Loss of WRAG/LCW - prompt action before the rules change could prevent a loss of more than £1500 per year!
Anyone who could or should be making a new claim for Employment and Support Allowance or (if on Universal Credit) a formal request for a Work Capability Assessment could be significantly better off by doing so before 3 April 2017!
We are still awaiting the Regulations that will make these changes, but we have detailed below how the proposed changes could work, given what we currently know about the government's plans.
The government has decided that those who are assessed as unfit for work and put in the Work Related Activity Group (or deemed to have a Limited Capability for Work) should get the same basic allowance as jobseekers.
How does this affect ESA claimants?
Anyone who makes a new claim for ESA (either Contributory or Income-Related) on or after 3 April 2017 and who is put in the Work Related Activity Group will not receive the Work Related Activity Component, which is worth £29.05 per week.
Those who are put in the Support Group will receive the Support Component.
Existing ESA claimants already getting the Work Related Activity Component included in an ESA award will continue to do so until they are found fit for work. Also, those already getting the Support Component in an ESA claim made prior to 3 April 2017 who, on review, are placed in the Work Related Activity Group will be paid the Work Related Activity Component.
How are Housing Benefit awards affected?
For those who get Contributory ESA (and not Income Related ESA) and whose Housing Benefit is calculated, the same rules as for ESA above apply.
So, any HB claimants who make a new claim for ESA on or after 3 April 2017 and who are put in the Work Related Activity Group will not have a Work Related Activity Component added into their HB applicable amount, but those who are put in the Support Group will have a Support Component added to their HB applicable amount.
And for those whose ESA claim was made before 3 April 2017: If they are put in the Work Related Activity Group, or on review they are moved from the Support Group to the Work Related Activity Group they will have the Work Related Activity Component included.
The change will not affect HB awarded to someone while they are getting Income Related ESA because they will be passported onto maximum HB anyway.
(We await the Regulations to see how this change will affect other areas of Housing Benefit, such as the earnings disregard and non-dependant deductions).
What about Universal Credit?
The change affects not only new claimants, but also new requests for a Work Capability Assessment from 3 April 2017.
Existing UC claimants (eg. claiming as jobseekers) who request a Work Capability Assessment on or after 3 April 2017 and who are deemed to have a ‘Limited Capability for Work’ will not receive extra money in respect of the Limited Capability for Work element in their award. But note that their Claimant Commitment and Work Allowance (earnings disregard) (if appropriate) would be in line with their status as having a 'Limited Capability for Work'.
Anyone deemed to have a Limited Capability for Work Related Activity (Support Group) will receive the LCWRA Element.
Existing UC claimants already getting the Limited Capability for Work Element included following a Work Capability Assessment which was requested before 3 April 2017 will continue to receive the element until they are found fit for work.
We are aware of some Universal Credit claimants who have submitted sick notes for several months; although their work search requirements were temporarily switched off, they were not referred for a Work Capability Assessment because they had not specifically requested this. It is best to advise anyone who is likely to be unable to work for a few weeks to make a formal request for a Work Capability Assessment as soon as possible and before 3rd April 2017.
My tenant is claiming Jobseeker’s Allowance but now he has health problems – what should I advise?
If his illness is likely to be short-term, he should speak to his Adviser at the Job Centre so that he can have time off his jobsearching and minimise the risk of a sanction. If the symptoms are likely to last for several weeks, he could make a claim for Employment and Support Allowance. If he is poorly for more than 13 weeks the Job Centre staff may advise him he cannot stay on Jobseeker’s Allowance anyway.
There are a few things to watch out for:
- If he has had a Work Capability Assessment and been found fit for work at anytime in the past he will need to show that this is a new or significantly worse condition, otherwise he may not be paid any ESA until he is assessed (the ‘repeat claim’ rules).
- If he lives in an area where the Full (Digital) UC Service has started, his new claim would have to be for Universal Credit; he can still get a Work Capability Assessment done via his UC claim but he may need to consider the impact of monthly payments on UC, making a digital claim and using his online UC account, needing an email address, that ideally he would need an account which is not Post Office Card Account etc.
- If he is going to claim ESA / UC – do it before 3 April!!
My tenant claimed ESA in November 2016, she has just been found fit for work so her ESA has stopped. Is it worth her appealing the decision?
Yes! There are lots of good reasons to challenge a fit for work decision (eg. of those who take their challenge to appeal stage 62% win) – the April 2017 change in the rules has just added another good reason!
If your tenant wins her appeal and is deemed to have a Limited Capability for Work, she will be paid the Work-Related Activity Component - even if her Appeal is heard after 3 April 2017 - because her claim was made before the rules changed.
If she does not challenge the decision within the time limits, she will most likely have to claim benefit as a jobseeker. Then, if in the future, she tries to make another claim for ESA (or if she is on UC by then, if she requests a Work Capability Assessment), she will firstly have to get past the ‘repeat claim’ rules and secondly – if her claim / request is made after 3 April 2017, and she is deemed to have a Limited Capability for Work (ie not Support Group) – she will get no extra money.
My tenant has health problems but is unlikely to get into the Support Group – so why should they bother requesting a Work Capability Assessment after 3 April 2017 if they are not going to get any extra money?
It is still worth doing this – because if the claimant is assessed as having a Limited Capability for Work they will not be expected to be searching for and applying for jobs. Instead, they will just be expected to do some work-related activity, so will be less likely to be sanctioned.
Depending on how the Regulations are changed, having a 'Limited Capability for Work' could also mean a higher earnings disregard is applied, and for couple where one is working and one 'incapacitated' help towards child care costs may be allowed.