Benefit Entitlement

HC Deb 21 June 1990 vol 174 c712W

Mr. Flynn

To ask the Secretary of State for Social Security if he will set out the basis of calculation under the income support and housing benefit regulations which produced the result that the claimant who was the subject of commissioner's decision CIS/236/1989 was £2.49 per week worse off as a result of the £2.82 increase in her pension in April 1989; in how many cases similar losses have occurred; and whether he will amend the regulations to restore the total benefit entitlement in such cases retrospectively.

Mrs. Gillian Shephard

[holding answer 18 June 1990]: Prior to the uprating in April 1989, the claimant concerned was in receipt of retirement pension in excess of the appropriate income support level. But income support was payable in the form of a transitional addition of £1.49, to protect the value of the claimant's total benefit income at April 1988 on the introduction of income support. This addition entitled the claimant to maximum housing benefit that is rent and rates rebates of 100 per cent. and 80 per cent. respectively. After meeting the net liability for housing costs of £0.70 a week, the claimant's disposable income was £48.23 for each week in which rent was due.

The increase in retirement pension of £2.82 a week in April 1989 more than overtook the need for the transitional addition of £1.49. The claimant was no longer entitled to income support, the transitional addition, or maximum housing benefit. As income was in excess of the appropriate level, the rent and rates rebates were reduced by 65p and 15p respectively for every pound above the level. After meeting liability for housing costs of £4.62 a week, the claimant's disposable income was £45.64 for each week in which rent was due.

It is estimated that some 30,000 people on income support receiving a transitional addition lost entitlement to maximum housing benefit in a similar way in April 1989. But an estimated 95 per cent. of all those floated off maximum housing benefit at the uprating—some 550,000 —gained or were no worse off. The transitional additions were intended as a temporary cushion in April 1988. We have no plans to reinstate them in this situation.