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# Erosion of TSDPE and ‘sum of the relevant increase’

How do you calculate the ‘sum’ of a relevant increase to calculate erosion?

I have simplified the case for ease but the principle should be the same.

A claimant is getting the carer element of UC £163.73 and TSDPE of £285.

They are then assessed as LCWRA meaning an increase of £343.63.

For erosion -

(b)for the second assessment period, the initial amount reduced by the sum of any relevant increases in that assessment period;

So - is the ‘sum of the increases’ the net effect - ie 343.63 - 163.73 = The sum of the increases would be £179.90 and TSDPE could continue at £105.10

OR

the increases added up - i.e. £343.63 (while ignoring the loss of £163.73) so wiping out the TSDPE

Another example might be - going from LCW to LCWRA, if receiving LCW before is the increase 343 or 343-289 ?

In either of these examples the ‘new’ elements haven’t been increased, they weren’t in payment before so the sum of the increases would be the whole new elements.

‘sum’ could mean plus one element minus another, but there is no reference to decreases in other elements so I am fearing the worst!

if it is the net effect then timing could make a real difference, for instance if you gained 343 LCWRA but in the same month a child became an adult (loss of child premium) then you would keep most of your TSDPE, compared to losing child element one month and then getting LCWRA the next (TSDPE wiped out)

note - nothing in guidance comes close to explaining this, here is the reg

[F1The transitional element – initial amount and adjustment where other elements increase

55.—(1) The initial amount of the transitional element is—

(a)if the indicative UC amount is greater than nil, the amount by which the total legacy amount exceeds the indicative UC amount; or

(b)if the indicative UC amount is nil, the total legacy amount plus any amount by which the income which fell to be deducted in accordance with section 8(3) of the Act exceeded the maximum amount.

(2) The amount of the transitional element to be included in the calculation of an award is—

(a)for the first assessment period, the initial amount;

(b)for the second assessment period, the initial amount reduced by the sum of any relevant increases in that assessment period;

(c)for the third and each subsequent assessment period, the amount that was included for the previous assessment period reduced by the sum of any relevant increases (as in sub-paragraph (b)).

(3) If the amount of the transitional element is reduced to nil in any assessment period, a transitional element is not to apply in the calculation of the award for any subsequent assessment period.

(4) A “relevant increase” is an increase in any of the amounts that are included in the maximum amount under sections 9 to 12 of the Act (including any of those amounts that is included for the first time), apart from the childcare costs element.]

point 4 does relate it back to maximum UC, but states any amounts included that have increased - rather than a change to the overall maximum amount, so I don’t think the increases could be offset against losses in the maximum amount when calculating the relevant increase!

would the policy intention have been the ‘net’ increase? I’m not convinced on that either

Any ideas?