85, and pay for 16-17 year olds and apprentices rising 6.0% to £8.00 per hour.
Major Reforms to the Benefits System
Alongside the rate increases, the DWP is implementing several major policy changes. The most notable is the removal of the two-child limit in the Universal Credit Child Element from April 2026. This controversial policy, which restricted support to the first two children in a family, is being scrapped.
The government estimates this removal will have a profound impact. By 2030, it is projected that 600,000 fewer individuals will be in relative low income after housing costs, including 450,000 children. Furthermore, around two million children will live in households that see their income rise as a direct result.
Assessments, Reviews, and Projected Savings
The DWP plans to intensify its scrutiny of claims to ensure accuracy and control costs. It will conduct an additional 122,000 Work Capability Assessments for existing claimants by 2029-30. The department is also extending Personal Independence Payment award review periods and increasing face-to-face health assessments.
Furthermore, the Targeted Case Review programme, which identifies incorrect Universal Credit claims, will be extended to 2031. Combined, these measures targeting claim accuracy are expected to generate substantial savings for the Treasury, totalling £1.95 billion by 2030, with the case review alone saving an extra £1.3 billion.
Rates for the Universal Credit Standard Allowance and the Health Element are now set in legislation until April 2029, a measure confirmed by both the Labour Party and the DWP, providing longer-term certainty for claimants and policymakers alike.
