Following the introduction of Pension Credit in October 03 Local Authorities now use a pension credit assessed income figure when determining HB/CTB entitlement. Problems arise when a client is in receipt of a war pension as this is included as income for pension credit purposes. Most loal authorities disregard it as income but are using the assessed income figure provided by the pension service. I have had a couple of cases were they have not disregarded the war pension, merely used the assessed income figure to determine entitlement. As a result clients are underpaid or not paid HB/CTB, and in some cases assume it is because they are in receipt of pension credit and do not challenge their award.
The local authority have told me this was just an oversight but if anyone else has any similar cases I could raise the issue with the Penson Service.

I don't think this is a Pension Service issue - the inclusion of a war pension in their calculation will normally take the claimant outside of guaranteed credit - the notification the HB section will receive will therefore either show a savings credit entitlement or a nil entitlement - these SC notifications should also show the income/capital etc that they have used.

The HB assessors should, if they are reading the assessment correctly, pick up on the fact that there is a war pension in the calculation, and carry out the HB/CTB calculation accordly. Hence your LA saying it was an oversight.

We picked up on this, and some LAs interpretation, some time back

Circular HB/CTB A27/2002 said:


"7 People with just the Savings Credit will claim standard HB/CTB and the Savings Credit will be treated as income. In these cases Local Authorities will be required to use The Pension Service’s assessment of a person’s income in their calculation."

A16/2003 repeated

"9. People with just the savings credit will claim standard HB/CTB and the savings credit will be treated as income. However, in these cases Local Authorities (LAs) will be required to use The Pension Service's assessment of a person's income and capital in their calculation. The capital cut off of £16,000 still applies to these cases, and to all other cases where the claimant is not in receipt of Pension Credit."

as did A20/2003

"A12 LAs are required by legislation to use The Pension Service’s assessment of the pensioner’s income and capital. This means that for standard HB/CTB claims when savings credit only is in payment, LAs will not need to collect details of a pensioner’s income and capital. Instead they will rely on the figure provided by The Pension Service. Pensioners will only need to report changes in their circumstances, apart form those that are tenancy related, to The Pension Service."

You can understand that a lot of LAs assumed that this meant the figure is set in stone. The regs, of course, say differently. (One of the) regs 23 says

"Calculation of claimant’s income in savings credit only cases
23.—(1) In determining the income and capital of a claimant who has, or whose partner has, an award of state pension credit comprising only the savings credit, the relevant authority shall, subject to the following provisions of this regulation, use the calculation or estimate of the claimant’s or, as the case may be, the claimant’s partner’s income and capital made by the Secretary of State for the purpose of determining that award.
(2) .......
(4) The relevant authority shall modify the amount of the net income provided by the Secretary of State only in so far as necessary to take into account–
(a).....
(f) any modification under section 134(8) of the Administration Act (disregard of certain war pensions) which is applicable in the claimant’s case.
....."

However they did issue circular A23/2003, which LAs should realise points out the actual position.

"Assessed Income Figure

9. Where savings credit only is in payment, LAs will be required to use the AIF as provided by The Pension Service when processing a standard assessment of HB/CTB. The Pension Service will provide a breakdown of the income on the RIS 20212 report as follows

• Amount of Notional Income from Capital

• Amount of War Disablement Pension

• Amount of War Widows Pension

• Amount of War Orphans Pension

• Amount of capital held

• Occupational Pension Details of customer and their partner

• Amount of Other Income of the customer and their partner

• Amount of Other Benefit of the customer and their partner

• Amount of earnings of the customer and their partner

• Amounts disregarded by The Pension Service, where appropriate

10. For clerical saving credit cases, The Pension Service will complete form NHB PC clerical and forward to the LA.

11. The LA will modify the AIF in these circumstances

• to take account of the savings credit

• if there is a dependent child, any Child Benefit, Child Tax Credit in payment

• to include the income of a partner who is not included in the Pension Credit calculation

• to include the income of a non-dependant that is treated as the customer's income

• to apply the HB/CTB disregard instead of the Pension Credit disregard when the former is more generous

12. The Pension Service will deal with all appeals against the AIF unless the LA has made any modifications."