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 80% of Bereavement Allowance recipients and 46% 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.
"But 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.
