DWP £5,000 Compensation Payment – How Universal Credit Claimants Can Apply

If you’ve lost disability premiums during the transition from legacy benefits to Universal Credit, the Department for Work and Pensions (DWP) may owe you a significant sum—up to £5,000. This compensation package is aimed at righting a wrong that affected tens of thousands of disabled claimants, many of whom saw their income drop suddenly during the Universal Credit rollout.

Let’s break down everything you need to know—from eligibility to how and when you’ll receive this payment.

Overview

Here’s a quick summary of what this compensation covers and how it will be handled:

Key Information	Details
What is it?	Up to £5,000 for lost disability premiums during UC migration
Who qualifies?	People who lost SDP or EDP when moved from legacy benefits to UC
How to apply?	No application required—DWP is contacting eligible individuals
When are payments due?	May to August 2025, depending on case type
How many people affected?	Over 57,000 claimants
Official site	GOV.UK – Universal Credit

Background

Between 2013 and 2019, many people receiving legacy benefits like ESA, JSA, and Income Support were also getting additional disability-related premiums—like the Severe Disability Premium (SDP) or Enhanced Disability Premium (EDP). These helped cover everyday challenges like personal care, higher energy use, or transportation costs.

But when claimants were moved to Universal Credit, these premiums were often lost—especially for those who moved before January 16, 2019. This left many worse off, with some losing more than £200 a month.

Legal action ruled this unfair. Now, the government is paying compensation to those who lost out during that transition.

Who Qualifies

You might qualify if:

• You were on legacy benefits that included the Severe or Enhanced Disability Premiums
• You moved to Universal Credit before January 16, 2019
• You were financially worse off due to the transition
• You weren’t given proper transitional protection by the DWP

Example Cases

• Jane, an ESA claimant with Severe Disability Premium, lost £172/month after moving to UC in 2018. She’s now owed compensation.
• Daniel and his partner, on the couple’s Enhanced Disability Premium, lost over £120/month after switching to UC in 2017. They’ll also receive a payout.

How Much Could You Get?

The actual amount depends on your lost entitlement and how long you went without the premiums. Here’s a breakdown of estimated monthly losses:

Premium Type	Single Person	Couple
Enhanced Disability Premium	£84/month	£120/month
Severe Disability Premium	£172/month	£246/month
Disabled Child Premium (per child)	£177/month	—

Payments will be calculated using DWP’s records of what you were receiving versus what you should have received.

Payment Process

You won’t need to apply—the DWP is managing the process.

Step 1

DWP is checking claims from 2011 to 2020 to identify people affected by the loss of these premiums.

Step 2

Eligible individuals will receive a letter outlining the compensation details, expected amount, and payment timeline.

Step 3

Different groups will be paid at different times:

Group	Payment Timeline
Current UC claimants (post-2020)	By August 2025
Claimants transitioned 2018–2020	May to August 2025
Former UC claimants (left the system)	Later in 2025 (more complex)

If you don’t get a letter by the end of 2025 but think you qualify, contact the DWP directly.

Tips

While you’re waiting:

• Keep your old benefit statements and letters handy
• Make sure DWP has your up-to-date address and phone number
• Use services like Citizens Advice for support
• Be wary of scams—DWP won’t email or text asking for bank details
• Don’t throw away DWP letters—you might miss your payment notice

This compensation is long overdue and will make a real difference to thousands of disabled claimants who were unfairly penalised. If you think you’re eligible, keep an eye on your post and reach out for support if you have concerns.

FAQs