20 December 2017
Bereavement benefits changes and the need for protection
As bereavement benefits change, the need for family protection is more important than ever.
As you read this, we mark 75 years since the publication of the Beveridge Report that ushered in the modern welfare state, and we are just 8 months on from the most significant reform to working age benefits since the time of Beveridge.
The lack of support for bereaved mothers and children was one of the “evils” that Beveridge wanted to tackle with the “giant” of a specific suite of bereavement benefits.
The April 2017 reform introduced a new Bereavement Support Payment benefit, which replaced the existing Bereavement Payment, Bereavement Allowance and Widowed Parent’s Allowance benefits1. The impact of the reform has been especially felt on the support provision available to widowed parents with dependent children.
Despite inflation ticking up, the level of support is now £350 per month with discretionary increases, and the provision period is 18 months2. Previously, this support was the equivalent of £450 per month, paid bi-weekly and indexed3, with the support period lasting until the youngest child ceased to be financially dependent – which could mean a support period of up to 20 years.
The benefit continues to be conditional, with neither the previous nor the new bereavement benefit being available to parents who were in cohabiting relationship with their deceased partner. With the significant growth in cohabiting families in the UK, this is a very real but largely unknown issue.
The supporting rationale for this change to bereavement benefits for parents with children is the provision of back to work support from Universal Credit plus the availability of increased free childcare.
But let’s look at childcare and its cost in more detail. Whilst there is some government support for childcare for children aged two and older, most working parents with younger children do not get any state help. In October this year, the Trades Union Congress (TUC) published detail on childcare costs: their analysis revealed that in England, a single mum or dad with a young child in nursery for 40 hours a week would need to spend two-fifths4 (40%) of their pay on childcare. This makes the balance between work and family life challenging, especially for those who cannot work fewer hours or get support from friends and family.
The reform to the welfare bereavement benefit provision available to working age families and the lack of support to those in cohabiting relationships, gives good reason to review clients’ family resilience and protection needs. It’s worth considering the merits of a simple indexed family income benefit cover, which can provide financial support to your clients and their families, should the worst happen. In addition to this, counselling and support services available from Scottish Widows Care, provided in partnership with RedArc, can provide bereaved parents with practical advice, signposting to specialist services such as childcare, and emotional support needed at such difficult times.
For further information on bereavement benefits and Universal Credit, see the Turn2Us charity, www.turn2us.org.uk
Sources 1-3: www.turn2Us.org.uk
Source 4: www.TUC.og.uk