Jobseeker’s allowance was introduced in October 1996 and replaced unemployment benefit as the benefit for unemployed people.
Jobseeker’s allowance claimants must be available for and actively seeking work as a condition of their benefit, and Jobcentre Plus provides a wealth of support to help people back into work, including help with jobsearch techniques, basic skills and work-focussed training.
There are also a series of measures in place to help jobseekers in the transition from benefits into work, whether that work is full or part time.
For example, jobseekers can also claim working tax credits, which provide financial support to people who are working and on a low income. This support aims to boost work incentives by topping up the wages of people on lower pay, according to their family circumstances. This includes providing direct help with the cost of child care for working families.
Jobseekers may also qualify for a Job Grant, a non-taxable, discretionary, work related payment which aims to bridge the gap between a customer’s final payment of benefit and first receipt of wages. To qualify for this, a customer must have been in receipt of a qualifying benefit for 26 weeks immediately prior to starting work of at least 16 hours per week. Awards are £100 for single customers or couples without children and £250 for lone parents or couples with children.
In addition, jobseekers can have their housing benefit extended to cover the first four weeks they are in work, providing they have previously been in receipt of jobseeker’s allowance or other income related benefits for at least 26 weeks immediately before entering work. A similar scheme, with similar rules, exists to support homeowners back into employment. The Mortgage Interest Run-On provides an additional four weeks’ payment of mortgage interest costs after a customer enters work.
We know that the vast majority of people are better off in work. However, we understand that some jobseekers still find the transition into work difficult, and in the December White Paper “Building Britain’s Recovery: Achieving Full Employment”, the Government further announced that we will introduce an enhanced Better off in Work Credit that will ensure that everyone who has been unemployed for 26 weeks or more will receive at least £40 a week more income on moving into work. The new credit will be introduced in one region from October 2010 and we expect the credit will be available nationally from January 2011.
In addition, lone parents in receipt of jobseeker’s allowance may be eligible for the In Work Credit which is paid at £60 a week in London and £40 a week in other parts of the country. Customers who return to work from incapacity benefits may be eligible for the Return to Work Credit which is paid at £40 a week. Both credits are available to these customers when they start work for 16 hours a week, with payments lasting for 52 weeks.