End of Universal Credit; reaching pension age

When a person reaches pension age their UC should stop and they can claim HB and Pension Credit if appropriate. However, in practice this does not seem to work well. Firstly, the claimant does not seem to get much information if any about the change over. Secondly, the (limited) number of cases seem to show a lot of confusion.

In some instances, UC has been stopped at the start of the assessment period in which the claimant reaches pension age thus leaving a gap in housing costs in particular.

It might be that Housing Benefit can be claimed in this short period between UC ending and pension age starting . A recent student UT case allowed that for instance but that was not a Full Service area. DWP guidance is that no such claim can be made to cover the gap but I dont think they have thought this through well.

In other instances a part payment of UC is being made but this seems to be cases in which pension credit has been claimed in advance and the amount of the pro rata payment seems to bear little relation to the usual monthly award.

Not many cases so far as I say but in time it will affect every claimant. 

So any ideas on how this should work?

What you have described for UC is what the rules say. Because UC entitlement is based on circumstances at the end of the AP there is no entitlement to UC for the assessment period in which a claimant reaches State Pension. However there is a specific exemption for those who have made an advance claim for Pension Credit. In the latter case a pro data payment is due based on how far through the assessment period pension age is reached.

See
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/843708/adma4.pdf
Paragraph A4238

https://www.legislation.gov.uk/uksi/2013/381/schedule/1/made
See part 3 Paragraphs 20 and 26.

This is of course a nonsense and financially very hard for claimants. They can end up with a long gap between last UC payment and first SP payment. If partial payments can be made for some it is obvious that it must be practically possible for all claimants to get a partial payment.

Hi Peter

This is a regular discussion topic on Rightsnet - see for example:

https://www.rightsnet.org.uk/forums/viewthread/15279
https://www.rightsnet.org.uk/forums/viewthread/14783

I don’t think the UT decision really helps - as you say it dates from the old “live” service and the key point in the case is that there was nothing in the UC (Transitional Provisions) Regs 2014 nothing to stop someone claiming HB in the normal way if they no longer had a UC award and no outstanding UC issues pending - once they had ceased to be a “UC claimant” as defined in those regs they were clear to reclaim legacy benefits if they wanted, even if only for a short period as in the UT case.  With full service, Article 7 of the No 23 Order imposes a blanket ban on claiming HB subject only to prescribed exceptions like the SDP.  In that UT case, if the student had lived in a full service area she would have been prevented from reclaiming HB by Article 7 of the No 23 Order.

Even though it does not seem actually to be written anywhere in the legislation, it is just assumed and accepted that people over SPC age may claim HB despite the No 23 Order.  Strangely this is not one of the prescribed exceptions in Article 7 - it is implied.  But Article 7 would presumably stop anyone from physically making their HB claim during the couple of weeks leading up to SPC age even if UC has stopped - it would be an attempt to make a new working age claim which you just cannot do.  Or can you make the claim after reaching SPC age (relying on the implied/assumed exemption from Article 7) and have it backdated under the working age good cause rule?

As there is a policy intention to penalise people who don’t claim SPC in advance, that explains why the Regs do not expressly provide for HB to fill this gap.  But whether the HB Regs as they stand could be made to work that way I don’t know

I agree with the previous two posts, but just to pick up on your point that “the pro rata payment seems to bear little relation to the usual monthly award”:

The way the pro-rating is done is by calculating the award for the shortened AP, and then pro-rating that amount according to the length of the AP. However, that means many claimants who are employed will end up with an award bearing no relation to their regular award, depending on when their payday(s) fall.

Charles - 11 February 2020 08:29 PM

The way the pro-rating is done is by calculating the award for the shortened AP, and then pro-rating that amount according to the length of the AP. However, that means many claimants who are employed will end up with an award bearing no relation to their regular award, depending on when their payday(s) fall.

Would like to check if I have understood this correctly.

Say a claimant has a full month UC maximum entitlement of £600, unearned income of £50 and a £100 deduction for earnings. Normal full month UC payment is therefore £450/month.

If the claimant reaches SP age exactly half way through AP the maximum UC entitlement would be pro-rated to £300, unearned income deduction pro-rated is £25 but the earnings deduction only applies if the wages are received during the half month before SP age is reached meaning the UC payment is either £275 or £175.Is that correct?

The way I read the formula in Reg 47(7) of the Claims and Payments Regs (btw, what on EARTH is it doing there??? - should be in Part 3 of the main UC Regs - but anyway …) a whole month’s UC should be calculated using 100% of the usual element rates plus 100% of any income, but only unearned income to which the claimant is entitled in the pre-SPC period and only earned income received during the pre-SPC period.  The income calc would not, for example, include SRP to which there is no entitlement during the short AP and would not include any earnings paid after the end of the short AP.  But anything that is caught during the short AP is subject to a normal full month calculation.  The final calculated award is then reduced pro rata.

Using the figures in your case:

Max UC = £600 as normal
Unearned income = £50 as normal
Earnings = either zero or £100 as normal, depending on the pay date.
Award is calculated as £550 or £450 depending on the earnings date
Final apportioned award is either £275 or £225

Thanks HB - I note that your calculation is more favourable for claimant when earnings fall to be taken into account.

Thanks for all the responses. It is a growing issue and something that should be taken to UT even if just to demonstrate how unfair this is.

I struggle to think the DWP policy is to say “congrats to getting to pension age….and good luck with your forthcoming eviction proceedings” caused by this mismatch between the end of UC and the start of HB.

I know some Council reps are pressing DWP for change and hbinfo will do so too….once we know who the Sec of State will be after this Thursday!