Widowed parents could lose up to £12,000 under a new scheme which replaces the Widowed Parent’s Allowance, UK charities have warned.
Under the current rules, bereaved families are entitled to the Widowed Parent’s Allowance which draws on the deceased parent’s National Insurance contributions to provide for their family until the youngest child leaves school.
However, on 6 April 2017, it will be replaced by the Bereavement Support Payment, which provides support for just 18 months.
The Department of Work and Pensions (DWP) has also removed inflation-linked payments, and moved widowed parents with longer-term income support needs onto Universal Credit. However, charities have claimed that this will put grieving families under undue financial pressure.
“Latest DWP figures show 75 per cent of bereaved families will be worse off in cash terms under the new scheme, with the average working widowed parent losing out on over £12,000,” said Alison Penny of the Childhood Bereavement Network.
“That’s a huge difference to families struggling to cope after a parent dies.
“Over time, Bereavement Support Payment will be worth less to families, while childcare and other costs of bringing up children are likely to rise. Over the last 30 years, funeral costs have risen far higher than inflation. Bereavement Support Payment will stretch less and less far to cover families’ needs after a parent dies.”
The government had originally planned to end bereavement support after just one year, but extended the scheme following a public consultation.
The payments will be tax free and exempt from the benefits cap, while the poorest out-of-work families with children are expected to see an increase in the cash value of their awards. Furthermore, the bereavement payments will now be available to widows and widowers without children for the first time.
However, charities including Widowed and Young (WAY) claim that the new plans will still leave 91 per cent of parents worse off than they would be under the current system.
“We are really disappointed that the government is forging ahead with significant changes to bereavement support payments from April,” said Georgia Elms, chair of WAY.
“Many newly widowed parents stand to lose thousands of pounds under the new system, which will see bereavement payments for new claimants stop after 18 months rather than continuing for up to 20 years.
“While we are pleased to see that widows and widowers without children will now be entitled to bereavement support for up to 18 months, WAY will continue to campaign against the other changes, which will have a significant impact for parents who have the misfortune to be widowed after 6 April 2017.”
