HB Sch 6 para 5 and disregarded property query

Hello

Has HB Sch 6 para 5 been updated to include UC? 

Client has a learning disability and receives 24/7 care in ‘independent’ living and previously been awarded ESA & HB. 

Their capital went over £16,000 during Covid 19 pandemic so they lost entitlement to irESA and HB .  Payment of considerable rent costs has now reduced capital below £16,000 and client has successfully claimed UC.

As accommodation is regarded for UC purposes as ‘specified’, i.e they receive care, support or supervision, a claim for HB has been made for housing costs. 

This has been refused as their capital has been deemed to be over £16,000.

Capital consists of a current bank account; a discretionary trust set up by claimant’s parents over 30 years ago and a 20% share in the house left in the now-deceased parent’s Will. Several of the other 5 people who have been left a share in this property do not wish to sell it yet; one of the people actually lives there but are not disabled or over pensionable age. 

With regard to the capital in the discretionary trust I assume it was previously disregarded when my client claimed irESA under HB Sch 6 para 5,  but has this been updated to include UC?  I note the reference in the CPAG WRH p.492 footnote 22 referencing Gartside v Inland revenue Commissioners ... but it would be just easier to point the HB decision maker to HB Sch 6 para 5 if it did now include UC.

With regard to the share in the property I’d appreciate any suggestions as to why this asset should be ignored as capital.  This was left to the claimant nearly 6 years ago.  When it is eventually sold my client’s 20% share of the proceeds of the sale has to go into the discretionary trust as I think the parental Will stipulates this.

Yes - UC is a passporting benefit and any amount of UC has the effect that all of the claimant’s capital (and income for that matter) is to be disregarded.

The (mostly) up to date version of the regs is on legislation.gov.uk. https://www.legislation.gov.uk/uksi/2006/213/schedule/6

Para 5 as amended reads (and has read for the past 8 years or so):

Where a claimant is on universal credit, income support, an income-based jobseeker’s allowance or an income-related employment and support allowance, the whole of his capital.

The LA is probably interested in your client’s capital for CTS purposes, but it is irrelevant to HB entitlement.

LA don’t agree - decision reads

‘Having reviewed the Housing Benefit Regulations relating to disregarded capital, capital
held by a UC recipient is not disregarded for Housing Benefit purposes, but taken into
account within the calculation of the Housing Benefit award, to which if that capital
exceeds the £16,000 capital limit there is no eligibility to Housing Benefit.’

We’ll appeal

That is really the sort of thing that makes you question how the author found themselves in a position to be making decisions.

If you know anyone sensible at the LA, I would suggest dropping them a line.

Thanks Elliot LA has seen sense and has awarded HB so appeal has lapsed.

One does despair when the decision maker is served up the law on a plate and still manages to make an incorrect decision.