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Reaching State Pension Age on Universal Credit

Paul_Treloar_AgeUK
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Finally, something that is good news to report. From a written statement from Dr Thérèse Coffey, The Secretary of State for Work and Pensions.

I can today announce that we will amend regulations to smooth the transition from Universal Credit to pensioner benefits and remove any potential gap in support.

All those who reach State Pension Age while claiming Universal Credit will receive a run-on, meaning that they can receive a payment for the entire Assessment Period in which they reach State Pension Age. Entitlement to pensioner benefits and State Pension is unaffected and continues as usual. This ensures there is no gap in benefit provision as people approach State Pension Age. This will benefit approximately 200,000 pensioners who will benefit by an average of £350 from this run-on at a cost of around £70 million over the next five years.

This process is already in operation on an extra statutory basis, ensuring that nobody loses out upon reaching State Pension Age, and legislation will be amended accordingly later this year.

Reaching State Pension Age on Universal Credit:Written statement - HCWS146

Vonny
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Paul_Treloar_AgeUK - 05 March 2020 11:15 AM

Finally, something that is good news to report. From a written statement from Dr Thérèse Coffey, The Secretary of State for Work and Pensions.

I can today announce that we will amend regulations to smooth the transition from Universal Credit to pensioner benefits and remove any potential gap in support.

All those who reach State Pension Age while claiming Universal Credit will receive a run-on, meaning that they can receive a payment for the entire Assessment Period in which they reach State Pension Age. Entitlement to pensioner benefits and State Pension is unaffected and continues as usual. This ensures there is no gap in benefit provision as people approach State Pension Age. This will benefit approximately 200,000 pensioners who will benefit by an average of £350 from this run-on at a cost of around £70 million over the next five years.

This process is already in operation on an extra statutory basis, ensuring that nobody loses out upon reaching State Pension Age, and legislation will be amended accordingly later this year.

Reaching State Pension Age on Universal Credit:Written statement - HCWS146

Are people receiving the extra statutory payments?  I was under the impression that people were losing out, do people know who to ask and how to get the payment?

Paul_Treloar_AgeUK
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No idea, we only heard about this today.

Ianb
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This is very good news. It is interesting that the announcement indicates that payment will be for the whole AP whereas claimants who previously got UC because they made a prior claim for PC only got, to the best of knowledge, a pro rata UC payment to reflect the point in the AP when they reached pension age.

I am not clear whether this means that any pension entitlement that falls within the AP is ignored or whether it will be treated as unearned benefit income in the usual way. The announcement read as if it may be ignored but that would be quite generous - particularly to those reaching pension age just after the start of their AP. Guess we have to wait to see the legislation.

Benny Fitzpatrick
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But, but , but….......

The UC computer and the PS computer don’t communicate, and the UC computer doesn’t recognise when someone reaches State Pension age.

Ianb
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Benny Fitzpatrick - 06 March 2020 11:19 AM

But, but , but….......

The UC computer and the PS computer don’t communicate, and the UC computer doesn’t recognise when someone reaches State Pension age.

There was me thinking the UC computer program was flexible and can be updated on a fortnightly basis!

JPCHC
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I’d forwarded the Written Statement to the Complaints Resolution Team who had previously refused a special payment to my client in these circumstances and highlighted the fact that they’d said the process was already in operation on an extra statutory basis.  Today, they called me to say it’s not and she doesn’t know why she told Parliament that it was! She said they’ve had no guidance on this so can’t pay out any compensation.  Rather than seeking clarification internally, she suggested my client raise it with his MP but I am just wondering whether anyone has heard any more about what they’re actually doing.

Paul, does Age UK know what’s happening? 

Many thaks

Ianb
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In the statement it said
“I can today announce that we will amend regulations to smooth the transition from Universal Credit to pensioner benefits and remove any potential gap in support.”

I don’t recall seeing anything since about regulations being amended. Perhaps it’s got lost in amongst response to other issues.

Paul_Treloar_AgeUK
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We’ve not heard anything specifically but we’ve also not received any queries on the issue recently so difficult to gauge what’s actually happening in practice.

Paul_Treloar_AgeUK
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We’ve received an update from Pension Service colleagues, see below. I don’t know anymore than what’s below and the person I contacted is on leave next week so might not be able to help with any questions I’m afraid.

Currently, the UC system does not have the functionality to identify automatically when a claimant (or in the case of a MAC, the younger partner) is approaching or has reached SPa.

The solution being applied in the meantime is to run ad-hoc scans of the UC caseload to identify the backlog of people who have reached SPa and take steps to move them off UC. Pending implementation of the full IT solution, and subject to capacity, we are aiming to move to more frequent scans that will identify people before they reach SPa so they can be advised about claiming Pension Credit / pension age Housing Benefit prior to their UC award end date.

With regard to how State Pension is taken into account, the process of accounting for State Pension income in a UC award is largely automated so receipt of State Pension does not in itself prompt an action to review the award to confirm whether the claimant is still entitled to UC on age grounds.

As you’re aware, on 5 March, the Secretary of State announced that UC will be paid for the whole assessment period in which a person reaches SPa (or the younger partner in a MAC reaches SPa). This will apply in all cases, irrespective of whether the person claims, or is entitled to, Pension Credit. The person will be able to claim Pension Credit from SPa and / or pension age Housing Benefit from the first Monday following SPa and any overlap between UC and the pensioner benefits will be disregarded.

This change is already being implemented, with run-on payments being made on an extra-statutory basis pending the necessary changes to regulations.
During this interim period, in the small number of circumstances where there are additional payments made from the UC system after the run-on period, these will be disregarded and not recovered. Once the more frequent scans are in place, this situation should no longer occur.

JPCHC
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Thanks - that’s really useful Paul.  It completely contradicts what the Complaints Resolution Manager told me i.e. she doesn’t know why the SoS said that and that they weren’t making any extra-statutory payments on this basis!