Could You Live On £77 A Week?

It's a well- known fact that the benefits system is confusing, with the government's own figures showing that more than two million people are failing to claim everything they should. But, as well as stopping people claiming their entitlement, this confusion can also make it tricky to put your own safety net in place.

Here's a guide to the benefits you may be entitled to if you lose your job or are unable to work due to sickness or disability.

• Jobseeker's Allowance
  If you lose your job or a temporary contract finishes, you may be able to claim Jobseeker's Allowance (JSA) while you look for work. This is paid at a rate of £77.00 a week for those age 25 or over (£61.05 for those up to 24). There are two types of JSA - contribution-based JSA, which is dependent on your national insurance record over the previous two years, and, if you don't qualify for this, income-based JSA. If you're self-employed, you're unlikely to qualify for contribution-based JSA. With both types you can do some work, providing it is for less than 16 hours a week, but your household income will be taken into account when assessing how much you'll receive. On top of this, if your savings exceed £6,000, this will also affect the amount of income-based JSA you receive.
• Statutory Sick Pay
  If you're unable to work because you're sick or disabled, the minimum you can initially expect is Statutory Sick Pay (SSP) at £99.35 a week. This is paid by your employer for the first 28 weeks of your absence. There are conditions though. You'll need to earn at least £123 a week, and it's not available if you're self-employed. Some employers are more generous too, so it's worth checking what you would receive if you weren't able to work.
• Employment and Support Allowance
  Once you're no longer eligible for SSP, or if you didn't qualify for it in the first place, you will need to make a claim for Employment and Support Allowance (ESA) if you're still not fit enough to work. The amount you'd receive varies, but is a maximum of £77.00 a week for the first 13 weeks, followed by up to £77.00 a week thereafter (or £117.60 if you're unlikely to be able to work). Like JSA, there are two types of ESA - contribution-based and income-based - but, unlike JSA, you may be able to claim both types. Whichever type you qualify for, all claims kick off with a work capability assessment, which will determine whether you are in the work-related activity group or, if your disability or illness severely limits your ability to work, the support group.
• Additional support
  While these are the main benefits you can claim if you can't work, you might also be entitled to additional support. This could include income support, help with your rent, or mortgage interest or and council tax, and tax credits. But, however many different benefits you're able to claim, there is a cap on the amount you can receive. The benefit cap is £350 a week for a single person or £500 a week for couples or single parents with children, and it applies to a range of benefits including JSA, ESA, housing benefit, child benefit and child tax credit. And, with the government intent on slashing the welfare bill by £12bn, state support for those unable to work is likely to come under further pressure.
• Set up your own safety net
  If the prospect of making ends meet on as little as £11 a day doesn't appeal, it's possible to take steps to protect your standard of living. Income protection pays out if you're unable to work due to long-term illness or injury, with some policies also allowing you to include unemployment cover. A policy can be taken out to cover up to 70% of your pre-tax salary and, as plans are flexible, you can adjust the terms to fit your needs and budget.