Welfare Reform and Pensions Bill

Welfare Reform and Pensions Bill

Summary of changes to incapacity and disability benefits

Single work-focused gateway

Clause 47 amends the Social Security Administration Act 1992 (SSAA) inserting new sections 2A and 2B which create regulation making powers whereby:

·  both new and existing claimants will be required to attend ‘work-focused interviews’ as a condition of either claiming benefit, or continuing entitlement to the full amount of benefit;

·  the new interview requirement will apply to income support, housing benefit, council tax benefit, widows benefits, incapacity benefit, severe disablement allowance and invalid care allowance. Only one work-focused interview will be required where someone claims more than one of these benefits.

·  regulations will determine the interviewing process, the procedure if someone fails to attend, good cause and benefit sanctions for non-attendance, exemptions from the interview requirement, and rights of appeal against a decision that a claimant has failed to comply with the interview requirement.

Although much of the detail will be established in secondary legislation the accompanying explanatory notes [Bill 44-EN] clarify the Government’s policy intentions. Work-focused interviews will be conducted by personal advisers who will be acting on behalf of the Secretary of State, but who could be employees of a range of agencies: Benefits Agency, Employment Service, local authority, or private/voluntary organisation running contracted-out services. Incapacity benefit claimants will not be obliged to undertake jobseeking activities. It is intended that claimants will be required to attend repeat interviews at specific ‘trigger points’ (e.g. a child reaching school age) or at set periods of time. The Government intends to exempt certain groups of people from the interview requirement, such as people over pension age, and HB/CTB recipients in full-time employment. Claimants will have the right of appeal to an independent tribunal against a decision of any ‘designated authority’ (i.e. civil servant, local authority employee, etc.) relating to the interview requirement.

Personal capability assessment

Clause 50 amends section 171C of the Contributions and Benefits Act 1992 (SSCBA) making provision for ‘personal capability assessments’ to replace the ‘all work test’ for incapacity benefits. Regulations will determine how someone will be treated as incapable of work according to a personal capability assessment. The explanatory notes advise that the “threshold of incapacity…will be unchanged”. In effect, the substance of the ‘all work test’ will remain the same, but its name will be changed. An assessment of work capability will operate alongside the incapacity test.

Incapacity benefit contribution conditions

Clause 51 amends Para 2 of Schedule 3 SSCBA to create a new first contribution condition for incapacity benefit (IB) to provide that a claimant ‘must have actually paid contributions of a relevant class’ in one of the two previous complete tax years. Regulations will provide for relaxing the first contribution condition for certain (as yet unspecified) cases. The explanatory notes appear to confirm that carers on ICA will be protected, as was proposed in ‘Support for Disabled People’. There is no indication in the explanatory notes that any other groups will also be protected.

Incapacity benefit and occupational pension payments

Clause 52 inserts a new section 30DD SSCBA which creates regulation making powers to provide that

·  incapacity benefit can be reduced if a claimant is receiving an payment from an occupational pension, personal pension scheme, or public service pension scheme;

·  regulations will determine the formula for reducing IB, i.e. the amount of pension to be disregarded and the rate of the reduction;

·  pensions can be treated as notional income where claimants have deliberately deferred receipt to avoid an IB reduction.

The explanatory notes indicate that the formula proposed in ‘Support for Disabled People’ will be used, i.e. that the first £50 of a pension payment will be disregarded and IB will be reduced by 50% of payments above this threshold.

Abolition of SDA

Clause 53 amends s30A SSCBA to give entitlement to incapacity benefit to people who:

i.  are aged 16 or over and under 20

ii.  have been incapable of work for 28 weeks,

iii.  are resident and present in GB,

iv.  are not in full time education (to be defined by regulations)

These mirror the severe disablement allowance (SDA) qualifying conditions for people under 20. Clause 54 repeals sections 68 and 69 SSCBA thereby abolishing SDA. In effect IB will be paid on a non-contributory basis, in place of SDA, to those incapable of work who claim before the age of 20. Clause 70 provides regulation making powers for transitional provisions which, according to the explanatory notes, “will be used to protect existing recipients” (of SDA). The notes also say that SDA claimants under the age of 20 at the date of change will transfer to long-term IB a year later. The Government has since announced at second reading its intention to table an amendment to raise this age limit to 25.

DLA entitlement conditions

Clause 55(1) amends s64 SSCBA so that ‘circumstances may be prescribed’ for determining who satisfies the attendance allowance (AA) conditions of entitlement. This mirrors the power that already exists in DLA primary legislation for regulations to further define conditions of entitlement. The explanatory notes suggest that “the regulations would be used when the conditions of entitlement to AA needed to be clarified: for example, if a judicial decision departed significantly from the policy intention”. This confirms our fear that these provisions will be used to quickly overturn important court judgments such as Fairey/Halliday.

DLA and AA life awards

The wording in the Contributions and Benefits Act for DLA and AA is to be amended with the effect that:

·  Clause 56 amends s71(3)SSCBA so that the term “for life” is replaced by “an indefinite period”. This implements the proposal in ‘Support for Disabled People’ to discontinue use of the term ‘life award’. DLA awards can still be made for fixed periods. The term ‘for life’ does not appear in the equivalent AA primary legislation;

·  Clause 55(2) and Clause 56(2) amend the wording of the rules governing terminal illness claims for AA and DLA, to avoid the impression that special rules claims can never be reviewed.

DLA mobility component for under 5s

Clause 56(3) amends section 73(1) to allow entitlement to the higher mobility component to children from the age of 3, instead of 5. Disability groups had argued for the lower mobility component to be also extended to 3 and 4 year olds in recognition of the high transport costs incurred by parents of children with sensory impairments. However, the lower age limit for the lower mobility component is to remain at 5 years.

Duleep Allirajah

RNID Welfare Benefits Policy Officer

revised 16 March 1999