Hello, I hope someone can assist.

Someone came to see me with a recent HB and CTB award letter. He argued that his IB was being treated in full as income despite the fact that IB is paid to him at a reduced rate. The reduction is due to pension income, he has an occupational pension over £85 per week and therefore has 50% of the excess taken out.

I contacted HB to ask if they could take IB at the rate he is actually paid into account when calculating his income. They refused to do this and say they have to take into account the amount of IB he is 'entitled' to, not what he actually gets. They agreed that this seemed to be unfair and suggested that I appeal.

I have had a brief look at CPAG and Leg. but can't seem to find anything that specifically relates to this, Can anyone point me in the right direction? I have had a long day so maybe I am not looking in the right places!

Many thanks

Surely the point is that the law states that 50% of his income in excess of £85 is to be deducted from his IB, so he is NOT entitled to receive full payment of IB. The situation is not the same as eg money being deducted from benefit to pay off a social fund loan, where the client is still 'entitled' to the full amount.

Tue 13-Mar-07 09:59 PM by shawn

(edited to fix html)

I agree with Ruth. The amount of IB entitlement is the gross income. Definitely a case to pursue right through to the end.

If the reduction in IB was due to repayment of an overpayment, the LA would be correct. I think the LA has got confused.

Regards

I agree in priciple with Kevin, however HB/CTB guidance states the following:
"If the reduction is due to CSA reduced benefit direction or because of reduction due to hospitilisation, the net amount is used as unearned income. However if reduced for any other reason the gross amount is counted as unearned"

The regs HB 2006 40(5) seem to confirm this to be the case although citing Schedule 5 (Income disregards) as exceptions. I have trawled Sch 5 as it includes the infamous voluntary payments, and have not noticed any reference to reduced IB rates.

Seems to me that the correct decision has been made but is one of those that doesn't make any sense. I would love to be shown I am wrong...

<QUOTE>HB/CTB guidance states the following:
"If the reduction is due to CSA reduced benefit direction or because of reduction due to hospitilisation, the net amount is used as unearned income. However if reduced for any other reason the gross amount is counted as unearned<END QUOTE>

There is a clear distinction in this case. On three grounds.

1) It is not a "reduction" in the true sense.

2) The "reduction" is not due to either of the reasons given in the GM; nor is the "reduction" of the same nature.

3) The award of "reduced" IB is ACTUAL entitlement and is therefore in itself the gross income.


It's not the greatest analagy, but the "reduction" in IB is no different to any "reduction" of HB/CTB by way of the taper sysytem when income exceeds the applicable amount.

For what it's worth, I wouldn't hesitate to argue the above on behalf of a clmt at Tribunal. And, perhaps more importantly, I would genuinely expect a Tribunal to find for the clmt. And, certainly a Cmmr.

As an aside, I rarely place any serious reliance on the GM (other than to assist in dissecting the alleged meaning of legislation).

Hope the above helps.

The decision cannot be correct on the basis of the facts outlined because they would taking income into account twice. First the occupationanal pension itself would be counted and second a notional sum equivalent to the reduction of the ICB because of the amount of the occupational pension. There is simply no legislative provision nor precedent for that.

The original poster has made it clear that the ICB is being reduced because of an occupational pension payment and not a recovery of an overpayment.

Gross income is enitlement income. Where an overpayment is being recovered he is still entitled to the amount before recovery. When ICB is reduced because of an occupational pension then his entitlement is reduced also and not just the payability.

Thank you everyone for your help on this one.