Advice NI Policy Newsletter July 2019
The Advice NI Policy Newsletter
Welcome to the latest in our series of Advice NI policy eNewsletters ‘Think'.
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Two significant reports have been published this month, focussing on major policy issues within Universal Credit & PIP.
In terms of Universal Credit Natural Migration, the Work & Pensions Committee highlight concerns regarding DWP refusal to release a list of the exact ‘change of circumstances’ that trigger ‘natural migration’. With Universal Credit claimants unable to revert back to legacy benefits, surely transparency and more targeted information is imperative to protect the rights of the claimant?
The APPG on Terminal Illness recommends amending the definition of terminal illness in UK law so that a person is regarded as having a terminal illness if it is the clinical judgment of a registered medical practitioner or clinical nurse specialist that they have a progressive disease that can reasonably be expected to cause the individual’s death. More inside.
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The Policy Team.
Works & Pensions Committee publishes report on Universal Credit: Natural Migration
So-called “natural migration” is trapping benefit claimants in the DWP “lobster pot”, struggling with a sudden drop in income and with no way back, says the Work and Pensions Committee as it publishes its latest report on the “baffling”, sprawling welfare reform today, Tuesday 23 July 2019.
The DWP has pursued a policy of "managed migration", with the policy aiming to ensure that claimants moving off legacy benefits getting transitional payments to mitigate any loss. But the report states there are no similar protections in place for those whose circumstances have changed and so are deemed to have undergone "natural migration" by the Department. "Understanding when existing benefit claimants will need to naturally migrate to UC is so complex, it baffles even experienced benefit advisers."
Rt Hon Frank Field MP, Chair of WPSC, said:
“In the history of humankind, has there ever been an example of a Government introducing a fundamental welfare reform and none of its employees being able to tell if it will leave people better or worse off? Hardly surprising that baffled and anxious claimants are finding themselves trapped in what the Department chillingly calls the “lobster pot” of Universal Credit, and with much less to live on as a result. The UC application page needs to come with a health warning, and anyone who gets inadvertently caught in DWP’s lobster pot should be compensated.”
The Committee is calling on the Department to work with stakeholders to develop clear and comprehensive guidance on the circumstances which will lead an existing benefit claimant to be forced to reapply for their entire benefit entitlement in the form of Universal Credit. The Committee asks, within this report, for the Department to provide a complete list of the “changes of circumstance” which will trigger ‘natural migration’. In the absence of this vital information, there is no clarity over the factors that will cause the move to UC. The Committee cannot simply accept on trust the Department’s assurances that this is not a "systemic" issue: DWP should explore ways to make the carry-over of WCA decisions from legacy benefits to UC a more automated process. If it cannot do this, it should report regularly to the Committee on the number of cases where this is not happening on time.
Conclusions and recommendations of the Works & Pension Committee:
Universal Credit: Managed Migration
Statement by Secretary of State for Work and Pensions, Amber Rudd
Today I am laying regulations to commence the pilot, for no more than 10,000 claimants, which will start this month.
We have also revised our approach to claimants who are entitled to the severe disability premium. The regulations that I am laying today will enable us to begin to provide support for claimants who were entitled to the premium and have already moved to universal credit. From 24 July 2019, those claimants will be considered for backdated payments covering the time that has elapsed since their move. They will also gain access to ongoing transitional payments that reflect the severe disability premium to which they were previously entitled. We have reviewed the rates of those payments to enable the most vulnerable to receive increased support. Claimants will now receive payments of up to £405 per month alongside their universal credit awards, increased from the previous proposed maximum of £360.
Following the High Court judgment on the severe disability premium, the regulations will also—in 2021—bring an end to the barrier that currently prevents its recipients from moving to universal credit as a result of a change of circumstances. Until 2021, anyone who currently receives the premium and whose circumstances change will continue to be held on legacy benefits, as they are now. After 2021, the barrier will be removed.
The full statement is available here:
All-Party Parliamentary Group [APPG] publishes report examining Terminal Illness PIP claims
Entitled ‘Six Months to Live? Report of the All-Party Parliamentary Group for Terminal Illness Inquiry into the Legal Definition of Terminal Illness’, the report was compiled by Marie Curie, which provides the Secretariat to the APPG for Terminal Illness.
The Advice NI sent a submission and is quoted in the Final Report:
“Patients may be aware that they are terminally ill, but have requested clinicians not to tell them of their expected prognosis. While the law allows third parties to claim on behalf of people living with a terminal illness in these circumstances, as Advice Northern Ireland pointed out in its evidence, patients may miss out on a Special Rules claim they are otherwise eligible to make unless they are dealing with a specialist adviser who is aware of and able to navigate this process.”
The report also states: ‘The current legal definition of terminal illness, with its “six-month rule”, is unfit for purpose – it is outdated, arbitrary and not based on clinical reality. It is ironic that this measure, originally designed to help terminally ill people avoid a long wait to qualify for benefits has, in practice, become a barrier to access for many people with terminal conditions. Clinicians, social and palliative care workers and medical experts all recommended to the APPG that it should be changed.’
“The current rules seriously restrict access to vital financial support for many terminally ill people, whose condition will never improve and only deteriorate until they die, but who may live for longer than six months. The policy is not only very hard on people living with terminal illnesses, it also causes a great deal of financial pressure and worry on their families at the very worst time in their lives.”
-Drew Hendry MP, chair of the APPG for Terminal Illness
Revisions and supersessions for DLA transfer claimants who claim PIP after reaching 65 or pension age
PIP regulations in Northern Ireland by the Personal Independence Payment (Transitional Provisions) (Amendment) Regulations (Northern Ireland) 2019 (SR.No.118/2019). Part of the explanatory memorandum states:
7.3 One of the policy intentions within PIP, and DLA before, has been to focus financial support on those who become disabled earlier in life, i.e. before age 65, and have had less opportunity to work, earn and save for their retirement. The age 65 threshold applied equally to men and women since DLA was introduced in 1992 and upon the introduction of PIP. With state pension age now aligned between men and women at age 65, and with it gradually rising towards age 66 (by October 2020), the upper age threshold, known as the relevant age, for claiming PIP is also rising in line with the increases in state pension age.
7.4 The gap identified in the legislation governing this group of claimants means that where their PIP award is subject to a revision or supersession for a change of circumstances there is no exemption in the Transitional Regulations to the upper age restriction. A strict application of the legislation would mean PIP would no longer be payable to this group in this situation. This goes against the policy intent and if applied would disadvantage these claimants.
Update on (HMRC) Non-Universal Credit (Non-UC) Tax Credits debt
From 14 June 2019, HMRC customers who are no longer in receipt of Tax Credits and have a debt, are in employment on a Pay As You Earn (PAYE) scheme and have net earnings of £5,200 or more with one employer, may have their debt transferred to the Department for Communities (DfC) for recovery using existing methods of recovery, including recovery directly from earnings (DEA).
Following the transfer, DfC Debt Management (DM) will contact the customer by sending a routine Letter Before Action (LBA). Customers who wish to engage with the Department and set up an arrangement to repay their debt can do so by using the contact details which will be provided in the LBA letter. Customers who choose to not engage will be transferred into a Direct Earnings Attachment (DEA) procedure, where appropriate.
Pension Credit Amendment Regulations Age
The State Pension Credit (Additional Amount for Child or Qualifying Young Person) (Amendment) Regulations (Northern Ireland) 2018 made provision for additional amounts for children and young people to be included in pension credit awards for claimants who do not have a tax credit award.
Support for low income pensioners with responsibility for children is currently provided through Child Tax Credit, which is being abolished in accordance with the Welfare Reform (Northern Ireland) Order 2015 (“the 2015 Order”). The purpose of the Regulations is to ensure support for children continues to be provided for low income pensioners by introducing a new additional amount within Pension Credit.
WCMS Communication for Voluntary Sector Newsletters
The Child Maintenance Service is currently implementing a Compliance and Arrears Strategy, which aims to address the long standing issue of historic debt which built up on the 1993 and 2003 schemes. The Department intends to introduce new Regulations (currently planned for July) to enable child maintenance arrears on the CMS 2012 Scheme to be collected through a deduction from benefit, including from Universal Credit once on-going maintenance has ceased. Further information on the Strategy can be found at:
Where the debt is over £500 and the case is less than ten years old, or with debt over £1,000 and the case is ten or more years old
- CMS will write to receiving parents advising them to contact the Department if they still want to pursue the arrears owed to them. If they do, a number of checks will be performed to establish whether there is a realistic chance of collection. If there is, CMS will make an attempt to establish collection.
- Where either the receiving parent does not respond within 60 days of the first letter, or the case is assessed as having little chance of successful collection, or the attempt to collect the debt is unsuccessful, the debt will be written off.
Other arrearsCMS will send a letter to the receiving parent and the other parent to explain that it will automatically write the debt off if it is:
- £500 or less and the case is less than 10 years old; or
- £1,000 or less and the case is 10 or more years old.
Arrears owed to the DepartmentThe Department will write off all debt owed to it which had accrued under the previous schemes. Collecting this debt will not benefit families and is not a good use of Departmental funds, as it is not cost effective to collect or continue to maintain this debt.
Further information can be found at:
Note:The new powers have now been introduced which allow CMS to make deductions for arrears of child maintenance from benefits after all on-going child maintenance has been paid. From mid July 2019, CMS will start requesting deductions for arrears of child maintenance from relevant benefits customers, and you may receive queries about this.
If you have any queries about the Compliance and Arrears Strategy, would like any further information, or would like to arrange a meeting to discuss, please do not hesitate to contact the CMS Outreach Officer on 02890 539829, or by email at firstname.lastname@example.org
Office of the Discretionary Support Commissioner - Annual Report 2018 - 2019
Discretionary Support is administered by the Department for Communities (the Department). The Welfare Reform (Northern Ireland) Order 2015 makes provision for the Department to make payments by way of grant or loan to prescribed persons.
The Commissioner states in the Annual Report:
“I noted in last year’s report, and I remain concerned, that as part of DS there is a threshold set for Income and Earnings: Regulation 15. During the period covered by this report, I have again reviewed several cases where the family income threshold has been exceeded, thus preventing access to DS.”
CPAG releases ‘Challenging Decisions’ report
The first Computer Says ‘No!’ report focused on problems with the information provided to claimants about their UC award.
The Report concluded that claimants are not being provided with sufficient information to understand their entitlement, and that the Department for Work and Pensions (DWP) is failing in its legal duty to provide adequate information to over two million claimants each month about how and when to challenge a decision they do not agree with.
Universal Credit and the self-employed
Hywel Williams PQ re what criteria the Department uses to categorise universal credit applicants as gainfully self-employed.
The Department provides tailored support to our claimants who are in self-employment through our work coaches to help them to increase their productivity and earnings. Work coaches can refer low-earning claimants to mentoring support from New Enterprise Allowance providers and sign-post claimants to the other extensive business support which is already funded by the Government.
All claimants with earnings from self-employment, whether gainfully self-employed or not, are required to self-report these each month to ensure that any Universal Credit (UC) payments take into account all household earnings. Monthly reporting allows UC to be adjusted monthly. Claimants are required to report the total of actual payments into and out of their business in each month, minus any Income Tax, National Insurance, permitted business expenses and relievable pension contributions actually paid. This gives a net profit figure, which is treated as the self-employed earnings total in the UC calculation. Any drawings from business to personal accounts or, where a claimant has incorporated their business, payment of salary from their company to their personal account, is disregarded in this calculation to avoid double counting.
When a claim is made to Universal Credit the Department will, on the basis of the information provided by the claimant, assess whether the claimant may reasonably be expected to work. If a claimant is in a group expected to work, the number of hours they may be expected to work is a maximum of 35 but may be lower, for example to take account of caring responsibilities or a health condition.
If a claimant is self-employed and in a group expected to work, the Department then considers a number of factors to establish whether someone is gainfully self-employed. A claimant is considered to be in gainful self-employment where all of the following apply:
- the claimant is carrying on a trade, profession or vocation as their main employment
- their earnings from that trade, profession or vocation are self-employed earnings
- the trade, profession or vocation is organised, developed, regular and carried out in expectation of profit
As we announced in the Autumn Budget 2018, we are extending the 12-month start-up period where claimants are exempt from the Minimum Income Floor to all gainfully self-employed claimants who are new to Universal Credit. This start-up period will provide time for self-employed claimants to establish and grow their business, or to adjust to Universal Credit.
On average earnings from self-employment are lower than from employment and the self-employed make up a significant proportion of those in in-work poverty. The Government believes the MIF, by incentivising claimants to earn more from self-employment, or alternatively enter employment, offers the most effective way of tackling in-work poverty for the self-employed.
Post Office Card Accounts
Marion Fellows PQ re Post Office card accounts ending in 2021.
The The Post Office card account contract ends in November 2021. There are currently no plans to extend this contract.
The DWP has written to customers who use the Post Office card accounts to encourage them to receive payment into a mainstream account. This is part of our policy of reducing reliance on payment exception services and promoting financial inclusion through the use of mainstream accounts. Mainstream accounts offer more features and reduce the cost to the taxpayer. One of the key messages we highlight, is that 99% of banks’ personal accounts enable customers to withdraw cash, deposit cash and cheques, and make balance enquiries at a Post Office counter via its network of 11,600 branches.
For those claimants and pensioners who are unable to open a mainstream account, the DWP will implement an alternative payment service that allows users to obtain cash payments in their local area (including suburban and rural locations) before the end of the Post Office card account contract in November 2021.
All DWP letters provide a free telephone number where the customer can call to discuss their payment options further and change their method of payment over the telephone. A copy of these letters will be placed in the House of Commons Library.
As we approach the end of the Post Office card account contract, the DWP and POL will work together to issue joint guidance on Post Office card account user’s options, to transfer to other payments methods.
How many claimants of Universal Credit received payments into a Post Office Card Account? (POCA)
Ruth George Parliamentary Question re the POCA contract ending in November 2021
The Department’s standard method of payment for pensions and benefits is into a bank, building society or credit union account. For claimants who cannot open one of these accounts, or provide the details for their own account to access their payment, the Department can offer two alternatives: The Post Office Card Account and HM Government Payment Exception Service, both of which guarantee access to their payment of pension and or benefit.
The Department has been contacting claimants using Post Office Card Accounts since September 2015 offering information to claimants to move to standard payment methods.
As a claimant may receive more than one payment of Universal Credit in each month, we have supplied the total volume of Universal Credit payments made into Post Office Card Accounts in each of the last 12 months in the table below. Increasing volumes of Universal Credit payments into these types of account reflect those naturally migrating from legacy benefits and taking their payment method with them.
May 2019 … 15,724 payments made
Universal Credit and protection from excessive deductions
Ruth George PQ re the specific Regulations protect claimants from excessive deductions.
The The Government recognises the importance of safeguarding the welfare of claimants who have incurred debt. Under Universal Credit there is a structured approach to deductions from benefit, which simplifies the current complex arrangements. Claimants can view their Universal credit statement online and easily understand both how their award is calculated and what debts are being repaid, supporting them to manage their financial obligations.
The aim of the deductions policy in Universal Credit is to protect vulnerable claimants by providing a last resort repayment method for arrears of essential services. The policy also enables social obligations to be enforced when other repayment methods have failed, or are not cost effective, and ensures that benefit debt is recovered in a cost effective manner.
Regulations protect claimants from excessive deductions, which could lead to financial difficulty.
Universal Credit is made up of a standard allowance plus any additional elements that apply, for example a housing element or child element. The overall maximum amount that can be deducted for debt repayments from a claimant’s Universal Credit each month is an amount equal to 40 per cent of their Universal Credit standard allowance.
Where requested deductions exceed the 40 per cent maximum, or there is insufficient Universal Credit in payment for all deductions to be made, a priority order is applied, which determines the order in which items should be deducted. ‘Last resort’ deductions, such as rent or fuel costs, are at the top of the priority order, ensuring that claimant welfare is prioritised, followed by social obligation deductions, such as fines and child maintenance, and finally benefit debt, such as Social Fund loans and benefit overpayments.
There are two exceptions to the overall maximum deduction rate. The first is deductions for current consumption of gas, electricity and water, which do not count towards the overall maximum amount. The second is where a Conditionality Sanction or Fraud Penalty is being applied or an Advance is being recovered, ‘last resort deductions’ (that is arrears of rent, service charges, gas or electricity) continue to be taken, even if it means that more than 40 per cent is deducted. This is to protect vulnerable claimants from being made homeless or having their fuel disconnected.
The Universal Credit, Personal Independence Payment, Jobseeker’s Allowance and Employment and Support Allowance (Claims and Payments) Regulations 2013(S.I, 2013/380) and specifically Regulation 60 and Schedule 6, paragraph 4 explains how claimants are protected from excessive deductions. These regulations are available at http://www.legislation.gov.uk/uksi/2013/380/contents/made.
Universal Credit and Deductions
Frank Field PQ re how many universal credit claimants had (a) an advance payment repayment deduction, (b) a historic debt repayment and (c) both attached to their claim in 2018-19The Department recognises the importance of safeguarding the welfare of claimants who have incurred debt. Under Universal Credit there is a structured approach to deductions from benefit, which simplifies the complex arrangements that exists within legacy benefits. From October 2019 the maximum rate of deductions from a claimant’s standard allowance will be reduced from 40% to 30%. From October 2021 we are increasing the recovery period for advances from 12 to 16 months, further supporting those in financial need.
If a claimant considers that they are facing financial hardship because of the amount that is being deducted from their Universal Credit award, they can ask the Department to consider reducing their deductions. Furthermore, work coaches can pause some repayments in certain circumstances to ensure they are manageable. This is called a financial hardship decision.
During 2018/19 there were: (a) 1.043m claimants with deductions from UC for UC Advance repayments; (b) 0.749m claimants with deductions from UC for non-UC debts; and; (c) 0.491m claimants with deductions from UC for both UC Advance repayments and non-UC debts in 2018/19 (this volume is included in volumes for (a) and (b).
Advice NI asked about N.I. arrangements regarding UC and free school meals? Does the process mirror that in GB where The Department for Education (DfE) provides an Electronic Eligibility Checking Service (ECS) to all local authorities in England, which is used to confirm eligibility for free school meals. To support this, there are already data sharing agreements in place between DfE and the Department for Work and Pensions (DWP) and other government departments who administer benefits which qualify families for free school meals.
DfC: The GB Department for Education Eligibility Checking System (ECS) does not currently support eligibility checking for Northern Ireland. Instead claimants applying for free school meals or uniform grants submit a copy of their Universal Credit statement with their application. The assessing or awarding free school meals is the responsibility of the Education Authority.
Advice NI sought confirmation on how UC claimants can access their UC medical assessment (Limited Capability for Work LCW) report.
DfC: These reports are not automatically issued to the claimant but they can request to have a copy issued either by contacting their Service Centre over the phone or in writing via their online journal.
Advice NI asked about the Universal Credit arrangements and processes for the non-digital application and maintenance of UC claims, with specific reference to people who do not speak English as a first language.
DfC: Thank you for your query regarding non-digital application and maintenance of UC claims.
The Department for Communities are committed to ensuring the needs of those who may not be able to access services through the standard process are considered at all times and you’ll be aware that we are working with increasing numbers of customers who do not speak English as a first language.
Our response is very much tailored to the individual’s circumstances and in the case of the Syrian Vulnerable Refugee Scheme arrangements are in place to meet with these customers as a group when they first arrive, usually at a local facility in their community. At these sessions, interpreters are available and all the necessary information to make the claim can be made and details agreed to follow up on anything outstanding. This process has been working well for these customers. Equally, when we know employers are bringing large numbers of new workers to NI who may not speak English, we can offer a similar opportunity to meet these people more locally with interpreters immediately available in person to help manage that initial contact.
When customers present unexpectedly who do not speak English, we can communicate with them through a translation service, available (through a telephony service) in all our local offices. In addition to this, a face to face interpreting service is provided by Flex Language Services. The date and time for an interview must be pre-arranged in advance of the claimant’s appointment and is subject to the translator’s availability. This additional support may be put in place on a one off basis or for a short, medium or long period of time depending on the needs of the claimant.
For clients who do not speak English and have no way of communicating with us, we can manage their case on an on-going basis through telephony. This means when they phone, our staff can connect with a translator and address the issues on the phone at that time.
The customer’s Work Coaches will also support them to improve their language and digital skills. For example, Work Coaches will consider referral or signposting to English for Speakers of Other Languages (ESOL) classes or equivalent courses at a local college or community organisation. We work with LibrariesNI, local colleges or community organisations to assist claimant’s to improve their digital skills.
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