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Spring Edition 2021 Welfare Benefits Team Factsheet The Over In this edition we cover Universal credit Major change for Means-testing and 75s... and the Budget disabled people non-means testing Pensioners Many married women (and other groups - please see below) who reached ‘state pension age’ (i.e. the age at which they could officially retire and receive a state retirement pension) before 6 April 2016, may have Missing missed out on state retirement pension entitlements dating back many years. They may now be own National Insurance Out… owed many hundreds of contributions record. To pounds (in some cases qualify for a full pension thousands of pounds) in (currently worth £137.60 back pay. per week) a person The current estimate needed to have a National is that £2.7 billion in back Insurance contributions pay in state retirement record of at least 30 pension is owed and qualifying years. £90 million in ongoing However, married entitlements is to be paid. women who did not If a person reached have a complete National state pension age before 6 Insurance contributions April 2016 then they could record could apply for a claim the ‘old’ Retirement Category B Retirement Pension. Under these rules Pension (worth up to a person could claim a £82.45 per week or Category A Retirement 60% of their husband’s Pension based full Retirement Pension upon their entitlement whichever was the lesser figure) based upon their husband’s National Insurance contributions record once their husband had reached the then state retirement age of 65. In effect a woman could be paid whichever paid the greater amount between the Category A Retirement Pension and the Category B Retirement Pension. Continued on page 2 For further information contact: welfare.benefit@lbhf.gov.uk
2 | Welfare Benefits Team Factsheet Spring Edition 2021 Pensioners Missing Out… Who may be affected? Continued from page 1 The Pension Service have been As stated this does not only affect married women. It also affects others. aware of the issue since last year. It The people who may have missed out include: has taken on extra staff to identify and contact those who are owed money. Between August 2020 and Age 65 Married women (or civil partners) who reached state January 2021 scans of old computer before pension age of 65 before 6 April 2016 whose Retirement records took place to identify those 6 April 2016 Pension is less than £80.45 per week (£82.45 per week potentially affected. Anyone who from 5.4.2021). thinks that they may have missed out may contact the Pension Service Age 65 Married women (or civil partners) whose husband (or on 0800 731 0469 to check. before civil partner) reached the age of 65 before 17 March The ‘new’ State Pension was 17 March 2008 who failed to apply for any additional Retirement introduced for people reaching Pension, perhaps because they did not realise that they state pension age on or after 6 April 2008 could. 2016. Qualification is dependent upon the contributions record of Pension was Widows (or bereaved civil partners) whose pension was the claimant. How much is paid not increased when their husband (or civil partner) died. is ultimately determined by how not increased complete a person’s National Insurance contributions record is. To Aged 80 A person who is now aged 80 or over whose Retirement qualify for a full pension (currently Retirement Pension is less than £80.45 per week (£82.45 per week worth £179.60 per week) a person Pension is less from 5.4.2021) irrespective of their marital status. must have a National Insurance than £80.45pw contributions record of at least 35 qualifying years. Anyone who is affected by this and receives a lump Partner was If a woman (or civil partner) was underpaid but they sum payment or an increase in their underpaid and are now deceased, then her widow (or bereaved Retirement Pension should bear in now deceased civil partner) or surviving children may apply for the mind that it could impact on any backdated payment that would otherwise have been benefits that they are currently in paid to her. receipt of.
Welfare Benefits Team Factsheet Spring Edition 2021 | 3 The Over 75s… State retirement pension, private pensions and occupational Since 1 August 2020 the TV licencing pensions are all counted as income laws were changed, and people along with any earned income. aged over 75 no longer qualify for Attendance Allowance, Disability a free TV licence unless they are in Living Allowance and/or Personal receipt of Pension Credit or are blind Independence Payment are all fully (severely sight impaired) or live in a disregarded but must be declared. care home. Pension credit can be claimed over Pension Credit is designed to provide the phone or online. people over state retirement age with a minimum income for day- to-day living. From 5 April 2021 the minimum income figures will be: • £177.10 per week for a single pensioner • £270.30 per week for a pensioner couple The principle is that if a single pensioner’s total income or pensioner couple’s total income is less than these amounts, they can apply for Pension Credit as a top-up to their already existing income. The European Economic Area (EEA) and Swiss citizens and their family members living in the UK by 31 December 2020 will be able to claim or continue to receive benefits for as long as they continue to be lawfully resident in the UK and meet the eligibility requirements. To lawfully live in the UK, EEA and Swiss citizens and their family members (including children) must apply to the EU Settlement Scheme by 30 June 2021. Depending on their circumstances, they will be either Deadline issued with pre-settled status or settled status. Those with settled status will be treated equally to British citizens and can claim benefits. Those with pre-settled to apply to status will need to pass the ‘right to reside test’ to get benefits. Irish citizens and their family members living in the UK will be able to claim or continue to receive the UK EU Settlement benefits to which they are entitled, without a need to register with EU Settlement Scheme. Scheme Without a pre-settled or settled status, EEA and Swiss Citizens cannot claim benefits. It is important to apply to the EU Settlement Scheme. 30 June 2021 Applications can be made online at www.gov.uk For further information contact: welfare.benefit@lbhf.gov.uk
4 | Welfare Benefits Team Factsheet Spring Edition 2021 Universal credit and related measures in the Budget The budget on 3 March 2021 included several announcements relating to benefits and COVID-19 support. Universal credit uplift and working tax credit increase The temporary increase to the standard allowance in universal credit (UC), which was introduced in response to COVID-19, will not be removed in April 2021 as originally planned. It will be extended by six months until the end of September 2021. The uplift is worth £86.67 per month (£20 per week). There is however no easement of the benefit cap, so some families will continue to fail to benefit, in part or full, from the uplift. There will be a £500 lump-sum payment in April 2021 to people getting working tax credit for those in work who have not yet migrated to UC. Advance payments People making a new claim for UC receive their first payment a calendar month and a week after the date of their claim. Claimants can request an advance payment of up to 100 per cent of what they are due to receive, in order to manage their finances in that period. Monthly deductions are then made from their UC payment to pay back the advance. From April 2021, applicants will be offered the option to repay over a 24-month period instead of the previous 12 months allowed, to support with budgeting their money. Deductions Deductions are made in UC to contribute to the reduction of priority debts such as rent and utility arrears. From April 2021, the normal maximum deduction rate for arrears will change from 30 per cent to 25 per cent of a claimant’s UC standard allowance. This will reduce the monthly deductions, to be repaid over a longer period. Minimum income floor The minimum income floor (MIF) is a measure that assumes that, after a year of self-employment, someone who would otherwise have to look for work, will be earning the equivalent of the full-time national minimum wage. UC is then based on that assumed figure. The minimum income floor was suspended in March 2020 and this has now been extended until the end of July 2021. It will be gradually reintroduced from August 2021. DWP work coaches will have discretion to not apply the MIF on an individual basis, where they assess that claimants’ earnings continue to be affected by COVID-19 restrictions.
Welfare Benefits Team Factsheet Spring Edition 2021 | 5 Shared accommodation rate exemptions for care leavers The shared accommodation rate applies to those who are under the age of 35, living alone and renting privately. It limits the housing costs that can be met by benefit, to the price of a certain standard of bedsit or a room in a shared house. There are some exemptions e.g. parents, couples and some people with disabilities and includes care-leavers, who are currently exempt from the shared accommodation rate until their 22nd birthday. From June 2021, it is the DWP’s intention to raise this to the 25th birthday. Currently, those aged 25-34 who have spent three months in a homeless hostel for the purposes of rehabilitation/re-settlement are also exempt from the shared accommodation rate. This will be extended to those under 25 from June 2021. Surplus earnings rule The surplus earnings rule is designed to ‘even-out’ the calculation of UC for people with high fluctuations in their income. An example would be people who get a regular low wage (and therefore a higher amount of benefit) but also get a large annual bonus, which would end or substantially reduce their UC but only for the month in which it is received. At present, the carry-over is limited to £2,500 per month, and this will be extended until 31 March 2022. It has come into force in the last year, when some low-income claimants received back-dated payments from the Self-Employed Income Support Scheme, and this may be repeated in 2021/22 as that scheme is expanded. Support for employees The furlough scheme for employees affected by COVID-19 is being extended. The Coronavirus Job Retention Scheme helps employers to keep staff on their payroll when they have had to close or scale back due to COVID-19, rather than making them redundant. The scheme pays a percentage of employees’ wages, up to a certain amount per month. This was due to run until the end of April 2021 but has been further extended in the Budget to the end of September 2021. Employers will be asked to contribute 10 per cent in July and 20 per cent in August and September as the scheme is gradually phased out. More information is available at www.gov.uk Self-Employment Income Support Scheme SEISS Support for the self-employed is also extended. The Self-Employment Income Support Scheme allows self- employed people to claim a taxable grant if they have lost trading / partnership trading profits due to COVID-19. A fourth grant, covering the period between February and April 2021, will be available from late April. A fifth grant, covering the period from May to July 2021, will be available from late July. More information is available at gov.uk More changes are expected over the coming months. For further information contact: welfare.benefit@lbhf.gov.uk
6 | Welfare Benefits Team Factsheet Spring Edition 2021 Major change for disabled people moving to universal credit 27 January 2021 saw of circumstances that will To make up for the The three different the closure of what was prompt a legacy benefit loss of SDP when people levels of transitional known as the SDP gateway being closed and a claim move onto UC, the DWP payments are: for working age people. for UC to be made are: has introduced SDP 1. £405 a month where People who receive the • moving into, or out of, transitional payments, joint claimants were severe disability premium employment (although included in the UC award. receiving the higher (SDP) in their legacy that doesn’t always They are only available couple rate SDP in their benefits such as income mean they need to stop to people who have legacy benefits. support (IS) or income- claiming tax credits or received SDP within their related employment and IS, IRESA or IBJSA in the 2. £285 a month for claim UC through being support allowance (IRESA) month before they claim single claimants not unemployed) can now claim UC. UC and continue to meet in the UC limited • becoming responsible capability for work- Severe disability for a child for the first the eligibility conditions premium was an for SDP. They are not related activity time, where a new (LCWRA) group. It is additional premium claim for child tax credit available to people who awarded to top-up legacy are only receiving a SDP also paid to couples would no longer be where only one benefits in recognition of possible within their HB or council the extra disability related tax support, or to people member is eligible for costs that people living • moving home to a claiming benefits for the SDP and they are not with severe disability incur, new local authority first time. receiving the LCWRA as long as they met the and needing help with component in UC. following criteria: housing costs. 3. £120 a month for single • were in receipt claimants who have of disability living LCWRA. This is lower allowance, personal because they will be independence payment receiving the LCWRA or Attendance element of UC. It is also Allowance at the paid to couples where relevant rate, only one member is eligible for SDP and • no one was claiming they are receiving the Carer’s allowance for LCWRA component in looking after them UC. • and they were the Households receiving only adult living in the the SDP in their HB property. only will miss out on Before 27 January, this protection, as will there was a two-year households who lose period where these other elements of their claimants were protected legacy benefits when from the move to UC they move to UC. and could remain on The SDP the legacy benefit with transitional element SDP. Now, if they have will decrease over a relevant change of time. circumstances, they will Anyone have to move from legacy concerned about benefits and apply for UC. moving from Over half a million existing benefits households on IRESA onto UC can get SDP. There are also call our advice many households on line for a HB who get the SDP benefit as part of their HB check first. calculation, and they were protected by the SDP gateway too. Some of the changes
Welfare Benefits Team Factsheet Spring Edition 2021 | 7 Motability Until 31 July 2021, Motability customers who are in ‘temporary and exceptional financial need’ due to COVID-19 can apply for an advance of the £600 good condition bonus (GCB), which is usually only paid to customers at the end of the vehicle lease. The Motability Charity scheme is also now open for grant applications again. For more information, see www.motability.co.uk Appeal hearings by video link Due to the COVID-19 pandemic, social security appeal tribunal hearings have been taking place by telephone rather than face-toface. Claimants and tribunal members (along with representatives, witnesses, carers and/or interpreters if participating) are all joined by teleconference. HM Courts and Tribunals Service are now putting measures in place to hold video hearings as an alternative option to phone hearings. The latest version of the benefit appeal form asks appellants firstly whether they want to take part in an appeal hearing (as opposed to having the tribunal members make a decision based on the paperwork). If they want to take part in a hearing, it then asks which options they would accept out of a telephone hearing, video hearing or face-toface hearing. The tribunal, not the appellant, makes the final decision on which type of hearing to hold. A copy of the benefit appeal form (SSCS1) and guidance on what to expect when joining a telephone or video hearing are available at gov.uk. People taking part in video hearings are asking to dress as if they were coming into a court or tribunal building, to have a plain background, and not to eat or drink anything except water during the hearing. UC Benefit rates from April 2021 Monthly UC Up to April 2021 April - Sept 2021 October 2021 - April 2022 standard allowance £20 included £20 included £20 remove Single under 25 £342.72 £344.00 £257.33 Single 25+ £409.89 £411.51 £324.84 Couple under 25 £488.59 £490.60 £403.93 Couple 25+ £594.04 £596.58 £509.91 * Be aware these are illustrations of some basic amounts that are part of the UC calculation and that they can be lower or higher if for example, there are housing costs or extra elements to be added. See: www.gov.uk/government/publications/benefit-and-pension-rates-2020-to-2021 For further information contact: welfare.benefit@lbhf.gov.uk
8 | Welfare Benefits Team Factsheet Spring Edition 2021 What does Welfare means-testing Benefit Officer and non-means Case Study testing mean? Miss M, aged 15 years old resided in a 3 bedroom LBHF property with her mother - who was our Tenant and her 2 younger brothers. Unfortunately, Mean Tested Benefits her mother passed away on 29/10/2018. Means tested benefits are those benefits in the social Miss M remained in the 3-bedroom property with security system that assess your personal circumstances her 2 younger brothers aged 7 & 9 years old. Miss M (single, couple, disabled etc) income and savings/capital, was made to succeed her mother’s tenancy, but as to determine your entitlement to benefits. These benefits she was only 15 years old then, her Uncle became the are to help meet the cost of basic living expenses. Trustee of the property and Miss M the beneficiary. Examples of means-tested benefits are: An interview was arranged for Miss M and her uncle A to visit our Housing Office at White City to complete • Universal Credit the signup succession. Our WBO, Uyi was present at • Income-based Jobseekers Allowance (IBJSA) that interview to meet with Miss M and her Uncle A. • Income-related Employment Support allowance Miss M was referred to Uyi by the Housing Officer (IRESA) for a benefit check and to identify other benefits and support Miss M might be entitled to, including • Income Support (IS) assisting with her rent payment. • Housing Benefit (HB) After the completion of the signup succession, Uyi • Pension Credit (PC) completed a Pre-tenancy signup checklist with her. It • Tax Credit (child tax credit & working tax credit) emerged that Miss M had just turned 16. Uyi informed her that she would be entitled to claim Universal Credit • Council tax support (CTS). (UC). With the assistance of her Uncle, Miss M visited Entitlement to these benefits can give access to the her local job centre to apply for UC. UC was awarded following support through the social fund: and included help with housing costs for the rent. This • Sure start maternity grant cleared the arrears that had built up. Miss M’s rental income support officer (RISO) applied for the rent to • funeral payment/ bereavement payment be paid directly into the rent account (APA alternative • cold weather payment. payment arrangement). Her Uncle moved into the The amount of income/savings/capital affects your property as well, until Miss M turns 18. Everyone was eligibility. happy with the outcome. Uyi completed the Post signup checklist with Non-mean Tested Benefits Miss M, 4 weeks after the sign-up interview, via the Your income/savings/capital are largely ignored for telephone to further make enquiries. It emerged that the eligibility to non-means tested benefits, as long as her circumstances remained the same. The family claimants meet the criteria. expressed their appreciation of Uyi’s assistance Examples of some non-means tested benefits are: received by text messages and verbally. • state retirement pension • carer’s allowance • child benefit • personal independence payment (PIP) • attendance allowance (AA). CAR PAYMENT RENT Welfare benefits advice line 020 8753 5566 Advice line Morning Afternoon Monday 9.30am–12.30pm 13.30pm–16.30pm Wednesday 13.30pm–16.30pm GAS LIGHTS Friday 9.30am–12.30pm 13.30pm–16.30pm DOES THIS FEEL LIKE YOU? Welfare benefits team: welfare.benefit@lbhf.gov.uk Call our advice line 0208 753 5566 0012. 2021. For further information contact: welfare.benefit@lbhf.gov.uk
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