Looks a good move to lower the waiting period for mortgage costs but does ISMI kick in at 100% after 13 weeks. If it does then it looks more advantageous than the 26 week rule which would only give equivalent of 900% in 26 weeks. Is 26 weeks going from April to be replaced by 13 weeks covering all situations?

Doesn't seem to be any details but it sounds like that for all new claimants from April it will be a 13 week wait whatever date they took the loan out. There could be a few take up / better off calc issues: advantages in delaying claims to April 2008 the closer the date gets. The lifting of the cap from 100K to 175K means for people with big mortgages a lot of jobs would no longer be worthwhile financially compared with being on the dole. Anyone with a big mortgage earning below the average wage might find income based JSA with housing costs + full ctb makes them better off out of work.

I know there are no details available but do you think people who are still within the 39-week waiting period in April 09 (but have waited at least 30 weeks) will be paid housing costs, or will the 13-week wait apply to new claims only?

you're right about lack of detail .. though they have consisitently (thus far !!) said new working age claims ...

Housing costs ....

This is supposed to have been introduced as a reaction (kneejerk possibly?) to the crisis in the housing market - so what has April 09 got to do with it, other than saving money by delaying it's introduction? the crisis in starting to occur now and will grow in the next few months.......

Because the waiting period of 13 weeks will not be introduced until April 2009, a considerable number of people will therefore stand a real chance of losing their homes in the next 7 months. The cost of trying to rehouse these claimants together with added costs of rent, etc will far outweigh any money think think they are going to save by not introducing the change sooner - like the end of September/October. There will also be the immeasurable cost in terms of personal relations - financial problems being one of the major causes of relationship breakdowns.

It could be done - they have been quick enough in the past to change a regulation via the SI route when a Commissioner's decision went against them -

Quite agree, the way it was delivered and understanding from the current financial position we find ourselves in, one expected the support to take affect with immediate affect.

Brown at his old tricks, people need the support now not post possession being granted, he should be publically challenged over this and brought to account for his misleading statement.

I am not aware that any regualtions have yet been laid on this. It looks as if it will be pretty complicated (look at all the points reaised above) and they will ahve to be sorted out before the regs can be made, or they'll only get it wrong and not deal with things they should ahve thought of!

I can't see why it has to necessarily has to be complicated - after all it's only a matter of issuing a statutory instrument the effect of which would be to substitute 13 weeks for 39 weeks.

Our worry is that by the time this comes into effect, the damage will have been down and countless people will have lost their homes. In addition of course, if it is to only be a applied to new claims made on or after the start date of the new regs, then those who have manged to just about hold their own through the winter will still be losers.

The whole saga is in a way self defeating - the government now owns a sizable portion of the mortgage market in one way or another: if they allow customers to be evicted because they have not been able/willing to help them, then the powers that be suddenly become somewhat less than proud owners of a large number of repossessions......and through local Authorities will be incurring additional costs by having to pay HB etc.

....but then, as Confusious would have said, words such as logic, common sense, simplicity and JCP do not sit comfortably in the same sentence...............

"...they'll only get it wrong and not deal with things they should ahve thought of!"

Nothing new there then.

I got a reply today from DWP about this - current plan is that the new rules (ie 13 weeks and, although i failed to check specifically, presumably £175K) will only apply to new claims from Apri 09; pre April claimants will be on 39 weeks and presumably £100K) - Not good news.

I fired off a list of Qs about how on earth this is going to work? - will people be able to break claims and requalify ? etc etc - but I'm just getting 'no details are available' back.

If they stick with this plan then i suppose that some people should already be being advised of the possibilty deferring a claim - two groups come to mind:

1) 'New costs' claimants who only get something once the ISMI kicks in - it looks like they'll wait longer before they get anything if they claim now rather waiting until the rules change (assuming the new rules start early April).

2) Claimants with over £100K loans o/s might be better off deferring rather locking themselves into the lower limit.

As its apparently working-age only thing there's possibly a better off issue for those people with a choice of SPC or IS/JSA(IB).

Conversely, if the new 2 year limit only applies to new claims, there might be some people better off with the old rules...

looks like things are going to be messy ... hope i'm wrong.

Anyone seen anything about this change now happening from 1st January?

Has anyone got any more information on this? I need to advise someone on whether she should claim IS now or wait until April. If she claims now the 39 weeks would not end until August 09 but a claim in April would be paid at the end of June. I

Also, is it confirmed that claims after April will be paid for 2 years only?

Courtesy of Adelphi:

The following changes will be for customers making new working age claims to Income Support, Jobseeker's Allowance and income-related Employment and Support Allowance and will not be applied to existing customers:

shortening the waiting period before support for mortgage interest is paid from 39 weeks to 13 weeks for new working age claims
increasing the capital limit for new working age claims to £175,000
introducing a two year time limit on support for mortgage interest for new Jobseeker’s Allowance claims only.
These changes will be reviewed when the housing market recovers.

Ministers announced on 2 September that we would introduce these changes in April 2009 but this date has been brought forward and we are currently planning to introduce them in January 2009.

,
Housing Benefit Strategy Division
5th Floor, The Adelphi
1-11 John Adam Street
London
WC2N 6HT

Good news thanks for that

It isn't good news for anyone who needs to claim benefit now - or alrady just has and will still have to serve out the balance of 39 weeks, while johnny-come-latelies jump the queue by as much as nearly six months!

Got to say i'm not sure what's best for clients in our area - we have alot of unemployment that is very long term - those clients when claiming from January 2009 risk losing their homes due to the 2 year rule.

At least if someone's claimed before Jan - even though they have a longer wait - they can continue to receive help for as long as they need it.

Not confirmed.

A DWP official has said that those already waiting for mortgage help pre the January change will have the same waiting period as those under the new 13 week rule from January.

So anyone who has already waited or part waited the 13 weeks before the change should get mortgage interest help and the higher amount right after the change or a lot quicker.

Bill - that would be sensible but it's contrary to what I'd been told - where did you get that information?

I phoned our local delivery centre and asked to be put through to IS mortgage help section and asked them. not saying it's right though.

Although it would be strange to do it any other way, very unfair on people who claimed earlier but will get paid later.

Thought people would like to know.

At the Social Security Advisory Committee meeting it was announced that the Government intends to use the urgency provisions to by-pass the usual SSAC consultation process on this change, on the basis there isn't time.
It was also said that SSAC understands the draft regulations do not yet exist in final form, so hard to see how the BDCs can be giving a clear line on it at present. Though I expect there's some bits that are fairly close.

There is likely to be a SSAC consultation AFTER the regs have been made, which might not be such a pontless exercise as all that if the Govt means what it says about this being a quick-fix temporary response.

Dear All

Sorry to be so dense but could someone kindly direct me to the source of this news story?

many thanks
rich

hi richard ...

see Government brings forward housing costs help: DWP confirms new rules will now be introduced in January 2009 (7 November 2008) ...

... plus further links at the bottom of that news story

cheers - shawn

Which one? If you mean mine, I was there!

Do we know yet whether people in the middle of their 39 week wait will get help earlier when the change takes effect in Jan?

Thanks,
Suzy

No, but the initial proposal was for new claimants only. Still no regs as far as I can find out.

Regs waiting for todays changes, perhaps.

From the PBR

"The Government has already announced reforms in September, which will strengthen the system of support for new claimants of working age by reducing the waiting period from 39 to 13 weeks, and raising the capital limit to £175,000. The Government will increase eligibility for this support by raising the capital limit further to £200,000. The Government will also maintain the level of support at the current interest rate for the next six months for existing claimants so that net support to such claimants is increased."

Interesting. I wonder if by 'current' they mean 6.08% or 4.58%.

DWP notice on standard rate shows 6.08% until mid-Dec then 4.58%.

(see http://www.dwp.gov.uk/resourcecentre/standard_rate_of_interest.pdf - though of course this may be updated soon.)

dclg saying '... and the standard interest rate for this support will be frozen at the current rate of 6.08 per cent ...'

http://www.communities.gov.uk/news/corporate/1071959

Interestingly there's no reference to the 200k limit only being for new claims

"Increasing the support available for those eligible households paying the interest on their mortgages. Under new changes to the Support for Mortgage Interest scheme, the capital limit on which eligibility for assistance is calculated will be doubled to £200,000 and the standard interest rate for this support will be frozen at the current rate of 6.08 per cent - ensuring those with higher value loans and on fixed rate mortgages don't miss out."

While new claims are mentioned in the 13 weeks reference:

"New support measures to help vulnerable homeowners meet their mortgage interest payments. The DWP is reforming Income Support for Mortgage Interest (SMI), by shortening the waiting period before SMI is paid from 39 weeks to 13 weeks for new working age claims. This will come into effect from 5 January 2009."

Any significance?

Isn't it wonderful how they manage to totally c**k up a perfectly simple issue!

So is the £200K permanent or temporary, as the £175K was supposed to be?

One of our customers has just had a client come in with a letter saying that she will no longer qualify for income support following a fall in the standard rate due on the 14th - in direct contradiction to the policy stated above and the revised information given at

http://www.dwp.gov.uk/resourcecentre/standard_rate_of_interest.pdf

Presumably this is due to some bureaucratic lag, but it may be worth watching out for.

I have just spoken to our local BDC about this as I have a client in same situation.
They say they were not advised that the SRI had been frozen at 6.08% so have recalculated existing claims at 4.58% .
They will now be recalculating all claims they have changed in line with the 6.08%.
Mind you - I had to fax them the info from their own resource centre to convince them after being told that we were wrong!

I too have spoken to the mortgage interest team at our two local BDCs - Bolton and Chorlton as I have a client affected by this.

Both say that they have not been instructed to freeze the rate and the computer automatically sets the rate when bank rates change and this is 4.58% at present.
Chorlton said they were not aware of any changes at all and Bolton said they understood that this change would take effect from 5th Jan 09.

It seems to me that the message has not filtered down to BDCs yet and that this needs to happen ASAP.

Does anyone have any higher level contacts in Adelphi we can talk to?

I've spoken with someone at the Adelphi today.

I was given the somewhat surprising advice that anybody who receives a letter stating that their benefit is to be reduced or stopped for this reason should contact their benefits office immediately and advise them of the information in the URLs above.

I was also told that there is still absolutely no guidance on transitional arrangements for the reduction of the waiting period to 13 weeks.

re the transitional arrangments and existing claimants in the waiting period.

Does anyone know if those already in a waiting period, but who are not recieving benefit (i.e. not entitled till ISMI kicks in) will benefit from the new arrangment, or will they be treated as existing claimants?

Thanks,

Apparently (as of yesterday) the regulations are still being drafted. There are (at least) three possibilities:

1) anyone 13 weeks + already goes straight to full housing costs from Jan 5th
and anyone under 13 weeks only has to wait 13 weeks.

2) the clock restarts for those claimants who would otherwise have to wait more than 13 weeks from Jan 5th

3) the new arrangments only apply to fresh claims and existing claimants
have to wait up to 39 weeks

Initially we were told that 3) would apply, but now we're told that no decision has been made.

I have just spoken to our local BDC. They recieved guidance today on how to implement the freezing of the 6.08% interest rate.

Their computer system has currently set the SIR at 4.58%.
They will implement the 6.08% SIR in Jan 09 and customers will be compensated for any reduction in interest payments to their lender in the interim.

Customers who would be knocked off benefit altogether as a result of the decrease will be identified now and a manual adjustment will be made so that their benefit is unchanged.

Has anyone heard any rumours that the reduction from 39 to 13 may not apply to Scotland???!!

I don't think they could do this. Benefits are not among the delegated powers given to the Scottish Parliament. The Scots might not like it, but they are still part of Great Britain.

I agree Ariadne, that was my "take" on the rumour when I heard it. Supposed to be some kind of dispute between the Scottish Goverment and Westminster about it clashing with proposed Scottish assistance for home owners. Somehow I think the source of the rumour has been a bit "previous" or got hold of the wrong end of the stick.

There was a BBC Moneybox programme on Monday which I am told said anyone who had already applied would only have to wait 13 weeks. Does anyone know please whether this has been confirmed by DWP - there is no press release on their website?

Also, will the increase to £200K apply to everyone?

Any ideas on when the Regs. will be issued?

I'm reliably informed that an annoucement on this will be issued sometime today together with a Guidance etc.

Apologies - can we downgrade that to "an annoucement on this will be issued sometime...." Hopefully, there will be something out tomorrow (Friday)

new guidance - IS/JSA Bulletin 10/08 - confirms that those who are already in receipt of IS/JSA/ESA at the point of change will benefit from the new 13 week rule ..

eg if you're already past the 13 weeks when the new rules are introduced you get full help immediately .... or if you've served 8 weeks when the new rules are introduced, you get full help 5 weeks later

more info in rightsnet news shortly .....

more now @

Changes to help with housing costs from January 2009: New DWP guidance

thanks to Mike Shermer and Peter McGeever for alerting us to the new guidance

I don’t quite understand why there is the exclusion referred to on the last page: the 13 week bit won’t apply to people who are in the waiting period but not getting IS etc due to excess income. This will cause quite a big disparity in entitlement to people in very similar circumstances: eg if someone has a little bit more of an occupational pension, perhaps just 10p or something, compared with his next door neighbour in otherwise identical circumstances he could be thousands of pounds worse off.

Does it also mean some people will have an incentive to jack in their job to stop receiving SSP in order to get a bigger gain in IR ESA housing costs?

I must be reading it wrong. Some people would have an incentive to give up part time jobs as well wouldn't they?

Anyone know when there will be regs for this or are they still being written up? Seems like they're cutting the whole thing a bit fine.

Does the exclusion Damian refers to really mean what it appears to mean? I find the wording rather obscure anyway, but if it does mean people are excluded just because their income in the QP is a few pence above the limit (but not excluded if they are in the same situation but happen to be on CBJSA) then it seems to me to be a serious deficiency in the provision.

The SI number is SI 2008/3195...the Regs were laid and signed off on the 15th - the latest date that would allow for them to be introduced on the 5th Jan. As they were written in a bit of a hurry there may well be the odd glitch or two ......

happy weekend reading !! ... here's the regs ...

http://www.opsi.gov.uk/si/si2008/uksi_20083195_en_1

If anyone has any queries etc, in the spirit of cooperation, goodwill and deeper understanding of the ways of JCP, a gentleman by the name of Gary Rodgers has volunteered to put his email address on this forum and field any questions you may have on this subject - and in time honoured manner, where he may not be able to provide an answer he will no doubt know a man who knows a man who can ...........




Rodgers Gary WWEG HOUSING COSTS <GARY.RODGERS@DWP.GSI.GOV.UK>

Morning

How nice to see you all back again - no doubt you really missed all this didn't you.....?

We have received the following clarification from JCP regarding the implementation of the above Regs – or more precisely from a lady named Beverley who works for the Products & Transformation Division (Transformation?).

On a cautionary note, I telephoned both our local office and the claim lines on Friday and they weren't too sure about their advice......

Mike

----------------------------------------------------------------------------------

I have today contacted the Housing Team who are dealing with the changes to the mortgage interest scheme from January 09. They have confirmed that existing customers, who made their benefit claim prior to January 09, will, if they satisfy the qualifying conditions, be awarded mortgage interest from week 14. There is no requirement for any existing customer to contact Jobcentre Plus to ensure that this happens.

A scan is currently being developed that will identify existing cases and Jobcentre Plus staff have been alerted that guidance will be issued shortly to inform them of the action they will need to take on receipt of that scan. In the mean time where customers do make contact, and in advance of the scan being issued, staff have been informed and are aware of how to apply the new housing cost rules in these instances.

Beverley Walsh
Products & Transformation Division

more dwp guidance ... see today's rightsnet news

New housing costs rules from January 2009: New DWP guidance

Looks like I was right about the exception. Those swines who have been shelling out NI contributions so that they can get on IB (like Fiona, the example in the guidance) will get what they deserve - repossession! and as for the people on SSP, the government is doing all it can to encourage them to chuck in their jobs to save their houses! All fitting in well with the goverment not wanting people to be too hasty in finishing on grounds of sickness.

Wed 07-Jan-09 10:30 AM by Gareth Morgan

There are all sorts of winners and losers.

Having the standard interest rate set at a prescribed level for an initial period of up to 6 months creates a lot of them.

I can understand that with all sorts of divergence from base rate linkage by lenders, linking was going to be difficult; this gives some people a good chunk of extra income..

If you got a Woolwich tracker mortgage for 0.16 per cent below base rate in late 2007 for £200,000 then your current interest, before Thursday’s expected cut will be

£306.66 pcm

The SMI figure in benefits will be £1013.33 pcm

A net profit of £163 a week

There are all sorts of better off issues to take into account. Like getting out of the 2 year limit by going on ESA for a short period of sickness, like a couple of weeks flu, instead of staying on JSA. You then come into sched 2 para 4A (3) in the JSA regs which was put in there by reg 6 of the ammendment regs

So.........my client who became a lone parent on 06/12/08 and claimed IS etc straight away but is not entitled due to excess income in the form of Incapacity Benefit.......

He's got a letter telling him to re-claim IS on 03/02/09 as this will be the 8 week point and his mortgage is pre 95.

Does this still apply?