Household budgets face another shake‑up as ministers lock in next year’s benefits formula, with fresh winners and some losers.
Millions of Universal Credit recipients are in line for an above‑inflation uplift from April 2026 after the government set a new uprating formula. The standard allowance will rise by 6.2 per cent, with the biggest households gaining around £450 a year, while some disability‑related payments shift in the opposite direction.
What the 6.2% Universal Credit uplift means
The Department for Work and Pensions will raise the standard allowance for all eight million people on Universal Credit in April 2026. Ministers agreed in July to uprate the basic payment by a new formula that adds last September’s inflation to a fixed top‑up for the next three years.
The standard allowance goes up by 6.2% in April 2026. That means roughly £6 a week more for a single adult over 25, and around £9 a week more for a couple over 25.
Most other benefits look set to track inflation alone at about 3.8 per cent, so Universal Credit’s core payment pulls ahead next year. The rise lands automatically and appears on statements from the first assessment period that ends after the April rollout date.
New monthly rates at a glance
- Single, under 25: £316.98 to £336.63 (▲ £19.65 per month)
- Single, 25 and over: £400.14 to £424.95 (▲ £24.81 per month)
- Couple, both under 25: £497.55 to £528.40 (▲ £30.85 per month)
- Couple, one or both 25 and over: £628.10 to £667.04 (▲ £38.94 per month)
How the figure was calculated
The uplift stems from a simple formula: take Consumer Prices Index inflation recorded for September and add a fixed percentage. For 2026, CPI came in at 3.8 per cent and the fixed element is set at 2.3 per cent, producing an uprate of about 6.2 per cent on the standard allowance.
Universal Credit’s core payment rises by CPI plus a fixed top‑up until 2029, whereas most other benefits track CPI only.
This approach guarantees an above‑inflation increase for several years, but the exact gain varies with inflation prints. A slightly lower CPI reading than forecast trims a few pounds off what households might have expected.
Winners, trade‑offs and a two‑tier worry
Every Universal Credit household gains from the higher standard allowance. Yet changes to the health‑related component point the other way. The additional element for those with significant health conditions will be frozen at about £97 a week for existing claimants until 2029/30. New claimants from next year will see that extra payment set at around £50 a week instead.
Health element shift: frozen for existing claimants, cut for new ones. Standard allowance still rises by 6.2% for everyone.
Disability organisations warn that this creates a two‑tier system. They argue that disabled people face higher costs, often running far above mainstream inflation, and that freezing or cutting support leaves gaps that the standard allowance uplift cannot fill.
What you could gain in a year
The monthly changes translate into hundreds of pounds over 12 months. The largest increase falls to couples where one or both partners are 25 or over.
| Household type | Current standard allowance (pcm) | From April 2026 (pcm) | Approx annual gain |
|---|---|---|---|
| Single, under 25 | £316.98 | £336.63 | ~£236 |
| Single, 25 and over | £400.14 | £424.95 | ~£298 |
| Couple, both under 25 | £497.55 | £528.40 | ~£370 |
| Couple, one or both 25 and over | £628.10 | £667.04 | up to ~£450 |
Context from economists and charities
Research groups call the 6.2 per cent rise a help, but not a cure. Analysts at the Resolution Foundation note that inflation came in a touch lower than forecast, nudging down the calculated uplift by a fraction compared with expectations. They say the timing matters because September’s figure sets next April’s increase in stone.
Anti‑poverty campaigners argue that the basic rate still fails to match the cost of essentials, especially for single adults. They want ministers to consider an independent mechanism that benchmarks the standard allowance to real‑world living costs rather than to prices alone.
What stays the same — and what changes
Standard allowance
Rises by 6.2 per cent for all Universal Credit claimants from April 2026. This sits on top of the child, housing and other elements you may receive.
Most other benefits
Expected to increase by around 3.8 per cent in line with September inflation. The exact uplift depends on the benefit and policy decisions taken at the Budget.
Health‑related element
Frozen at roughly £97 a week for existing claimants until 2029/30. Set at about £50 a week for new awards, creating different outcomes depending on when you qualify.
Will you actually see the full increase?
In most cases, yes. The standard allowance boosts your maximum award before any deductions, so your payment should rise by the amounts shown. Several factors can limit what lands in your account:
- The benefit cap may restrict your total award if your elements exceed the cap for your area and family size.
- Deductions for advance repayments, overpayments or third‑party debts reduce the cash you receive.
- Sanctions or unreported changes of circumstances can alter your entitlement mid‑period.
If you work and receive Universal Credit, the taper rate still applies to your earnings. The uplift raises your maximum entitlement, so the cash increase usually still flows through pound‑for‑pound unless the cap or deductions bite.
How to estimate your new award
Add 6.2 per cent to your current standard allowance, then apply 3.8 per cent to other elements if they follow CPI. Compare the result with your most recent statement. If you live as a couple, remember the allowance applies per couple, not per person. If you think the change looks wrong after April, send a journal message and ask for a breakdown of the calculation.
What to watch at the autumn Budget
The Treasury is expected to confirm uprating orders and may set further welfare changes. Keep an eye on any updates to Local Housing Allowance rates, the benefit cap, or work allowances. Small shifts in these rules can outweigh the headline uplift for some households.
Practical examples
Single renter, over 25, part‑time work
Current standard allowance £400.14 pcm. From April 2026 this becomes £424.95 pcm. If you earn above the work allowance, the taper still reduces your award, but the 6.2 per cent boost increases your maximum entitlement. Check whether the housing element or any childcare help also rises with CPI.
Couple, one partner over 25, no children
Current allowance £628.10 pcm. From April 2026 this becomes £667.04 pcm — roughly £39 more each month, or near £450 a year. If you have deductions for an advance, consider reducing the repayment rate before April to feel the full benefit.
Key takeaways for claimants
From April 2026, most Universal Credit households gain between about £236 and about £450 a year from the 6.2% uplift.
- Check your online statement in April to confirm the new rate has been applied.
- Review deductions to avoid losing the benefit of the increase.
- If you have a health condition, be aware of the new health‑related element rules for future claims.
- Watch Budget announcements for decisions on housing support, caps and work allowances.
For families under pressure, the uplift offers some breathing room, especially where rents and bills still strain budgets. Those with higher disability‑related costs may not feel the same relief. If you plan ahead — by checking deductions, updating your circumstances promptly and budgeting for the likely increase — you can make the most of the change when it lands.
One final check worth doing: test how a change in hours or pay might interact with the higher allowance. A simple calculation with your taper and work allowance can show whether a small shift in earnings leaves you better off overall, once the 2026 rates take effect.
A 6.2% uplift sounds decent on paper, especially the ~£39 a month for over‑25 couples, but prices for rent and food have jumped alot more for many of us. Still, it’ll definately help with bills. I just hope deductions don’t swallow it—advance repayments, overpayments, all that. Please make the new rates crystal‑clear on statements in April so people can actually budget.