Delayed reduction of surplus - advice tactics

Sorry to bang on about what is something of an obsession of mine.  It seems to be received wisdom that having an early or late salary payment taken into account in an earlier/later AP than would otherwise have been the case is a Bad Thing, to be appealed against whenever it happens.  As I hope this thread makes clear, that is by no means always the case.  There is a worked example half way up that thread which factors in the expected reduction of the surplus earnings disregard to £300 a month.  Now we know that isn’t happening for at least another year, we need to understand the implications for people who have the odd out-of-place salary payment; btw much of what I say here also applies to people who are paid four-weekly and have an eight-week month from time to time.

These cases will tend to come to advisors’ attention after the two-salary AP has happened: the claimant sees that his/her UC has reduced or ended completely, thinks “What? This cannot be right!” and seeks advice.  Now in all cases, the one thing that a Tribunal cannot do on appeal is make it so that never happened - it happened, it’s in the past.  What are the best options now?

In many cases where there is nil UC entitlement for the month in question, your client is going to gain across the whole two months unless they are subject a hefty benefit cap in Month 2.  If you challenge this successfully, you are diddling your client out of money.  I know you will say fluctuating payments disrupt budgets but as I said above, you cannot make it so that the payments did not fluctuate, they already did that before the client approached you.  Your task now is to make sure that your client has as much money as possible when the dust settles at the end of Month 2.

The people who are worse off across the two months are those whose circumstances closely match the JR group: they have a work allowance and they have residual UC entitlement at the end of Month 1, or they only just miss out on UC in month 1.  For them a challenge is worthwhile.

What has surplus earnings got to do with this?  Well, the windfall for the nil-UC-Month-1 group would be limited by the £300 surplus earnings threshold.  Take that limit away and the gains made through having nil UC in month 1 are potentially far higher.

It really is well worth taking the time to calculate the full two-month entitlement before launching any MR/appeal in these cases.

Thanks Peter, I think this is really helpful.

I had one of these last week (a four weekly paid client) and I actually thought of you, banging on obsessively, while I was showing them that although it made budgeting harder, they were actually slightly better off over the whole year. In this case the double payment happened in October, and now that the client is aware of it, she’s preparing for it to happen again.

But I think it is still basically a BAD THING because a) it’s usually unexpected the first time it happens to a claimant, b) it makes budgeting harder for people who are already on the limit, and c) landlords don’t like it when an APA payment doesn’t arrive.

In the case I saw last week, there was a missed APA due to the “eight week” month, and it was followed the next month by the annual skipped payment, so it really made a mess of their rent account.