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Updated March10
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Income Support
LEGISLATION Income Support is covered by Articles 122-126, 130-133 of the Social Security Contributions and Benefits (NI) Act 1992. Regulations are contained in the Income Support (General) Regulations (NI) 1987 as amended, and the Income Support (General) (Jobseeker’s Allowance Consequential Amendments) Regulations (NI) 1996.
Income Support is the means-tested benefit for certain groups of people who are not in full time work. A person not in full time work and not required to sign on for work, whose income and capital fall below a certain level, and who falls into one of the prescribed categories is entitled to have her/his income topped up by Income Support. An unemployed person who signs on as available for and actively seeking work will claim Jobseeker’s Allowance (JSA). This will be topped up by Income-based Jobseeker’s Allowance (JSA(IB)) if necessary. Income Support is an adult only benefit and can only be paid for adults who are over sixteen and under 60. Support for children is paid by way of Child Tax Credit (CTC) and for those over 60 the relevant benefit is Pension Credit (PC). A person who a claim on or before 6 April 2004, will have transitional protection. Employment Support Allowance (ESA) was introduced on 27 October 2008. ESA has replaced Income Support for people making a new claim on grounds of illness or disability. Some people with an illness or disability may still be able to claim Income Support. These circumstances are covered in section 2. People who are currently claiming Income Support on the grounds of illness or disability will continue to be able to do so until the government moves them onto ESA. The government plan to start the transfer during 2010/2011. A person claiming should check if s/he would be better off claiming Income Support or ESA. For further information on transitional arrangements see section 12. 1. GENERAL CONDITIONS OF ENTITLEMENT
To qualify for Income Support, a person must
satisfy all of the conditions outlined below. 1.1 Must be aged at least sixteen and under 60
A person aged at least sixteen and under 60 who falls within one of the prescribed categories is entitled to claim Income Support. However, sixteen and seventeen year olds are subject to special rules and are paid at special rates. A payment can also be made to a sixteen or seventeen year old where this will prevent severe hardship. Young people aged under sixteen can never claim Income Support for themselves. A person aged 60 or over is no longer able to claim Income Support and should claim PC instead. 1.2 Must not have capital over £16,000
Income Support is not payable to a person if s/he and/or partner have capital over £16,000. Those who are permanently in residential care, nursing homes or other types of residential accommodation also lose entitlement if they have over £16,000 in savings and/or capital. The legislation sets out what counts as capital and what can be ignored. Personal possessions (other than those which would be considered an investment, eg an art collection) and the person's home will not normally be included as savings or capital. Any payment made to a person as the holder of a Victoria or George Cross medal will also be ignored. The surrender value of any insurance policies and certain other savings can be ignored in specific circumstances. For the full list of what is ignored as capital, see Schedule 10 of the Income Support (General) Regulations (NI) 1987 as amended. Notional capital rules provide that a person will still be treated as possessing capital where s/he has deprived her/himself of this capital in order to secure or increase entitlement to Income Support. 1.3 Must not be in full-time
employment
A person will not be entitled to Income Support if s/he is working sixteen hours or more per week or her/his partner (if s/he has one) is working 24 hours or more per week. Exceptions to this rule include:
Further, a person who takes up full-time employment may be able to get mortgage interest run on for up to four weeks (see 5.1.3). 1.4 Must not be in full-time
education
Income Support will not normally be payable to a person in full-time education. Exceptions to this include people who do not have to be available for work, for example some lone parents. The rules depend on how old a person is when s/he starts the course. Whether or not a course amounts to full-time education is a complicated matter:
If dealing with students and entitlement, consult Students and Benefits Booklet [produced by the Adult Learner Finance Project in association with Law Centre (NI)] or contact Law Centre (NI). 1.5 Must satisfy the habitual
residence and right to reside test
A person must be present in the United Kingdom (UK), habitually resident in the UK, Republic of Ireland, Channel Islands or Isle of Man (the Common Travel Area (CTA)) and have a right to reside. The test applies to all people claiming (but not partners or dependants) including British/Irish citizens returning from abroad to Northern Ireland. Some groups are automatically treated as habitually resident, including:
The European Union (EU) now includes Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia and Slovenia. Workers from these states (except Malta and Cyprus) are referred to as A8 nationals. The habitual residence test states that no person will be treated as habitually resident unless s/he has a right to reside in the UK, Republic of Ireland, Channel Isles or Isle of Man. This may affect access to Income Support. Most A8 nationals must register with the Home Office’s Worker’s Registration Scheme and have twelve months uninterrupted employment, except for thirty days, before retaining a right to reside for Income Support domestically. Under the European Citizenship Directive 2004/38 the right to reside can be retained by a person who has worked for 12 months, become involuntarily unemployed and registered as a jobseeker. In effect, a lone parent should claim income based JSA rather than Income Support. Bulgaria and Romania were the last two countries to join the EU. Workers from these states are referred to as A2 nationals. Most A2 nationals must comply with strict rules under the Home Office’s Worker’s Authorisation Scheme and have worked for twelve months in authorised work before obtaining full EU rights. There are exceptions to these rules and if a person is turned down for Income Support because of the habitual residence test, contact Law Centre (NI). The right to reside is complex and subject to constant change. See Your Rights in Northern Ireland, a guide for migrant workers at www.lawcentreni.org or telephone the Law Centre’s advice line. 1.6 Must not be a person subject to immigration control
A person will be a ‘person subject to immigration control’ if s/he is not an EEA national and:
Income Support may only be claimed if any one of the categories listed below apply. If a category applies for at least one day in a benefit week, it is normally deemed to apply for the whole of the benefit week. 2.1
Childcare responsibilities
There are exceptions to the above rules.
2.2 Caring
Note: If a person no longer satisfies the above conditions or stops acting as a carer, s/he can continue to claim Income Support for eight weeks.
2.3 Sickness and disability
ESA was introduced on 27 October 2008. It is not possible to make a claim for Income Support on the grounds of illness from that date and the claim will be treated as a claim for ESA. This will affect people who cannot work because of pregnancy related illness, sickness and disability or who are disabled students. There are exceptions to this rule. It will be possible to make a claim for Income Support on disability grounds where:
A person who was receiving Income Support due to illness on 27 October 2008 will continue to do so. The government plans to introduce the ESA medical known as the ‘work capability assessment’ for those claiming Income Support on grounds of illness and who are under 25 from 2009. Those claiming Income Support on grounds of disability will start to be moved onto ESA from 2010/2011 and become subject to the 'work capability assessment'. The rules set out below apply to those who are currently claiming Income Support on grounds of disability and to those who are entitled to make new claims for Income Support on grounds of disability (see exceptions set out above).
Note: A person claiming JSA can, in some circumstances, opt to continue to claim that benefit during short periods of sickness. S/he can be treated as capable of work for up to two weeks if s/he is unable to work as a result of a disease or disability. This means that when a person is only likely to be sick for a short time, s/he will not necessarily have to claim Income Support.
2.4 Education and training
ESA was introduced on 27 October 2008. Claims for Income Support on grounds of disability on or after that date are treated as claims for ESA unless exceptions apply (see 2.3). If the person fits into another eligible group, eg s/he is a carer or a relevant lone parent, s/he may claim Income Support but s/he might not be able to claim a disability premium. A person claiming should check to see if s/he would be better off claiming ESA or Income Support.
2.5 Others
3. WORK FOCUSED INTERVIEWS
3.1 Lone parents
Compulsory work-focused interviews have been introduced for lone parents who are making a claim for or currently receiving Income Support. These rules do not apply to lone parents aged under eighteen or over 60. A lone parent making an initial claim for Income Support will be required to attend a work-focused interview if responsible for a child living in her/his household. The interview is compulsory and benefit will not be paid if the person, without good cause, does not attend. S/he will have to reapply for benefit and attend an interview before benefit will be paid. Where a lone parent remains on Income Support, further interviews will take place every six months. In certain cases, a lone parent is required to attend further interviews every 13 weeks. Failure to comply, without good cause, will result in a benefit sanction of £12.86 per week which will continue until the person complies or reaches the age of 60 (see 3.2.1 for what is good cause). Lone parents are required to prepare and update a work action plan as part of the work-focused interview. An interview can be waived or deferred if it is considered that it would be inappropriate or of no assistance. 3.2 Others
The government has introduced schemes which make entitlement to Income Support conditional on attending work-focused interviews. The initial interview must take place as soon as reasonably practicable. However, the first work-focused interview for people claiming Income Support on the grounds of incapacity or because of appealing a decision on capacity for work is rescheduled to eight weeks after the claim is made. One such scheme has been administered by Jobs and Benefits Offices since 30 June 2003 and is now the main work-focused interview scheme. It requires a person claiming Income Support at one of these offices who is at least sixteen years old and under 60 to attend a work-focused interview with a personal adviser as a condition of receiving Income Support. Where a person has made a fresh claim for Income Support and fails to attend without good cause, s/he will be treated as having made no claim. Where a person already in receipt of Income Support fails to attend an interview without good cause, her/his benefit will be reduced by £12.86 weekly until s/he takes part in an interview. This scheme includes the partner of a person claiming. A partner is required to attend a work-focused interview as a condition of the person claiming receiving the full amount of Income Support where:
A partner who her/himself is claiming one of the following benefits is exempt:
If a partner fails to attend without good cause (see 3.2.1), the person claiming will have her/his benefit reduced by £12.86 weekly. Another scheme, the Pathways to Work scheme, applies to a person claiming Income Support on the basis of incapacity for work or because s/he is appealing a decision that s/he is not incapable of work. A person making a new claim for Income Support because of incapacity who is at least eighteen and under 60 is required to:
Similar requirements apply to a person with an existing claim, except that s/he is required to attend a sequence of two further work-focused interviews at monthly intervals instead of a sequence of five further interviews. In addition, a person may be required to take part in additional interviews at given points during the period of an award. Failure to attend an interview without good cause (see 3.2.1) will result in a benefit sanction of £12.86 weekly. The requirement to attend an interview may be waived or deferred if it is deemed that an interview would not be of assistance or appropriate to the person. A person making a new claim is not required to take part in the sequence of five monthly interviews if s/he is exempt from the personal capability assessment because of a severe condition (see Law Centre (NI) Encyclopedia of Social Welfare Rights, section A.4 Incapacity Benefit, 1.4.2). A person with an existing claim is not required to take part in the initial interview as well as the sequence of two monthly interviews if s/he is similarly exempt from the personal capability assessment. 3.2.1 Good cause A person must show good cause within five working days of the date on which the interview was to take place or one month if new facts become evident and these facts show good cause for not attending. In deciding if good cause is applicable, the decision maker must take into account:
4. WHO CAN A PERSON CLAIM FOR?
A person making a new claim for Income Support can only claim for her/himself and partner. S/he cannot claim for dependent children and/or qualifying young people. Instead s/he must claim CTC. A person with an existing claim has transitional protection. See section 12 for details. A person can claim for a partner if s/he is married, has formed a civil partnership or they are living together as husband and wife or as if they were civil partners. If a dispute arises as to whether two people are living together as husband and wife or as civil partners, then case law suggests the whole relationship should be looked at and a number of particular factors considered. These include whether two people live in the same household, the financial arrangements, whether there is a sexual relationship, whether there are any children of the relationship and how the two people appear in public. If a couple separates permanently, then separate claims can be lodged. A temporary absence will not affect status as a couple, where the intention is to resume living together within 52 weeks (or not substantially longer than this in specific circumstances). A couple no longer count as a couple in certain circumstances. These include people living separately because one partner is in custody or a compulsory patient detained under mental health provisions, or in residential care on a permanent basis. For a full set of the circumstances, see Regulation 16 of the Income Support (General) Regulations (NI) 1987 as amended. 5. HOW MUCH?
The amount of Income Support payable is calculated by subtracting a person's resources (ie income) from her/his needs (ie the weekly amount the person claiming and her/his partner are considered to need, weekly, to live on). 5.1 Needs
In calculating a person's needs, three elements are taken
into account:
5.1.1 Personal allowances
Personal allowances are fixed amounts which cover basic weekly living expenses including food, fuel, clothing, laundry, etc. The amount paid depends on age and whether single, a lone parent or one of a couple. Personal allowances for children and qualifying young people have ceased to exist in Income Support for new claims from April 2004. See section 12 for transitional arrangements for claims existing prior to April 2004.
A person aged sixteen or seventeen is entitled to Income Support if s/he satisfies the normal rules of entitlement. If a person is in ‘relevant education’ s/he will only be entitled to Income Support in certain circumstances, see section 2.4. If s/he is a qualifying young person for child benefit purposes (see below) and is living with someone who counts as responsible for her/him then that person might be able to claim Child Benefit and Child Tax Credit for her/him. A child is anyone under sixteen. It also includes anyone aged sixteen or over but under 20 who counts as a ’qualifying young person’ for Child Benefit purposes. This will include a person who:
5.1.2 Premiums
Premiums are paid on top of personal allowances in recognition of extra expenses due to caring responsibilities, age and disability.
This premium is paid where the person claiming or partner is in receipt of Carer’s Allowance (CA), or is entitled to and would be in receipt of CA but for the fact that another benefit (eg Incapacity Benefit) is in payment which overlaps with CA. An extra statutory payment to compensate a person or partner for not getting CA also counts. If a person stops getting or being treated as getting CA, or the person whom s/he is getting CA for dies, entitlement to the carer premium continues for a further eight weeks. Amount paid single person £29.50 couple one of whom
gets or would get CA
£2 couple both of whom get or would get CA
£59.00
This premium is paid
where a person or any adult member of her/his family who is under 60 is in
receipt of the highest rate care component of DLA. Amount
paid single adult
£13.40 couple
£1
The circumstances in which the severe disability premium is paid are as follows:
Amount paid single person
£52.85 couple (lower rate)
£52.85 couple (higher rate)
£105.70 Note: A person claiming who is in receipt of one of the qualifying benefits and has a partner who is registered blind or is treated as blind because s/he came off the register in the last 28 weeks is treated as having no partner and therefore as a single person. The following people do not count as non-dependants:
For any of the three categories above, a close relative can also be disregarded as a dependant where:
Note: The following three premiums are called client group premiums.A person will be awarded only one client group premium, whichever one is the highest.
There are two routes to the disability premium. Firstly, A person who claimed before 27 October 2008 (or who meets the exceptions, see 2.3) (but not a partner) can qualify for the premium if s/he:
Any gap of up to eight weeks where a person is no longer incapable of work is ignored. If a partner satisfies these conditions, then s/he should claim in order to receive the disability premium. Secondly, a person claiming or partner aged under 60 can qualify if s/he is:
The disability premium remains payable if undertaking specific training courses, or where the person or partner’s DLA has been suspended or reduced because s/he is in hospital, or where the person has a partner whose long term rate of Incapacity Benefit (or short term rate because of terminal illness) stopped at pension age or when Retirement Pension started and the person has remained continuously entitled to Income Support since then. The person or partner must also have been previously entitled to the disability premium. Amount paid single person
£2 couple
£39.15
A
person who has a partner who is between 60 and 79 years old will qualify for
this premium. Amount paid
£97.50
This premium is awarded in one of three circumstances:
Amount
paid
£97.50 Note: The three premiums
below only apply for pre-April 2004 claims with no CTC.
The family premium
is awarded in respect of a family with a child or qualifying young person. One
family premium applies regardless of the number of children or qualifying young
people. It can be added to any of the premiums listed below.
This applies to a child or qualifying young person who is a member of the family and who receives DLA at any rate or who is registered blind or treated as blind (ie taken off the register within the last 28 weeks). However, the premium is not applicable if the child or qualifying young person has capital over £3,000. A separate premium is paid for each child or qualifying young person who is in receipt of DLA and can be paid on top of any other premium. Amount
paid
£51.24
This applies where a
child or qualifying young person is in receipt of the high rate care component
of DLA. The premium is not
payable in respect of any child or qualifying young person who has capital over
£3,000. Amount
paid Each child/qualifying
young person
£20.65
Normally, only one premium (the highest) is paid. However, there are five exceptions:
5.1.3 Housing costs
Some housing costs for owner-occupiers will be taken into account in assessing the needs for Income Support. The amount will be a weekly one representing mortgage interest, interest on loans for repairs or improvements, co-ownership payments, ground rent and service charges. The level of support for mortgage interest and repairs and improvements is restricted to total loans below £200,000. Any loan to adapt the home for a person with a disability is ignored when working out if total housing costs exceed this limit. There are complex rules covering which housing costs are eligible for help. Contact Law Centre (NI) for further advice. The rules of entitlement to housing costs changed on 5 January 2009. A person making a claim to Income Support on or after this date will not receive any housing costs for the first thirteen weeks. This is known as the qualifying period. After the thirteen weeks, full housing costs will be considered in a person’s claim. Prior to 5 January 2009 there were different rules for help with housing costs for loans taken out either before or after 2 October 1995 (see below). These had longer qualifying periods. A person waiting to receive housing costs under these rules should be automatically transferred over to the new shorter qualifying period, with payment starting immediately for a person who has been on benefit for fourteen or more weeks.
5.1.3.1 Exceptions - people in a qualifying period but not in receipt of IS, JSA or ESADifferent rules apply where a person has made a claim for Income Support prior to January 2009 and was not entitled to a payment as her/his income was too high. The relevant qualifying period at the date of the original claim will apply. This includes people who will not become entitled to benefit until housing costs are awarded. In this case it may be worth considering making a new claim. A person who is not entitled to Income Support or the income related element of either JSA or ESA because her/his income is too high, but is in receipt of the contributory element of JSA or ESA on 4 January 2009 and is still in the qualifying period, will qualify for the new thirteen week qualifying period. 5.1.3.2 Old rulesUnder the old rules, prior to 5 January 2009, a person under 60 with a new loan (ie loan taken out on or after 2 October 1995) would not get housing costs for the first 39 weeks of a claim. Full housing costs would be awarded after 39 weeks. There were exceptions where the rules in relation to a loan taken out before 2 October 1995’ applied and a person with a partner aged 60 or over was entitled to full housing costs straightaway. 5.1.3.3 Old rulesUnder the old rules a person under 60 with an existing loan (ie loan taken out before 2 October 1995) would not get housing costs for the first eight weeks of a claim, and only 50 per cent for the next eighteen weeks. Full housing costs would be awarded after 26 weeks. A person with a partner aged 60 or over receives full housing costs straightaway. Note. A person claiming PC will receive full mortgage interest straightaway. 5.1.3.4 Loans for repairs and improvementsA person can get help with loans for repairs or improvements to maintain the current home, or any part of the building in which it is contained, in a habitable condition. Loans towards the cost of necessary survey work should also be included. Help towards the interest payments on a loan will be payable for any of the following:
If the loan is also for other repairs and improvements, housing costs will only be paid for the proportion which relates to any of the items listed above. The amount payable is calculated as for mortgages (ie waiting periods and similar interest rates apply). 5.1.3.5 Reduction in paymentsThe amount payable may be reduced if:
These income levels only apply to non-dependants in full-time paid work but see below if also on PC. Full-time paid work is paid employment of sixteen hours or more a week. Gross income is gross wages (before tax and national insurance deductions) and most other income. Some income is disregarded. This includes DLA, Attendance Allowance and payments from the Macfarlane Trusts, the Eileen Trust, the Independent Living Funds and the Fund. Where a non-dependant is not in full-time paid work, a weekly deduction of £7.40 will usually apply. Exceptions to this rule provide that in certain cases no deductions will be applied (see below). A weekly deduction of £7.40 will be made where a person is on Income Support or JSA(IB) and aged 25 or over. A deduction from housing costs will not be made in respect of:
No deduction will be made for the housing costs of non-dependants, regardless of the circumstances of the non-dependants themselves, where the person applying or partner is:
5.1.3.6 Other mattersMost payments of mortgage interest are calculated using a standard rate of interest. From 5 January 2009 the standard interest rate was set at 6.08 per cent. If the rate of interest a person pays is higher than the standard rate, then s/he will have to meet the shortfall. A person does not have to go through a new waiting period if there is a break in claiming Income Support for a short period. Where the break in claim is for twelve weeks or less, the two periods are linked and a person does not have to wait, but requalifies for help with housing costs immediately. Longer linking periods apply in certain circumstances. For example, a longer period of 104 weeks applies to certain welfare to work beneficiaries and a period of 52 weeks applies if a person or partner:
Interest on ineligible loans (eg a loan for a car or a business debt which is secured on a home) where a partner has left, or died, or cannot or will not pay, will not be covered by Income Support. A person who was receiving help with these costs prior to 2 October 1995 may still continue to receive it under transitional protection rules if s/he satisfies conditions. Help with accumulated arrears of interest is not provided. Transitional protection has been introduced to cover certain groups of people who have existing claims who would otherwise be worse off as a result of these changes. For the vast majority, mortgage interest payments will be paid direct to the building society, or other lender, rather than to the person. 5.1.3.7 Mortgage interest run-onA person will continue to receive the housing costs element of Income Support for a period of four weeks where:
The amount paid will be the lowest of either:
A person should notify the local office that s/he has started full-time work. Payment should then be made automatically to the person and not the lending agency. All income and capital are ignored in calculating the amount of housing costs. 5.2 Resources
Resources are the income of a person from all sources. They include part-time earnings, most other benefits and maintenance payments. However, Attendance Allowance, DLA (any component) Constant Attendance Allowance, Social Fund payments, Exceptionally Severe Disablement Allowance and Housing Benefit do not count as resources. Where a person is a member of a couple, her/his partner’s income is added to hers/his. 5.2.1 Part-time earnings
Net earnings (ie earnings after deductions of tax, National Insurance and half of any contribution paid towards a personal or occupational pension) will be taken into account in full, less any amount which is to be disregarded (see 5.2.2). No deductions can be made for travel, childcare or other expenses. Also, any payments made by the employer for travel costs to work or childcare expenses will be treated as earnings. Any other work-related expenses paid by the employer are treated as wages unless they are exclusively and necessarily incurred in the performance of the duties of employment. Payments of reasonable expenses to volunteers will be ignored provided no additional payments are being made. 5.2.2 Earnings disregardDisregard first £20 where a:
5.2.3 Basic £5/£10 disregard
If a person does not qualify for a £20 disregard, £5 of
her/his earnings will be disregarded if s/he is single. If a couple claim, £10
of their total income is disregarded whether or not they are both working. 5.2.4 Other income
Other income, including other benefits, falls into one of three types. The main categories of income are set out below. 5.2.4.1 Treatment for Income Support purposes: count in full
5.2.4.2 Treatment for Income Support purposes: ignore first £10
Only £10 in total can be ignored. However, the £10 ignored is additional to the total disregard of any Mobility Supplement, Attendance Allowance or Constant Attendance Allowance paid as part of a War Disablement Pension. 5.2.4.3 Treatment for Income Support purposes: ignore in full
Any child care expenses reimbursed to the person claiming in respect of her/his participation in the New Deal for Lone Parents or such a scheme supporting its objectives which has been approved by DEL are also ignored. Charitable or other voluntary payments made regularly are ignored except where a person is involved in a trade dispute or within the first fifteen days following her/his return to work after a trade dispute. Regular personal injury payments derived from lump sums held in trust or in an annuity or from an agreement or court order are disregarded in full, regardless of what the payment is intended for. Other incomes may be disregarded in part or in full. For a complete list see Child Poverty Action Group’s Welfare Benefits and Tax Credits Handbook or Schedule 9 of the Income Support (General) Regulations (NI) 1987. 5.2.4.4 MaintenanceMost maintenance for a claimant counts in full. However, special rules apply to child maintenance. A person who receives child maintenance is entitled to a weekly disregard of up to £20. From April 2010 child maintenance will be ignored completely. 5.2.4.5 Income from capitalIncome Support is not payable where a person and/or partner have capital over £16,000. The threshold above which capital will be deemed to generate income is £6,000. The first £6,000 is ignored and an income of £1 per week will be assumed for every £250 or part of £250 in excess of £6,000. A person who is permanently resident in residential care, nursing home or other type of residential accommodation and who has capital in excess of £16,000 will not be entitled to Income Support. The first £10,000 of any capital is ignored and an income of £1 per week will be assumed for every £250 or part of £250 in excess of £10,000. 5.2.4.6 Notional incomeA person will still be treated as possessing income which s/he has deprived her/himself of for the purpose of securing entitlement or increasing entitlement to Income Support. This may include an assumption of income where work is undertaken for which a person does not receive any payment or any proper payment. In making such a decision, the Social Security Agency will consider what would be a reasonable payment and also the circumstances of the person for whom the work is undertaken. This does not apply to:
6. DEDUCTIONS FROM INCOME SUPPORTDirect deductions from Income Support can be made to cover a number of items including arrears of rent, rates, electricity, non-dependants (in Housing Benefit or Income Support housing costs), for recovery of overpayments, recovery of Social Fund loans, child support maintenance, integration loan paid to refugees and fines. If in mortgage arrears, no amount can be deducted towards arrears where the lender is covered by the mortgage payments scheme. This will apply to most lenders. For arrears of housing costs, £3.25 weekly for each housing debt (maximum of £9.75) will be deducted towards the arrears. For fuel debts, estimated weekly use plus £3.25 weekly for arrears of each fuel debt (maximum £6.50 for arrears) will be deducted. Where a person does not receive CTC, deductions from Income Support for housing costs (except for mortgage interest payments) and fuel arrears are subject to a maximum of 25 per cent of a person's applicable amount (excluding help with housing costs) except where the person gives her/his consent for the higher deduction. Where a person or partner receives CTC, the 25 per cent maximum is applied to the total of a person’s applicable amount (excluding help with housing costs) plus Housing Benefit for rates and Child Benefit. For child support maintenance payments, £5.00 under the new rules (£6.50 under the old rules) will be deducted. The maximum aggregate amount that can be deducted towards housing arrears, fuel arrears and child maintenance payments is £9.75. For recovery of overpayments, the maximum deduction is usually £9.75 except in fraud cases, where a higher amount of up to £13.00 will be deducted. These deductions can be reduced by negotiation. For details of how recovery of Social Fund loans is made see Law Centre (NI) Encyclopedia of Social Welfare Rights A.6 Social Fund. 7. BENEFIT FRAUDFraud can occur when a person deliberately misleads the DSD, or fails to, or allows another person to fail to notify promptly a change of circumstances that could affect entitlement to benefit. There are two offences, namely making false representations for benefit and dishonest representations for benefit. There are three main options available to the DSD in relation to fraud. These are:
7.1 Formal caution
Caution is generally used for less serious offences. A person will be asked to attend a formal caution interview where s/he will be asked to sign a record admitting the offence and accepting the caution. Accepting a caution means that a person will not normally be prosecuted. The caution may be cited in court where a person is successfully prosecuted for a further offence. 7.2 Penalty
A person can be offered the option of paying a penalty if:
The penalty is an additional 30 per cent of the recoverable overpayment caused by the offence and is added to the amount of overpayment and recovered in the same way. A person will be sent a notice setting out the broad terms of the penalty and will be invited to an interview to discuss acceptance of the penalty. A person does not have to make the decision to accept the penalty at the interview but will be allowed five days to make up her/his mind. Once a person has entered into an agreement to pay the penalty, s/he will have 28 days in which to change her/his mind. Note: Acceptance of a formal caution or penalty will bring immunity from prosecution for the specified offences. However, a person may still be prosecuted for related offences such as a Housing Benefit overpayment. Acceptance of a formal caution or penalty is an admittance of guilt. Caution or penalty should not be accepted just to avoid prosecution if the person did not commit the offence. A person will not automatically be prosecuted if s/he does not accept the formal caution or penalty. Prosecution will depend on the evidence that the DSD has obtained. 7.3 ProsecutionFraud is a criminal offence and can result in prosecution. The maximum penalty for these offences, if convicted in summary proceedings in the magistrates court, is a £5,000 fine or six months in prison, or both. This is in addition to repayment of any overpayment that may have occurred. Where a case is tried on indictment in the Crown Court, the maximum penalty is an unlimited fine or seven years imprisonment or both. 7.3.1 Benefit sanctions
In addition to a fine, imprisonment and recovery of any overpayment, the DSD can apply benefit sanctions to certain benefits including Income Support. If a person is convicted of one or more benefit offences in two separate proceedings and one offence is committed within five years of the conviction of another, the DSD will impose benefit sanctions. This only applies to offences committed since fraud legislation was introduced on 1 April 2002. A person’s Income Support will be reduced as follows:
The sanction will apply for thirteen weeks. From April 2010 a 'one strike' sanction will apply where a first offence of benefit fraud results in a prosecution, caution or an administrative penalty. The additional sanction is the reduction of benefits for 4 weeks as above. This will be in additional to any recovery of overpayment or administrative penalty. A claimant who accepts a caution or administrative penalty has a 4 weeks period in which to change his or her mind. If a second or subsequent benefit fraud offence results in another administrative penalty or caution then a further 'one strike' sanction of four weeks reduction of benefit will apply. 7.3.2 Other issues
Where a doubt arises during the investigation about a person’s entitlement to benefit, the benefit may be suspended until further information is gathered. This decision cannot be appealed other than by way of judicial review. A person in this situation should supply the information required as quickly as possible and try to persuade the decision maker not to suspend benefit. If this does not work, a fresh claim for benefit should be lodged. This decision can then be appealed. A decision maker may also seek to recover an overpayment once the investigations have been completed. This can be done where the cause of the overpayment is attributable to a failure to disclose information or accidental or deliberate misrepresentation of circumstances and either of these caused the overpayment. 8. URGENT CASES PAYMENTSUnder Income Support, urgent cases payments will be paid only to persons subject to immigration control in specific circumstances, and to people treated as possessing notional income which is not readily available. Urgent cases payments throughout the period of entitlement will be 90 per cent of the Income Support personal allowance rate for a single person or couple. The Income Support rate for any children, housing costs (for owner-occupiers), and any premiums will be paid in full. Note: For a person claiming under the urgent cases rules and who is appealing a decision on her/his incapacity for work, the usual rate will be taken as the relevant personal allowance reduced by 20% per cent benefit penalty (if this is appropriate). The 90 per cent reduction is then applied to that figure. The government is intending to abolish urgent needs payments by April 2010. 9. ASYLUM SEEKERSUnder the Asylum and Immigration Act 1999, an asylum seeker awaiting a decision on her/his claim for asylum cannot claim social security benefits. An asylum seeker in receipt of Income Support or who claimed asylum at port of entry or on arrival before 3 April 2000 is provided with transitional protection and can continue to claim until a change of circumstances. For information about the new system of support for asylum seekers, contact Law Centre (NI) Immigration Unit or the Northern Ireland Council for Ethnic Minorities. 10. EXAMPLES10.1 ExampleTom and Tara aged 35 and 36 are married. They have three children aged eight, thirteen and fifteen. The only income they have is Child Benefit of £46.40 and CTC of £130.62. Tom is currently out of work due to illness but is not receiving any other benefits.
10.2 ExampleSue and John both aged 39 have five children aged two, six, nine, fourteen and seventeen, all of whom are still at school. John was recently made redundant and received a redundancy payment of £8,200. However he has got a part-time job working in the hospital for twelve hours earning £74.20 net per week. The part-time job suits him as Sue has a disability and is in receipt of the high rate care component of DLA. John now claims Carer's Allowance of £53.10 per week for looking after her. Sue also receives Child Benefit of £72.80 and CTC of £225.65 per week.
Top11. OTHER ASSISTANCE11.1 Child Tax CreditCTC is a means-tested benefit which provides help for dependent children. It replaced amounts for children in Income Support from 6 April 2004. A person making a claim for Income Support from this date must also claim CTC for any dependent children. If entitled to Income Support, s/he will also be entitled to maximum CTC. See Law Centre (NI) Encyclopedia of Social Welfare Rights A.7 Tax Credits. 11.2 Social Fund
A person on Income Support will be entitled to claim payments from the Social Fund although some payments will be loans rather than grants. Three types of payment can be made from the Social Fund. 11.2.1 Maternity, Funeral Expenses, Cold Weather and Winter
Fuel Payments
These are the only demand-led payments available from the
Social Fund. In other words, if a person meets the qualifying conditions, s/he
will get a payment. 11.2.2 Community Care Grants
These are grants which are intended to promote community care. Normally, a person will only qualify for a grant if it can be shown that the grant will:
11.2.3 Budgeting and Crisis Loans
These are recoverable loans. Budgeting Loans are intended to assist a person to meet important intermittent expenses for which it may be difficult to budget. Crisis Loans are to assist with a disaster or other particular unforeseen circumstances. See Law Centre (NI) Encyclopedia of Social Welfare Rights A.5 Social Fund. 11.3 Housing
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free prescriptions, eye tests and glasses, dental check ups and treatment, school meals, school uniforms (from education and library board) and milk and vitamins (if expectant mother or has children under five); and |
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help with travel expenses if going to hospital for treatment. |
CTC was introduced on 6 April 2003. PC was introduced on 6 October 2003. They replaced Income Support for certain groups.
From 6 October 2003, when PC was introduced, a person who is over 60 is no longer able to claim Income Support. Instead s/he will claim PC and, if s/he has dependent children, CTC. CTC does not count as income for PC.
Existing claimants aged 60 or over at 5 October 2003 were transferred to PC and, if applicable, CTC from 6 October 2003.
CTC was introduced on 6 April 2003. It eventually replaced amounts for children in many benefits including, from 6 April 2004, Income Support.
From 6 April 2004, a person making a new claim for Income Support is no longer able to claim for dependent children on Income Support. Instead s/he should claim CTC. CTC replaces the following Income Support amounts:
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personal allowances for children; |
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premiums for children; |
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the family premium. |
From this date, a new claim for Income Support includes only amounts for adults and housing costs.
Before 6 April 2004, a person could claim for her/himself, partner and any dependent children who live in the same household who were her/his responsibility. From 6 April 2003 to 5 April 2004, both new and existing claims for Income Support continued to include personal allowances and premiums for children. In April 2004, the then Inland Revenue (now amalgamated with Her Majesty’s Customs & Excise into a new department, Her Majesty’s Revenue & Customs or HMRC) began the transfer to CTC. However, people aged 60 or over with dependent children and claiming Income Support at 5 October 2003 were transferred to PC and CTC from 6 October 2003.
The transfer of people with long-standing claims of Income Support is due to take place at some time in the future.
Those affected by these changes have transitional
protection.
Transitional protection provides that a person who had an existing claim for Income Support on 5 October 2003 is not worse off by transferring to PC.
To ensure this, regulations allow for PC to include a transitional amount, if necessary. Transitional protection is lost if entitlement to PC stops for more than eight weeks.
Transitional protection allows claims that already included child dependant additions on 5 April 2003 to retain them until transferred to CTC. This transitional protection is lost if entitlement to the additions ceases or stops due to exceeding the earnings limit and this occurs for more than eight weeks.
A person who on 6 April 2004 had an existing claim for Income Support which includes dependent children and had a CTC award from before that date ceased to have these included in the claim from 6 April 2004. The calculation of income for the purpose of Income Support is now the same as for new claims (see 5.2).
A person who on 6 April 2004 had an existing claim for Income Support which included dependent children and had no CTC award continues to have these included in the claim until HMRC transfers them to CTC or until CTC is claimed (whichever comes first). Until this happens, both Child Benefit (excluding £10.50 for a child under one year old) and CTC count in full as income in the calculation of Income Support. When CTC is awarded and amounts for dependent children in Income Support cease, Child Benefit and CTC are ignored in full as income.
Income Support is covered by Articles 122-126, 130-133 of the Social Security Contributions and Benefits (NI) Act 1992. Regulations are contained in the Income Support (General) Regulations (NI) 1987 as amended, and the Income Support (General) (Jobseeker’s Allowance Consequential Amendments) Regulations (NI) 1996.
Welfare Benefits and Tax Credits Handbook, 11th Edition, CPAG, 2009/2010, £37.00.*
Social Security Legislation, Vol 11: IS, JSA, PC & The Social Fund (Mesher, Wood, Poynter, Wikely and Bonner) 2009/2010, £144.00 (including updating supplement in March 2010).*
*Both these books are available from CPAG, 94 White Lion Street, London N1 9PF.
© Law Centre (NI) January 2010
All rights reserved. No part of this publication may be reproduced, stored on any retrieval system or transmitted in any form by any means, including photocopying and recording, without the prior written permission of Law Centre (NI).
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