Requalifying for cESA under the proposals for time-limiting WRA group awards to 12 months

Another issue is whether time on IB before migration to ESA will count towards the 12 months’ time limitataion.  Any thoughts?

No it doesnt. Its for ESA claims only. The 12 months will start when the ESA claim starts and also includes the 13 week assessment period.
I have attatched a word document that hopefully will make this easier.

Still disgraceful though!

Has anyone researched the position of those with fluctuating conditions such as MS , and if they will be able to reclaim contribution based ESA support group in the future?

I’m thinking of the scenario where someone with MS qualifies for ESA WRAG (cb).  They live with a partner in full time work so lose ESA after 12 months.  If they are unable to work for another 3 years, is there any way they could qualify for ESA SG (cb) in the future?

We were looking at exactly the same question about requalifying for ESA (C) and linking periods. Thought we wouldn’t raise this with DWP at this point in case they actually might not have considered it.. Will await the detail (if there is any) with interest.

It’s in the Welfare Reform Bill, S51(2) (but the related Explanatory Notes are more helpful). Looks like they’re not using the familiar concepts of ‘linking rules’ at all; instead to satisfy the contribution conditions (specifically the amended first contribution condition for CESA), you have to be able to point to at least on tax year, later than the tax years on which your original 12 month entitlement was based, in which the contribution conditions were satisfied.

So, if your 12 months are up April 2012, your award having been based on 08-9 and 09-10 NIC’s, then, as I read the new NIC conditions for ESA, you would have to do at least 26 weeks work, and pay NIC’s, in the tax year 12-13, at which point you may requalify for CESA from the start of the following benefit year, ie. in January 2014.

You would also then however have to satisfy the second contribution condition for CESA for the tax years11-12 and 12-13 so you would have to have signed on for credits or JSA for any periods you weren’t working or on CESA in those years.

Following this logic through, if your end date is before October 2012 you could still squeeze in 26 weeks NIC’s in tax year 12-13, and restart CESA in January 2014. If you end date is after October, you can’t do this, and to get 26 weeks NIC’s in a tax year you have to wait until tax year 13-14 which puts your earliest date for requalifying back to January 2015.

So the theoretical minimum requalifying period, if I’m right, is about 15 months, for six months of which you have to be working - but the six months have to be within one tax year

Could be wrong though.

Richard Atkinson

I think the answer to Al Franco’s question is similar. Clause 51 doesn’t end a period of limited capacity for work which will continue provided you attend WCA’s,  WFI’s etc. Then when you are put in the support group the bar on CESA entitlement will end. We have seen a few people who have moved to and from the support group. I think this is what should happen. Whether the DWP will cope with it with reduced staffing and telesale type offices is another matter.

It will be important to advise people to stay ‘on the sick’ when CESA ends because of this (and because they may similarly move in and out of entitlement to IR ESA as well).

But if they want to go back to work, they should make sure it’s for at least six months in one tax year (see previous post). This is presumably a example of the new, much simpler system Mr Duncan-Smith is so passionate about.

MS doesn’t always fluctuate by the way - mine just gets steadily worse.

Richard Atkinson

Not sure if this isfor a new thread but, As Tony Bowman said this is not law yet.

However, there was a story in Yesterday’s Times (I’m not proud of it but occasionally I buy the paper because a friend is the athletics correspondant) The story was saying that people on Contributory ESA are being written to to warn them of the impending threat of their benefits being cut and the need to re-apply for income based ESA.  The change is not law yet, but the DWP said they were writing to people to make sure they were given as much notice as possible and to provide reassurance!!

hi

see rightsnet news story about letter to claimants -

DWP to write to claimants about time limiting of contribution based ESA from Spring 2012

also dwp adviser and intermediary update -

Proposed changes to contribution-based Employment and Support Allowance

cheers ros

Incidentally, 12 months after the change was announced and 5 months before they are introduced, DWP have published some actual research into the outcomes for ESA claimants. http://research.dwp.gov.uk/asd/asd5/rports2011-2012/rrep774.pdf

Headline: only about 17% of claimants who passed the WCA (either support group or WRAG) were in work 18 months after the start of their claim - 26% of those previously employed before ESA claim, 9% of those not employed immediately prior to ESA claim.

In other words there is no research base to support the 12month limit at all: most successful ESA claims were for much longer periods.

Richard Atkinson

Sorry in advance for the length of this post which I’ve had to continue in a 2nd post immediately after this one. 

I’m coming to this thread from this one:  http://www.rightsnet.org.uk/forums/viewthread/2288/.  I’m reluctant too to give the Department advance warning of potential flaws in the rules by discussing them here.  However, given that the rules have retrospective effect, I think it’s expedient to take a cautious look at some arguments that clients might be able to use either now or after their CESA stops in 2012.

My reading of section 1A as inserted by section 51 of the Welfare Reform Bill (see link provided by Richard above) is that, whilst both contribution conditions must still be satisfied, it is the second contribution condition rather than the first which will initially determine when you can re-claim CESA after it has stopped due to time-limiting.

The following example illustrates how I think the new rules will operate as well as showing how you might successfully re-claim CESA after it stops:

1)  I work from 6 April - 5 Oct 2009, ie 26 weeks, earning £150 p/w gross. This is more than the LEL which is, for 2009/10, £95 p/w.  I pay class1 contributions on those earnings. 

2)  I am awarded CESA from, say, 12 Oct 2009.  I haven’t had any previous ESA awards so no linking issues.

3)  In support of my award in (2) above, I rely on tax year 2007/08 to satisfy the first contribution condition, and tax years 2006/07 and 2007/08 to satisfy the second contribution condition. 

4)  My CESA ends on 6 April 2012 when (let’s assume) the time-limiting rules commence.  I have clearly had 365 days of CESA by then.  And I’m not entitled to IRESA due to, say, capital >16k.

5)  I re-apply for credits from and including 6 April 2012 because I still assert that I have limited capability for work. [The time-limiting rules are likely to amend Reg 8B(2)(a)(iv) of the Credit Regs 1975 to provide a legal basis for claimaing credits in this situation.  Along the lines of “would have had LCW but for their entitlement ending under section 1A WRA 2007”]

6)  I re-claim ESA from 6 July 2012.  My new period of LCW starting on 6 July does not link with my old one which ended on 6 April 2012 because there is more than 12 weeks between these two dates.  Note, my continued receipt of credits in (5) above cannot prevent the periods of LCW concerned being broken because days of credits are only for the purpose of helping you establish entitlement to ESA (see Reg 3 Credits Regs) rather than representing days of ESA entitlement in their own right.  And that’s good because we want the periods broken.  My “relevant benefit year” for this new ESA claim is 2012.

7)  I’m awarded CESA from 9 July 2012 (6,7, and 8 July are waiting days on which I’m not entitled to ESA) for the following reasons:

The tax year I rely on to satisfy the first contribution condition is 2009/10 (see (1) above).  Although my weekly earnings are greater than the weekly LEL, the effect of Reg 7A ESA Regs is to disregard any earnings that exceed the LEL.  Still, because I have worked at least 26 weeks I have 26 x LEL which is the minimum needed to satisfy the first contribution condition for CESA.  Section 1A(2)(a) WRA 2007 is, therefore, satisfied re the first contribution condition.

The tax years I rely on to satisfy the second contribution condition are 2009/10 and 2010/11. 

In 2009/10 (again see (1) above), I earned £3900 (ie 26 x 150).  Note, earnings for the second contribution condition aren’t capped by the LEL as they are for the first condition above (though in order to count as earnings they must at least equal the LEL; if not, they don’t count as earnings at all).  The only potential cap is the Upper Earnings Limit (UEL) whose 09/10 weekly value was £844.  As my weekly earnings are way below that they are all counted. 

However, in order to satisfy the second contribution condition my earnings + any credits must not be lower than £4750 (ie 50 x the 09/10 LEL of £95 p/w). Unfortunately, my earnings are lower.  The shortfall is: £850 (ie 4750 – 3900). 

However, I receive credited earnings (ie credits) for each week from 12/10/09 due to my receipt of ESA (see (2) above).  One week’s credit produces an earnings factor of £95 (ie the value of the LEL).  So I just need 9 weeks’ credits to make up the shortfall (9 x £95 = £855).  Therefore, 9 weeks of ESA will make up the shortfall.  I am still receiving ESA on 7/12/09, ie 9 weeks after the start of my award, so tax year 2009/10 satisfies the second contribution condition also. 

Note, however, that after 7/12/09, I would not be awarded any further credits for 2009/10 because the law gives me only enough credits to enable me to satisfy the second contribution condition (ie 50 x LEL - see “reckonable year” in Reg 2(1) of Credit Regs 1975).  But that’s fine.

I am entitled to ESA throughout the whole of tax year 2010/11 so I am credited with 50 x the 10/11 LEL of £97.  Accordingly, 2010/11 also satisfies the second contribution condition.  Again, I got 50 not 52 weeks credits as that’s all I needed.

Section 1A(2)(a) WRA 2007 is satisfied re the second contribution condition.

Section 1A(2)(b) is also satisfied because 2009/10, ie one of the tax years I’ve currently relied on to satisfy the second contribution condition, is later than 2007/08, ie the “second” of the tax years I had previously relied on to satisfy the second contribution condition (see (3) above).  Note, the other year I’ve currently used, ie 2010/11, is also later than 2007/08, but it didn’t have to be as Section 1A(2)(b) only requires “at least” one of my current award’s tax years to be later, not both. 

As I satisfy section 1A(2) WRA completely I am awarded CESA as above for a new period of 365 days.

8)  My CESA expires on 8 July 2013.

Continued from last post :-)

My reading of the current law and section 1A above would suggest that if an existing CESA claimant could answer “yes” to “all” of the following questions they might be better off ending their current CESA and making a new claim that, crucially, doesn’t link with the old award:

•  Have they “ever” worked for at least 26 weeks in a single tax year (ie 6 April – 5 April)?  The weeks do not need to be consecutive but there do need to be at least 26 of them.
•  In that tax year concerned, did they pay, or were they treated as paying (see below), class 1 (employed) or class 2 (self-employed) contributions?
•  Was their wage from employment in “each” of the 26 weeks identified at least equal to that tax year’s weekly LEL?  Or, if self-employed, did they pay class 2 contributions for each of the 26 weeks identified.   
•  Were they entitled so some CESA (even for a day) in 2010/11? and,
•  Do they satisfy the second contribution condition for 2009/10 and 2010/11? ie, total earnings + any credits = a value not less than 50 x that tax year’s weekly LEL.

If yes to all then by ending their existing CESA now or in the near future and re-claiming more than 12 weeks later they are likely to begin a new 365 day period of CESA ahead of the introduction of time-limiting.  As we know, they will have to serve 3 new waiting days at the start of their new period of LCW and be subject under normal rules to the assessment phase pending a new WCA.

The above argument is based on Regs 8(1) and (2)(d), as amended, and 145(1) ESA Regs 2008, together with the proposed section 1A WRA 2007.  There are other circumstances in Reg 8(2) which would assist a similar successful break so it’s worth checking that reg. 

The argument is also based on the fact that tax year 2010/11 cannot possibly have been one of the two tax years used to satisfy the second contribution condition re the old CESA award, ie the one you would voluntarily stop to effect the break.  That’s because the earliest date that 2010/11 can start being used for contributions/credits purposes is the first Sunday in January 2012 (section 21(6) SSCBA 92).  However, whilst 2010/11 represents “at least” one new tax year as required by section 1A(2)(b), you would still have to rely on 2009/10 as your other year because the second contribution condition looks to the last two complete tax years before the relevant benefit year, ie 2012.

Some other important points:

•  You will have to forfeit at least 12 weeks payment of CESA in order to break your claim.  But you will be giving up 12 weeks to potentially gain upto another 52 weeks, and

•  You should consider protecting your credits’ record either on grounds of having LCW, or being unemployed during the 12 week break in CESA entitlement.  As we know, you do not have to have an ongoing ESA award in order to claim LCW credits.  Any credits claim for those 12 weeks would appear to satisfy Reg 8B(1) and (2)(a)(v) of the Credits Regulations 1975. But you would have to apply in writing for such credits in accordance with Reg 8B(4) Credit Regs.  In order to come within 8B(2)(a)(v) it would also appear you’d have to delay applying for the credits until after the 12 weeks have elapsed - but you could have them awarded retrospectively.

If you choose not to maintain your class 1 credits for this 12 week period then it would not jeopardise the CESA that we’re proposing would start in/around March 2012.  What it might do is cause you problems with future attempts at re-claiming CESA after March 2013 when your proposed new award of CESA would expire.

•  Just a reminder: you only actually pay class 1 contributions if your earnings are above the primary threshold.  The primary threshold is higher than the LEL (eg for 2010/11: LEL(£97 p/w); primary threshold (£139 p/w)).  Clients, therefore, might rightly answer “no” to the question “did you pay class 1’s?” where their earnings did not exceed the primary threshold.  However, as long as those earnings were “not less than” the LEL they would be treated as if they had in fact paid class 1’s.  That is why the question in the checklist above is “have class 1’s been paid or treated as paid?”

Of course you do not need to rely on Reg 8 ESA Regs to found your new, unlinked CESA claim.  It just appears to make it easier given that it relaxes the first contribution condition for certain claimants.  I suppose in my long-ish example above the claimant there could have broken his claim voluntarily in Dec 2011 and re-claimed in March 2012 instead of waiting for the time limiting rules to end his award at point (4).  The result would have been the same: a new 365 days, except it would have run from March 2012 rather than July.

Disclaimer to this post and the last one: I take no responsibility for any loss caused to anyone if this advice is, either under current law or as a result of law introduced in future, wrong.  The above content is meant for experienced advisers only who are able to critically assess the information for themselves (and who have professional indemnity insurance :-) ).  In short, I could be very wrong.

Thank you Tom for the effort you put into the previous posting. There are two aspects of the first part of the posting that I’d like to clarify. The first is at paragraph 5) where you imply that on expiry of the 12 month cESA award period, a claimant who cannot transfer to irESA would need to re-apply for LCW credits if they wished to receive them. My understanding was that on expiry of a cESA award, the claim would automatically become an NI credits-only claim without any need for a new claim and, because virtually all such claimants would by virtue of having been in receipt of ESA for at least 12 months have satisfied a WCA and no longer be submitting med certs, that credits-only claim would continue until the claimant failed a subsequent WCA, started work or something similar.

I’d also understood that the continuing credits-only entitlement would form part of the same claim as that in which 12 months’ benefit had previously been paid and that to break the link between that claim and a potential subsequent one, there would need to be an eight-week gap after the credits-only entitlement ends rather than after payments of benefit ended. You express a view in paragraph 6) that a period during which credits-only are paid on a claim can count towards the eight weeks that must elapse if two cESA claims are not to be linked, rather than being part of one claim or the other.

The problem I’d envisaged was how a claimant who had automatically transferred to a credits-only claim after the expiry of his cESA 12 month award period and who would need to break that credits-only claim for eight weeks before they could reclaim cESA, could contrive such a break without failing a subsequent WCA or starting work. I wasn’t particularly looking forward to advising clients that the best course of action would be for them to notify the JC+ on the day after their 12 month cESA award period ends that they no longer consider themselves to have limited capability for work and don’t wish to continue with a credits-only claim, followed by a volte face and a new claim eight weeks later. If what you say is correct, this won’t be an issue.

Peter,

Your two queries as I understand it are:

a)  Do credits based upon having LCW continue once entitlement to ESA ends?
b)  Does a continuing award of such credits mean that two periods of LCW separated by more than 12 weeks nevertheless link?

I think the answer to (b) is no.

Only periods of LCW can link.  A period of LCW is defined by Reg 2(1) ESA Regs as “…a period throughout which a person has, or is treated as having, limited capability for work…” 

Whereas LCW credits, in the absence of any entitlement to ESA, are only awarded if you effectively “would have” had LCW or “would have” been treated as having LCW in specified circumstances.

Clearly, “would have” is not the same as “has” or “is” for the purpose of Reg 2(1) above.  Consequently, any period in which you receive LCW “credits only” does not appear to be a period of LCW.  It follows that two proper periods of LCW would not link if they were separated by more than 12 weeks even though credits continued to be awarded during the break concerned. 

However, there is a problem, on reflection, with this interpretation.  It doesn’t explain why a recipient of “credits only” still undergoes the WCA.  I have a client, for instance, who is appealing against a decision stopping his LCW “credits only” following his failure to score 15 points.  If he’s successful at appeal, eg awarded 15 points, does the tribunal find that he “would have had LCW but for the fact he’s not entitled to ESA” or that he does indeed “have LCW”.  If the latter then his resulting award of LCW “credits only” could arguably form a period of LCW as defined by Reg 2(1) above.  The problem is that the Credits Regulations 1975 refer to a “day of limited capability for work” without that phrase being defined anywhere in the legislation governing ESA. 

Ultimately, however, section 22(5) SSCBA and Reg 3 Credits Regs expressly provide that any award of credits is only for the purpose of enabling someone to satisfy the contribution conditions of entitlement to benefit rather than, say, allowing a period of LCW to continue once a person’s entitlement to ESA has ended.  It follows that my above client’s tribunal should, if allowing his appeal, decide that he effectively “would have had LCW” and no more.  If I’m wrong, Peter, then you would be right about there having to be a sufficient break (it’s 12 not 8 weeks) between the ending of LCW “credits only” itself and the start of a new period of LCW.

The current law on (a) is equally unclear.  There are 3 possible options I think as follows:

i.  The award of LCW credits continues after the award of ESA ends
ii.  The credits end at the same time as the ESA ends
iii.  There is no current award of credits to end

In the linked thread http://www.rightsnet.org.uk/forums/viewthread/2288/  I agreed with Richard that the answer was (i).  That seems to be your view also Peter.  However, as you rightly state, point (5) of my earlier example above implies that the answer is (ii), otherwise why would someone have to re-apply for credits.  In any event, my position across the two threads is contradictory.  Your post prompted me to read the caselaw, in particular CIB/3327/04 and CIB/1602/06 (both available from the UT website). 

As a result, I think the correct legal position is, in fact, (iii), though in practice the DWP still operate as if it were (i).  You really need to read the caselaw concerned to understand this.  And, of course, it’s still unclear how the eventual time-limiting rules will affect the current law.

The confusion surrounding credits stems from 1987-88 (well before my time in benefits) when, as para 26 of CIB/1602/06 notes, the system changed from one of awarding weekly credits to one of crediting earnings and earnings factors but only when necessary at the end of the tax year.  In my original example I pointed out that no more credits would be awarded after an earnings factor of 50 x LEL was satisfied.  However, my references there to “class 1 credits” should of course have been to “credited earnings” or “earnings factor” so I’ve taken the liberty to correct that error.  However, I’ve left point (5) unaltered in order that both your and this present post retain their meaning. 

However, given what has come to light since, point (5) should now read “ To comply with the letter of the law I should re-apply, but no earlier than the end of tax year 2012/13, for any credits I need from the period 6/4/12 – 5/7/12 though in practice the DWP will continue to award me credits for that period unless they tell me otherwise.  Again, in theory and in spite of my new period of LCW starting on 6/7/12, I also need to apply, no earlier than the end of tax year 2012/13, for LCW credits for the period 6/7/12 - 5/4/13, though again the DWP practice is simply to award these credits unless I fail a WCA.”

Thanks Peter. Hope that clarifies things.  And even if it doesn’t, happy new year all the same :-)

Hi,
Given the previous in depth advice I am hoping that one of you might help me with an ongoing problem that relates to continuation of cESA.
Scenario is this-
client claimed ESA- was refused-appealed- at the first hearing Tribunal decided to award the appeal but made an error of law in that they did not make any determination as wrag or support. Client was put into wrag as default by dwp. (At the short hearing tribunal had alluded to support group but not mentioned on decision notice.)Decison on basis of reg 29(2)(b)- susbst. risk to claimant’s health. (Although she could easily have fitted into 3 of the descriptors) - she has CFS/ME which is the sticking point.
Tried without success to get this remedied- but due to inadequate admin in Tribunal office it took 6 mths to refer back to the relevant tribunal who felt by then that quick repair wasn’t possible and case should be set aside. I was mindful that the pending 12mth cap on cESA would apply to client- we discussed pros and cons and she was adamant she wanted to try for re-hearing.On the basis that benefit likely to cease when the new legislation bites, and it was not unreasonable to assume that another Tribunal could award ESA/wrag (preserving status quo) or ESA/support which would be unaffected by the new laws.

Fresh hearing last week was adjourned for the decision to be made- decision notice now received suggests that the appeal is withdrawn, as client may not be entitled to ESA.
Having spoken about this with other advisers- they think that I should heed the advice- especially as I want to remain on good terms with the Tribunal although personally I would like to see exactly why they would refuse the appeal- and see if this is correct!

However- if I withdraw client will lose the basic rate ESA she has had up to now ( and I suspect there may be an overpayment if DWP didn’t amend the wrag rate after the set aside. (I presume before then given a lawful award at Tribunal she is fully entitled to the money received.)

Is it unlikely she will get benefit again if she reclaims given the case history and withdrawl of appeal and or refusal to uphold appeal by Tribunal - and of course previous EMP reports show no problems and nil points! (the case is so stale that the 6 mths has easily passed)
In my opinion client is not fit for work - she could I think theoretically claim cJSA for 6 mths (she was working up until June 2010- illhealth compromise agreement was finalised in Sept 2010. She has been on the basic rate on ESA pending appeal since then and as wrag for some 6 months before the original hearing was set aside.) i say theoretically as she’s unfit for work!
Does basic rate ESA count towards contribution credits?
What about a new claim for cESA- likely to fail sure, but we appeal. (Except I’m not sure if client is up to another EMP medical - or do as suggestd earlier on this post - use previous EMP - but this is now over 1 yr old)

Can’t claim iESA as husband too much income - but without basic ESA will be huge drop for the household income- am in the process of checking potential working tax credits etc with husband.

Suggestions for what next?
withdraw appeal?- this hopefully ensures I stay ‘friends’ with Tribunal - especially since I am a regular visitor!
continue appeal? - although probably will fail
re-claim esa?- new appeal - wait for several long months - but get basic rate in meantime - and client continue to re-claim/re-appeal indefinitely assuming each claim is 6mths after last one?
I know that the new Tribunal had all the papers for the set aside - should they have seen these?
start jsa -  but this will obviously only be a 6mths fix and somewhat artificial
something else? (what!)

Any ideas - let me know.
Thanks for you help

Lid26

The recently-issued DWP guidance on this tells us that claimants have to ‘leave benefit’ for 12 weeks after a 365 day award of cESA before they might qualify for a further cESA award. Can I canvas opinions on the meaning of ‘leave benefit’? I still think it means that the NI credits-only award that will follow the termination of cESA payments will also have to be broken for at least 12 weeks before a new claim for cESA can be made.