The government have published the first detailed draft regulations for Universal Credit and is formally consulting the SSAC about them.
I’ve started building the detail into our Future Benefits Model (FFBM) and there are substantial changes to previous announcements. Some of them are simplifications, such as the earnings disregard rules now discarding the formula for reducing them by increased housing costs in favour of a simple two tier system based on having any housing costs. Others clarify the options so that we know now that there will be no mortgage interest support for those with any earnings at all. Other tweaks include the disregard of 100% of pension contributions, instead of the current 50%, when deriving net earnings … and much else.
This does, of course, mean rewriting and remodelling, my paper which was nearly finished, but it will be rather better for it.
Some of these changes, such as the mortgage interest rule, destroy the governments claim that people will always be better off in work under UC. Someone losing £100 a week mortgage support because they get a couple of hours work a week paying £20 will be substantially worse off.
The change in earnings disregard rules is likely to lead to more cliff edge effects.
I’ll put some more detailed looks at the effects together shortly.