over £100 million distributed to people in need benefits overview welfare state benefits 2013

Over £100 million distributed to people in need

Benefits Overview

Welfare State Benefits 2013


Benefits Not Claimed

• £20 billion in unclaimed benefits every year

• 4.5 million people losing out• 1.2 million entitled households without

children miss out on Tax Credits• 500,000 entitled working households

miss out on Housing Benefit• 3 million households miss out on Council

Tax Benefit• 1.7 million pensioners missing out on

Pension Credit


Why people don’t claim

Ignorance (didn’t know they could) Too complicated Pride Think they don’t qualify Have been ill-advised by amateur

‘Experts’


Means Tested Benefits

• Income-related ESA

• Income-based JSA • Income Support • Pension Credit• Housing Benefit• Local Housing

Allowance• Council Tax

Benefit• Social Fund

payments inc. funeral grants & cold weather payments

Non-Means Tested Benefits

• Attendance, Carer’s, Guardian’s, Maternity Allowance

• Disability Living Allowances

• Contribution-based ESA & JSA

• Industrial Disablement Benefit/WDP

• Child Benefit• State Pension • Severe Disablement

Allowance• Statutory Maternity

& Sick Pay


State Retirement Pension

Full Amount – Single Person £107.45 Spouse or adult dependent £64.40

BUT

Standard Appropriate Amount=

£142.70/£217.90


Pension Credit

Guarantee Credit

Savings Credit


Guarantee Credit

Mrs Bloggs is 66 years old, lives on her own and is in receipt of State Pension of £105.60 per week

therefore

• Entitlement to Guarantee Pension Credit of £37.10 per week to bring her up to £142.70


Savings Credit

Designed to reward individuals who have made some sort of financial plan for retirement

Can be paid on its own or with Guarantee Credit

Over 65 or have a partner over 65


Savings Credit

Figures:

– Maximum rate of £18.54pw for single person/£23.73pw for a couple

– Will probably qualify with an income of up to £189pw for single person/£277pw for couple


Housing and Council Tax Benefit

If in receipt of guarantee credit then there is entitlement to 100% Housing and Council Tax Benefit

However, although this will cover full cost of Council Tax it may not pay total rental costs

Those in the private rented sector receive Local Housing Allowance (LHA)

Different rules for those under 60/65


Attendance Allowance

Payable at Higher (£77.45) and Lower (£51.85) rates depending on disability

65 or over to claim Need help with day-to-day living Can be claimed even if not in receipt of

the help required or living alone Usually help required for 6 months or more

but special help available for terminally ill


Disability Living Allowance (DLA)

Under 65 at time of claim Can be claimed for ill/disabled child Same eligibility as Attendance Allowance Care element has 3 rates according to

disability Mobility element has 2 rates Other benefits can increase if in receipt of

DLA


Forthcoming Changes


Benefit Cap

Effective April 2013 £500pw for families £350pw for single people Exemption for disabled and pensioners Deduction from Housing Benefit initially Deductions will be from Universal

Credit from October 2013


Benefit Cap

Assessment phase already underway Discretionary Housing Payments

available – not a right 67,000 households affected in 2013/14 75,000 households affected in 2014/15 54% of those affected are in London Average benefit reduction is £83pw per

household


Universal Credit

To be introduced October 2013 – April 2014 for new claimants

Twelve million existing claimants will be transferred from April 2015 – October 2017 (transitional protection)

Will replace Income Support/Job Seekers Allowance/Employment Support Allowance/Housing Benefit/Local Housing Allowance/Child and Working Tax Credits


Universal Credit

Age Group 18 - qualifying age for Pension Credit

Not in education Must accept claimant commitment Commitment will depend on ability to

work Sanctions for not fulfilling commitment Could result in reduction of benefits for

up to 3 years


Universal Credit

Calculation will be personal amount plus additions for children/children with disabilities/limited capability for work or work related activities/caring for a disabled person and housing costs

Subject to benefit cap (£500 for families and £350 for singles)

Upper capital limit £16k Paid monthly to individual


Universal Credit

All claimants will be placed in one of four conditionality groups

– No work related requirements– Work focused interview requirement only– Work preparation and subject to work

focused interviews– All work related requirements (full

conditionality)


Council Tax Benefit

Will be abolished 1 April 2013 Replaced by localised schemes Initial plans must be submitted to

government by January 2013 10% cut in funding from central government Protection for pensioners Local Authorities will decide on the approach

but all working age households are likely to have to pay some form of Council Tax

Disputes will be heard at local Tribunals


Council Tax Benefit

Postcode lottery as different authorities use differing rules

Public consultations underway Some proposals:

– Local authorities may ‘take the hit’– Cutting capital limit to £6k from £16k– Capping maximum support to 65%– Counting Child Benefit as income– Removal of second home discount– Second homes to pay 150% (roughly 1.5m people)


Housing Benefit

86% rise in working applicants for Housing Benefit since 2009

Rental costs have risen 37% in five years

390,000 new families in 2011 111,000 new homes built


Housing Benefit

Changes apply from April 2013 Applies to council or housing association

properties Benefit will be allocated in accordance with

bedroom entitlement LHA will rise by CPI not average area rent Only impacts on those under pensionable

age (61.5 in April 2013)


Housing Benefit

Will affect 1.4 million people Recent survey by NAO shows that 90%

of claimants are not fully aware of changes

Almost 50% know nothing at all about what is going to happen


Housing Benefit

Who needs a room ?– Adult couple– Single person over 16– Two children of same sex under 16– Two children under 10 regardless of their

sex– Any other child– Carer (who does not normally live with you

and only if you need overnight care)


Housing Benefit

Who doesn’t need a room ?

– Your partner (even if you have to sleep apart because of a medical condition)

– Visiting children


Housing Benefit

One ‘spare’ bedroom will result in a cut in Housing Benefit of 14%

Two or more ‘spare’ bedrooms will result in a cut in Housing Benefit of 25%


Housing Benefit

Example:

Mr and Mrs Smith live in a two-bedroom flat costing £70pw in rent. At the moment they receive full Housing Benefit to cover this.

From April 2013 they are classed as having one ‘spare’ bedroom therefore their Housing Benefit will be cut by 14% or £9.80 per week. They will have to pay this themselves.


Housing Benefit

Example 2Mr and Mrs Bell and two teenage sons aged 13 and 15 live in a 3-bed house. The rent is £100pw and they receive £10pw in Housing Benefit.From April 2013 the boys are expected to share a room so they are considered to have a spare bedroom.Housing Benefit will reduce by £14pw therefore they will lose it all


Disability Living Allowance

Replaced by Personal Independence Payment from April 2013

2 components – mobility and daily living Each component will have 2 rates –

standard and enhanced New activities test No automatic entitlement

over £100 million distributed to people in need benefits overview welfare state benefits 2013

Documents

pension credit slide

need housing

need help

need savings credit

couple slide

need state retirement

ill slide

receipt of guarantee