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Universal Credit will have a major overhaul on November 13 which could cost self-employed people hundreds of pounds a month.
The Minimum Income Floor policy, which restricts how much the self-employed can get in benefits, was due to be introduced this year but was suspended due to Covid-19.
The suspension is due to end on November 13, and MIF will come into force then – unless the DWP decides to delay it.
If it comes in it could be a catastrophic blow to many self-employed who may already be feeling financial pressure as a result of new lockdowns.
Ministers today told the House of Commons it has not yet been decided if the date of the delay will go further than November 13.
The situation has prompted benefits campaigners such as welfare group Advice NI to urge the government to extend the MIF suspension to April next year.
Head of Policy Kevin Higgins warned: "I am deeply concerned about the poverty and destitution that could potentially face many people this Christmas."
He urged ministers to stop the MIF from coming back, so "people are not left penniless during the holiday period.”
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The Minimum Income Floor is how much the DWP expects you to earn – not necessarily how much you're actually earning.
Your Minimum Income is worked out by multiplying minimum wage with the number of hours you agreed to work.
If your earnings dip below this "floor", your Universal Credit will be capped.
The DWP will still work out your payment as if you had earned your Minimum Income, not accounting for your loss in earnings.
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There will be exemptions to the MIF – such as firms in their first 12 months.
Employment Minister Mims Davies told the Commons today: "Claimants will always be contacted before the minimum income floor is applied to them.
"Universal Credit claimants who were subject to the minimum income floor prior to the pandemic will be given the opportunity to review their self-employment status and activity, ensuring that their current circumstances are reflected and their business continues to be viable, before any reintroduction of the minimum income floor.
"The regulations to relax the minimum income floor are in place until November and I will update the House on arrangements beyond this in due course."
- Universal Credit
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