WIREDGOV

The current system of paying bereavement benefits is inconsistent and complex, with no encouragement to return to work the Minister for Welfare Reform, Lord Freud said yesterday as he published a consultation to ensure that widows and widowers are supported better in the future.

Bereavement benefits provide financial assistance for people after the loss of a spouse or civil partner, but the complexity of the different payments available under the current system undermines their effectiveness. With around eighty per cent of Bereavement Allowance recipients and forty six per cent of Widowed Parent’s Allowance recipients not getting the maximum payment, it is difficult for people to anticipate what support they will receive.

There are also concerns that the current process can harm people’s long term job prospects by distancing them from the labour market. Ministers believe that in future the benefits should, at the right time, encourage claimants who are without employment into a supported return to work.

Lord Freud said:

"Losing a spouse or civil partner is a life changing event emotionally, socially and economically and there is an important role for Government to play in providing some relief from the financial pressures in the short term to support them during this readjustment.

"However, the current system is inconsistent and complex, with some claimants qualifying for a lump sum and others receiving payments for as long as 20 years with no encouragement or support to return to work.

"The benefits need updating to ensure that they effectively support bereaved spouses and civil partners at a difficult time.  I invite anyone with an interest in these benefits to comment on our proposals."

The consultation is seeking views on proposals to:

• Simplify the payment system: by moving to a uniform payment structure for all recipients, with support focused on the period immediately following bereavement;
• Simplify the contribution conditions: by basing full payment on a single year of National Insurance Contributions;
• Rename the benefit: so that the benefit name reflects the function of the payment.

Notes to Editors:

1. The consultation is published at:   http://www.dwp.gov.uk/consultations/2011/bereavement-benefit.shtml
2. Each year the government pays £600 million in bereavement benefit payments.
3. This money supports around 41,000 bereaved husbands, wives and civil partners.
4. However, the primary aim of the review is not to save money but to improve an out-of-date system.
5. The award for Bereavement Payments is £2,000
6. The average award for Bereavement Allowance is £77.93
7. The average award for Widowed Parent’s Allowance is £100.72
8. Currently DWP distributes around £200bn each year in benefits and pensions, yet almost two million children are still growing up in a household where no one works – and 5 million people are stuck on out of work benefits.
9. We are carrying out a fundamental reform of the welfare system, to ensure that the money that we spend addresses some of these problems.
10. Bereavement benefits support people after the loss of a spouse or civil partner. But this important part of the state safety net has fallen outside recent reviews. This consultation seeks to ensure that bereavement benefits truly meet the needs of widows and widowers and their dependants in the 21st century.
11. Payments made under the War Pensions Scheme or Armed Forces Compensation Scheme will not be affected by this review. The review will not impact those already in receipt of bereavement benefits at the point at which a new scheme is introduced.

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