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Backdated SDP and the savings threshold
Hi there, I have a client who has been given conflicting information and it’s made me wonder if my information is correct:
Client is on ESA SG and PIP, living alone, no one claiming carers’s allowance. He got help from another organisation to get backdated SDP nearly year ago which amounted to 10,000. He he £7,000 left at the moment and his ESA is not tarriffed. However he has now been sent another IS10 to look at dates even further back for unclaimed SDP. He is concerned that this will take him over the savings threshold. He has been told by 2 other organisations that 1. It is not disregarded and 2. it is disregarded.
However, It is my understanding that any further backdated money awarded is disregarded for 52 weeks (which explains why he’s not getting tarriffed on being over £6000 in savings.
I think that provided he is between £6,000-£16,000 after the 52 weeks is up, he will be tarriffed but his ESA will not end (it’s highly unlikely he could/should spend the amount of money he is likely to receive in 52 weeks, and may be seen as a deprivation of capital)
Would anyone be able to confirm this for me?
Thank you in advance for any information and/or advice given
I seem to remember that any backdated payment for missing SDP was disregarded in full even after the 52 weeks as long as you remained on ESA, but can check tomorrow for sure?
Benefit arrears of any description are disregarded for 52 weeks.
Benefit arrears which are paid in order to correct for official error are disregarded indefinitely (or at least for the duration of the ESA award). E.g. the payments made as a result of the trawl due to incorrect conversion from IB/IS to ESA.
See para 11, Sch 9 ESA Regs 2008.
Benefit arrears which are paid in order to correct for official error are disregarded indefinitely (or at least for the duration of the ESA award).
I think this only applies if they are £5000 or over, otherwise the standard 52 weeks apply.
I seem to remember that any backdated payment for missing SDP was disregarded in full even after the 52 weeks as long as you remained on ESA, but can check tomorrow for sure?
Hi there sorry for the delay in getting back to you I have been on annual leave . Its seems that the commenter below tour initial comment is also in agreement if it was done in error. sounds like this is the sort of thing that would be classed as an error on the DWPs par as they should have been paying SDP from 2013.
Benefit arrears of any description are disregarded for 52 weeks.
Benefit arrears which are paid in order to correct for official error are disregarded indefinitely (or at least for the duration of the ESA award). E.g. the payments made as a result of the trawl due to incorrect conversion from IB/IS to ESA.
See para 11, Sch 9 ESA Regs 2008.
Hi there sorry for the delay in getting back to you I have been on annual leave . Thank you for your response. It seems that this would be an occasion where there has been an official error as he should have been getting paid the SDP from 2013 and so will be disregarded for the duration of the ESA award.
Letter from the GMS Team:
‘During a recent check of your claim to ESA, it came to the attention of the department that you have been in receipt of PIP since 10/02/2016 and as such, are entitled to a Severe Disability Premium.
You are owed arrears of Severe Disability Premium for the period 05/02/2016 to 25/11/2021 Totalling (figure is 19k) which we expect to credit to your account within the next 3 working days.
This is classed as “official error arrears of £5000.00 or more” and may be disregarded as capital by the DWP under certain conditions. You should keep this letter as it may be important to produce as evidence in a future capital decision.’
So in addition to the bad grammar, does this mean that the arrears can be disregarded as capital for more than 52 weeks. It is very important for the person to be able to keep the money stashed away for more than a year, until they are ready to use it for a very personal reason and this is their only chance of being able to afford this.
Can it continue to be disregarded when the inevitable (maybe) happens and they have to claim UC?
What do you think?
[ Edited: 29 Mar 2022 at 10:41 am by Vonny ]What do you think?
Yes, the lump sum can be disregarded for as long as your client remains entitled to ESA.
See para.11 of Schedule 8 (Capital disregards) of the ESA Regs 2008 which allows:
11.—(1) Subject to sub-paragraph (2), any arrears of, or any concessionary payment made to compensate for arrears due to the non-payment of—
(a)any payment specified in paragraph 8, 10, 11, 66, 72, 73 or 74 of Schedule 8 (other income to be disregarded);
(b)an income-related allowance, an income-related benefit or an income-based jobseeker’s allowance, universal credit, child tax credit or working tax credit;
(c)any discretionary housing payment paid pursuant to regulation 2(1) of the Discretionary Financial Assistance Regulations 2001,
(d)bereavement support payment under section 30 of the Pensions Act 2014,
10(e)maternity allowance under section 35 of the Contributions and Benefits Act (state maternity allowance for employed or self-employed earner),
but only for a period of 52 weeks from the date of the receipt of the arrears or of the concessionary payment.
(2) In a case where the total of any arrears and, if appropriate, any concessionary payment referred to in sub-paragraph (1) relating to any one of the specified payments, benefits or allowances, amounts to £5,000 or more (referred to in this sub-paragraph and in sub-paragraph (3) as the “relevant sum”) and is—
(a)paid in order to rectify, or to compensate for—
(i)an official error as defined in regulation 1(3) of the Social Security and Child Support (Decisions and Appeals) Regulations 1999, or
(ii)an error on a point of law; and
(b)received by the claimant in full on or after 14th October 2001,
sub-paragraph (1) is to have effect in relation to such arrears or concessionary payment either for a period of 52 weeks from the date of receipt, or, if the relevant sum is received in its entirety during the award of an income-related allowance, for the remainder of that award if that is a longer period.
So para.11(1) deals with the general 52-week disregard for arrears but para.11(2) allows the longer disregard where the amount exceeds £5,000 and they are due to official error. Note also that para.11(3) also allows the disregard to carry over into a UC award provided that happens continuously.
I’d also strongly suggest keeping copies of that letter as we see these rules routinely ignored.
Brilliant, thanks Paul and yes I will make sure she keeps the letter. Do you think there is any benefit in writing back for further confirmation and details of the regs allowing the disregard for over 52 weeks to prevent any future problems or will the letter she already has be enough? I just want to make sure everything is covered.
Thanks
Brilliant, thanks Paul and yes I will make sure she keeps the letter. Do you think there is any benefit in writing back for further confirmation and details of the regs allowing the disregard for over 52 weeks to prevent any future problems or will the letter she already has be enough? I just want to make sure everything is covered.
Thanks
I would hope that a copy of the letter confirming that an official error has been accepted as being the cause of the arrears being paid would be sufficient - I wouldn’t do much more than that for now.
Thanks
I would hope that a copy of the letter confirming that an official error has been accepted as being the cause of the arrears being paid would be sufficient - I wouldn’t do much more than that for now.
The clearly says it is classed as ‘official error arrears’ so I agree as we have this is writing so it should be ok for her. Guess it will be when she has to move over to UC that it might become a problem, but given the track record this should hopefully be a few years off!