Some claimants will be receiving Income-Related ESA to top up an award of Contributory ESA.
As Income-Related ESA is a legacy benefit, these claimants (if they have not already done so), will receive a Migration Notice at some point during 2025.
The Migration Notice is a letter notifying the claimant that their legacy benefit/s i.e. the Income-Related ESA (and any HB^) are due to end and inviting them to claim Universal Credit (UC) instead.
^ unless living in ‘specified’ or ‘temporary’ accommodation.
As Contributory ESA is not a ‘legacy benefit’ the claimant’s entitlement to this will not end – whether or not they claim UC.
Example: Steve worked up until 10 years ago when he had to finish work after a bad accident. He claimed and was award Contributory ESA (in the Support Group) as he had paid the correct level of National Insurance. He went into the Support Group from week 14 of his award and that triggered entitlement to an Income-Related ESA top up (the Enhanced Disability Premium). A few months later, he was awarded the daily living component of PIP, and this meant that he became entitled to more Income Related ESA ( the Severe Disability Premium). He now receives £138.20 a week in Contributory ESA, topped up by £102.35 a week in Income-Related ESA and £134.00 a week HB that covers his full rent.
As Steve gets IR-ESA (and HB) he will be sent a Migration Notice some time in 2025.
Migration onto UC
When a legacy benefit claimant receives a Migration Notice, they will need to make a claim for UC if they wish to continue to receive the financial support their legacy benefits have been giving them.
If they make their UC claim before their Deadline Day, then that will bring their legacy benefit awards to an end – albeit with a two week run-on.
If they fail to make their claim before their Deadline Day, then their legacy benefits will be brought to an end from Deadline Day – albeit with a two week run-on
The HB run-on will be a 2 week extension of the amount they were receiving before. The IR-ESA run-on depends on them still meeting the normal conditions of entitlement for that benefit during those 2 weeks.
If they are also on Contributory ESA this will continue in payment but will become New-Style ESA.
Example: Steve receives his Migration Notice on 11th April 2025, this gives him a Deadline Day of 12th July 2025. He makes his claim for UC on 5th May 2025.
That claim triggers a ‘stop notice’ being sent to the ESA Department and the HB Office.
The HB Office bring his Housing Benefit to an end two weeks after his UC claim i.e. on 18th May.
The ESA Department bring his Income-Related ESA to an end two weeks after the UC claim i.e. on 18th May. And they ‘convert’ his Contributory ESA into New Style ESA and continue to pay him.
This means that he should receive a further two weeks of his full ESA entitlement, and then ongoing payments of New-Style ESA of £276.40 a fortnight.
As he was on ESA when he made his claim for UC, his work capability status should transfer to his UC claim – so his first (and ongoing) UC awards should include a LCWRA Element.
And as he has some unearned income i.e. his New-Style ESA, his UC award will also take this into account.
The breakdown of Steve’s UC will look something like this:
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Standard Allowance
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£ 393.45
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LCWRA Element
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£ 416.19
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Housing Costs Element
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£ 580.67
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Transitional Element
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£ 234.03
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Max UC =
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£1624.34
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|
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Reduced by income
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|
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New-Style ESA
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£ 598.87
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UC entitlement
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£1025.47
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What if Steve misses his Deadline Day?
Even if he claims UC after his Managed Migration Deadline Day - or if he doesn't claim UC at all - Steve should still be entitled to 2-week run-ons of Income-Related ESA and HB, beginning on his Deadline Day.
Missing the two week IR-ESA run-on?
Only Old-style Contributory ESA can be topped up by Income-Related ESA (New-Style ESA gets topped up by Universal Credit).
So, we are wondering whether there is a risk that those C-ESA claimants with an IR-ESA top up could be missing out on their IR-ESA top up on claiming UC?
For example, Steve above had been receiving £240.55 per week in total of Old-Style ESA, made up of £138.20 per week of Contributory ESA, and £102.35 of Income-Related ESA. When he claims UC, the Contributory ESA is converted from Old-Style ESA to New Style ESA, and remains in payment. He is entitled to a further (2 x £102.35 =) £204.70 of Income-Related ESA in respect of the 2 weeks after his UC claim is made. But there is a chance that the DWPs systems will not pay it. If you come across a claimant who appears to have missed out on this run-on, please email us at advice@ucnotes.co.uk (please don't share the claimant's personal details).
Transitional Protection
Where a legacy benefit claimant moves onto UC through the Managed Migration process and is worse off on UC, then they will normally be entitled to a Transitional Element in their first and ongoing UC awards (until lost or totally eroded).
Where the migrating claimant is getting Contributory ESA, then this will be factored into that assessment.
Claimants should compare their total legacy entitlement – so for Steve his Income-Related ESA and HB (before any deductions for debts or overpayments) – with their UC entitlement (after the deduction for New-Style ESA, but before any deductions for Advances, debts, overpayments). If they believe they are worse off, they should request a breakdown of how any Transitional Element has been worked out and show it to a Benefits Adviser.
We believe there may be issues with how the DWP are calculating the Transitional Element for these claimants. If you are advising a claimant and it appears as though an error has been made, please email us at advice@ucnotes.co.uk (please don't share the claimant's personal details).