One in Four Summer 2012: In a welfare state?

You may have heard a lot about changes to welfare benefits recently.  Sam Barnett-Cormack digs deep to uncover what’s really going on (this article was originally published in Summer 2012 One in Four)

If you are claiming Incapacity Benefit, you may be worried about the move to Employment Support Allowance (ESA). You may have heard about the new benefits, Universal Credit (UC) and Personal Independence Payment (PIP), replacing means-tested benefits and Disability Living Allowance. This is all quite hard to understand, which makes it more frightening. This quick guide should help you understand what’s changed, and what’s going to change, so you know what’s worth worrying about, and what isn’t so bad.

What’s changing now

Employment Support Allowance: People who get Incapacity Benefit are already being migrated to Employment Support Allowance, which was introduced in 2008.  This is assessed by the Work Capability Assessment (WCA).  Assessment begins with an ESA50 form where the claimant describes the difficulties they experience.  Most people will then have a face-to-face assessment with a doctor, nurse or physiotherapist, employed by Atos Healthcare.  Most people go to a local assessment centre, but home visits can be arranged.  You can usually get costs of getting to the assessment refunded.  People are reassessed frequently, often once a year.

The assessor will try to work out whether you can complete certain tasks. If you have problems, you score points. If you get 15+ points, you are assessed as having “limited capability for work” (LCW). You can also be “treated as having LCW” for specific reasons, but there aren’t many. For example, people on Highest Rate Disability Living Allowance Care do not qualify automatically, but people having frequent kidney dialysis do.

For some of these activities, if you have the highest level of difficulty with them you are assessed as also having “limited capability for work-related activity” (LCWRA). People who are terminally ill and expected to die within six months are automatically placed in this category. Anyone with LCWRA will be considered to have LCW as well.

People with Limited Capability for Work, but not Limited Capability for Work Related Activity, are placed in the “work-related activity group” (WRAG). People in the WRAG are expected to take steps to prepare for a return to work, and have “work-focussed interviews” at the JobCentre. If your assessment suggests a return to work within 3 months is plausible, you will also be referred to the Work Programme. The Work Programme provider can require you to do things to facilitate a return to work, and your benefit may be stopped if you don’t. They cannot require you to apply for work, take work, or take a work experience placement. Other people in the WRAG can volunteer for the Work Programme, and must then do what the provider tells them.

Those with Limited Capability for Work-Related Activity are placed in the “support group” (SG). People in the SG get extra money and are not required to do anything. They may volunteer for the Work Programme, in which case the provider can’t require them to do anything.

You are allowed to have someone with you for your assessment. You may also ask for the assessment to be recorded, in which case you should mention this on your ESA50 form, and also when you are given your appointment. You may have to travel further to an assessment centre equipped for recording. You will be given a copy of the recording, and an identical copy will be kept by Atos.

The Work Capability Assessment has been criticised a lot. The assessors use a computer programme called LiMA to help with the assessment, and people feel that this leads to an impersonal assessment. Many claim that the assessments tend to be inaccurate, particularly for mental health conditions. A lot of people feel the result of their WCA is wrong, and appeal. There is a fairly high rate of success at appeals – 40% have the original decision overturned.

ESA can be paid on the basis of National Insurance (NI) contributions or on the basis of income. If you have made enough NI contributions, you will be paid ESA without any means-test. This will be paid at the single person rate, even if you live with a partner. If your household income is low enough, and you don’t have too much in savings, you can be paid income-based ESA. If you live with a partner, you will get a higher rate of income-based ESA, but you may not get any if they work more than 24 hours a week.

Extra ESA can be paid if you have LCWRA and receive Higher rate DLA Care. This is the Enhanced Disability Premium. There is also an additional amount for people who receive the Middle or Highest rate DLA Care and live alone, with no-one claiming Carer’s Allowance for looking after you. This is the Severe Disability Premium.

You are allowed to work while on ESA, although any money you earn will be deducted from the benefit (after the first £10) if you receive income-based ESA. You must be working less than 16 hours a week, and can only do it for one year. You can keep working for more than one year without losing your ESA if you are in the Support Group, or if you make very little money.

Housing Benefit: Local Housing Allowance (LHA), for people in private rented accommodation, used to be based on median rents. This has changed to the 30th percentile – a level less than 70% of rents in the area. In some areas, this hasn’t changed the level of benefit much, but in others it has made it significantly lower.

LHA has also been capped nationally. If rents in your area are so high that the 30th percentile would be higher than the cap for that size of home, you will not get more than the cap. This mostly affects people in areas with very high rents, like parts of London and the South East.

What’s coming next?

Just as we have been getting used to the change from IB to ESA, the Government has decided to overhaul the entire benefits system. These changes arte not set in stone yet, but we haver a good idea of how they are intended to work.  The assessment of people too ill to work is one of the few things that isn’t changing.

Universal Credit: All income-based benefits are being replaced with one new benefit, called Universal Credit (UC). This will have the similar rules regarding income as income-based ESA, but any money you do earn will be deducted gradually, so working should always mean you have more money.

People claiming Universal Credit will normally have to look for work, as they do on Job Seekers Allowance now. However, the rules from ESA will determine if people have Limited Capability for Work or Limited Capability for Work Related Activity. People with LCW will have reduced conditionality. Like now, they will be required to prepare for a return to work, but not apply for jobs. People with LCWRA will have no conditions applied.

People with LCW will get a bit of extra money, probably the same amount as the ESA WRAG now. People with LCWRA will get more extra money, initially the same as the ESA Support Group now, but the Government plan to increase that amount.

If you have LCW or LCWRA and do work, you will be allowed to keep more of that money.

If you live with a partner who does not have LCW or LCWRA who does not work, they will be required to look for work just as if they claimed JSA now. However, if you receive a high level of the care component of DLA (or PIP, see below), they may be classed as a carer, and not be required to seek work.

Some current means-tested benefits give extra money to some people receiving Disability Living Allowance. These disability premiums will not be included in Universal Credit. The Government have said that the additional means-tested support for people with illnesses or disabilities will be through extra money for those with LCW or LCWRA. The Severe Disability Premium of ESA is will not be available in UC.

Contribution-based benefits are not affected by the change to Universal Credit.

Personal Independence Payment: Personal Independence Payment (PIP) will be replacing Disability Living Allowance for working-age claimants from April 2013.  At first, only new claimants whose claims go through the Bootle office will apply for PIP instead of DLA. This means claimants in Merseyside, Cheshire, the North East and the North West of England, and some other areas.  From October 2013, all new claimants must apply for PIP, as will any existing claimants whose DLA award is up and anyone receiving DLA who reports a significant change in their condition.  Most people with indefinite awards of DLA will be reassessed between January 2014 and March 2016. A small number will be reassessed from October 2013. People who are terminally ill and expected to die within 6 months will be left until last.  Everyone aged 16-64 in April 2013 and claiming DLA will have to transfer to PIP, even if they turn 65 before reassessment.  All reassessments are expected to be complete by late 2016.

The assessment will be very different from DLA. The Government are still working on the criteria to be used. They published their second draft in November 2011; a consultation about it recently closed. The assessment will definitely be points-based, and will consider several activities, some about Daily Living, and some Mobility. If you score a certain number of points (the second draft suggests 8 or more) in either category, you will get the “Standard rate” of that component, and if you reach a higher threshold (the second draft suggests 12 or more), you will get the “Enhanced rate” of that component.

Needing help to prepare a meal will no longer give automatic entitlement, unless you are completely unable to prepare a meal yourself.  Some things that weren’t considered in DLA will be considered in PIP, like planning your finances.  Being unable to leave the house without someone to guide you or keep you safe will entitle you to Enhanced rate Mobility, while needing someone with you to go somewhere unfamiliar will entitle you to Standard rate Mobility.  In both Mobility and Daily Living, you will be able to combine scores from different activities. If you need someone to remind or encourage you to do lots of things, you could get the standard rate Daily Living just from that.

The second draft of the criteria doesn’t give any points for needing someone with you most of the time to make sure you don’t harm yourself. If you need supervision for certain activities,  you can get you some points, but it might not even be enough for standard rate Daily Living.  The concept of “unable or effectively unable to walk” is no longer used. If you need an aid of any sort to walk even short distances, you should score some points. If you need a wheelchair to get even short distances, you should get enhanced rate Mobility.

At present DLA can be paid once you experienced the relevant level of impairment for 3 months (the “qualifying period”) and if it’s expected to last at least another 6 months (the “prospective test”). The Government had planned to set the qualifying period for PIP at 6 months, but decided to increase the prospective test to 9 months instead.

PIP will be based on how well you can perform each activity most days. If you need help with something at any point in a day, you need help with it “on that day”. This means that if you need help to get dressed or undressed at least once on most days, you need that help most days.

The Government should respond to the consultation on these proposals soon. We know that some people have expressed concern at things like the lack of points for needing general supervision. Hopefully the Government will listen to people’s concerns.

Benefits or programmes for which DLA currently qualifies you are expected to be available to people on equivalent levels of PIP.

Housing Benefit: The handling of social housing is being changed. If you are in social housing larger than the Government think you need, your Housing Benefit will be reduced, requiring you to pay some rent yourself even if you are receiving an income-based benefit. This change only affects people in social housing.

Housing costs will be a component of Universal Credit, rather than a separate benefit. You will not normally be able to have the housing costs element of Universal Credit paid direct to your landlord.

Council Tax Benefit: Council Tax Benefit is being abolished, but Local Authorities are being given extra funding to provide Council Tax relief on a local basis. They will be required to give full relief to pensioners, but will be free to decide who else to help and how much. They will be required to spend 10% less on Council Tax relief than they previously spent on Council Tax Benefit.

Benefit Cap: A cap is being introduced on benefits, with the aim of making sure that out-of-work households cannot get more money than a typical working family earns. People who are working, but still entitled to income-based benefits, will not be affected, and nor will households including a person who receives DLA or PIP, or a person with LCWRA.

The cap is expected to be about £350 per week for a single person without children, or £500 for couples and people with children. This is more than most people get in benefits, and is unlikely to affect households not living in particularly expensive areas, or with lots of children.

Some positive points?

While there is a lot to be worried about, there are some positive things in recent news about disability benefits.

The Government had announced plans to withdraw DLA mobility (and later PIP mobility) from people living in residential care. They have now agreed not to do so.

The Court of Appeals has ruled that it is unfair to treat disabled people exactly the same as others when deciding how many rooms you need for housing benefit. They ruled that there should be an assessment to determine if there is a genuine need for an extra room due to disability. The Government may appeal this decision further, and have no announced how they are responding to the ruling.

While the essence of the proposed changes will remain, it seems it is possible that the final form that benefits changes take may alter in the period before they are implemented.

Sam Barnett-Cormack campaigns on welfare and disability issues, and contributes to publications

Tips for dealing with benefits

1. Give yourself as much time as possible

If you get a letter about benefits, open it straight away, don’t put it off.  You need to give yourself as much time as possible to get advice and get prepared for anything you might need to do.  If you know that benefits-related letters make you anxious, get a friend, partner or other supportive person to be there when you open that brown enevelope.

2. Keep good records

Record the time, date and name of the person you spoke to any time that you speak to people about benefits by telephone. Make sure that you make photocopies of any benefits forms you fill and that you keep copies of any letters you send related to your claim.

3. Don’t take it personally

No matter how difficult the process of claiming benefits seems, the benefits system is not trying to make things hard for you personally.  Try to avoid feeling that someone, somewhere has it in for you.

4. Be firm but polite

All people who work in the benefits system are people, too.  They are advised to stop dealing with people who appear to be becoming aggressive. No matter how angry you feel, you must remain on the right side of assertive.

5. You have a right to have things explained

If you don’t understand why something is happening, or the reasons seem unclear it is your right to have that decision or communication explained fully.

6.  Get good advice not hearsay

Get advice as early as you can from a reputable source. Don’t rely on what a friend of a friend said. Do you research or get the advice of someone who already has gone through the process.

7. Phone a friend (or someone you trust)

In many benefits related situations you have the right to take someone you trust with you. Try to arrange that as early as possible.

8. Don’t panic! (or don’t panic for long)

Get others involved if you need to, get advice, get your records together, get prepared.

This article appears in the summer 2012 edition of One in Four magazine

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