What on earth is CRAG?

CRAG Regulations

CRAG Regulations

 The Charges for Residential Accommodation Guide (CRAG) is the rules set out by the government on the means testing of  people needing residential care.
CRAG covers everyone – you don’t need to be old to need residential care, just unlucky!  Many people still think such care is  free after the Governments recent PR exercise pretending to make things better while actually doing nothing – politicians  sleight of hand sadly, no more!!!!

 You may also wish to download the relevant Local Authority Circular

 LAC(DH)(2011)1: Charging for Residential Accommodation

This circular (LAC(DH)(2011)1) informs councils of changes to the Charging for Residential

Here is the 2012 version of CRAG:

CHARGING FOR RESIDENTIAL ACCOMMODATION GUIDE

(CRAG)
CONTENTS

1.         Introduction

 

About this guidance

1.001                                       Revisions of the Guidance

1.002                                       Status of the Guidance

1.003                                       Acts of Parliament and Regulations

1.004                                        Gender

General

1.005-1.006A                          Statutory basis

1.007-1.008                             Standard rate

1.008A                                                Arrangements for accommodation

Assessing ability to pay and how much to charge

1.009                                       Regulations

1.010                                       Local authority managed home

1.011                                       Independent homes

1.012                                       Nursing mothers

1.013                                       Residents with a dependent child

1.014-1.015                             Reduction for assistance in running a local authority managed home

1.016                                       Information to be given to the resident

1.017-1.019                             Residents and Enduring Power of Attorney, Lasting Power of Attorney or Property Affairs Deputyship etc. unable to handle their own affairs

1.020                                       Treatment of fractions in the assessment

Social Security benefits

1.021-1.022                             Local authority managed homes

1.023-1.024                             Independent homes

1.024A                                    Attendance Allowance/Disability Living Allowance (Care component)

1.025                                       Admission to hospital

Collecting charges from residents in independent homes

1.026                                       Resident to pay the charges direct to the home

1.027                                       Liability for payment to the home

1.027A                                                Charges for day care services

1.028                                       Preserved rights

1.029                                       Liaison with the Department for Work and Pensions/Jobcentres/The Pensions Service

1.030                                       Complaints

1.031                                       Permanent and Temporary Stays

 

2.         Less Dependent Residents

 

2.001-2.002                             Background

2.003-2.005                             National Health Service Act 1977

2.006-2.007                             Effect of repeal of powers under the NHS Act 1977

2.008                                       Identifying “less dependent” residents

2.009                                       Definition of board

2.010 – 2.011                          Assessing “less dependent” residents

 

3.         Temporary Residents

 

3.001-3.006b                          Who is a temporary resident?

Charging for the first 8 weeks

3.007                                       Up to 8 weeks

3.008                                       After 8 weeks

3.008A            -3.008B                       Income Support/Pension Credit for temporary residents

3.009                                       Assessing ability to pay

3.010                                       Capital

3.011-3.014A                          Income

3.015                                       Couples

3.016                                       Attendance Allowance (AA) / Disability Living Allowance (DLA) Care Component

 

4.         Couples

 

4.001-4.003                             Local authority treatment of couples

4.003A                                                Capital limits for couples, including civil partners

4.004-4.006                             Temporary residents

4.007                                       Permanent residents

 

5.         Personal Expenses Allowance

 

5.001-5.004                             Purpose of the personal expenses allowance

5.005-5.006                             Amount of personal expenses allowance

5.007                                       Varying the amount of personal expenses allowance

 

6.         Capital

 

6.001                                       What is capital?

6.002                                       Types of capital

6.002A            -C                                Treatment of Investment Bonds

Effect of capital

6.003-6.005                             Capital limits

6.006                                       Spare

Beneficial Ownership of capital

6.007                                       Does the resident own the capital?

6.008                                       Ownership disputed

6.009                                       Spare

6.010                                       Joint beneficial ownership of capital

Treatment of capital

6.011-6.014                             Valuation

6.015                                       Expenses of sale

6.016                                       Spare

6.017                                       Debt secured on asset

6.018                                       National Savings Certificates

6.019                                       Disregards on capital

6.020                                       Capital held abroad

6.021                                       Transfer of capital to UK not prohibited

6.022-6.023                             Sources of valuation

6.024                                       Transfer to the UK prohibited

6.025                                       Evidence required of value

6.026                                       Action on receipt of evidence

6.027                                       Capital not immediately realisable

6.028                                       Disregarded indefinitely

6.028A                                                Disregarded for 12 weeks

6.029                                       Disregarded for 26 weeks or longer

6.030                                       Disregarded for 52 weeks

6.030A                                                Disregarded for 2 years

6.031                                       Disregarded for other periods

6.032                                       Meaning of reasonable period of disregard

6.033                                       Information required

6.034-6.035                             Action on receipt of information

Capital treated as income

6.036                                       Capital paid by instalment

6.037                                       Payments under an annuity and bonds

6.037A                                    Third party payments made under an agreement to meet excess fees

6.038                                       Earnings

6.039                                       Income treated as capital

6.040                                       Tax refunds

6.041                                       Holiday pay

6.042                                       Income from a capital asset

6.043                                       Bounty payments

6.044                                       Advance of earnings or loan from employer

6.045                                       Irregular charitable and voluntary payments

6.045A                                                Third party payments to help clear arrears

6.046                                       Arrears of contributions to a child’s custodian

6.047                                       Trust funds

6.048                                       Property

6.049-6.052                             Notional capital

6.053-6.054                             Capital available on application

6.055                                       Date to be taken into account

6.056                                       Spare

Deprivation of capital

6.057-6.057A                          General

6.058                                       Forms of capital to be considered

6.059                                       Ownership

6.060-6.061                             Has deprivation occurred?

6.062-6.063                             Purpose of disposing of an asset

6.064                                       Timing of disposal

6.065-6.066                             Conversion of capital to personal possessions

6.067                                       Deprivation decided

Diminishing notional capital

6.068                                       Calculation of the rate at which notional capital should reduce

 

7.         Treatment of Property

 

7.001                                       General

7.002-7.003                             Property to be disregarded

7.003A- 7.003C                      Disregarded for the first 12 weeks of a permanent stay

7.004                                       Meaning of relative

7.004A                                                Meaning of family

7.005                                       Meaning of incapacitated

7.006                                       Property acquired but not yet occupied

7.007-7.009                             Discretion to disregard property

Property to be taken into account

7.010                                       Legal and beneficial owners

7.011                                       Legal ownership

7.012                                       Beneficial ownership

7.013-7.015A                          Joint beneficial ownership of property

7.016                                       Property held in a shared trust

7.017                                       Sale of jointly owned property

7.018                                       Property owned but rented to tenants

7.019-7.020                             Deferred payments

8.         Income Other Than Earnings

 

General

8.001-8.002                             What is income?

8.003-8.004                             Treatment of income

8.005                                       Income taken fully into account

8.006                                       Social Security benefits

8.007                                       Deductions from benefits

8.008                                       Industrial Injuries Disablement Benefit

8.009                                       Pneumoconiosis, byssinosis and miscellaneous diseases benefit scheme

8.010                                       Retirement Pension

8.011                                       Widow’s Benefits and Widowed Mothers Allowance

8.012                                       Workmen’s compensation

8.013-8.014                             Annuity income

8.014A&B                               Income from investment bonds

8.015                                       Income from certain disregarded capital

8.016                                       Income from insurance policies

8.017                                       Income from certain sub-lets

8.018                                       Third party payments to meet higher fees

8.019                                       Trust income

Income partly disregarded

8.020                                       £10 disregard

8.021                                       Overall disregard

8.022                                       War disablement pension

Other disregarded sums

8.023                                       The Savings Disregard

8.023A-C                                Occupational Pensions, Personal Pensions and Retirement Annuity Contracts

8.024-8.029                             Annuity income from home income plan

8.030                                       Income from subletting

8.031                                       Income from boarders

8.032-8.035                             Mortgage protection insurance policies

8.036                                       Income from certain disregarded capital

8.037                                       Income fully disregarded

8.038-8.039                             Income Support/Pension Credit paid for home commitments

8.040                                       Christmas Bonus

8.041                                       Payment from any of the Macfarlane Trusts, the Fund, Eileen Trust etc…

8.041A- 8.041B                      Dependency increases paid with certain benefits

8.042                                       Gallantry awards

8.043                                       Income frozen abroad

8.044                                       Income in kind

8.044A                                                Payments made to trainees

8.045-8.047                             War widows and war widowers special payments

8.048                                       Work expenses paid by employer

8.049                                       Expenses paid to voluntary workers

Charitable and voluntary payments

8.050-8.052                             General

8.053-8.056                             Spare

8.057                                       Income treated as capital

8.058                                       Notional income

8.059                                       Actual and notional income

8.060                                       Treatment of national income

8.061-8.062                             Spare

8.063                                       Income available on application

8.064-8.067                             Amount of income

8.068                                       Date taken into account

8.068A                                                Personal Pensions and Retirement Annuity Contracts

8.069-8.069A                          Income due but not paid

8.070                                       Deprivation of income

8.071                                       Meaning of deprive

8.072                                       Questions for consideration

8.073                                       Was it the resident’s income?

8.074-8.075                             Has deprivation occurred?

8.076                                       Purpose of the disposal of income

8.077-8.078                             Timing of the disposal of income

8.079                                       Conversion of income to a capital asset

8.080-8.081                             Deprivation decided

 

9.         Earnings

What are Earnings?

9.001-9.002                             General

9.003                                       Gross earnings

9.004                                       Net earnings of employed earners

9.005                                       Occupational pension

9.006                                       Personal pension

9.007                                       Statutory Sick Pay, Statutory Maternity Pay, Statutory Adoption Pay and Statutory Paternity Pay

Period over which earnings should be taken into account

9.008                                       Payments for regular periods

9.009                                       Payments which are not for a fixed period

9.010                                       Income Support/Pension Credit in payment

9.011                                       Income Support/Pension Credit not in payment

9.012                                       Net earnings of self – employed earners

9.013-9.014                             Assessing the weekly net earnings of self-employed

earners

9.015                                       Royalties or fees from copyright

9.016-9.017                             Spare

9.018-8.019                             Disregards

9.020                                       People entitled to a £20 disregard

9.021                                       People who have ceased or interrupted

employment

9.022                                       People who have ceased self – employment

9.023                                       Earnings frozen abroad

 

10.       Trust Funds

 

10.001-10.002                         What is a trust fund?

10.003-10.004                         Trustees

10.005                                     Identifying a trust

10.006                                     Treatment of trusts

10.007                                     Information needed

10.008                                     Absolute entitlement

10.009                                     Information needed

10.010-10.014                         Absolute entitlement to capital

10.015-10.017                         Absolute entitlement to income

10.018                                     Absolute entitlement to capital and income

Discretionary trusts

10.019                                     Information needed

10.020-10.022                         Treatment of discretionary payments

Compensation for personal injury

10.023-10.024                         Information needed

10.025-10.026                         Treatment of capital

10.027                                     Treatment of income

 

11.       Third Party Payments and Tops-Ups

 

11.001-11.006                         What are payments made by a third party and top-ups payments

11.007-11.008                         Third party payments to clear arrears

11.009-11.010                         Third party top-ups to meet higher fees

11.011-11.012                         Third party tops made by the resident

                                                                       

12.       Students

 

12.001                                     General

Grant income

12.002                                     Sources of grant income

12.003                                     Period over which grant should be taken into account

12.004                                     Assessed contribution

12.005-12.006                         Amount of grant income

Covenant income where there is no grant income

12.007                                     Meaning of covenant income

12.008                                     Deed of covenant

12.009-12.010                         Amount to be taken into account

12.011                                     Disregards

12.012                                     Student loans

12.013                                     Eligibility for student loans

12.014-12.015                         Maximum student loans

12.016                                     Calculation of weekly income from student loans

12.017                                     Amount to be disregarded

12.018                                     Access funds

12.019-12.020                         Treatment of payments

13.       Transitional Provisions

 

Annex  A         Social Security Benefits Rates

Annex  B          Treatment of couples in claims for Income Support/Pension Credit

Annex  C         National Savings Certificate Values

Annex  D         Health and Social Services and Social Security Adjudication Act 1983

Annex E          Payment of Attendance Allowance / Disability Living Allowance (Care component)

Annex F          Payments of Income Support/Pension Credit and Retirement Pension for periods in Hospital

Annex G           Legislation for payment of War Widows and War Widowers Special Payments

Annex H           Draft Legal Agreement for Deferred Payments

Annex I            Pension Credit

Annex J            The Qualifying Age for the £20 Disregard

Annex K          Amending Circular Summary

 

                                               

 

 

 

 

 

 

 

           

 

 

 

 

 

 

 

 

 

 

                                   

SECTION 1 – INTRODUCTION

 

About this guidance

Revisions to the Guidance

 

1.001    This guidance has been revised at least annually since it was introduced in 1993.  For
this revision the opportunity has been taken update, re-number and re-order paragraphs where necessary and, therefore, there will not be an exact correlation with paragraph numbers in previous issues.    

 

            Status of the guidance

 

1.002    This guidance is issued under Section 7(1) of the Local Authority Social Services Act 1970 which requires local authorities to exercise Social Services functions under guidance of the Secretary of State. The powers exercisable by Ministers under the Local Authority Social Services Act 1970 (and also the National Assistance Act 1948) have been transferred to the Welsh Ministers.

 

            Acts of Parliament and Regulations

 

1.003    Where a paragraph in this guidance is directly linked to a section of the Act or a regulation, the relevant section or regulation is shown immediately following the text of the paragraph. Section refers to a section of the National Assistance Act 1948. Reg. refers to a regulation of the National Assistance (Assessment of Resources) Regulations 1992. Schedule refers to a schedule to the National Assistance (Assessment of Resources) Regulations 1992.

 

            Gender

 

1.004    In all paragraphs the words “he” or “his” should be taken as also referring to “she” or “her”. The male form has been used purely for ease of writing and reading.

 

General

 

            Statutory basis

 

1.005    Where a person is provided with accommodation under Part 3 of the National Assistance Act 1948, section 22 of that Act provides for him to be charged for the accommodation.

Section 22(1)

 

1.006    Section 22 requires the local authority to fix a standard rate for the accommodation. If a resident (i.e. a person who is provided, or proposed to be provided, with accommodation under Part 3) is unable to pay the standard rate, the local authority must assess their ability to pay, and decide what lower amount should be charged.    

 

Section 22(3)

 

1.006A There should be no charge made for aftercare services, which can include residential care, provided under Section 117 of the Mental Health Act 1983.

 

 

            Standard rate

 

1.007    Section 22 requires local authorities to set the standard rate for local authority homes at an amount equivalent to the full cost to the authority of providing the accommodation. Guidance on fixing a standard rate in local authority-managed homes is provided from time to time by the local authority associations.

            Section 22(2)

 

1.008    The standard rate for accommodation in care homes not managed by the local authority will be the gross cost to the local authority of providing or purchasing the accommodation under a contract with the independent sector home.

                        Section 26(2)

            Arrangements for accommodation

 

1.008A Where a local authority is considering whether to make arrangements for residential accommodation, and is determining whether care and attention are otherwise available to a person, section 21(2A) requires the authority to disregard the person’s capital up to the capital limit (see paragraph 6.003). Where a local authority needs to calculate a person’s capital for the purposes of section 21(2A), the capital shall be calculated in the same way as if he were a person for whom accommodation is proposed to be provided.                                                                                                                                                                                                   Section 21(2A) and (2B)

 

Assessing ability to pay and how much to charge

 

            Regulations

 

1.009    Where a resident (i.e. a person who is provided, or proposed to be provided, with accommodation under Part 3) is unable to pay either the standard rate or the actual cost incurred by the local authority, the local authority must assess his ability to pay using regulations made for that purpose. These are The National Assistance (Assessment of Resources) Regulations 1992.

Section 22(5)

 

            Local authority managed home

 

1.010    In local authority managed homes, the authority must charge the full cost of providing the accommodation – the “standard rate”. Where the local authority is satisfied that a resident is unable to pay the standard rate, it must assess his ability to pay and, on the basis of that assessment, decide the lower amount which should be paid.        

                                                                                                                                      Section 22(3)

            Independent homes

 

1.011    A contract made, showing services to meet assessed needs, with an independent home must include arrangements for the local authority to pay the home for the accommodation, as well as specifying the amount to be paid. The local authority must then ask the resident to refund that amount to the authority. Where the resident satisfies the local authority that he is unable to make a full refund, the local authority must assess their ability to pay in the same way as a person in a local authority managed home, and decide the lower amount to be refunded. (See 1.023 and 1.024 for collection of charges).

Sections 26(2) and 26(3)

            Nursing mothers

 

1.012    Section 21(1)(aa) of the National Assistance Act 1948 allows for the provision of residential accommodation for nursing mothers. Because of this, a local authority should charge for the accommodation under the rules contained in this guidance. In these circumstances it may be necessary for local authorities to vary the amount of Personal Expenses Allowance to reflect the needs of the infant (see 5.007).

           

            Residents with a dependent child

 

1.013    Similarly, where a person placed in residential accommodation has a dependent child, the local authority will need to consider using the powers in Section 22(4) of the National Assistance Act 1948 to vary the amount of personal expenses allowance needed by the resident to reflect the needs of the dependent child (see 5.007).

           

            Reduction for assistance in running a local authority managed home

 

1.014    Section 23 of the Act allows local authorities to make rules governing the running of residential accommodation managed by them. These rules may provide for part of the charge for accommodation to be waived where a resident helps in running the home. The payment the resident is liable to make must be determined in accordance with section 22, and the local authority may then waive part of that charge in accordance with the rules made.

                                                                                                             Section 23(3)

 

1.015    The provisions in paragraph 1.013 do not apply to people in homes that are not managed by the local authority.

 

            Information to be given to the resident

 

1.016    The local authority must ensure that the resident is given a clear explanation, usually in writing, of how the assessment of his ability to pay has been carried out. This should explain the usual weekly assessed charge. They should also inform the resident of the reasons why the charge may fluctuate, particularly where a new resident’s charge may vary in the first few weeks of admission because, for instance, of the effect of benefit paydays on Income Support/Pension Credit or the withdrawal of Attendance Allowance or Disability Living Allowance (Care component). The resident should, however, be informed of why the charge may fluctuate. There is no requirement to specify the assessed charge in the contract with the home.

            Residents and Enduring Power of Attorney, Lasting Power of Attorney or Property and  Affairs Deputyship etc

 

1.017     In all cases, the local authority should find out if a resident has any of the following:

  • Enduring Power of Attorney (EPA);
  • Lasting Power of Attorney (LPA) for Property and Affairs;
  • Property and Affairs Deputyship under the Court of Protection; or
  • any other dealings with the resident’s affairs (e.g. someone who has been given appointee-ship by the Department for Work and Pensions (DWP) for the purpose of Benefit payments).

 

1.18  Social work staff should establish at the time of the assessment of care needs whether a        resident has capacity to consent to the care plan and any following financial assessment.  If a resident appears to lack the capacity to consent to their financial information being given to the authority, while all practicable steps have been taken to help the resident, the authority should make enquiries as to whether there is a registered EPA, or registered LPA for Property and Affairs, or a Property and Affairs Deputy to manage the person’s financial affairs, or an Appointee by the Secretary of State for Work and Pensions to manage the person’s benefits.

 

  • An EPA can be used without being registered whilst the resident has capacity, provided the resident consents.  If the resident loses capacity an EPA cannot be used without being registered, though it can still be used for essentials whilst in the process of being registered (e.g. it can be used for the payment of regular bills, but not major matters, such as selling a house).  An attorney can only apply to register an EPA when they believe the resident is loosing capacity.  LPA replaced EPA on 1 October 2007.  A person given power under an EPA before 1 October 2007 can still use it and apply to have it registered.
  • A Property and Affairs LPA can only be used when it has been registered.  However, a LPA can be registered whilst the person has capacity.
  • With regard to a person appointed by the Secretary of State for Work and pensions to manage the person’s benefits, unless such a  person falls within one of the other categories (e.g. EPA or LPA) the appointee has no power to make decisions on behalf of someone who lacks capacity except in relation to benefits as provided under DWP regulations.

While residents have capacity, they may wish to choose whether to give the information themselves or to pass this onto their Attorney.

1.019    If there is no one acting in this capacity, and if, following an assessment of capacity to
make financial decisions, it is considered that the person does not have the capacity to
manage some or all of their finances, the authority should satisfy itself under its duty of
care that there are arrangements put in place which meet the requirements of the Mental
Capacity Act 2005.  Provision of services should not be delayed whilst applications are
made to register an EPA Property and Affairs LPA or to appoint a Property and Affairs
Deputy or an Appointee.

 

            Treatment of fractions in assessment

 

1.020  When any calculation in the assessment results in a fraction of a penny, round up if that    

would be in the resident’s favour, otherwise round down.                                                        

Reg 4

 

Social Security benefits

 

            Local authority managed homes

 

1.021    With effect from 6 October 2003 the Part 3 rate of Income Support/Minimum Income Guarantee was abolished and people in residential accommodation, which is managed or provided by a local authority, are entitled to normal rates of Income Support/Pension Credit.

 

1.022    People in residential accommodation which is managed or provided by a local authority but which does not include board are entitled to Income Support/Pension Credit as if they were living in their own home and may claim Housing Benefit.

 

            Independent homes

 

1.023    With effect from 6 October 2003 the residential allowance element of Income Support/Minimum Income Guarantee was abolished and people in registered independent residential care homes, including those providing nursing care, are entitled to normal rates of Income Support/Pension Credit.  They are not entitled to Housing Benefit.

 

1.024    People in unregistered independent residential accommodation are entitled to Income Support/Pension Credit at the same rate as if they were living in their own homes and may claim Housing Benefit plus Supporting People payment where appropriate.

 

            Attendance Allowance / Disability Living Allowance (Care Component)

 

1.024A  See Annex E for details of entitlement to Attendance Allowance and Disability Living Allowance (DLA) (Care Component).

 

            Admission to Hospital

 

1.025    When a resident is admitted to hospital, in some circumstances his Social Security benefits might be reduced after a period. See Annex F for details.

 

Collecting charges from residents in independent homes

           

            Resident to pay the charges direct to the home

 

1.026    Normally, residents will pay their assessed charge direct to the local authority. However, Section 26(3A) of the National Assistance Act 1948 provides for an exception to this rule for residents placed by local authorities in independent sector homes: where the resident, the local authority, and the organisation or person managing the premises all agree, the resident may pay direct to the home the amount that he or she would otherwise pay to the local authority. This will leave the local authority responsible for paying the home the remainder of the cost.  N.B. Wherever possible residents should be offered a choice as to whether they wish to pay their contribution directly to the care home or if they would prefer the authority to pay gross and pay their contribution to the authority.

Liability
for payment to the home

 

1.027    This exception to the normal rule is an administrative easement which will be particularly useful where the resident and home provider wish to maintain a form of landlord – tenant relationship, for example, where the premises are provided by a housing association. However, authorities should note that they remain responsible for the full amount should the resident fail to pay the home as agreed. In such a case the authority will recover the charge from the resident in the normal way.  It is not good practice to expect the care home to recover any debt owed to the local authority.

Section 26(3A)(a)

            Charges for Day Care Services

 

1.027A Residents should not be charged extra for day time activities which have been negotiated as part of the residential care package, as the cost of these services would already be included in the standard charge agreed by the local authority for that package. Where a separate package of services has been arranged by the local authority for a resident then it can consider whether to charge the resident extra for these services (see “Fairer Charging Policies for Home Care and Other Non-Residential Social Services”at wales.gov.uk/topics/health/publications/socialcare/guidance1/fairercharging/?lang=en. As the resident may only have their PEA and any disregarded income available, the amount charged (if any) is likely to be minimal.

 

            Preserved rights

 

1.028    Following the full implementation of the community care reforms in April 1993, individuals who were in receipt of special levels of Income Support/Minimum Income Guarantee to fund their stays in residential accommodation had their entitlement to this support preserved.  Under section 26A of the National Assistance Act 1948, local authorities had the power to make residential accommodation arrangements for specified categories of these preserved rights cases. Where such arrangements were in place, the charging rules set out in CRAG applied.   From 8 April 2002, all entitlement to preserved rights came to an end and section 26A ceased to have effect.  Any arrangements made under section 26A ended, and the Assessment of Resources Regulations and this guidance applies in the usual way to all persons formerly entitled to preserved rights.

 

            Liaison with Department for Work and Pensions/Jobcentres/the Pensions Service

 

1.029    It is important that local authorities maintain good liaison arrangements with Jobcentres/the Pension Services as in some aspects of the assessment the authority, if they have not been able to obtain necessary information from the resident or another source with due account of the common law duty of confidentiality, may need to contact the Jobcentres/the Pension Services. In this respect a consent form has been developed by DWP for individuals to complete so that information on the detailed breakdown of the rate of benefit they can receive can, with their consent, be shared with authorities as appropriate.  The full title of the form is Customer’s Consent to the DWP Disclosing their Benefit Entitlement Information to the LA for Community Care Assessment Purposes.  Please note – local authorities should not approach DWP or the offices of Jobcentre Plus or the Pension Services if they can obtain accurate breakdowns of entitlement from residents.

 

            Complaints

 

1.30      Complaints about the level of charge levied by a local authority are subject to the usual social services complaints procedures described in “Listening and Learning: A guide to handling complaints and representations in local authority social services in Wales” issued in April 2006.

 

            Permanent and Temporary Stays

 

1.031    Admissions to residential accommodation should be deemed temporary or permanent depending solely on the needs and circumstances of individual service users. As such, authorities’ or users’ resources should play no part in the decision. Knowing whether they are permanent or temporary will matter a great deal to residents and carers. Hence decisions about the status of admission should be made, agreed and shared, openly with them – or others on their behalf if appropriate – and put in writing.

 

SECTION 2 – LESS DEPENDENT RESIDENTS

 

 

            Background

 

2.001    Before April 1993, local authorities had powers to arrange for the provision of residential accommodation under:

 

a)    the National Assistance Act 1948; and

 

b)    the National Health Service Act 1977.

 

2.002    The powers to provide accommodation under the National Health Service Act 1977 were repealed from 1st April 1993 by the National Health Service and Community Care Act 1990.

 

            National Health Service Act 1977 (NHS Act 1977)

 

2.003    The NHS Act 1977 was used to provide accommodation mainly for people who were able to live more independently than those accommodated under the National Assistance Act, but who nevertheless required some degree of care and support. These were mostly (but not always) people under pension age.

 

2.004    Local authorities were not required to charge for accommodation arranged under the NHS Act 1977. They were empowered to make a reasonable charge where appropriate, but were not required to assess the resident’s ability to pay. This meant that the money left with residents for their personal use was not limited to the prescribed amount for personal expenses allowed for people accommodated under the National Assistance Act.

 

2.005    This provision existed because less dependent residents are encouraged to live as independently as possible, perhaps with a view to eventually living independently in the community. They need extra money for, e.g. the cost of food or household expenses, or travel to work.

 

            Effect of repeal of powers under the NHS Act 1977

 

2.006    Subject to the exemption outlined in 1.006A, all adult residential accommodation placements made by local authorities, including those for people who are less dependent, are made under the National Assistance Act 1948. Under this Act, a charge must be made for the accommodation. If a resident can not pay the full charge, the local authority is required to assess his ability to pay in accordance with The National Assistance (Assessment of Resources) Regulations 1992.

 

2.007    It is recognised that the normal charging rules would not be appropriate for “less dependent” residents because they will usually need to be left with more than the standard personal expenses allowance if they are to live as independently as possible. There is special provision in the regulations, therefore, to enable local authorities to continue to treat “less dependent” residents differently where they consider it reasonable in the circumstances to do so.  

            Reg 5

 

 

 

 

            Identifying “less dependent” residents

 

2.008    For the purposes of the charging rules a “less dependent” resident is a person who is in, or for whom accommodation and board is proposed to be provided in, premises which are not an establishment which is carried on or managed by a person who is registered under Part 2 of the Care Standards Act 2000.

 

Reg 2(1)

            Definition of board

 

2.009    In 2.008 above, “board” means at least some cooked or prepared meals, cooked or prepared by someone other than the resident (or a member of his family) and eaten in the accommodation, where the cost of the meals is included in the standard rate fixed for the accommodation.

            Reg 2

            Assessing “less dependent” residents

 

2.010    It is up to the local authority how much it decides is reasonable to disregard of the resources of a person who is “less dependent”. Factors to be taken into account include:

 

  • the resident’s commitments, i.e. to what extent is he incurring costs directly for necessities such as food, fuel and clothing

 

  • the degree of the resident’s independence, i.e. to what extent should he be encouraged to take on expenditure commitments

 

  • whether he needs a greater incentive to become more independent, e.g. he may be encouraged to take on paid employment if most or all of his earnings and any Working Tax Credit received are disregarded.

            Reg 5

 

2.011    Where a resident is in, or for whom accommodation is proposed to be provided in, premises which are not an establishment which is carried on or managed by a person who is registered under Part 2 of the Care Standards Act 2000 the capital limits for Income Support and Housing Benefit will be £10,000 and £16,000.  For Pension Credit there will be a lower limit only of £10,000.

 

 

SECTION 3 – TEMPORARY RESIDENTS

 

            Who is a temporary resident?

 

3.001    The definition of temporary resident contained in the regulations, is a resident whose stay is unlikely to exceed 52 weeks, or, in exceptional circumstances, is unlikely to substantially exceed 52 weeks.

            Reg 2(1)

 

3.001A An admission is temporary either if the agreed intention is for it to last for a limited time period, such as respite or intermediate care, or there is uncertainty that permanent admission is required.

 

3.001B An admission is permanent if the agreed intention is for the resident to remain in residential accommodation.

 

3.002    Decisions on the temporary or permanent status of a resident must have been agreed with the resident and/or their representative and included in the written care plan.

3.003    A stay, which was initially expected to be permanent may, in fact become temporary (e.g. an unexpected improvement allowing discharge).  In such cases the resident should be treated as temporary from the date of admission.  It would be unreasonable to apply to the resident rules which would affect him as a permanent resident (e.g. treatment of the resident’s former home, in particular placing a charge on the resident’s interest in the property).

3.004    Similarly a stay, which was initially expected to be temporary, may become permanent but in such cases the financial assessment as a permanent resident should only be from the date that an amendment to the care plan has been agreed with the resident and/or their representative.

 

3.005    Where a temporary resident has a partner their resources cannot be jointly assessed (see Section 4).

 

3.006    The status of a resident may affect the amount of Income Support/Pension Credit payable:
a)    a temporary resident may receive Income Support/Pension Credit which
includes an amount in respect of housing costs or any Housing benefit and/or
Council Tax Benefit entitlement may continue to be paid in respect of their
home in the community

b)    a trial period resident may only receive Income Support/Pension Credit
housing costs or Housing Benefit and/or Council Tax Benefit for 13 weeks  (see WOC 22/95 paragraphs 7 to 11).

 

Charging for the first 8 weeks

 

            Up to 8 weeks

 

3.007    An assessment of ability to pay is not required for the first eight weeks of a stay. It is  for the local authority to decide whether it will carry out a financial assessment or whether it will charge an amount that it appears reasonable for the resident to pay.  If it is decided to carry out a financial assessment the calculation should be in accordance with Sections 4 to 12.                                                                                                                  

                        Section 22(5A)

 

            After 8 weeks

 

3.008    After 8 weeks, the local authority must charge the resident at the standard rate for the accommodation and carry out an assessment of his ability to pay.

 

            Income Support/Pension Credit for temporary residents

 

3.008A Where a resident enters residential accommodation for a temporary period the amount of any Income Support or Pension Credit in payment will usually remain the same because they will be treated as normally residing in their own home.  However, if the severe disability premium and the enhanced disability premium (if appropriate) are included in the Income Support calculation or the severe disability additional amount is included in the Pension Credit calculation, they will no longer be included where Disability Living Allowance care component/Attendance Allowance has ceased.  There are special rules for Income Support and income related Employment Support Allowance where one member of a couple enters residential accommodation for a temporary period (see Annex B).

3.008B The lower capital limit for temporary residents in receipt of Income Support or income related Employment and Support Allowance is £6,000.  The lower capital limit of £10,000 is only applied to permanent residents in receipt of Income Support or income related Employment and Support Allowance and any resident in receipt of Pension Credit.

 

            Assessing ability to pay

 

3.009    If the local authority decides to make an assessment straight away, or from the eighth week, his ability to pay should be assessed in accordance with the following paragraphs.

 

            Capital

 

3.010    Disregard the dwelling normally occupied as the resident’s home where:

 

a.)   the resident intends to return to occupy that dwelling and that the dwelling is still available to him; or

 

b.)   he is taking reasonable steps to dispose of the property in order to acquire another more suitable home to which he will return.

            Schedule 4 para.1

 

For all other capital assets, follow the guidance in Section 6.

 

            Income

 

3.011    If Income Support/Pension Credit is in payment, check, from the resident’s notice of award of Income Support/Pension Credit, whether the benefit includes an amount in respect of housing costs. If it does, disregard the amount allowed. Income Support/Pension Credit may be paid for home commitments for up to 52 weeks on admission to residential accommodation.

            Schedule 3 para.26

 

3.012    If Housing Benefit is in payment in respect of the home address, disregard the amount of HB in full.                                                                                      Schedule 3 para.3

 

3.012A From 1 April 2003, under new “Supporting People” arrangements, local authorities have powers to make payments for housing support charges in respect of a resident’s home address.  Such payments are made to assist independent living and may be made by the local authority to residents or to housing or support providers on a resident’s behalf.  If liability to meet charges continues whilst a resident is in a care home, payments from the local authority to meet the charges can be disregarded in the assessment of a resident’s income or capital.  Payments that should be disregarded are those which are made to meet charges that are of a kind that would have qualified for Housing Benefit or Income Support/Minimum Income Guarantee prior to 1 April 2003, under the transitional Housing Benefit scheme which prepared for the introduction of “Supporting People”.  Payments that should be disregarded are set out in schedule 1B of the Housing Benefit (General) Regulations 1987 (as in force immediately before 1 April 2003).  These are broadly defined to include activities necessary to support individuals in independent tenancies, and may include payments to meet charges for:

 

  • a warden in sheltered housing;
  • emergency alarms;
  • cleaning of rooms and windows if the resident or someone in the household is unable to clean them himself;
  • general support and counselling to assist a resident to comply with the terms of the tenancy agreement, for example, maintaining the safety and security of their dwelling, or keeping the interior of the dwelling in an appropriate condition.

 

Additionally, where a resident is paying part or all of the cost of a housing support service himself this amount should be disregarded from the assessment of income and capital.

                        Schedule 3 paras 28D and 28E, Schedule 4 paras 22 and 23

 

3.013    Income Support/Pension Credit, Housing Benefit and Supporting People payments may not meet the full cost of continuing home commitments. Where there are extra costs, disregard such additional amounts as appears reasonable. Extra costs might be:

 

  • a fixed heating charge;

 

  • water rates;

 

  • mortgage payment or rent not met by Income Support/Minimum Income Guarantee

 

  • service charges not met by Income Support/Minimum Income Guarantee

 

  • insurance premiums

 

  • housing support charges not met by the local authority

 

                               Schedule 3 para.27

 

3.014    Where neither Income Support/Pension Credit, Housing Benefit nor Supporting People payments are in payment, in respect of the home address, assess the resident’s income in accordance with Sections 8 and 9, and then disregard from the total such amount as appears reasonable to allow in respect of home commitments. Such expenses might be:

 

  • interest charges on:
    • hire purchase agreement to buy the dwelling occupied as the home (e.g. a caravan)
    • loans for repairs or improvements to the dwelling
    • mortgage payments
  • ground rent or other rental relating to a long tenancy

 

  • service charges (e.g. regular charge payable to the management company of a block of flats)

 

  • housing support charges (made under Supporting People)

 

  • any insurance premiums

 

  • standard charges for fuel

 

  • water rates

 

  • payments under:

 

  • co-ownership scheme
  • tenancy agreement or licence of a Crown tenant

                   Schedule 3 para.27

 

A disregard on income to meet these expenses should also be allowed if the resident is taking reasonable steps to dispose of the property in order to acquire another more suitable home to which he will return.

            Schedule 3 para. 27

 

3.014A Any cash payment made to a temporary resident in lieu of discretionary coal is fully disregarded.

                                               Schedule 3, para 28    

            Couples

 

3.015    Where one or both members of a couple, including civil partners, are temporarily in residential accommodation see Section 4 for their assessment.

 

            Attendance Allowance (AA) / Disability Living Allowance (DLA) Care Component

 

3.016    Where the resident is a temporary resident, AA or DLA Care Component should be completely ignored – but remember that either benefit will be withdrawn after four weeks if the resident is relying on public support. These rules also cover Constant Attendance Allowance and Exceptionally Severe Disability Allowance payable with Industrial Injuries Disablement Benefit or War Disablement Pension.                                                    

                        Schedule 3 para.6

 

 

 

 

 

SECTION 4 – COUPLES

 

Local Authority treatment of couples

 

4.001    Under the National Assistance Act 1948, the local authority has no power to assess a couple, or civil partners, according to their joint resources. Each person entering residential care should be assessed according to their individual means.

 

4.002    SPARE

 

4.003    The authority should attempt to identify cases where a resident is the main recipient of the couple’s income, and the assessment of the resident’s financial contribution could result in a substantial reduction in the amount of income remaining for the spouse, or civil partner, at home. In such cases the local authority should consider increasing the resident’s personal expenses allowance, as described in Section 5, in order to leave enough for them to continue to support their partner at home. The use of this discretion should be considered and negotiated in the light of the individual circumstances of each case, but it would be reasonable for the authority to take into account factors such as the usual standard of living of the spouse, or civil partner, at home, and if the spouse, or civil partner, has higher than average outgoings for whatever reason. However, the weight to be attached to these considerations will be for the authority themselves to determine.

 

            Capital limits for couples, including civil partners

 

4.003A Where a resident is one of a couple (irrespective of whether the resident’s stay is permanent or temporary, or whether the other member of the couple is also a resident or remains in the former home) the resident must have in excess of £23,250 capital in his own right, or his share of jointly owned capital must be in excess of £23,250 before he is excluded from support on the grounds of capital.

 

            Temporary residents

 

4.004    Where a member, or both members, of a married couple, or civil partners, are admitted to residential accommodation on a temporary basis their ability to contribute towards the charge should be assessed individually according to Section 3. In every case, the authority must assess each resident separately. Disregard any Income Support/Pension Credit awarded in respect of home commitments. Income Support/Pension Credit and Housing Benefit may not meet the full cost of continuing home commitments. Where there are extra costs, disregard such additional amount as appears reasonable. Extra costs might include:

 

  • a fixed heating charge;

 

  • water rates;

 

  • mortgage payments, rent or service charges not met by Income Support/Pension Credit/Housing Benefit

 

  • insurance premiums

 

 

4.004A It will be important for local authorities to consider most carefully the needs of couples, or civil partners, in receipt of Pension Credit in this regard as, on the face of it, they now received less benefit than younger individuals.

 

4.005    It will be useful to know how Income Support/Pension Credit will be calculated in these cases; this may give a guideline as to how much the spouse, or civil partner remaining at home is likely to be able to contribute towards the charge.  Where Income Support/Pension Credit is being paid for a couple, or civil partners it would be reasonable to expect the partner receiving the Income Support/Pension Credit to contribute towards the charge for accommodation for the other partner a sum equivalent to the Income Support/Pension Credit payable for that partner.  If Income Support/Pension Credit is paid to the partner in residential accommodation, the full amount will have to be taken into account but the local authority could consider varying the personal expenses allowance as described in section 5 in order to leave enough for the partner at home to meet their expenses. The authority should discuss with the partner remaining at home any financial commitments that may be taken into account.

4.006    Local authorities should ensure that the partner remaining at home receives, as a minimum, the basic level of income support/pension credit for a single person and any premiums/additions to which they may be entitled in their own right.  This may involve a voluntary agreement by the partner to disclose information to achieve this.

 

            Permanent Residents

 

4.007    Where one, or both, members of a couple, or civil partnership are admitted permanently to residential accommodation the local authority must assess their ability to contribute towards the charge according to their individual resources following the rules laid down in Sections 5 to 13.

 

Note: Paragraphs relating to how state benefits are calculated for couples have been deleted and reproduced at Annex B

 

 


SECTION 5 -PERSONAL EXPENSES ALLOWANCE

 

            Purpose of the Personal Expenses Allowance

 

5.001  The Personal Expenses Allowance (PEA) is intended to enable residents to have money
to spend as they wish.  In assessing a resident’s ability to pay for his accommodation, the local authority is required to ensure that he retains an amount for personal expenses.
                                                                                                                                          

                                                                                                                        Section 22(4)

5.002 Authorities are reminded that PEA should not be spent on aspects of board, lodgings and

care that have been contracted for by the authority and/or have been assessed as necessary

to meet individuals’ needs by the authority and the NHS.  In this regard, authorities
should ensure that an individual resident’s needs for continence supplies is fully reflected
in their care plan.  Neither authorities nor providers of residential care have the authority
to require residents to spend their PEA in particular ways.

5.003 Authorities are reminded that, based on a financial assessment of an individuals’ resources,

individuals must be left with the full value of their PEA. It is then up to each resident to

determine how the PEA is spent. This does not preclude residents buying extra services

from the care home, where these are genuinely additional to those services that have been

contracted for by the authority and/or have been assessed as necessary by the authority or

NHS. Nor does it preclude arrangements agreed between the resident and the care home,

particularly where the care home manager is acting as agent or appointee of the resident,

for the PEA received by the resident to be reduced on an occasional or routine basis for the

purchase of additional services. Authorities are also reminded that under Section 22(4) of

the National Assistance Act 1948 they have the power to increase the PEA in special
circumstances (see 5.007). This will be particularly important for residents where certain activities or services, although not specifically included in their care plan, can nevertheless contribute significantly to optimum independence and well-being.

 

5.004    See NAFWC 14/02 for fuller guidance.

            Amount of Personal Expenses Allowance

 

5.005    The amount allowed in the assessment for personal expenses is laid down each year in the National Assistance (Sums For Personal Requirements) (Wales) Regulations and is the same for each resident whether they are in a local authority run home or an independent sector home.   It is currently £24.00 per week.

 

5.006    If a resident has no income, it is not the responsibility of the local authority to make a
PEA payment to them.  It would be expected that the local authority would assist the
resident to access a welfare benefits or independent advocacy service to resolve this.

 

            Varying the amount of Personal Expenses Allowance

 

5.007    Under section 22(4) of the National Assistance Act of 1948 local authorities have the power to allow a different amount from that prescribed for personal expenses in special circumstances.  Examples of where a local authority might consider allowing a different amount are:

 

 

  • someone who does not qualify as a “less dependent” resident solely because he lives in registered private or voluntary sector accommodation or in local authority accommodation where board is provided and therefore cannot be assessed under the rules described in Section 2 but who, nonetheless, needs to retain more of his income in order to help him lead a more independent life, for example if he is working.

 

  • Where a person in residential accommodation has a dependent child, the local authority should consider the needs of the child in setting the personal expenses allowance in addition to disregarding any Child Tax Credit in payment.  This applies whether or not the child has accompanied the person into the accommodation, and will be particularly important where the resident has income which is taken fully into account (see section 8 and 9 of this guidance) in the charging assessment (e.g Income Support/Pension Credit, and Child Benefit and Child Support Maintenance Payments where the child is accommodated with the resident under Part 3 of the National Assistance Act 1948).

 

  • Where a person temporarily in residential accommodation receives Income Support/Pension Credit including an amount for a partner who remains at home (see 4.006) the local authority should consider the needs of the person at home in setting the personal expenses allowance.

 

  • Local authorities are required to ignore half of a resident’s occupational pension, personal pension or retirement annuity contract where the resident is paying half of that pension to a spouse, or civil partner (see 8.023A).  This disregard does not cover unmarried couples.  Where the person in residential accommodation is the main recipient of an unmarried couple’s overall income (e,g. occupational pension), the local authority can use its discretion to increase the resident’s personal expenses allowance in special circumstances to enable the resident to pass some of that income to the partner remaining at home.  In considering this, the local authority should bear in mind the effects it could have on benefits such as Income Support/Pension Credit, Housing Benefits and Council Tax Benefit of increasing the partner’s income, as increasing the partner’s income in this way may lead to a reduction in benefits resulting in the partner being no better off and no worse off.

 

  • Where a person is responsible for a property that has been disregarded, for example, because they are temporary or they qualify for one of the mandatory property disregards, the local authority should consider increasing the person’s PEA to meet any resultant costs. Local authorities should make a specific effort to address this issue in the assessment and could usefully include appropriate questions in their financial assessment forms.

 

 

 

 

 

 

 

 

 

 

SECTION 6 -CAPITAL

 

            What is capital?

 

6.001    A resident’s resources are either capital or income. It may not always be obvious whether a payment should be treated as capital or income, but generally, a payment of capital is one which is:

 

a)         not in respect of a specified period; and

 

b)         not intended to form part of a series of payments.

 

            Types of capital

 

6.002    Examples of capital are shown in the following list. The list is intended as a guide and is not exhaustive.

 

  • Buildings

 

  • Land

 

  • National Savings Certificates and Ulster Savings Certificates

 

  • Premium Bonds

 

  • Stocks and shares

 

  • Capital held by the Court of Protection or a Deputy appointed by that Court

 

  • Any savings held in:

 

  • building society accounts – income which is paid into an account becomes capital once the period over which it is taken into account as income expires.
  • bank current accounts, deposit accounts or special investment accounts. This includes savings held in the National Savings Bank, Girobank and Trustee Savings Bank – income which is paid into an account becomes capital once the period over which it is taken into account as income expires.
  • SAYE schemes
  • Individual Savings Accounts (ISAs) and Tax Exempt Special Savings Accounts (TESSAs)
  • Unit Trusts
  • Co-operative share accounts
  • cash
  • trust funds (see Section 10) 

 

            Treatment of Investment Bonds

 

6.002A The treatment of investment bonds in the financial assessment for residential accommodation is complex because, in part, of the differing products that are on offer.  For this reason authorities should seek the advice of their legal departments when they arise.  However, it is possible to offer some general advice and authorities are referred to Social Security Commissioner’s decision R (IS) 7/98 which rules that an investment bond falls within the disregard by virtue of its intrinsic nature as a policy of life assurance.  N.B. The AOR are largely based on Income Support Regulations.

 

6.002B Authorities are advised that if an investment bond is written as one or more life insurance policies that contain cash-in rights by way of options for total or partial surrender, then the value of those rights has to be disregarded as a capital asset in the financial assessment for residential accommodation (see paragraph 15, schedule 10 of the Income Support (General) Regulations 1987.  In contrast, the surrender value of an investment bond without life assurance is taken into account.

 

6.002C Income from investment bonds, with or without life assurance, is taken into account in the financial assessment for residential accommodation.  Actual payments of capital by periodic instalments from investment bonds, with or without life insurance, are treated as income and taken into account provided that such payments are outstanding on the first day that the resident becomes liable to pay for his accommodation and the aggregate of the outstanding instalment, and any other capital sum not disregarded, exceed £16,000 (see also 8.014A).

 

Effect of capital

 

            Capital limits

 

6.003 A resident with capital of more than £23,250 is liable to pay the standard charge for the accommodation, if in a local authority home, or the full amount of the contracted fee if in an independent sector home. If a resident has more than £23,250 there is no need to make a wider assessment of his ability to pay. Where a resident is one of a couple, or a civil partnership the resident is liable to pay the standard rate or full contracted fee if they have more than £23,250 in their own right; or if their own capital and their share of jointly held capital is more than £23,250.                                                                                                                                                                                                                                                                                                           Reg 20

 

6.004    Capital of £23,250 or less is fully disregarded.

 

6.005    Capital over £23,250 is taken into account in full.

           

6.006    SPARE.

 

6.006A SPARE

 

 

Beneficial ownership of capital

 

            Does the resident own the capital?

 

6.007    A capital asset normally belongs to the person in whose name it is held. The following paragraphs provide guidance on how to establish beneficial ownership where there is a dispute.

 

            Ownership disputed

 

6.008    Where ownership is disputed, ask for written evidence to prove ownership. Where a resident is said to be holding capital for another person, obtain evidence of the arrangement and the origin of the capital, and evidence to show the intentions for its future use and for its return to the rightful owner.

 

            Examples

1.         A resident has £14,000 in a building society account in his own name. He says that £3000 is set aside for his grandson’s education. However, there is no deed of trust or other legal arrangement which would prevent the resident using the whole amount for his own purposes. The resident is treated as the beneficial owner of the whole amount.

 

  1. A resident has £10,000 in a bank account in his own name, and shares valued at £6,500. He provides evidence to show that the shares were purchased on behalf of his son, who is abroad, and that they will be transferred to his son when he returns to Britain. Although the resident is the legal owner, he is holding the shares in trust for his son, who is the beneficial owner. £10,000 is to be treated as the resident’s capital.

 

6.009    SPARE

 

            Joint beneficial ownership of capital

 

6.010    Where a resident has joint beneficial ownership of capital, unless it is an interest in land (see Section 7), divide the total value equally between the joint owners, and treat the resident as owning an equal share. This method of treatment avoids administrative difficulties. Once the resident is in sole possession of his actual share, treat him as owning that actual amount.

            Reg 27(1)

 

            Examples

A resident and her daughter have £21,000 in a joint building society account. The resident contributed £8,500 and the resident’s daughter, £12,500. Treat the resident as owning £10,500.

 

The joint account is then closed and the resident and her daughter open separate accounts. The resident has £8,500 in her account. Treat her as owning £8,500.

 

Treatment of capital

 

            Valuation

 

6.011    For the purposes of valuation only, the value of a capital asset (for example property) other than National Savings Certificates (see 6.018) is the current market or surrender value, whichever is higher, less:

 

a)   10% of that value if there would be any expenses involved in selling the asset only where there will be actual expenses.  The expenses must be connected with the actual sale, and not simply the realisation of an asset e.g. the cost of fares to withdraw money from a bank are not expenses of sale.  The deduction is always 10% even if it is known from the outset that the actual expenses will be more or less that 10%; and

    Reg. 23(1)(a)

b)    any outstanding debts secured on the asset, e.g. a mortgage.               Reg. 23(1)(b)

 

6.012    A capital asset may have a current market value (e.g. stocks or shares) or a surrender (e.g. premium bonds) value. The current market value will be the price a willing buyer would pay to a willing seller. The way the market value is obtained will depend on the type of asset held, e.g. the values of stocks and shares or unit trusts are quoted in newspapers.

 

6.013    If the resident and the assessing officer both agree that, after deducting the amounts in paragraph 6.011 (a) and (b) (where appropriate), the total value of the resident’s capital will be:

 

a)  more than £23,250; or

 

b)  £23,250 or less

 

it is not necessary to obtain a precise valuation. If there is any dispute, obtain a precise valuation.

 

6.014    In the case of land, buildings or a house where it is necessary to obtain a precise valuation because of a dispute, a professional valuer should be asked to provide a current market valuation. (see Section 7 for the treatment of property)

 

            Expenses of sale

 

6.015    Once the asset has been sold (e.g. a property), the capital to be taken into account is the actual amount realised from the sale less the actual expenses of sale.

 

6.016    SPARE

 

            Debt secured on asset

 

6.017    “Secured on” means a legal charge or mortgage must have been made on the capital asset.

 

            Example

A resident owns a property which comprises a house and garden (his home), plus an extra piece of land which, although attached to the garden, is not part of it. It has been decided to disregard the value of the resident’s former home, but to take into account the value of the extra land because it does not form part of the resident’s “home” and could be sold separately. The resident has a mortgage secured on the whole of the property (i.e. the house, garden and extra land).

The value of the land to be taken into account is the market value of that piece of land, less 10% of that value for expenses of sale and the whole of the mortgage secured on the home and the extra land.

 

            National Savings Certificates

 

6.018    The value of National Savings Certificates is:

 

a)  if sale of the issue ceased before the first day of the July immediately before the resident entered residential care, the price they would have realised on that 1st July if they had been purchased on the last day of the issue; and

 

b)  in any other case, the purchase price.                                             Reg 23(2)

 

            Annex C is a table of the value of each issue

 

            Disregards on capital

 

6.019    Different types of capital will be disregarded for different periods as covered in paragraphs 6.020 to 6.035.

 

            Capital held abroad 

 

6.020    If capital is held in a country outside the UK (i.e. England, Scotland, Wales, Northern Ireland,) the amount to be taken into account in the assessment of the resident’s ability to pay will depend on the conditions for transfer to the UK.                      Reg.24

 

            Transfer of capital to UK not prohibited

 

6.021    Where capital is held abroad and all of it can be transferred to the UK, its value in the other country should be obtained and taken into account less any appropriate deductions under 6.011.

           

            Sources of valuation

 

6.022    To establish the value of capital in a country outside the UK, examples of the source of information include:

 

  • a bank of the country concerned, including branches in the UK.

 

  • a solicitor

 

  • an accountant

 

  • an estate agent (or similar person) in the country concerned

 

  • a stockbroker

 

6.023    Examples of the information required in the valuation include:

 

  • details of the asset

 

  • names of the beneficial owners

 

  • precise value of the asset (if known) but otherwise

 

  • an estimated value

or

  • if the asset is for sale, the price at which it is for sale (if that genuinely represents its current market value)

 

            Transfer to the UK prohibited

 

6.024    Where the resident represents that the value of any capital which he holds in a country outside the UK cannot be wholly transferred to the UK because of some prohibition in that country (e.g. currency restrictions) the local authority should require evidence confirming this fact. Acceptable evidence of the prohibition on transfer of value to the UK would include documents/letters from a Bank either in this country or abroad, or from a Government official or solicitor.

 

            Evidence required of value

 

6.025    If the evidence shows that some restriction prohibits the transfer of the value of any of the resident’s assets to the UK, the local authority should seek the following evidence:

 

  • details of the asset

 

  • its value in the country in which it is held

 

  • whether any money is available directly from the asset and, if so, the amount and date it would become payable

 

  • whether the asset is for sale and, if so, the progress and prospects of such a sale

 

  • the nature and terms of the restriction being imposed which prevents the transfer of all the capital to the UK (for example whether some capital can be transferred immediately and the remainder subsequently at intervals).

 

            Action on receipt of evidence

 

6.026    1.         If the transfer or the capital is prohibited, the authority should take into account the value that a willing buyer would pay in the UK for the assets. This may quite possibly be less than the market or surrender value in the foreign country.

 

2.         If restrictions do not exist, the capital should be valued as in 6.020 to 6.023.

 

            Capital not immediately realisable

 

6.027    Capital which is not immediately realisable (e.g. National Savings Bank investment accounts which require one month’s notice or Premium Bonds which may take several weeks to realise) should be taken into account in the normal way at its face value. This will be the value at the time of the financial assessment and will need to be confirmed, and adjustments made if necessary, when the capital is realised.  If the resident chooses not to realise the capital use the value at the time of assessment and re-assess at intervals in the normal way.

 

            Disregarded indefinitely

 

6.028    The capital assets listed below are disregarded indefinitely:

 

  •       property in specified circumstances (see Section 7)
  •       surrender value of any:

 

  •       life insurance policy                                           Schedule 4 para.13

 

  •       annuity                                                              Schedule 4 para.9

 

  •       payments of training bonus up to £200                            Schedule 4 para.17

 

  •       payments in kind from a charity                                      Schedule 4 para.17

 

  • any personal possession such as paintings or antiques unless they were purchased with the intention of reducing capital for the purpose of reducing the authority charge (see para 6.065)

                                                                                                         Schedule 4 para.8

 

  •             any capital which is to be treated as income or student loans (see para 6.036 to 6.038 and 12.012 to 12.017)                                     Schedule 4 para.14

 

  •       any payment made by or derived from:

 

  •       the Macfarlane Trust
  •       the Macfarlane (Special Payments) Trust
  •       the Macfarlane (Special Payment) (No.2) Trust
  •       the Fund (payments to non-haemophiliacs infected with HIV)
  •        the Eileen Trust
  •        the MFET Trust
  •       the Independent Living Fund (2006)
  •       the Skipton Fund
  •       the London Bombings relief Charitable Fund
  •        the Caxton Foundation
                            Schedule 4 para.15

Note:  On 11th January 2011, Ministers announced plans for new measures for people who contracted hepatitis C and HIV from contaminated blood.  These measures, including the creation of the Caxton Foundation came into force on 31st October 2011.  Local authorities should ensure their charging practices reflect this addition of the Caxton Foundation to the stated list of organisations above.

 

  •             the value of funds held in trust or administered by a court which derive  from a payment for personal injury to the resident (e.g. vaccine damage, criminal injuries compensation funds)

    Schedule 4 para.10 and 19

  •       the value of a right to receive:

 

  • income under an annuity                                          Schedule 4 para.9
  • outstanding instalments under an agreement to repay a capital sum

            Schedule 4 para.13

 

  • payment under a trust where the funds derive from a personal injury

            Schedule 4 para.10

  • income under a life interest or a life-rent                   Schedule 4 para.11
  • income (including earnings) payable in a country outside the UK which cannot be transferred to the UK                              Schedule 4 para.12
  • an occupational pension                                           Schedule 4 para.15
  • any rent                                                                  Schedule 4 para.15

(N.B.  This does not necessarily mean that the income is disregarded –see section 8 for the appropriate guidance.)

 

  • Capital derived from an award of damages for personal injury and which is administered by a court or which can only be disposed of by a court order or
    direction.                                         Regulation 21(2) and Schedule 4 paragraph 19
  • The value of the right to receive any income under an annuity purchased pursuant to any agreement or court order to make payments in consequence of personal injury or from any funds derived from a payment in consequence of personal injury and any surrender value of such an annuity.
    Regulation 21(2) and Schedule 4 paragraph 19
  • Periodic payments in consequence of personal injury pursuant to a court order or agreement to the extent that they are not a payment of income are treated as income (and disregarded in the calculation of income).

Regulation 16(5) and 15(2) and Schedule 3 paragraph 10

  • any Social Fund payment                                                     Schedule 4 para.13
  • refund of tax on interest on a loan which was obtained to acquire an interest in a home or for repairs or improvements to the home               Schedule 4 para.13

 

  • any capital resource which the resident has no rights to as yet, but which will come into his possession at a later date, e.g. on reaching a certain age (reversionary interest)

            Schedule 4 para.4

 

  • payments from the Department for Work and Pensions to compensate for the loss of entitlement to Housing Benefit or Housing Benefit Supplement                                                                                             hedule 4 para.17

 

  • the amount of any bank charges or commission paid to convert capital from foreign currency to sterling                                                                 Schedule 4 para.15

 

  • payments to jurors or witnesses for court attendance (but not compensation for loss of earnings or benefit)

                                                                                                            Schedule 4 para.17

 

  • community charge rebate / council tax rebate                                    Schedule 4 para.17

 

  • money deposited with a Housing Association as a condition of occupying a dwelling

 

  • any Child Support Maintenance Payment (unless the child is accommodated with the resident under Part 3 of the National Assistance Act 1948 (mother and baby unit) – in this case take the payment fully into account)           Reg 6A

 

  • the value of any ex-gratia payments made on or after 1st February 2001 by the Secretary of State in consequence of a person’s or person’s spouse’s or civil partner’s imprisonment or internment by the Japanese during the Second World War.                                                                                    Schedule 4 para 20

 

  • any payment made by an authority under the Adoption and Children Act 2002 (under paragraph 3 of Schedule 4 to this Act), as amended by the National Assistance (Assessment of Resources and Sums for Personal Requirements) (Amendment) (Wales) Regulations 2006 whether income or capital.

 

  • the value of any ex-gratia payments from the Skipton Fund made by the Secretary of State to people infected with Hepatitis C as a result of NHS treatment with blood or blood products.                                                                           Schedule 4 para 15
  • Any payments made under section 2 or 3 of the Age-Related Payments Act 2004.

Schedule 4 para 25

 

  • Any payments made under section 63(6)(b) of the Health Services and Public Health Act 1968 to a resident to meet childcare costs where he or she is undertaking instruction connected with the health service by virtue of arrangements made under that section.                                                                Schedule 4 para 26
  • Any payment made in accordance with regulations under section 14 F of the Children Act 1989 to a resident who is a prospective special guardian or special guardian, whether income or capital.                                       Schedule 4 para 27
  • Any payment made under the Age-Related Payments Act 2004.
    Schedule 4 para 28  

Example

A former Far East prisoner of war receives a £10,000 ex-gratia payment in consequence of their imprisonment. At a later date they require residential care. They have a total of £33,250 capital. When calculating how much capital should be taken into account, the local authority disregards the first £10,000 of the resident’s capital. The normal capital rules are then applied to the remaining £23,250.

 

  • Payments made under a trust established out of funds provided by the Secretary of State for Health in respect of persons suffering from variant Creutzfeldt-Jakob disease to the victim or their partner (at time of death of victim) (see also 6.030A)                                                                                                                                                                                                                                              Schedule 4 para 21

 

            Disregarded for 12 weeks

6.028A  In the case of a resident who becomes a permanent resident on or after 9 April 2001 the value of any dwelling which he would otherwise normally occupy as his only or main residence subject to meeting the qualifying conditions that can be found in paragraph 12 of NAFWC 11/01. (see also 7.002- 7.003).

 

            Disregarded for 26 weeks or longer

 

6.029    The capital assets listed below are disregarded for 26 weeks, or longer where the local authority consider this to be appropriate, e.g. where a resident is taking legal steps to occupy premises as his home and the legal processes take more than 26 weeks to complete.

 

  • assets of any business owned (or part-owned) by the resident in which he was a self-employed worker, where he has stopped work due to some disease or disablement, but intends to take up work again when he is fit to do so (26 weeks from the date he took up residence in the residential accommodation, or longer where appropriate)

            Schedule 4 para.5

 

  • money acquired specifically for repairs to or replacement of the resident’s home or personal possessions, provided it is used for that purpose (26 weeks from the date the money was acquired, or longer where appropriate)

                        Schedule 4 para.7

 

  • premises which the resident intends to occupy as his home where he has started legal proceedings to obtain possession (26 weeks from the date he first sought legal advice or first commenced proceedings, or longer where reasonable to enable resident to obtain possession)

            Schedule 4 para.2

 

  • premises which the resident intends to occupy as his home where essential repairs or alterations are required (26 weeks from the date the resident takes action to effect the repairs, or longer where appropriate)

            Schedule 4 para.16

 

  • capital received from the sale of a former home, where the capital is to be used by the resident to buy another home (26 weeks from the date of the sale, or longer where appropriate)

            Schedule 4 para.3

 

  • money deposited with a Housing Association which is to be used by the resident to purchase another home (26 weeks from the date on which the money was deposited, or longer where appropriate)                                         Schedule 4 para.7

 

  • grant made under a Housing Act which is to be used by the resident to purchase a home or pay for repairs to make the home habitable (26 weeks from the date on which the grant is received, or longer where appropriate)        

                        Schedule 4 para.17

 

            Disregarded for 52 weeks

 

6.030    The following payments of capital are disregarded for a maximum period of 52 weeks from the date they are received.

 

  • the balance of any arrears of, or any compensation due to non-payment of:

 

  • Mobility Allowance
  • Mobility supplement
  • Attendance Allowance
  • Constant Attendance Allowance
  • Disability Living Allowance
  • Disability Working Allowance
  • Exceptionally Severe Disablement Allowance
  • Severe Disablement Occupational Allowance
  • armed forces service pension based on need for attendance
  • pension under the personal Injuries (Civilians) Scheme 1983, based on the need for attendance
  • Income Support/Pension Credit
  • Working Families Tax Credit
  • Disabled Person’s Tax Credit
  • Working Tax Credit
  • Child Tax Credit
  • Housing Benefit
  • Special payments to pre-1973 war widows (see 8.045 for details of these payments)

 

As the above payments will be paid for specific periods, they should be treated as income over the period for which they are payable; any money left over after the period for which they are treated as income has elapsed should be treated as capital.                                                                                                              Schedule 4 para.6

 

Example
A resident is assessed as being able to pay £75 per week pending receipt of Income Support/Pension Credit. It is explained to the resident that the charge will be re-assessed once Income Support/Pension Credit is received and that back payments will be required. Although not required to do so, the resident chooses to make payments of £90 per week. After six weeks arrears of Income Support/Pension Credit at £35 per week (£210) are received. The charges are re-assessed and the resident is required to pay £110 per week. As the resident has been paying £15 per week more than required, the arrears payable are £120 rather than the full £210 Income Support/Pension Credit arrears. The remaining £90 becomes capital and is disregarded for 52 weeks.

 

  • Payments or refunds for:

 

  • NHS glasses, dental treatment, patient’s travelling expenses
  • cash equivalent of free milk and vitamins
  • expenses in connection with prison visits                         Schedule 4 para.17

 

 

            Disregarded for 2 years

 

6.030A Payments made under a trust established out of funds provided by the Secretary of State for Health in respect of persons suffering from variant Creutzfeldt-Jakob disease to (see also 6.028):

 

  • the victim’s parent (or guardian) for 2 years from the date of death of the victim (or from the date of payment from the trust, if later) or

 

  • a dependent child or young person until they cease to be a member of the family (i.e. until they leave school between ages of 16 and 19) – but with a minimum of 2 years                                          

Schedule 4 para.21/5

 

            Disregarded for other periods

 

6.031    Assets of a business owned (or part-owned) by the resident in which he has ceased to be a self-employed worker, for a reasonable period to enable him to dispose of the business assets (see 6.032 onwards)                                                Schedule 4 para.5

 

            Meaning of reasonable period of disregard

 

6.032    It is not necessary for a person to have taken steps to realise his share of a business in order to qualify for a disregard. But he should be required to show that it is his clear intention to realise the asset as soon as practicable.

 

            Information required

 

6.033    The local authority should request

 

1.  information which describes the nature of the business asset

 

            and    2.         the resident’s estimate of the length of time necessary to realise the asset, or the resident’s share of the assets

 

            and    3.         a statement of what, if any, steps have been taken to realise the assets, what these steps were and what is intended in the near future

 

            and    4.         any other relevant evidence, for example the person’s health,  receivership, liquidation, estate agent’s confirmation of placing any property on the market.

 

            Action on receipt of information

 

6.034    If the person has taken steps to realise the capital value of the business, the value of the assets should be disregarded for the period considered to be reasonable, starting from the time the person ceased to be engaged in the business.

 

6.035    If the resident has no immediate intention of attempting to realise the business assets, the capital value of the assets should be taken into account.

 

 

Capital treated as income

 

            Capital paid by instalment

 

6.036    If the resident is entitled to capital which is payable by instalments, add together:

 

  1. the total of the instalments outstanding at the time the resident first becomes liable to pay for his accommodation or, in the case of a temporary resident whom the local authority has decided not to charge (see section 3) the first day on which the authority decides to charge for the accommodation; and

 

b.     the amount of other capital held by the resident.

 

If the total of a. and b. is over £23,250, treat the instalments as income.

 

If it is £23,250 or less, treat each instalment as capital                                                                                                                                                                  Reg.16(1)

 

            Payments under an annuity and bonds

 

6.037    Any payment under an annuity will be treated as income (see 8.013).  In cases of doubt local authorities should seek their own legal advice.

Reg.16(2)

            Third party payments made under an agreement to meet excess fees

 

6.037A For details of the treatment of lump sums paid by third parties and residents accessing

the 12-week property disregard, and how to convert to income see Section 11.  

            Earnings

 

6.038    Any income which is derived from employment is to be treated as earnings (see Section 9) and, as such should not be treated as capital.                                                  Reg.16(3)

 

 

Income treated as capital

 

6.039    The types of income in the following paragraphs should be treated as capital.

 

            Tax refunds

 

6.040    Any refund of income tax charged on profits of a business or earnings of an employed earner.

            Reg.22(2)

            Holiday pay

 

6.041    Any holiday pay payable by an employer more than 4 weeks after the termination or interruption of employment.                                                                    Reg.22(3)

           

            Income from a capital asset

 

6.042    Income derived from capital, e.g. building society interest or dividends from shares, should be treated as capital from the date it is normally due to be paid to the resident. This does not apply to income from certain disregarded capital. (see 8.015)

            Reg.22(4)

            Bounty Payments

 

6.043    Any bounty paid at intervals of at least one year from employment as

 

  • a part time fire-fighter

 

  • an auxiliary coastguard

 

  • a part time lifeboat- man or woman

 

  • a member of the territorial or reserve forces.                                  Reg.22(1)

 

            Advance of earnings or loan from employer

 

6.044    Any advance of earnings or loan made to an employed earner by the employer, should be treated as capital, if the resident is not still in work, as the payment does not form part of the employee’s regular income and would have to be repaid.

                                                                                                                                                 Reg.22(5)

 

            Example

A resident received £294 in one week but the pay slip showed that £200 of this was a loan made by the employer.

The local authority should treat £94 as earnings and £200 as capital.

 

            Irregular charitable and voluntary payments

 

6.045    Apart from certain exemptions (payments from AIDs trusts), charitable and voluntary payments which are neither made regularly nor due to be made regularly should be taken into account as capital in the normal way.

            Reg 22(7)

           

            Third party payments to help clear arrears

 

6.045A Payments in 6.045 will include any payments made by a third party to the resident to help clear arrears of charges for residential accommodation (if these payments are made directly to the local authority they are not treated as belonging to the resident (see 11.007 – 11.008).                                                                                   Reg.22(8)

           

            Arrears of contributions to a child’s custodian

 

6.046    Any payments of arrears of contributions by a local authority to a custodian towards the cost of accommodation and maintenance of a child should be treated as capital.                                                                                                                        Reg.22(6)

 

            Trust funds

 

6.047    The treatment of trust funds, both capital and the income from the trust, is dealt with in Section 10.

 

            Property

 

6.048 The treatment of property is dealt with in Section 7.

 

            Notional capital

 

6.049    In some circumstances, a resident may be treated as possessing a capital asset even where he does not actually possess it. This is called notional capital.          Reg.25

 

6.050    A resident’s capital is the total of all capital, whether actual or notional. That total amount is treated in accordance with the capital rules in Section 6.                             Reg.21

 

6.051    Where a person has actual and notional capital, if the actual capital exceeds the capital limit, it is not necessary to consider the question of notional capital.

 

6.052    Notional capital may be capital:

 

a)  which would be available to him if he applied for it;

 

b)  which is paid to a third party in respect of the resident

 

c)  of which the resident has deprived himself in order to reduce the amount of charge he has to pay.

 

            Capital available on application

 

6.053    Capital which would become available to the resident if an application were made, but which has not yet been acquired, is to be treated as belonging to the resident. This does not apply to

 

1.     capital held in a discretionary trust

 

  1. capital held in a trust derived from a payment in consequence of a personal injury

Reg 25(2)
3.   capital derived from an award of damages for personal injury and which is
administered by a court                                                                     Reg 25(2)

 

4.     any loan which could be raised against a capital asset which is disregarded, for example the home                                                                           Reg.25(2)

            

6.054    The local authority should distinguish between

 

1.     capital already owned by the resident, but which in order to realise he must make an application for, for example

 

  • money held by the resident’s solicitor

 

  • Premium Bonds

 

  • National Savings Certificates

 

  • money held by the Registrar of a County Court which will be released on application; and

 

2.     capital not owned by the resident, but which will become his on application being made, for example

 

  • an unclaimed Premium Bond win

 

In the case of 1. the resident has the actual capital but not the notional capital. In the case of 2. the resident has no actual capital but should be treated as having notional capital.

            Date to be taken into account

 

6.055    When the local authority treats capital available on application as notional capital they should only do so from the date it could be acquired by the resident.

 

6.056    SPARE

 

Deprivation of capital

 

            General                                                                                                                             

 

6.057    The local authority may consider that a resident has deprived himself of a capital asset in order to reduce his accommodation charge. If this is the case the local authority may treat the resident as still possessing the asset. The following factors will need to be considered.                                                                         

Reg.25(1) 

 

6.057A In Income Support, individuals must be treated as if they still possess capital in circumstances where they have deliberately deprived themselves of it in order to maximise their benefit entitlement.  The National Assistance (Assessment of Resources) Regulations 1992 do not impose this and it is within the authority’s discretion to decide whether or not to treat the resident as still possessing the capital. Pension Credit specifies circumstances in which this does not apply.  For example, individuals who choose to use their savings to reduce or clear a debt (including debts not immediately repayable) will no longer be considered as having deliberately deprived themselves to maximise entitlement.  Pension Credit also has slightly different rules for what resources an individual may be assumed to have when they apply for benefits.  The deprivation/resources on application “rules” within the residential care charging system are retained, in line with the rules for Income Support though there is discretion whether to treat a person as having deprived themselves of capital.

 

            Forms of capital to be considered

 

6.058    The authority should only consider questions of deprivation of capital when the resident ceases to possess capital which would otherwise have been taken into account.

 

            e.g. a resident gives a diamond ring worth £2,000 to her daughter the week before she entered residential accommodation. The authority should not consider deprivation as, had the ring still been possessed, it would not be taken into account as capital. However, if the resident had purchased the ring immediately prior to giving it to her daughter with £2,000 which had previously been in a Building Society account, deprivation should be considered.

 

            Ownership

 

6.059    The local authority should decide from available evidence whether the resident owned the capital (see 6.007 and 6.008 for details of ownership).

 

            Has deprivation occurred?

 

6.060    It is up to the resident to prove that he no longer has a resource. Failure to do so will result in the local authority treating the resident as if he still possesses the actual capital. Below are examples of acceptable evidence of the disposal of capital.  However, even where a resident produces such evidence, an authority must still consider the question of deprivation.

 

  • a trust deed

 

  • deed of gift

 

  • receipts for expenditure

 

  • documentary proof  that debts had been repaid (but see paragraph 6.063)

 

6.061    The examples below could indicate that a person has deprived themselves of capital.  However, an authority must then consider whether the deprivation was for the purpose of avoiding a charge for accommodation (see paragraph 6.062)

 

  • A lump-sum payment has been made to someone else (e.g. as a gift or potentially a repayment of a debt)

 

  • Substantial expenditure has been incurred (e.g. on an expensive holiday)

 

  • The title deeds of a property have been transferred to someone else

 

  • Money has been put into a trust which cannot be revoked

 

  • Money has been converted into another form which would fall to be disregarded (e.g. personal possessions)

 

  • Capital has been reduced by living extravagantly (e.g. gambling or following a much higher standard of living than the resident could normally afford)

 

  • Capital has been used to purchase an investment bond with life insurance.  Authorities will wish to give consideration, in respect of each case, to whether deprivation of assets has occurred i.e. did the individual place his capital in such an investment bond so that it would be disregarded for the purpose of the Assessment of Resources Regulations.

 

 

            Purpose of disposing of an asset         

 

6.062    There may be more than one purpose for disposing of a capital asset only one of which is to avoid a charge for accommodation. Avoiding the charge need not be the resident’s main motive but it must be a significant one.

 

6.063    If, for example, a person has used capital to repay a debt, careful consideration should be given to whether there was a need for the debt to be repaid at that time. If it seems unreasonable for the resident to have repaid that debt at that time, it may be that the purpose was to avoid a charge for accommodation.

 

            Examples

A person moves into residential accommodation and has a 50% interest in property which continues to be occupied by his spouse, or civil partner. The local authority ignore the value of the resident’s share in property while the spouse, or civil partner lives there but the spouse, or civil partner decides to move to smaller accommodation and so sells the former home. At the time the property is sold, the resident’s 50% share of the proceeds could be taken into account in the charging assessment but, in order to enable the spouse, or civil partner to purchase the smaller property, the resident makes part of his share of the proceeds from the sale available to the spouse, or civil partner. In these circumstances, in the Welsh Government’s view, it would not be reasonable to treat the resident as having deprived himself of capital in order to reduce his residential accommodation charge.

 

A person has £24,000 in the bank. He is about to move permanently to a residential care home, and before doing so, pays off £2,000 outstanding on a loan for home improvements. It would be reasonable in these circumstances not to treat him as having deprived himself of the £2,000 deliberately in order to reduce his residential accommodation charge.

 

A resident has £24,000 in a building society. Two weeks before entering the home, he bought a car for £10,500, which he gave to his son on entering the home. If the resident knew he was to be admitted permanently to a residential care home at the time he bought the car, it would be reasonable to treat this as deliberate deprivation. However, all the circumstances must be taken into account. If he was admitted as an emergency and had no reason to think he would not be in a position to drive the car at the time he bought it, it would not be reasonable to treat it as deliberate deprivation.

 

            Timing of the disposal

 

6.064    The timing of the disposal should be taken into account when considering the purpose of the disposal. It would be unreasonable to decide that a resident had disposed of an asset in order to reduce his charge for accommodation when the disposal took place at a time when he was fit and healthy and could not have foreseen the need for a move to residential accommodation.


Conversion
of capital to personal possessions

 

6.065    Where, for the purpose of avoiding or reducing the charge for accommodation, capital which would not have been disregarded has been used to acquire personal possessions, the current market value of those possessions should be taken into account as an actual resource. Their market value should not be disregarded under para 6.028.

 

6.066    If the resident, in depriving himself of an actual resource, converted that resource into another actual resource of lesser value, he should be treated as notionally possessing the difference between the value of the new resource and the one which it replaced e.g., if the value of personal possessions acquired is less than the sum spent on them the difference should be treated as a notional resource.

 

            Deprivation decided

 

6.067    If the local authority decides that the resident has disposed of capital in order to avoid a charge or to reduce the charge payable, the local authority will need to decide whether to treat the resident as having the capital (notional capital) and assess the charge payable accordingly; and then whether:

 

a.  to recover the assessed charge from the resident; or

 

  1. if the resident is unable to pay the assessed charge, to use the provisions of the Health and Social Services and Social Security Adjudication Act 1983 to transfer the liability for the part of the charges assessed as a result of the notional capital (see Annex D).

 

Diminishing notional capital

 

            Calculation of the rate at which notional capital should reduce

 

6.068    Where a resident has been assessed as having notional capital, that capital will have to be reduced each week by the difference between the rate which he is paying for the accommodation and the rate he would have paid if he was not treated as possessing the notional capital                                                                                             Reg.26

 

            Example

A resident is assessed as having notional capital of £23,250 plus actual capital of £6,000. This results in him having to pay the standard charge for the cost of the accommodation e.g. £250.

 

If he did not possess the notional capital, his capital would not affect his ability to pay for the accommodation so, based on an income of £86 and a personal allowance of, for example, £16 he would be assessed as paying a charge of £70.

 

The notional capital should be reduced by £180.00 per week i.e. the difference between the sum he has to pay because of the notional capital (£250.00) and the charge he would have had to pay if the notional capital did not exist (£70.00).

 

 

SECTION 7 – TREATMENT OF PROPERTY

 

            General

 

7.001    If the capital asset is a house or land there are circumstances under which its value must be disregarded indefinitely and circumstances where its value must be taken fully into account. Local authorities also have an element of discretion over whether to take the value of a property into account (see 7.007).

 

            Property to be disregarded

 

7.002    The value of a dwelling normally occupied by a resident as his home should be ignored if his stay in a residential care or nursing home is temporary and

 

  • he intends to return to that dwelling, and the dwelling is still available to him;

or

  • he is taking reasonable steps to dispose of the property in order to acquire another more suitable property for the resident to return to.

 

Only one dwelling can be disregarded in these circumstances.

 

            N.B. If the resident’s stay is initially thought to be permanent but turns out to be only temporary, the dwelling he normally occupies as his home should be treated in the same way as if he had been temporary from the outset.                                                                                                                                                        Schedule 4 para.1

7.003    Where the resident no longer occupies a dwelling as his home, its value should still be disregarded where it is occupied in whole or in part by:

 

  • the resident’s partner/ or former partner (except where the resident is estranged or divorced from the partner / former partner)

 

  • a lone parent with a dependent child who is the resident’s estranged or divorced partner

 

  • a relative (as defined at 7.004) of the resident or member of the resident’s family (as defined at 7.004A) who

 

  • is aged 60 or over, or

 

  • is a child of the resident aged under 18, or

 

  • is incapacitated.                                                          Schedule 4 para.2

 

 

            Disregard for the first 12 weeks of a permanent stay

 

7.003A In the case of a resident who became a permanent resident on or after 9 April 2001 the value of any dwelling which he would otherwise normally occupy as his only or main residence should be disregarded for the first 12 weeks of a permanent stay, subject to meeting the qualifying conditions which can be found in paragraph 12 of NAFWC 11/01.  This may not be their first permanent admission to permanent residential care.

Schedule 4 para 1A

7.003B Where a person leaves residential care (where they have been living on a permanent basis), before the end of the 12 weeks and then re-enters on a permanent basis within 52 weeks they will be entitled to the remaining balance of the 12 week disregard. If a resident leaves permanent care and then re-enters more than 52 weeks later, they will qualify for the disregard again.

7.003C The 12 week property disregard applies from the first day of permanent residential care provided by a local authority under Part 3 of the National Assistance Act 1948.  The disregard applies irrespective of whether the resident was already in a care home as a self-funder before being provided with Part 3 accommodation.  This is because the legislation defines “resident” in this context as a person who is provided with accommodation under Part 3 of the 1948 Act or a prospective resident (a person for whom accommodation is proposed to be provided under Part 3 of the 1948 Act).

                                   

            Meaning of relative

 

7.004    The term “relative” in paragraph 7.003 includes any of the following:

 

A.       parent (including an adoptive parent)

 

B.        parent-in-law

 

C.        son (including an adoptive son)

 

D.       son-in-law

 

E.        daughter (including an adoptive daughter)

 

F.        daughter-in-law

 

G.        step-parent

 

H.       step-son

 

I.         step-daughter

 

J.         brother

 

K.       sister

 

L.        grandparent

 

M.       grandchild

 

N.       uncle

 

O.       aunt

 

P.        nephew

 

Q.       niece

 

  1. the spouse, civil partner, or unmarried partner of any of A to K inclusive.

 

 

Meaning of Family

 

7.004A The term “family” in paragraph 7.003 includes any of the following:

 

A      a married or unmarried couple, a civil partnership, and any person who is

 

  • a member of the same household and
  • the responsibility of either or both members of the couple or

 

B       a person who is not a member of a married or unmarried couple, a civil partnership, and who is

 

  • a member of the same household and
  • the responsibility of the resident

 

            Meaning of “incapacitated”

 

7.005    The meaning of “incapacitated” in paragraph 7.003 is not defined in the regulations. It will be reasonable to conclude that a relative is incapacitated if either of the following conditions applies

 

i.         the person is receiving one (or more) of the following social security benefits incapacity benefit, severe disablement allowance, disability living allowance, attendance allowance, constant attendance allowance, or an analogous benefit;

or

 

ii.          the person does not receive any of the benefits listed in (i) but the degree of incapacity is equivalent to that required to qualify for any one of those benefits. Medical or other relevant evidence may be needed before a decision is reached.

 

            Property acquired but not yet occupied

 

7.006    Where the resident has acquired property which he intends eventually to occupy as his home, disregard the value of the dwelling for up to 26 weeks from the date the resident first takes steps to take up occupation, or such longer period as is considered reasonable.

            Schedule 4 para.16

            Discretion to disregard property

 

7.007    Where the local authority considers it reasonable to do so, they can disregard the value of premises not covered in paragraphs 7.002-006 in which a third party lives. Authorities will have to balance the use of this discretion with the need to ensure that residents with assets are not maintained at public expense. It may be reasonable, for example, to disregard a dwelling’s value where it is the sole residence of someone who has given up their own home in order to care for the resident, or someone who is an elderly companion of the resident particularly if they have given up their own home.  These are only examples and not exhaustive.

            Schedule 4 para.18

 

7.008   As with the issues of deprivation, authorities’ should consider the intention behind the
occupation of the premises by the third party (e.g. whether it was to care for the resident
or whether it was in anticipation of avoiding the inclusion of the property in the
financial assessment).  It would only be reasonable to disregard the property in the first
example.  The timing of the move into the property by the third party and the prognosis
of the resident at that time will also be relevant.

 

Example

             A close friend gives up their own home to care for the resident at a time when
residential care cannot be anticipated.  This would be reasonable circumstances for the

authority to give consideration to the exercise of discretion.

 

7.009    Where the local authority has decided to disregard the value of a property, it is left to the local authority to decide if and when to review that decision. It would be reasonable, for example, where the authority has been ignoring the value of a property because a long term carer was living there, for the authority to begin taking account of the value of the property when the carer dies or moves out.

 

Property to be taken into account

 

            Legal and beneficial owners

 

7.010    The treatment of property will depend on whether the resident is a legal or a beneficial owner. A legal owner is a person in whose name the property is held. A beneficial owner is one who is entitled to receive the profits or proceeds of property. In most cases the legal and beneficial owners will be the same person but, where this is not the case, the value of the property will be valued according to the following paragraphs.

 

            Legal ownership

 

7.011    For the purposes of assessing the resident’s ability to pay a charge no account should be taken of the value of a property where the resident is a legal owner but has no beneficial interest in the property. i.e. the resident is holding the property on trust for the beneficial owners and has no right to the proceeds or profits should the property be sold.

 

            Beneficial ownership

 

7.012    Where the resident is the sole beneficial owner of a property the capital value should be taken into account in full. If the resident and the local authority agree that the value of the property, after taking into account any deductions in 6.011 (expenses of sale and debts secured on the asset), is over £23,250, or when added to any other capital assets will take the total capital over £23,250, a precise valuation will not be needed. If the resident disputes the value, or there is some doubt as to the value, a professional valuation should be obtained.

 

            Joint beneficial ownership of property

 

7.013    Where a resident is a joint beneficial owner of property, i.e. he has the right to receive some of the proceeds of a sale, it is the resident’s interest in the property which is to be valued as capital, and not the property itself. The value of this interest is governed by

 

1.         the resident’s ability to re-assign the beneficial interest to somebody else

 

2.         there being a market i.e. the interest being such as to attract a willing buyer for the interest.

            Reg.27(2)

 

7.014    In most cases there is unlikely to be any legal impediment preventing a joint beneficial interest in a property being re-assigned. But the likelihood of there being a willing buyer will depend on the conditions in which the joint beneficial interest has arisen.

 

7.015    Where an interest in a property is beneficially shared between relatives, the value of the resident’s interest will be heavily influenced by the possibility of a market amongst his fellow beneficiaries. If no other relative is willing to buy the resident’s interest, it is highly unlikely that any “outsider” would be willing to buy into the property unless the financial advantages far outweighed the risks and limitations involved. The value of the interest, even to a willing buyer, could in such circumstances effectively be nil. If the local authority is unsure about the resident’s share, or their valuation is disputed by the resident, again a professional valuation should be obtained.

7.015A If ownership is disputed and a resident’s interest is alleged to be less than seems apparent from the initial information, the local authority will need written evidence on any beneficial interest the resident, or other parties possess. Such evidence may include the person’s understanding of events, including why and how the property came to be in the resident’s name or possession. Where it is contended that the interest in the property is held for someone else, the local authority should require evidence of the arrangement, the origin of the arrangement and the intentions for its future use. The law of equity may operate to resolve doubts about beneficial ownership, by deciding what is reasonable by reference to the original intentions behind a person’s action, rather than applying the strict letter of the law.

 

            Example

The resident has a beneficial interest in a property worth £60,000. He shares the interest with two relatives. After deductions for an outstanding mortgage, the residual value is £30,000. One relative would be willing to buy the resident’s interest for £5,000.  Although the value of the resident’s share of the property may be £10,000, if the property as a whole had been sold, the value of just his share is £5,000 as this is the sum he could obtain from a willing buyer. The resident’s actual capital would be £4,500 because a further 10 percent would be deducted from the value of his share to cover the cost of transferring the interest to the buyer

 

            Property held in a shared trust

 

7.016    Where a property is held in Trust and the resident is both a joint trustee and joint beneficiary, he legally owns the property as a trustee of the Trust, but purely on a “fiduciary” basis i.e. he is legally obliged to administer the Trust for the benefit of the Trust – as a whole, and not for his own particular purposes. His real interest is that of a beneficial owner, and falls to be valued accordingly (paragraphs 7.012 to 7.014).

 

            Sale of jointly owned property

 

7.017    See the example at 6.063 for the consideration of deprivation of capital where a jointly owned property is sold and the resident passes some of his share of the proceeds to the joint owner.

 

            Property owned but rented to tenants

 

7.018    Where a resident owns property, the value of which takes the resident’s total capital above £23,250, and the property is rented to tenants the resident will be assessed as able to pay the standard charge for the accommodation (because of the level of capital).  It will then be for the resident to agree to pay the rental income (along with any other income) to the local authority in order to reduce the accruing debt.

            Deferred Payments

 

7.019    Where an authority has agreed to enter into a deferred payments arrangement with the resident, the resident’s resources should be assessed under the Assessment of Resources Regulations as set out in CRAG.  When the assessment has been completed and it has been determined that the person has insufficient income and capital excluding their property, to meet their care home fees deferred payments may be offered.  The difference between what a resident is assessed as being able to contribute from means-tested income and assets including his former main or only home and the amount he would be assessed as being able to contribute if his main or only home were disregarded is then deferred.  A draft legal agreement that authorities may consider using, or adapting, when reaching deferred payments agreement with individual residents, is available at Annex H.  It should be noted that use of this draft legal agreement is not obligatory, and that the agreement only applies to the placing of a legal charge.

 

7.020    Authorities should bear in mind that deferred payments under section 55 of the Health and Social Care Act 2001 are distinct from the pursuit of debt through section 22 of HASSASSA 1983 (see Annex D for explanation of HASSASSA).  Deferred payments should be offered when individuals are willing to pay their assessed contribution but do not wish to do so immediately.  Section 22 of HASSASSA applies to situations where residents are unwilling to pay their assessed contribution, either now or in the future, and a debt arises.

Note:  Local Authorities should liaise with LHBs to provide appropriate information to patients, and make every effort to ensure that residents who are appealing against refusal of CHC funding are made aware of the scheme.

 

 

SECTION 8 – INCOME OTHER THAN EARNINGS

 

General

           

            What is income?

 

8.001    A resident’s resources are either capital or income. It may not always be obvious whether a payment should be treated as capital or income, but generally, a payment of income is one which:

 

a)         is made in respect of a period; and

 

b)         forms part of a series of payments (whether or not payments are received regularly).

 

8.002    A payment of income is generally taken into account for a period equivalent to that which it represents, e.g. a payment due to be made weekly is taken into account for a week, a payment due to be made calendar monthly is taken into account for a month, but a weekly rate is calculated before assessment. Guidance on the attribution of income to a specific period is in Section 9.

 

            Treatment of income

 

8.003    Income is treated in one of three ways:

 

a)         taken into account in full;

 

b)         partly disregarded; or

 

c)         fully disregarded.

 

 

8.004    Paragraphs (8.005 to 8.063) below list the types of income in each category, and provide further details where necessary.

 

            Income taken fully into account

 

8.005    The following types of income are taken into account in full:

 

  • Most Social Security benefits (8.006)

 

  • Annuity income (except home income plans) (8.013)

 

  • Cash in lieu of concessionary coal for permanent residents only. (Cash in lieu of concessionary coal is disregarded for temporary residents)

 

  • Child Support Maintenance Payments where the child is accommodated with the resident under Part 3 of the National Assistance Act 1948 (see 8.037 for other cases)

 

  • Home Office ex gratia incapacity allowances

 

  • Income from certain disregarded capital (8.015)

 

  • Income from an insurance policy (except mortgage protection insurance) (8.016)

 

  • Income from certain sub-lets (8.017)

 

  • Occupational/Personal Pensions

 

  • Refund of income tax

 

  • Third party payments made to meet higher fees (see Section 11)

 

  • Trust income (see Section 10)

 

  • War orphan’s pension                                                                    Reg.15(1)

 

            Social Security benefits

 

8.006    The Social Security benefits listed below are taken fully into account. However, see 8.041A for the treatment of certain dependency increases.

 

  • Attendance Allowance/ Disability Living Allowance (Care component) (this also includes any Constant Attendance Allowance (CAA) and Exceptionally Severe Disablement Allowance (ESDA) payable with Industrial Injuries Disablement Benefit or War Disablement Benefit) paid to permanent residents – see 3.016 for treatment of AA / DLA(Care) paid to temporary residents.

 

  • Child Benefit where the child is accommodated with the resident under part III of the National Assistance Act 1948 (see 8.037 for other cases).

 

  • Disability Working Allowance

 

  • Working Families Tax Credit/Working Tax Credit

 

  • Guardian’s Allowance

 

  • Housing Benefit – where the resident has been admitted permanently into unregistered accommodation or local authority accommodation not providing board so Housing Benefit is being paid to meet the accommodation charge.

 

  • Income Support/Pension Credit (but see paragraph 8.038 for exception)

 

  • Industrial Death Benefit

 

  • Industrial Injuries Disablement Benefit (IIDB) (8.008) – see also above and 3.016 for treatment of CAA and ESDA paid with IIDB

 

  • Incapacity Benefit

 

  • Invalid Care Allowance

 

  • Carer’s Allowance

 

  • Jobseekers Allowance

 

  • Maternity Allowance

 

  • Pneumoconiosis, byssinosis and miscellaneous diseases benefit scheme payments (8.009) – see above and 3.016 for CAA and ESDA id with these payments

 

  • Retirement Pension (8.010)

 

  • Severe Disablement Allowance

 

  • Widow’s benefit (widow’s pension (WP) and widowed mother’s allowance (WMA) (8.011). See Section 6 (Capital) for treatment of widow’s payment (wpt)

 

  • Workmen’s compensation (8.012) – see above and 3.016 for treatment of AA/CAA paid under the Workmen’s Compensation Act)                                                                                                 

                                    Reg.15(1)

            Deductions from benefits 

 

8.007    Where any Social Security benefit is being subjected to a reduction (other than a reduction because of voluntary unemployment) e.g. because of an earlier overpayment, the amount to be taken into account should be the gross amount of benefit before reduction.                                                                                                Reg.15(3)

 

            Industrial Injuries Disablement Benefit (IIDB)

 

8.008    Industrial Injuries disablement benefit is taken fully into account. However, some additional allowances may be paid with IIDB. These are:

 

a)         Exceptionally Severe Disablement Allowance (ESDA);

 

b)         Constant Attendance Allowance (CAA); and

 

c)         Reduced Earnings Allowance (REA).

 

ESDA and CAA are fully disregarded for temporary residents (see 3.016). REA is taken fully into account.

 

            Pneumoconiosis, byssinosis and miscellaneous diseases benefit scheme

 

8.009    These payments are made to people who are not entitled to workmen’s compensation (8.012) or IIDB (8.008). They are taken fully into account. AA may be paid with these payments – see 3.016 and 8.006.

 

            Retirement Pension

 

8.010    Retirement Pension may include various additions and increases, all of which are to be taken into account in full. AA may be paid with RP (see 3.016 and 8.006) for treatment of AA.

 

 

 

            Widow’s benefit (Widow’s Pension (WP) and Widowed Mother’s Allowance (WMA)

 

8.011    A widow may be entitled to WP or WMA. Both are taken fully into account. Widow’s Payment (WPT) may be paid in addition to WP or WMA. WPT is paid as a lump sum and is treated as capital.

 

            Workmen’s compensation

 

8.012    These payments are awarded for industrial injuries and diseases resulting from employment before the IIDB scheme started. AA may be paid with workmen’s compensation – see 3.016 and 8.006 for treatment of AA.

 

            Annuity income

 

8.013    An annuity is a fixed sum payable at specified intervals (normally annually), in return for a premium payable either in instalments or as a single payment. The annuity income is payable for a specified period, such as the recipient’s lifetime.

 

8.014    Income from an annuity is to be taken fully into account except when the annuity is:

 

a)     purchased with a loan secured on the resident’s dwelling (partial disregard – see paragraphs 8.024 to 8.030); or

b)    a gallantry award e.g., Victoria Cross Annuity, George Cross Annuity (fully disregarded – see paragraph 8.042).

 

            Income from Investment Bonds

 

8.014A The treatment of investment bonds in the financial assessment for residential accommodation is complex because, in part, of the differing products on offer.  For this reason local authorities should seek the advice of their own legal departments when they arise.  However, it is possible to offer some general advice.

 

8.014B Income from investment bonds, with or without life assurance, is taken into account in the financial assessment for residential accommodation.  Actual payments of capital by periodic instalments from investment bonds, with or without life insurance, are treated as income and taken into account provided that any such payments are outstanding on the first day that the resident becomes liable to pay for his accommodation and the aggregate of the outstanding instalment, and any other capital sum not disregarded, exceed £16,000 (see also 6.002A, B and C).

 

            Income from certain disregarded capital

 

8.015    Income from capital will generally be treated as capital and not income (see 6.042).

If there is any corresponding capital disregard then that will apply (for example the 52 week capital disregard for a payment in consequence of personal injury and the capital disregard for personal injury damages which are administered by a court).

However, income which comes from certain forms of disregarded capital is treated as income.  This will be the case where the capital is:

 

  • the normal dwelling of a temporary resident (but see 3.013 for disregard of income needed to cover housing commitments)

 

  • business assets which the resident is taking steps to dispose of

 

  • any capital consisting of the value of trust funds which derive from a payment of personal injury and the value of the right to receive any payment under that trust

 

  • a dwelling which the resident intends to occupy as his home and which he is taking steps to occupy

 

  • the former dwelling of the resident which is occupied by a partner or a relative of the resident who is over age 60, under 18, or incapacitated

 

  • premises belonging to the resident which are occupied in whole or in part by a third party, where the local authority are using their discretion to disregard those premises

 

  • any premises which the resident intends to occupy as his home and in respect of which he is taking legal steps to obtain possession

 

  • any premises which the resident intends to occupy as his home but which needs repairs or alterations in order for the resident to occupy

Income from such capital is generally not disregarded in the calculation of income.

 

However, in the final five situations only, income which covers mortgage repayments, payments for water rates and council tax shall be disregarded – see paragraph 8.036.

            Schedule 3 para.14

          

              Further, as stated below payments at regular intervals from personal injury trust funds are disregarded in the calculation of income.

            Income from capital to which there is actual or deemed beneficial entitlement is also disregarded as income for example from capital consisting of a payment in consequence of personal injury and income from capital derived from personal injury damages which are administered by a court.  However this does not apply to income from the value of trust funds derived from a payment in consequence of personal injury.

 

            Income from insurance policies

 

8.016    Any form of income from an insurance policy is generally taken into account in full. The only exception is income from a mortgage protection policy (para 8.032).

 

            Income from certain sub-lets

 

8.017    When a resident sub-lets a part of their property which is not part of the living accommodation, for example the garage or the garden, the income from that sub-let is taken fully into account. The treatment of income from other sub-lets is described in paragraph 8.030.

 

            Third party payment made to meet higher fees

 

8.18               For full details of the treatment of third party payments, see Section 11.

 

            Trust income

 

8.019    See Section 10


Income partly disregarded

 

            £10 disregard

 

8.020    The following types of income attract a £10 disregard:

 

  • Payments to victims of National Socialist persecution (paid under German or Austrian law)                                                                                                                       Schedule 3 para.11

 

  • Civilian war injury pension                                                Schedule 3 para.11

 

  • War disablement pension (8.022) – see also 3.016 and 8.006 for treatment of AA/CAA paid with WDP
  • Payments from the Armed Forces Compensation Scheme to be established under section 1(2) of the Armed Forces (Pensions and Compensation) Act 2004

 

  • War Widow’s and War Widower’s pension – but see 8.045 for War Widow’s AND War Widower’s Special Payments

 

            Overall disregard

 

8.021    Where more than one payment qualifies for a £10 disregard, the amount disregarded overall is £10. The only exception is where two or more payments, which were due to be paid and therefore taken into account in different weeks, are in fact taken into account in the same week because it was not practical to take them into account for the weeks in which they were due to be paid.

            Schedule 3 para.31

            War disablement pension

 

8.022    War disablement pension may include various additions and increases. Disregard £10 of the total amount, in addition to any disregard which may be appropriate on CAA which may also be paid with War disablement pension – see 3.016 and 8.006 for treatment of AA and CAA.

 

Other disregarded sums

 

The Savings Disregard

 

8.023   A savings disregard based on qualifying income is introduced from 6 October 2003 and will be made to residents as follows:

 

For individuals

 

  • Where a resident is in receipt of qualifying income of less than £111.80 per week there will be no savings disregard made
  • Where a resident is in receipt of qualifying income between £111.80 and £142.70 per week the savings disregard is made, which will equal the actual amount of the savings credit reward received or a sum of £5.75 whichever is less
  • Where a resident is in receipt of qualifying income in excess of  £142.70 per week, and a savings credit reward is in payment, a flat rate savings disregard of £5.75 per week is made irrespective of how much the savings credit payment is
  • Where a resident has qualifying income above the limit for receiving a savings credit reward (around £189.05 per week but could be higher if the resident is severely disabled. Has caring responsibilities or certain housing costs) a flat rate savings disregard of £5.75 per week is made.

 

For Couples

 

  • Where a resident who is part of a couple, including a civil partnership, and is in receipt of qualifying income of less than £178.35 per week there will be no savings credit
  • Where a resident who is part of a couple, including a civil partnership, and is in receipt of qualifying income between £178.35 and £217.90 per week the savings disregard is made, which will equal the actual amount of the savings credit reward received or a sum of  £8.60 per week whichever is less
  • Where a resident who is part of a couple, including a civil partnership, and is in receipt of qualifying income in excess of £217.90 per week, and a savings credit reward is in payment, a flat rate savings disregard of  £8.60 per week is made irrespective of how much the savings credit payment is
  • Where a resident who is part of a couple, including a civil partnership, and has qualifying income above the limit for receiving a savings credit reward (around £277.22 per week but could be higher if the resident is severely disabled, has caring responsibilities or certain housing costs) a flat rate savings disregard of £8.60 per week  is made.

 

The values of £142.70 and £217.90 above represent the standard minimum guarantee for an individual and couple respectively.  These amounts are increased to an appropriate minimum guarantee where individuals and couples qualify as severely disabled or as carers because of receipt of qualifying benefits.  Details of Pension Credit are given in Annex I.  Examples of how the savings reward is calculated, plus a list of qualifying income, are given in the document Pension Credit and the Savings Disregard on the website
www.dh.gov.uk/PolicyAndGuidance/OrganisationPolicy/FinanceAndPlanning/ResidentialCare/fs/en

 

Occupational Pensions, Personal Pensions and Retirement Annuity Contracts

 

8.023A Where a resident is in receipt of an occupational pension, personal pension, or payment from a retirement annuity contract and has a spouse, or civil partner, who is not living in the same residential care or nursing home, 50 per cent of the occupational pension, personal pension, or retirement annuity contract payment should be disregarded providing the resident passes 50 per cent on to his spouse or civil partner. If the resident passes less than 50 per cent of any of these payments mentioned above, or none of them, to his spouse or civil partner, for whatever reason, then the disregard should not be applied and the full amount in payment to the resident should be taken into account.  The only other time when 50 per cent of any of the payments a married resident or civil partner should cease to be disregarded is on death of the spouse or civil partner or divorce.                                                                                                                                                                                      Schedule 3 para 10A

 

8.023B Where an unmarried partner rather than a spouse or civil partner is involved the local authority should consider their discretionary powers to vary the PEA (see 5.005). This requirement to disregard 50 per cent of the occupational pension does not alter the authority’s discretion to vary the PEA in special circumstances (see 5.007).

 

8.023C Where a spouse or civil partner is legally entitled to receive part of the occupational pension, personal pension and retirement annuity contract (e.g. by means of a Court Order) that part of the pension does not belong to the resident and should, therefore, not form part of his income.  Fifty per cent of the amount actually in payment to the resident should be disregarded in accordance with 8.023A

 

            Annuity income from home income plan

 

8.024    There are different types of annuity plans (see paragraphs 8.013 and 8.014). Although income from an annuity is normally taken fully into account, this general rule does not apply to “home income plans”. Under these schemes, a retired person who owns his home obtains a loan secured on the property. He uses part of the loan (or all of it) to buy an annuity which provides an income. He may also have used part of the loan for other purposes, for example improving or extending the property. The gross income from the annuity covers the interest payments on the original loan and provides an income for the person.

 

8.025    In order to qualify for any disregard on the income from a home income plan, one of the annuitants must still be occupying the dwelling as his home. This might happen where a couple have a joint annuity secured on the home, and one partner continues to occupy the home when the other moves permanently to a residential care or nursing home. In these circumstances, if the partner at home receives all the income and makes full repayments on the loan, it will probably be appropriate to treat the income as possessed by the partner at home.

 

8.026   Where neither the resident nor any other annuitant occupies the dwelling as his home, no disregard can be allowed on the income. When a single person moves permanently to a residential care or nursing home, therefore, and ceases to occupy the dwelling on which the loan is secured as his home, there will be no disregard on the income from the annuity. In these circumstances the property may be sold, and the loan repaid. Consider whether to take the value of the property into account as capital under the provisions in Section 7. Where the property is taken into account, the amount of the loan secured on the property will fall to be deducted in calculating the value.

 

8.027    Where a resident receives income from a home income plan annuity, and a joint annuitant continues to occupy the property, specified amounts can be disregarded from the gross weekly income, but only where certain conditions are satisfied (see para.8.028) The amounts which may be disregarded are:

 

 

a)         the net weekly interest on the loan where income tax is deductible from the interest; or

 

b)         the gross weekly interest on the loan in any other case.

 

8.028    The conditions to be satisfied before any amount may be disregarded from the weekly income are:

 

a)         the loan must have been made as part of a scheme which required that at least 90% of that loan be used to purchase the annuity; and

 

b)         the annuity ends with the life of the person who obtained the loan, or where there are two or more annuitants (including the person who obtained the loan), with the life of the last surviving annuitant; and

 

c)         the person who obtained the loan or one of the other annuitants is liable to pay the interest on the loan; and

 

d)         the person who obtained the loan (or each of the annuitants where there are more than one), must have reached the age of 65 at the time the loan was made; and

 

e)         the loan was secured on a dwelling in Great Britain and the person who obtained the loan (or one of the other annuitants) owns an estate or interest in that dwelling; and

 

f)          the person who obtained the loan or one of the other annuitants occupies the dwelling as his home at the time the interest is paid.

 

8.029    Where the resident is using part of the annuity income to repay the loan, disregard the amount he pays as interest on the loan. Under some schemes, the capital is not repaid until the person dies or the annuity ends. In this case the payments the person makes on the loan will be interest only. If the resident qualifies for tax relief on the interest he pays, disregard the net interest paid. Otherwise, disregard the gross interest.                           

                                                                                                              Schedule 3 para.12

 

            Income from sub-letting

 

8.030    Income from sub-letting (whether paid by the sub-tenant or a third party) carries a disregard only where the resident occupies the dwelling of which part is sub-let as his home. This will therefore apply only to assessing a temporary resident. The disregard is shown in Annex A. See also paragraph 8.017 for income from sub-letting part of the property which is not part of the living accommodation, e.g. garage or garden).                                    

                        Schedule 3 para.12

 

            Income from boarders

 

8.031    A boarder is someone for whom at least one cooked meal is provided. Where a resident has income from a boarder (whether paid by the boarder or a third party) the first £20 of the income should be ignored plus half of any balance over £20.

 

            Example

A temporary resident receives £100 per week as income from a boarder living in his previous dwelling. The first £20 is ignored plus half of the remaining £80 (i.e.£40) making a total of £60 of the £100 to be ignored.    

                        Schedule 3 para.13

           

            Mortgage protection insurance policies

 

8.032    Any income from an insurance policy is normally taken into account. However, this does not apply to income from mortgage protection policies. A mortgage protection policy is one which is taken out:

 

a)         to insure against the risk of not being able to make repayments on a loan; or

 

b)         to protect the premiums payable on an endowment policy where the policy is held as security for a loan.

 

 

8.033    The income from these policies qualifies for a disregard only where the purpose of the loan is:

 

a)         to acquire or retain an interest in the dwelling occupied as the home; or

 

b)         for repairs or improvements to the dwelling occupied as the home.

 

8.034    The income from the policy must be being used to meet the repayments on the loan.

 

8.035    The amount of income from such a policy which should be disregarded is the weekly sum of:

 

a)         the amount which covers the interest on the loan; plus

 

b)         the amount of the repayment which reduces the capital outstanding; plus

 

c)                  the amount of the premium due on the policy.     

                                                                                    Schedule 3 para.19

 

It should be remembered that Income Support/Pension Credit may be adjusted to take account of the income from the policy, so income previously disregarded under 3.011 or 8.039 may no longer be in payment.

            Income from certain disregarded capital

 

8.036    Where income is received from certain property of which the capital value is being disregarded (see 8.015), the income should be taken into account in full less any mortgage repayments, or payments of Water rates or payments of Council Tax made during the same period as that in respect of which the income was received.           

                        Schedule 3 para.14

 

            Income fully disregarded

 

8.037    The following types of income are fully disregarded:

 

  • See 3.016 for the treatment of AA and DLA (Care) for temporary residents and 8.006 for permanent residents.

 

  • That part of an Income Support/Pension Credit award which is paid in respect of home commitments for temporary residents (8.038)

 

  • Supporting People payments made by a local authority to or on behalf of a resident for housing support charges of a kind falling within Schedule 1B to the Housing Benefit (General) Regulations 1987 (as in force immediately before 1 April 2003). (3.012A)

 

  • Certain charitable and voluntary payments (8.050 – 8.052)

 

  • Child Support Maintenance Payments and Child Benefit, unless the child is accommodated with the resident under Part 3 of the National Assistance Act 1948 (mother and baby units – see 8.005)

 

  • Child Tax Credit

 

  • Guardian’s Allowance

 

  • Christmas bonus (8.040)
  • Any payment made under the Age-Related Payments Act 2004

 

  • Any payment from:
    • the Macfarlane Trust
    • the Macfarlane (Special Payments) Trust
    • the Macfarlane (Special Payment)(No.2) Trust
    • the Fund (payments to non-haemophiliacs infected with HIV)
    • the Eileen Trust
    • the MFET Limited
    • the Independent Living (2006) Fund
    • the Skipton Fund
    • the London Bombings Relief Charitable Fund
    • the Caxton FoundationSchedule 4 paragraph 15

Note:  On 11th January 2011, Ministers announced plans for new measures for people who contracted hepatitis C and HIV from contaminated blood.  These measures, including the creation of the Caxton Foundation, came into force on 31st October 2011.  Local authorities should ensure their charging policies reflect this addition of the Caxton Foundation to the stated list of organisations above.

 

  • Council Tax Benefit

 

  • Disability Living Allowance (Mobility Component) and Mobility supplement

 

  • Dependency increases paid with certain benefits (8.041A)

 

  • Gallantry awards (8.042)

 

  • Income frozen abroad (8.043)

 

  • Income in kind (8.044)

 

  • Social Fund payments (including winter fuel payments)

 

  • Certain payments made to trainees (8.044A)

 

  • War widows special payments (8.045)

 

  • Work expenses paid by employer, and expenses paid to voluntary workers (8.048 and 8.049)

 

  • Any payment made under paragraph 3 of schedule 4 to the Adoption and Children Act 2002, as amended by the National Assistance (Assessment of Resources and Sums for Personal Requirements) (Amendment) (Wales) Regulations 2006.  (For example, if a family adopts a brother and sister but need to build an extension to their house to make a bedroom for the sister, this type of payment would be disregarded).

 

  • Any payments made under section 63(6)(b) of the Health Services and Public Health Act 1968 to a resident to meet childcare costs where he or she is undertaking instruction connected with the health service by virtue of arrangements made under that section.                                   Schedule 3 para 28J
  • Any payment made in accordance with regulations under section 14 F of the Children Act 1989 to a resident who is a prospective special guardian or special guardian.                                                                                 Schedule 3 para 28K

 

 

            Income Support /Pension Credit paid for home commitments

 

8.038    Under the Income Support/Pension Credit rules, an amount may be included in the award of Income Support/Pension Credit in respect of specified expenses to maintain the home address. Payment may continue for up to 52 weeks.

 

8.039    Any Income Support/Pension Credit a resident receives is normally taken into account in full in assessing the charge. However, where the award includes an amount for home commitments, that part of the Income Support/Pension Credit award is fully disregarded. The amount awarded for home commitments is shown as a separate entry on form A124N (clerical) or computer produced Award Calculation Sheet which DWP sends to the resident.

            Schedule 3 para.26

            Christmas Bonus

 

8.040    A Christmas Bonus is paid each year in the week starting the first Monday in December. It is paid to people who are entitled to specified benefits, for example:

 

  • Attendance Allowance;

 

  • Retirement Pension:

 

  • Widow’s and War Widow’s Pensions;

 

  • War Disablement Pension;

 

  • Incapacity Benefit or Severe Disablement Pension;

 

The Christmas bonus is fully disregarded in assessing the charge.   Schedule 3 para.22

 

Payments from any of the Macfarlane Trusts, the Fund, the Eileen Trust, the MFET Limited, the Independent Living Funds, the Skipton Fund, the London Bombing Relief Fund or the Caxton Foundation.

 

8.041    Payments from the Macfarlane Trust, the Macfarlane (Special Payments) Trust, the Macfarlane (Special Payment)(No.2) Trust, the Fund, the Eileen Trust, the MFET Limited, the Independent Living Fund (2006), the Skipton Fund, the London Bombing Relief Fund and the Caxton Foundation do not have to be declared if they are kept in a separate bank or building society account from the resident’s other resources. All payments are fully disregarded. It should be borne in mind that payments from the Independent Living Fund (2006) should cease when someone enters residential accommodation.                                                                                                  

                        Schedule 3 para.24

 

            Dependency increases paid with certain benefits

 

8.041A Dependency increases for adults can be paid with Job Seekers Allowance,           Maternity Allowance, Incapacity Benefit, Severe Disablement Allowance, Retirement Pension, Invalid Care Allowance and Unemployability Supplement paid with Industrial Injuries Disablement Benefit. Child Dependency Increases can be paid with Jobseekers Allowance (where the beneficiary has reached pension age), Incapacity Benefit, Severe Disablement Allowance, Retirement Pension, Carer’s Allowance, Invalid Care Allowance and Unemployment Supplement (as above) if claimed before April 2003. Where the dependent does not live with the resident, the increase will only be payable if the resident pays over at least the amount of the increase to the dependent. Where the increase is being paid over to the dependent, the amount of increase should be disregarded in full.

                        Schedule 3 para.28B

 

8.041B  Child Tax Credit is paid in place of child dependency increases in claims for Job Seeker’s Allowance, Incapacity Benefit, Retirement Pension, Carer’s Allowance and Unemployment Supplement from 7 April 2003.  Where Child Tax Credit is in payments, it should be disregarded in full, regardless of whether or not the child is accommodated with the resident.

            Schedule 3, para 28G

 

Gallantry awards

 

8.042    Gallantry awards are:

 

  • Victoria Cross Annuities

 

  • George Cross Annuities

 

These payments are fully disregarded.                                          Schedule 3 para.8

 

            Income frozen abroad

 

8.043    Income paid outside the UK which cannot be transferred to the UK should be fully disregarded so long as it continues to be frozen outside the UK.                                                                                                

            Schedule 3 para.16

 

            Income in kind

 

8.044    Income in kind means income received in the form of food, clothing, cigarettes etc. The value of such income is disregarded in full.                                                                                                               

Schedule 3 para.14

 

            Payments made to trainees

 

8.044A Trainees on certain employment schemes may receive a training premium and reimbursement of travelling expenses. These should be fully disregarded. The actual training allowance should be taken into account.

           

            War widows and war widowers special payments

 

8.045    War widows and war widowers special payments are made to the widows of men and the widowers of women who died from injuries or illness which resulted from service ended before 31 March 1973. The special payments are intended to compensate those widows and widowers who did not benefit from the amendments to the Armed Forces Pension Scheme. These payments, which are made under the legislation listed in Annex G, are fully disregarded.

 

8.046    A small number of widows and widowers do not qualify for the normal UK war widows and war widowers special pension, even though their circumstances are such that they might expect to do so. In these cases, ex-gratia payments are made at the same rate as the appropriate war widows and war widowers benefit.  Because they do not qualify for war widows and war widowers pensions under the normal rules, they are also excluded from the war widows and war widowers special payments scheme. The Secretary of State for Defence may therefore make special payments which are analogous to the war widows and war widowers special payments. Such payments are fully disregarded in the assessment.

 

8.047    War widows and war widowers special payments and analogous payments can normally be identified by the amount contained in the war widows and war widowers pension order book. In cases of doubt, contact the Veteran’s Agency at Norcross, Blackpool, Lancs tel. 0800 169 2277. They will need to know the name and reference number (shown on the pension book) of the war widow or war widower.                                                           

Schedule 3 para.25

           

Work expenses paid by employer

 

8.048    Where a person who is in paid employment receives a payment from the employer in respect of expenses which are incurred in the course of the employment, that payment is fully disregarded. The payments must be for expenses incurred exclusively and necessarily in the course of work.

            Schedule 3 para.3

 

            Expenses paid to voluntary workers

 

8.049    Where a person works for a charitable or voluntary body or as a volunteer, and receives no other payment as a result of the employment, any payment in respect of expenses which are actually incurred is fully disregarded.   

Schedule 3 para.2

 

Charitable and voluntary payments

 

            General

 

8.050    A charitable payment is not necessarily one made by a recognised charity, but may include payments made from charitable motives. A voluntary payment is one which the payer is under no legal obligation to make.

 

8.051    Generally, a charitable or voluntary payment which is not made regularly and is not due to be made regularly is treated as capital, with certain exceptions.                                                                                                                                                             Reg.22(7)

 

8.052    Payments which are made regularly or due to be made regularly are fully disregarded, with certain exceptions.

8.053    SPARE

 

8.054    SPARE

 

8.055    SPARE

 

8.056    SPARE

Income treated as capital

 

8.057    Certain forms of income are treated as capital – see 6.039 to 6.046 for details.                                                                                                                          Reg 22

 

            Notional income

 

8.058    A resident may be treated as having an income which he does not actually receive in a variety of situations. Such income is described as notional income and may be:

a)         income which is paid to the local authority by a third party to contribute towards the fees of a  home – see Section 11.

 

b)         income which would be available on application, see 8.064 about Rehabilitation Allowance.

 

c)         income which is due but has not yet been paid

 

d)         income which the resident has disposed of where the authority is satisfied that the resident has deprived himself of that income in order to reduce the charge payable for his accommodation.

 

Guidance on the factors to be considered is in the following paragraphs.

            Reg.17

            Actual and notional income

 

8.059    If the resident’s actual income is such that the full charge is assessed as being paid it will not be necessary to consider the question of notional income.

 

            Treatment of notional income

 

8.060    Notional income is calculated and treated in the same way as actual income.

 

8.061    SPARE

 

8.061A SPARE

 

8.062    SPARE

 

Income available on application

 

            General

 

8.063    Subject to certain exceptions, income which the local authority is satisfied would be available to the resident if an application were made, but which has not yet been acquired, is to be treated as belonging to that resident.                              Reg.17(2)

 

            Amount of income

 

8.064    Payments of the following cannot be taken into account as notional income

 

1.         income payable under a discretionary trust

 

2.         income payable under a trust derived from a payment made in consequence of a personal injury where such income would become available on application but has not been acquired                                                  Reg 17(2)

 

3.         income from capital derived from an award of damages for personal injury which is administered by a court                                                            Reg17(2)

 

4.         Working Tax Credit

 

Also income which would be fully disregarded should not be included as notional income, for example Housing Benefit, DLA (mobility) and refund of income tax.

 

8.065    Income which is subject to the awarding authority’s discretion, i.e. the resident has no right to payment shall also not be taken into account.                                    Reg.17(2)

 

8.066    Any potential entitlement to Severe Disablement Allowance should not be taken into account. This is because entitlement to this benefit is based on medical conditions which the local authority can not assume are satisfied.                                  Reg.17(2)

 

8.067    All other income should be considered. Examples of income which may be treated as belonging to the resident are

 

1.         unclaimed councillor’s attendance allowance

 

2.         unclaimed Social Security benefit (but not Severe Disablement Allowance).

 

3.         occupational pension not claimed.

            Date taken into account

 

8.068    The income should be taken into account from the date it could be expected to be acquired if an application was made. In considering the earliest date that account can be taken of the income the local authority should:

 

1. assume the application was made on the date the local authority first became aware of the possible income; and

 

2. take into account any time limits which might limit the period of arrears.                                                                                                                Reg.17(2)

 

            Examples

1.         A resident aged 69 is not receiving a retirement pension to which he would have been entitled had he applied. The local authority becomes aware of the possible entitlement on 30/9/03. As retirement pension can only be backdated a year from date of claim the local authority should only take it into account as income from 1/10/02.

 

2.         The local authority becomes aware that a resident aged 64 is not receiving an occupational pension to which he would have been entitled from the age of 60. On his 65th birthday his former employers state that he will be paid all the pension due from age 60. The local authority should take the pension into account from age 60.

 

            Personal Pensions and Retirement Annuity Contracts

 

8.068A Where a resident, aged 60 or over, has a personal pension plan and he has not purchased an annuity, or arranged to draw the maximum income available from the plan, notional income should be assumed in the assessment of charges.  This assumption should also apply to Retirement Annuity Contracts from which income can be derived from age 60 by the purchase of an annuity.  The Jobcentres/the Pension Services will contact the pension provider for details of the income which could be payable where Income Support/Pension Credit is claimed.  For Income Support/Pension Credit claimants authorities should liaise with the Jobcentres/the Pension Services to obtain details.  Where no IS is claimed the authority will need to seek the resident’s permission to approach the pension provider to obtain details of the income which could be received.  This notional income should then be taken into account in the assessment of charges.  The assumption of notional income from personal pensions and Retirement Annuity Contracts only applies to residents aged 60 or over.                                                                                                            Reg.17(2)

 

            Income due but not paid

 

8.069    Any income which is due to a resident, but which has not been paid, is to be treated as belonging to the resident. This does not apply to

 

1.         income payable under a discretionary trust

 

2.         income payable under a trust whose funds are derived from a payment made in consequence of a personal injury

3.         occupational pension which is not being paid, because:

a.         the trustees or managers of the scheme have suspended or ceased payments due to an insufficiency of resources; or

 

b.         The trustees or managers of the scheme have insufficient resources available to them to meet in full the scheme’s liabilities.

            Reg.17(2)

 

8.069A Examples of where to take into account income which is due to the resident, but which has not been paid are:

 

1.         superannuation or other income due but not yet paid (for example, because of a strike by pay clerks)

 

2.         pension or grant which has ceased temporarily, for example due to a postal strike.

 

            Deprivation of income   

 

8.070    A resident is to be treated as possessing income of which he has deprived himself for the purpose of paying a reduced charge.                                                                Reg.17(1)

 

            Example

A resident is assessed as having to pay the full charge based on his income from retirement pension and occupational pension. When reviewing the charge the local authority find that he has sold his right to receive the occupational pension thereby reducing the charge he is assessed as having to pay. The local authority decides that this was done for the purpose of reducing the charge and the occupational pension was taken into account.

 

            Meaning of deprive

 

8.071    A person will have deprived himself of a resource if, as a result of his own act, he ceases to possess that resource.

 

            Questions for consideration

 

8.072    Where the resident appears to have deprived himself of income the local authority should consider the questions covered in the following paragraphs.

 

            Was it the resident’s income?

 

8.073    Where a person, before he deprived himself of an income, was in receipt of that income it is reasonable to assume that the resource belonged to him. Sometimes there will be other evidence such as a letter or documentation which shows that the income was properly payable to the resident.

 

            Has deprivation occurred?

 

8.074    Deprivation will have occurred if a person relinquishes, or transfers to another person, an income which

1. he has been receiving or was due to receive and:

 

2. would have continued to receive had he not relinquished or transferred it.

 

8.075    It is up to the resident to prove that they no longer have the income. If he cannot prove that the income has been disposed of the local authority should treat the resident as still possessing the actual income.


Purpose
of the disposal of income

 

8.076   There may have been more than one purpose of the disposal of income only one of which is to avoid a charge, or a lower charge. This may not be the resident’s main motive but it must be a significant one.

 

 

 

Timing of the disposal of income

 

8.077    Consideration should be given to the timing of the disposal of the asset when deciding whether the purpose of disposing of the asset was to avoid a charge for the accommodation.

 

8.078    The local authority should make a judgement as to the purpose of the disposal of income only after balancing all the person’s motives, explicit and implicit, and the timing behind the action. The authority should bear in mind, however, that deprivation can be considered for resources disposed of at any time. The six month restriction only applies to using the provisions of section 21 of the Health and Social Services and Social Security Adjudication Act 1983 (see Annex D).

           

            Conversion of income to a capital asset

 

8.079    Where, for the purposes of paying a reduced charge or no charge, the right to receive an income resource has been sold, and therefore converted from income to a capital asset, the local authority should consider taking account of

 

1.         the amount of the former income resource or

 

2.         if the newly acquired capital gives rise to a tariff income or an increase in tariff income, the difference between the former income resource and the tariff income, or the increase in tariff income, arising from that capital asset.

 

            Example

A resident sold the right to receive an income under an annuity of £10 per week for £2800. Having no other capital the £2800 did not affect the resident’s assessment of charges. The local authority decided that the resident sold the right to receive the income for the purpose of reducing his assessed charge and treated the resident as receiving £10 per week notional income.

 

            Deprivation decided

 

8.080    If it is decided that the resident has disposed of income in order to avoid a charge or to reduce the charge payable, the local authority will need to assess the charge payable using the resident’s notional income.

            Reg.17(1)

 

8.081    If the resident is unable to pay the charge assessed using the notional income, the local authority should consider whether the provisions of section 21 of the Health and Social Services and Social Security Adjudications Act 1983 can be used to transfer the liability for that part of the charges assessed as a result of the notional income to the person to whom the income has been passed (see Annex D).

 

 

 

 

 

SECTION 9 – EARNINGS

What are earnings?

 

            General

 

9.001    Earnings consist of any remuneration or profit derived from employment. This will include such things as:

 

  • bonus or commission

 

  • payments in lieu of notice

 

  • holiday pay except any payable more than four weeks after the termination or interruption of employment

 

  • any payment by way of a retainer

 

  • any payment made by the person’s employer in respect of any expenses not wholly, exclusively and  necessarily incurred in the performance of the duties of employment. e.g. travelling expenses incurred by the employee between his home and the place of employment.                                         Regs. 10 and 13

 

  • any remuneration paid by, or on behalf of the employer to an employee who is temporarily unable to work because of illness or confinement

 

9.002    Earnings do not include

 

  • any payment in kind

 

  • any payment made by an employer for expenses wholly, exclusively and necessarily incurred in the performance of the duties of the employment

 

  • any occupational/personal pension

 

            Gross earnings

 

9.003    “Gross earnings” means the amount of earnings before any deductions are made, for example tax, National Insurance contributions, pension contributions and trade union subscriptions.

 

            Net earnings of employed earners

 

9.004    To calculate the amount of earnings to be considered in the assessment, deduct from the gross earnings:

 

  • the amount of income tax the resident pays or is liable to pay, or which is deducted by the employer

 

  • the amount of the deduction made by the employer in respect of Class 1 National Insurance contributions

 

  • half of any sum paid to an occupational or personal pension scheme which is:

 

  • paid by the resident; or

 

  • deducted from the earnings by the resident’s employer

                        Reg.14

            Occupational pension

 

9.005    An occupational pension scheme is one which provides benefits payable on termination of service, or on death or retirement.

 

            Personal pension

 

9.006    A personal pension is one which provides benefits payable on death or retirement, but which is not directly related to any previous employment.

 

Statutory Sick Pay, Statutory Maternity Pay, Statutory Adoption Pay and Statutory Paternity Pay

 

9.007    The amount of Statutory Sick Pay, Statutory Maternity Pay, Statutory Adoption Pay and Statutory Paternity Pay to be taken into account is the gross amount less:

 

a)         any income tax paid;

 

b)         any National Insurance employees contributions paid; and

 

c)         half of any sum paid by the resident as a contribution towards an occupational or personal pension scheme.

 

Details of these payments should be obtained from the resident in the first instance but, in the event of any queries the local authority should ask the employer for clarification.

 

Period over which earnings should be taken into account

 

            Payments for regular periods

 

9.008    Where the earnings are paid at regular intervals the weekly amount should be calculated as follows:

a.         earnings paid for periods of a week or less should be taken into account for one week.

 

b.         earnings paid for a calendar month should be multiplied by 12 and divided by 52 to arrive at the weekly amount.

 

c.         earnings paid annually should be divided by 52.

 

d.         earnings paid at other regular intervals should be multiplied by 7 and divided by the number of days for which the payment is made.                                                                         

                             Reg 18(1)(a)

 

            Payments which are not for fixed periods

 

9.009    Where a resident who works as an employed earner receives payments which cannot be attributed to a set period the payments should be taken into account as follows:

 

            Income Support/Pension Credit in payment

 

9.010    Where a resident, who is getting Income Support/Pension Credit, receives a payment of earnings which is not for a set period and is more than the weekly amount of benefit in payment it is unreasonable to take this into account in a particular week and it is therefore appropriate to apportion the payment over a number of weeks.  The appropriate DWP Office will calculate a number of weeks for which Income Support/Pension Credit will be withdrawn and the local authority should follow the same process (i.e. divide the earnings payment by the Income Support/Pension Credit payment plus the standard earnings disregard).  This will be the number of weeks for which Income Support/Pension credit will be withdrawn and that a proportion of the earnings should be included in the financial assessment.  If the answer is not an exact number of weeks the balance should be included in the final part week together with the reduced amount of Income Support/Pension Credit payable.                          Reg 18(2)

            Example

A resident receives a payment totalling £800.

 

He had been receiving Income Support/Pension Credit of £130 per week and would have been entitled to a weekly disregard of £20.

 

The local authority should divide the £800 by the amount of Income Support/Pension Credit in payment plus the disregard (£130 + £20 =£150.)  £800 ¸ £150 = 5.33

 

The £800 should be taken into account in the assessment for a period of 5 weeks at the rate of £150 (the Income Support/Pension Credit previously in payment plus the disregard)

 

In the 6th week the balance of the payment should be taken into account (i.e. £800 – (5x£150) = £50)

 

In assessing the charge over these 6 weeks the local authority should remember that Income Support/Pension Credit will be withdrawn for the first 5 weeks and will be paid at a reduced rate for the 6th week.

 

            Income Support/Pension Credit not in payment

 

9.011    Where Income Support/Pension Credit is not in payment and a resident receives a payment of earnings which is not for a fixed period, the payment should be taken into account over the number of weeks calculated by dividing the payment by the difference between the standard charge and the charge the resident was previously paying (or, if the resident was not liable to pay any charge, dividing by the standard charge). If this calculation results in a fraction of a week, the balance of the payment should be taken into account as income for that final week.                       Reg.18(1)(b)

 

            Example

A resident is paying a charge (A) of £120, the standard charge (B) is £550

 

He receives a payment (C) of £1,750, in respect of which he would be entitled to a £20 disregard if it was paid weekly.
The number of weeks over which the payment is to be taken into account is calculated as follows:

 

C ¸ (B – A) = 4.07 weeks

 

The resident pays the standard charge of £550 less the £20 disregard for 4 weeks (i.e. he pays £530 which is £410 more than he was paying.

 

At the end of five weeks he has used up £1,640 (4 x £410) and has been allowed to keep £80 (4 x £20).

 

He therefore has £110 of the £1,750 left to be taken into account in week 5, less the £20 disregard.

 

            Net earnings of self – employed earners

 

9.012    To calculate the amount of net earnings to be considered in the assessment, deduct from the gross earnings any relevant outgoings, liabilities or expenses such as

 

  • the amount of income tax the resident pays or is liable to pay

 

  • the amount of National Insurance the resident is liable to pay

 

  • half of any sum paid to a personal pension scheme

 

  • stock purchases

 

  • transport costs, wholly related to the business

 

  • stationery

 

  • advertising                                                                                     Reg.11

 

            Assessing the weekly net earnings of self – employed earners

 

9.013    Where the resident has recently started self – employment or where circumstances result in a change in the normal pattern of business, the weekly earnings should be calculated from the start of self-employment or the date of change by averaging the earnings over whatever period is going to result in the fairest assessment of earnings for the resident.

 

9.014    In all other cases, the weekly earnings should generally be calculated by averaging the net earnings over a period of a year. This means that the annual income will be divided by 365 (or 366 in a leap year) and multiplied by seven.  Every effort should be made to reach a fair estimate of weekly earnings until sufficient information is available to make a more accurate calculation.  The normal annual reassessment process should apply with more frequent reviews upon request, should there be regular variations in earnings.                                                           

Reg.12(1)

 

            Royalties or fees from copyright

 

9.015    Where the resident receives royalties or fees from copyright irregularly, the period of weeks over which the payment should be taken into account follows the process as set out in 9.010 and 9.011.                                                           Regulation 18(2)

 

9.016    SPARE

           

9.017    SPARE

            Disregards

 

9.018    The amount of earnings to be taken into account in the assessment is the net amount calculated in accordance with paragraphs 9.001 to 9.015 above, less the appropriate disregard.

 

9.019    Disregard £5 of the net weekly earnings unless the resident qualifies for a different disregard under paragraph 9.020 to 9.023 or a discretionary disregard under paragraph 2.009.

            Schedule 2 para.4

 

            People entitled to a £20 disregard

 

9.020    Disregard £20 of the net weekly earnings if the resident:

 

a)         receives Income Support/Pension Credit which includes a disability premium or a carer’s premium;

 

                        or:

 

b)         is under the qualifying age (see Annex J) and;

 

(i)         receives one of the following benefits:

 

  • Disability Living Allowance (mobility or care components at any rate)

 

  • Disability Working Allowance

 

  • Mobility supplement

 

  • Severe Disablement Allowance

or:

 

(ii)        has an invalid carriage or other vehicle provided under:

 

  • Paragraph 9 of schedule 1 to the National Health Service Act 2006 (previously section 5(2) of the National Health Service Act 1977); or

 

  • in Scotland, under section 46 of the National Health Service (Scotland) Act 1978

or:

 

(iii)       receives a grant under:

 

  • para 2 of Schedule 2 of the National Health Service Act 2006 (previously the National Health Service Act 1977; or
  • in Scotland, section 46 of the National Health Service (Scotland) Act 1978

or:

 

iv)        is registered as blind;

or:

 

v)        has provided medical evidence of incapacity in support of a claim for:

 

  • incapacity benefit; or

 

  • severe disablement allowance;

 

for a continuous period of not less than 28 weeks.

or:

 

vi)                 has ceased receiving Attendance Allowance or Disability Living Allowance solely because he has been in residential accommodation for more than four weeks

 

                        or:

 

c)         is over the qualifying age (see Annex J); and

 

satisfied one of the conditions in b) above before reaching the
qualifying age ; and

 

has worked continuously since reaching the qualifying age

 

                        or:

 

d)         is a lone parent.

 

                        or:

 

e)         receives Carers Allowance                                    Schedule 2 para 3

 

 

            People who have ceased or interrupted employment

 

9.021    In the case of a resident who has been employed as an employed earner and whose employment has ended or been interrupted, any earnings paid, or due to be paid in respect of that employment shall be fully disregarded.   

                        Schedule 2 para.1

 

            People who have ceased self-employment

 

9.022    In the case of a resident who has been self-employed and whose self-employment has ended, any earnings, apart from any fees from copyright or royalties, paid or due to be paid after the self-employment has ceased, shall be fully disregarded.                                                                                                                        

                        Schedule 2 para.2

 

            Earnings frozen abroad

 

9.023    Any earnings derived from employment which are payable in a country outside the UK, the transfer of which to the UK is prohibited, shall be fully disregarded.                                                                           

                        Schedule 3 para.15

 

SECTION 10 – TRUST FUNDS

This section does not apply to the Macfarlane Trust, the Macfarlane (Special Payments) Trust, the Macfarlane (Special Payments)(No.2), the Fund, the Eileen Trust, the MFET Limited, the Independent Living Fund (2006), the Skipton Fund, the London Bombing Relief Fund and the Caxton Foundation. See paragraph 8.041.

 

What is a trust?

 

10.001  A trust is an arrangement for one person or a group of people (the trustee(s)) to hold and administer capital in the form of money or property for the benefit of another person or group of people (the beneficiary (ies)).

 

10.002  Examples of capital which might be held on trust are:

 

  • money awarded by a court as compensation

 

  • proceeds of a separation or divorce settlement

 

  • money set aside by parents to ensure a regular income for a person who is unable to support himself by reason of illness or disability

 

  • a bequest under a will

 

            Trustees

 

10.003  Trustees may be:

 

  • the Public Trustee

 

  • the Court of Protection

 

  • a professional person such as a solicitor

 

  • the parents of a beneficiary who cannot act for himself

 

  • any other responsible person, perhaps appointed under the terms of a will

 

10.004  Trustees’ powers are governed by:

 

a)         the terms of any trust deed;

 

b)         the law of equity; and

 

c)         the Trustee Act 1925 or the Administration of Estates Act 1925 in England and Wales or the Succession (Scotland) Act 1964 in Scotland.

 

            Identifying a trust

 

10.005  A trust is usually set up by means of a trust deed. The deed sets out the terms of the trust, and will contain details of the beneficiaries, the amount by which they should benefit and when payment or payments should be made. The trust deed could be in the form of a will or Deed of Settlement.

 

            Treatment of trusts

 

10.006  A resident’s interest in a trust could take one of two forms:

 

a)         he has absolute entitlement to capital or income from the trust (10.008 – 10.018); or

 

b)         the trustees have discretion to make payments of capital or income to him (10.019 – 10.022).

 

            Information needed

 

10.007  Where a resident is a beneficiary under a trust, find out from the trustees or from the trust document whether:

 

a)         the beneficiary is absolutely entitled to money from the trust;

 

b)         the trustees have discretion to make payments; and

 

c)         the trust is in consequence of personal injury.

 

            Absolute entitlement

 

10.008  Absolute entitlement means that the beneficiary has an absolute vested interest in capital held on trust (or in a share of capital held on trust), and could call for the whole of the capital and income to be transferred to him at any time. This also applies where the beneficiary is incapable of managing his affairs. In these cases a Deputy appointed by the Court of Protection could call for the transfer on behalf of the beneficiary.

 

            Information needed

 

10.009  Where the beneficiary is absolutely entitled to money from the trust (i.e. has an unconditional right), find out whether he is entitled to:

 

a)         any capital held in trust; and

 

b)         any income produced by the trust assets.

 

 

            Absolute entitlement to capital

 

10.010  If the beneficiary is absolutely entitled to capital, find out the value of the capital. Where a number of beneficiaries have a shared interest in a trust, divide the total value equally between the joint beneficiaries and treat the resident as owning an equal share. This method of treatment avoids administrative difficulties. Once the resident is in sole possession of his actual share, treat him as owning that actual amount.

 

10.011  Where the resident is not in possession of capital to which he has absolute entitlement, but the capital would become available to him upon application being made, treat him as possessing that capital as an actual capital asset. See Section 6 (Capital).

 

10.012  Some trusts provide for the beneficiary to become absolutely entitled to the trust capital on a specified date, for example his 21st or 25th birthday. In these cases the beneficiary has a contingent interest. Once the contingency is satisfied, the beneficiary becomes absolutely entitled to the capital.

 

10.013  The capital asset constitutes a chose in action (“a thing which can be sued for”). The capital asset to be taken into account is the market value, after making an allowance for the value of the underlying assets. It will probably be necessary to obtain written evidence of the value of the trust fund. Where there would be expenses of sale, deduct 10% of the value.

 

10.014  Where the assessing officer and the resident agree that the value of the resident’s total capital, including the value of the trust capital, is:

 

a)         more than £23,250; or

 

b)         less than £23,250

 

it will not be necessary to obtain a precise valuation of the trust

 

            Absolute entitlement to income

 

10.015  Where a trust deed directs that a beneficiary is to receive income produced by the trust capital, the beneficiary has absolute entitlement to the income. The right to receive that income has a value, and the value of the right to receive income is a capital asset. That capital asset is fully disregarded for assessment purposes. (see paragraph 10.017 for treatment of the income).

            Schedule 4 para.13

 

10.016  A person who has a contingent interest in capital (as in paragraph 10.012) becomes absolutely entitled to receive the income from the capital on his 18th birthday, even where the contingency affecting the capital has not yet been satisfied. The value of the right to receive income is fully disregarded as in paragraph 10.015.

 

10.017  Where a person has absolute entitlement to income from a trust, the income he receives, or which would become available to him on an application being made, should be taken into account in full in the assessment. Where the resident does not receive income to which he has absolute entitlement, but the income would become available to him upon application being made, he should be treated as possessing that income as an actual income. (See Section 8 – Income). In order to treat the income as an actual resource, you must be able to identify the income which should be paid, and to establish that there is nothing which prevents payments being made, such as a legal charge against the fund.                                                                                                  Reg.17(1)

 

            Absolute entitlement to capital and income

 

10.018  Where the beneficiary has absolute entitlement to capital and income, and is being treated as possessing the capital sum, the income derived from the capital should be treated as capital, and not taken into account as income in the assessment.                                                                                                                                  Reg.22(4)

 

Discretionary trusts

 

            Information needed

 

10.019  If the trustees have discretion to make payments of capital or income, find out whether any payments are made, and if so:

 

a)         how much is paid;

 

b)         how often payments are made; and

 

c)         to whom the payments are made.

 

            Treatment of discretionary payments

 

10.020  Where payments are made wholly at the discretion of the trustees and there is no absolute entitlement either to capital or income, only take into account payments which are actually made. Do not assume notional capital or income from a discretionary trust (see Sections 8 (Income) and 6 (Capital).

 

10.021  Payments from a discretionary trust are effectively voluntary payments. Treat them in accordance with the normal rules for the treatment of voluntary payments (paragraphs 8.050 to 8.052)

 

10.022  Payments from a charitable trust which promotes a public benefit are always discretionary payments. Treat them in accordance with the normal rules for the treatment of charitable payments (paragraphs 8.050 to 8.052)

 

Compensation for personal injury

 

            Information needed

 

10.023  Obtain confirmation that the capital held in trust is a lump sum payment of:

 

  • compensation for injury or death (including vaccine damage)

 

  • damages under the Fatal Accidents Act

 

10.024  Find out whether the beneficiary receives any income from the capital held in trust, and if so:

 

a)         how much is paid; and

 

b)         how often it is paid

 

            Treatment of capital

 

10.025    Where the capital consists of any payment made in consequence of personal injury
and a court has not specifically identified the payment as being to cover the cost of
providing care, that capital is disregarded for a period of up to 52 weeks from the
date of receipt of the first payment.  If the money is placed in a disregarded location
such as a personal injury trust or is administered by a court the relevant disregards
will apply. Subsequent payments outside the 52 weeks are taken fully into account
unless they are placed into a disregarded location.
10.026    Where the capital consists of any payment made in consequence of personal injury and
a court has specifically identified the payment as being to cover the cost of providing
care that capital is taken into account.  However, if the money is placed in a
disregarded location such as a personal injury trust or is administered by a court the
relevant disregards will apply.

Regulation 21(2) and Schedule 4 paragraph 10A                                                                                                                                                                                                                             Schedule 4 para.10

 

Treatment of Income

 

10.027       The following periodical payments are disregarded:

 

  • Payments from a trust whose funds are derived from a payment made in consequence of any personal injury;
  • Payments under an annuity purchased pursuant to any agreement or court order to make payments in consequence of personal injury, or from funds derived from such a payment, in consequence of any personal injury;
  • Payments received by virtue of any agreement or court order to make payments to the resident in consequence of any personal injury

                                                Regulation 15(2) and Schedule 3 para.10

 

 

(The agreements mentioned above include out-of-court settlements)

 

 

           

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

                         SECTION 11 – THIRD PARTY PAYMENTS AND TOP-UPS

 

11.001 Third party payments can be made:

 

  • to help clear arrears of fees (see 11.007) and;
  • where the resident has chosen to move into a care home that is more expensive than the local authority would expect to pay having regard to the residents assessed needs.  This is known as a “top-up” (see 11.009).
  • These top-up payments can also be made by the resident (allowable only in certain circumstances) where the resident has chosen to move into a care home that is more expensive than the local authority would expect to pay having regard to the resident’s assessed needs i.e. the resident makes their own top-up (see 11.011).

11.002  Except in circumstances set out in 11.011, a resident cannot use their own resources to     pay for more expensive accommodation i.e. cannot act as their own third party and make             a top-up.

11.003  A third party could be a family member, friend or other person.

11.004  Top-ups made by a third party are intended to allow residents some greater                      freedom in choosing a care home in which they wish to live.

 

11.005 Top ups made by a third party will be owned by the resident and should be treated as
income in the financial assessment. (see 11.010 below)
Regulation 17(4)

 

11.006  If the third party is making a top up payment direct to the authority, by agreement, the       amount of the payment should be treated as notional income of the resident to ensure       that the payment is taken into account in the assessment.

Regulation 17(5)

 

            Third party payments to clear arrears

 

11.007 Payments made by a third party to the resident to help clear arrears of charges for
residential accommodation will be treated as capital in the normal way (if these     payments are made directly to the authority they are not treated as belonging to the             resident).(See11.008)
Regulation 22(8)

 

11.008  Where a third party makes a payment directly to the authority in respect of a resident’s

arrears on charges for residential accommodation it should not be treated as the resident’s
notional income and will not therefore need to be taken into account as available   towards the resident’s current charge.  In order to avoid the payment being regarded as             the resident’s capital, it is recommended that, where a single payment or a series of   payments are offered by a third party to help clear arrears, arrangements are made for the             payment to go directly to the authority.
Regulation 17(5)

 

 

            Third party top-ups to meet higher fees

 

11.009 Circular NAFWC 46/2004 and WHC 2004(066) provides guidance on the
associated National Assistance Act 1948 (Choice of Accommodation) Directions 1993,
which is intended to ensure that when authorities with social services responsibilities make
placements in care homes or care homes with nursing that, within reason, individuals are
able to exercise genuine choice over where they live.

11.010 It is advisable to carefully study the guidance in NAFWC 46/2004 but the following are
the main points relating to the charging process.

  • Local authorities must contract to pay the full cost of the accommodation, including the top up.
  • The third party’s contribution will be treated as part of the resident’s income for charging purposes and the authority will be able to recover it in that way.
  • The third party can, by agreement with all parties, pay the top up direct to the accommodation on behalf of the resident but even where there is such an agreement the authority continues to be liable to pay the required amount.
  • However, good practice would involve the third party payment being paid to the authority.  The authority would pay the full fee to the provider.
  • Local authorities should monitor the percentage of placements funded by the authority’s which involved a third party payment.
  • The resident will be required to demonstrate that either they, or the third party is able and willing to pay the difference between the authority’s usual rate and the accommodation’s actual fees.
  • Residents and third parties should understand, clearly, from the outset that there cannot be any guarantee that any increases in the accommodation fees will automatically be shared evenly between the authority and/or the resident or third party; that an increase in the resident’s income will not necessarily lessen the need for a top up as the residents income will be subject to the financial assessment in the normal way; that failure to keep up top up payments may result in the resident having to move  to other accommodation unless, after an assessment of need, it is shown that assessed needs can only be met in the current accommodation.

            Top ups made by the resident

11.011  From 24 October 2001, a resident may top up from his own resources as listed below
only if they and the authority have made a deferred payments agreement or the resident is
subject to the 12 weeks property disregard.

Residents subject to the 12 weeks property disregard may top up from:

  • Earnings disregarded under the regulations
  • Income disregarded under the regulations
  • Capital disregarded under the regulations (with the exception of the value of the resident’s home that is subject to the 12-weeks property disregard)
  • Other capital resources, excluding their home, with the proviso that:
  • People can only top-up to the value of the capital limit

 

          Residents who have a deferred payments agreement may top-up from:

 

  • Earnings disregarded by CRAG
  • Income disregarded by CRAG
  • Capital disregarded by CRAG
  • Other capital resources including the value of the property that is subject to the deferred payments agreement, with the proviso that the resident must be left with total capital resources under the means-test to the value of the capital limit.  (When the value of the property is used as “collateral” for top-ups, the amount of the top-up is added to the resident’s deferred contributions.  (This amount is eventually repaid when the home is sold).

 

11.012  Where a resident is making top-up payments in the circumstances described in 11.011, and where the value of the top-up is not added to the deferred payment contribution, because it is not made from the value of the resident’s property, the top-up must be treated as part of the resident’s income.                                                                                                                                                                                                  Reg 16A

 

          Example

A relatively young resident is subject to a deferred payments agreement.  She has a property worth £30,000, other capital resources of £10,000 and income of £150 per week.  The resident wishes to enter a residential care home where the actual cost is £400 per week, compared with the authority’s usual cost for someone with her needs of £300 per week.  The authority considers whether to agree to the placement and/or a deferred payments agreement in these circumstances.  It knows that the resident must be left with capital resources to the value of £23,250.  Taking into account the deferred contributions that must be repaid from the sale of the house, the authority calculates that this resident would spend her capital resources (that is £30,000 for the house plus £10,000 for the other capital resources) to the limit in approximately 2 years or so.  As a result the authority advises the resident to consider a less expensive home, as it feels that the resident would not be able to sustain her top-up contributions for the likely length of time she will spend in residential care.

Regs 16A and 28; and Reg 4

National Assistance (Residential Accommodation)

       (Additional Payments and Assessment of Resources)       

(Amendment) (Wales) Regulations 2003

 

 

 

SECTION 12  STUDENTS

 

            General

 

12.001  Students may have different types of income which will be treated in different ways.

 

Grant Income

 

            Sources of grant income

 

12.002  A student may receive a grant from a number of different sources, but the majority will receive a statutory award. This will be calculated in England and Wales by the Local Education Authority (LEA) and in Scotland by the Scottish Education Department (SED), according to the provisions in force at the start of the academic year. In both cases, the grant is likely to include amounts for various specific purposes, such as tuition fees, examination fees, personal maintenance (i.e. the standard maintenance grant), and travelling expenses. A student who receives a discretionary grant may have that grant assessed on a different basis. Care should be taken in establishing the details of the grant, in particular whether the grant is payable for the period of study since in many cases this will not be the case.

 

            Period over which grant should be taken into account

 

12.003  The notice of grant award will show what period the grant is payable for. If not the local authority should ask the LEA or SED for details.

a.         Where the grant is payable for the period of study, the amount to be taken into account should be divided equally over the number of weeks in the period of study.

 

b.         Where the grant is payable for some other period, the amount to be taken into account should be divided equally over the number of weeks for which the grant has been paid.                                                                       Reg.36(2)

 

            Note Grants which are awarded under the Education (Mandatory Awards) Regulations will include grant payment for the Christmas and Easter vacations. However, discretionary grants, where awarded, may not include payment for those vacations.

 

            Assessed contribution

 

12.004   The LEA or SED may decide that the student’s parent or spouse or civil partner should make a contribution to the grant. Such a contribution would be assessed on the basis of the income of the parent or spouse or civil partner and the actual grant payable will be reduced by the amount of assessed contribution.                                                                                                                                                                     Reg.35

 

           Amount of grant income

 

12.005 The amount of grant income to be taken into account should be the amount of standard maintenance grant included in the grant. The standard maintenance grant is specified in Schedule 2 to the Education (Mandatory Awards) Regulations 1987 and the figure should be obtained from the LEA each year. Any other part of the grant should be ignored.                                                                                              Reg.36(1)

 

12.006  Any assessed contribution from the resident’s parents or spouse or civil partner, whether
or not it is actually paid (including any paid by deed of covenant), should be added to the grant and taken into account up to the level of the standard maintenance grant.

 

                                                                                                                        Reg.35

Covenant income where there is no grant income

 

            Meaning of covenant income

 

12.007  Covenant income is the income, net of tax at the basic rate, payable to the student under a deed of covenant by a person whose income is, or is likely to be, taken into account in assessing the student’s grant or award.                                                                Reg.35

 

            Deed of covenant

 

12.008  A deed of covenant is an agreement in writing between a covenantor (donor) and a covenantee (recipient) that a certain sum or sums from the former’s income will be paid to the latter while certain conditions exist. A covenant enables the covenantee to reclaim in whole or part tax deducted by the covenantor from his payments.

 

            Amount to be taken into account

 

12.009  The amount of covenant income to be taken into account is equivalent to the amount of standard maintenance grant which would have been paid, had a maintenance grant been payable. Ask the LEA to provide details of the relevant standard maintenance grant in a case such as the resident’s.

            Reg.37(1)

 

12.010  Any amount of covenant income above the figure of the standard maintenance grant should be ignored.

            Reg.37(1)

            Disregards

 

12.011 No part of the grant or covenant income should be disregarded as a           charitable or voluntary payment. (see 8.050 – 8.052)                                                                                                                                                                                   Reg.38

            Student loans

 

12.012  Student loans are administered by the Student Loans Company Ltd. and are paid out of money made available by the Secretary of State for Education.

 

            Eligibility for student loans

 

12.013  Loans are generally available to full-time students on higher education courses lasting at least one academic year which are

 

1.         below postgraduate level (with the exception of the Post Graduate Certificate in Education) but above

 

1.a.       Advanced level

 

1.b.       Scottish Higher level

 

1.c.       BTEC or ScotVEC national diploma.

 

            Maximum student loans

 

12.014 The amount for which the student is eligible is always the maximum according to his circumstances. If the student has taken none, or only part, of the loan this will be by his own choice. If the student is eligible for a loan (see 12.013 above) it will be taken into account whether or not the student has taken the loan.                                                                                                                                                          Reg.39

 

12.015  The maximum amount of student loan will depend on

 

  1. where the student is studying (London or elsewhere)

 

2.         whether the student has reached the final year of the course

 

The maximum student loan can be found by asking the LEA or SED or by contacting the Student Loan Company Ltd. 100 Bothwell Street, Glasgow G2 7JD.

 

            Calculation of weekly income from student loans

 

12.016  The weekly amount of loan income should be calculated by dividing the appropriate maximum loan

 

1.         if the student is in the final academic year of the course, or if the course is only of one year’s duration – by the number of weeks between the start of the academic year (1 January, 1 April or 1 September as appropriate) and the last day of the course.

 

2.         in any other case – by 52 or 53 depending on the number of weeks in the academic year (the 12 months from 1 January, 1 April or 1 September) for which the loan is payable.

            Reg.39

            Amount to be disregarded

 

12.017  Up to £10 of the weekly income from a student loan should be disregarded.                           

                        Reg.39

 

            Access funds

 

12.018  Access funds provided by the Secretary of State for Education are intended for the relief of hardship, where a student might be prevented by financial considerations from starting or completing a course. The funds are administered by the educational institutions such as colleges and polytechnics and payments are made by lump sum, regular weekly cash payments, or by payment in kind. Payments can be made to third parties.

 

            Treatment of payments

 

12.019  Payments made at regular intervals should be treated as a voluntary payment and be subjected to a £20 disregard.                                                                 Reg.40(1)

 

12.020  Payments paid, or due to be paid, at irregular intervals should be treated as capital.

            Reg.40(2)

 

                                                                          

 

SECTION 13 – TRANSITIONAL PROVISIONS

 

From April 1996 all residents who were paying a protected amount calculated under the Transitional Provisions should have their charges assessed under the current rules.

 

Local authorities should keep archive copies of Transitional Provisions guidance to refer to should any resident query his past assessments.

 

 


ANNEX A

SOCIAL SECURITY BENEFIT RATES

   RATES

   RATES

(Weekly rates unless otherwise shown)

2011

2012

 

RATES OF PERSONAL EXPENSES ALLOWANCE (Wales only)

 

 

 

 

 

Standard PEA for all Part III residents.                  £23.00

24.00

 

 

RATES OF BENEFIT

 

(£)

 

 

 

 

ATTENDANCE ALLOWANCE  higher rate

73.60

77.45

lower rate

49.30

51.85

 

 

 

DISABILITY LIVING ALLOWANCE  Care Component  Highest

73.60

77.45

Middle

49.30

51.85

Lowest

19.55

20.55

   Mobility Component

 

 

Higher

51.40

54.05

Lower

19.55

20.55

 

 

CARER’S ALLOWANCE

 

55.55

58.45

 

EARNINGS RULES

 

 

 

 

 

Therapeutic earnings limit                    95.00

97.50

   INCAPACITY BENEFIT

 

 

 

 

 

Long-term Incapacity Benefit

94.25

99.15

         Short-term Incapacity Benefit (under pension age)  lower rate

71.10

74.80

higher rate

84.15

88.55

   Short-term Incapacity Benefit (over pension age)  Lower rate

90.45

95.15

higher rate

94.25

99.15

 

 

Increase of Long-term Incapacity Benefit for age

 

 

  higher rate

13.80

11.70

lower rate

5.60

5.90

   Invalidity Allowance (Transitional)

 

 

higher rate

13.80

11.70

middle rate

7.10

5.90

lower rate                      5.60

5.90

   INCOME SUPPORT/MINIMUM INCOME GUARANTEE

 

 

 

 

 

Personal Allowances  18 to 24

53.45

56.25

25 or over

67.50

71.00

   Premiums  Pensioner     Couple

103.75

106.45

Pensioner (enhanced)     Disability  Single

28.85

30.35

Couple

41.10

43.25

   Allowances for personal expenses for claimants in

 

 

   Private and voluntary residential  care and nursing homes  Personal expenses (Wales)

 

 

23.00

24.00

Capital  upper limit

16,000.00

16,000.00

amount disregarded

6,000.00

6,000.00

child’s limit

3,000.00

3,000.00

   amt disregarded of RC/NH

 10,000.00

 10,000.00

      Expenses for subtenants

20.00

20.00

Furnished or unfurnished  where heating is included, additional     Statutory Adoption Pay  Earnings Threshold  Rate   

 

 

 

Statutory Maternity Pay  Earnings Threshold

102.00

107.00

Standard Rate

128.75

135.45

   Statutory Paternity Pay  Earnings Threshold

102.00

107.00

Rate

128.73

135.45

   Retirement Pension  Category A or B

102.15

107.45

Category B(lower) – husband’s insurance

61.20

64.40

Category C or D   – non-contributory

61.20

64.40

Category C(lower) – non-contributory

36.60

38.50

   Additional pension

3.10%

5.20%

   Increase of Long-term Incapacity Benefit of age (over pension age)  Higher rate

19.25

20.25

Lower rate

9.65

10.15

   Invalidity Allowance (Transitional) (over pension age)  Higher rate

19.25

20.25

Middle rate

12.40

13.00

Lower rate

6.20

6.50

   SEVERE DISABLEMENT ALLOWANCE  Basic rate

62.95

69.00

   Age-related addition (from Dec 90)  Higher rate

13.80

11.70

Middle rate

7.10

5.90

Lower rate

5.60

5.90

 

 

 

PENSION CREDIT

 

Standard minimum guarantee

April 2011

April 2012

Single

137.35

142.70

Couple

209.70

217.90

Additional Amount for severe disability
Single

55.30

58.20

Couple (one qualifies)

55.30

58.20

Couple (both qualify)

110.60

116.40

Additional amount for carers

31.00

32.60

Savings Credit Threshold
Single

103.15

111.80

Couple

164.55

178.35

Capital
Amount disregarded – care homes

10,000

10,000

Deemed Income
£1 for each complete £500 or part thereof in excess of the above amounts
Housing costs
Deductions for non dependants aged 18 or over, not in work or in work

9.40

11.45

And in receipt of Pension Credit – aged 18 or over and in work:
Gross income: less than £124

9.40

11.45

Gross income: £124 to £182.99

21.55

26.25

Gross income: £183 to £237.99

29.60

36.10

Gross income: £238 to £315.99

48.45

59.05

Gross income: £316 to £393.99

55.20

67.25

Gross income: £394 and above

60.60

73.85

 
Amount for claimant and first spouse in a polygamous marriage or civil partnership

209.70

217.90

Additional amount for additional spouse

72.35

75.20

 
Disregards
Standard Earnings

5.00

5.00

Couple Earnings

10.00

10.00

Higher Earnings

20.00

20.00

War disablement pension and War widows pension

Armed Forces Compensation Scheme

10.00

10.00

10.00

10.00

Widowed Parent’s Allowance

10.00

10.00

Income from subtenants

20.00

20.00

Income from boarder’s (disregard the fixed £20)

20.00

20.00

Plus 50% of the balance of the charge  Deductions for direct payments arrears of housing, fuel, water costs, council tax and fines default

3.40

3.55

   Arrears of Community Charge court order against claimant

3.40

3.55

Court order against couple

5.30

5.60

   Maximum rates recovery of overpayments  ordinary payments

10.20

10.65

where claimant convicted of fraud

13.60

17.75

 

 

 

ANNEX B

THE TREATMENT OF COUPLES IN CLAIMS FOR INCOME SUPPORT/PENSION CREDIT

(for information only)

 

While local authorities do not have powers to assess a couple according to their joint resources, this is not the case for Income Support/Pension Credit. The treatment of a couple for Income Support/Pension Credit will depend on a number of factors and it may be useful to know how their benefit is assessed. This may give an indication of how much the spouse or civil partner who remains at home is likely to be able to contribute towards the cost of accommodation.

 

Temporary Residents

 

Where the couple are temporarily separated as a result of one being admitted to residential accommodation they will still be treated as a couple for Income Support/Pension Credit purposes, and the whole amount of Income Support/Pension Credit will normally be paid to one partner (generally the partner remaining at home). However, the way that the total amount of Income Support payable to the couple is calculated may differ from the way that the total amount of Pension Credit is calculated.

 

One member of a married couple temporarily in residential accommodation

 

Where only one member of a married couple or civil partnership  is temporarily in a residential care home, and the couple are entitled to Pension Credit, the Pension Credit will be paid at the normal appropriate minimum guarantee for the couple as if they were both still at home.

 

Where one partner is temporarily in a residential care home, and the couple are entitled to Income Support, the Income Support applicable amount will be the greater of:

 

•           the normal applicable amount for the couple as if they were both still at home

 

            or

 

•           the normal applicable amount for the partner remaining at home plus the applicable amount for the partner in the residential accommodation as if they were a single person.

 

Both partners temporarily in residential accommodation

Where both partners are in different residential homes or the same residential home Income Support/Pension Credit will be paid in respect of each partner, plus an amount for home commitments where appropriate.


One partner permanently in residential accommodation or both partners in separate residential accommodation

 

Where one partner moves permanently to residential accommodation Income Support/Pension Credit will be paid as if he were a single person. No account will be taken, in the Income Support/Pension Credit assessment, of the resources of the partner remaining at home although, for those under 60 years, the Jobcentre Plus may look to the partner at home to make a contribution as a liable relative.

 

Both partners in the same residential accommodation

 

Where both partners are admitted to the same residential care or nursing home, the Job Centre Plus/Pension Service Adjudication Officer will have decided whether to assess them as a couple or separately.

 

A married couple, civil partnership or unmarried couple who live in the same household are treated as one unit for Income Support/Pension Credit assessment purposes, and their resources are “aggregated”. This means that all the capital and income resources of the couple, whether jointly owned or owned by one partner or the other, are taken into account in one assessment for the couple.

 

An important factor in deciding whether to treat two residents as a couple for Income Support/Pension Credit purposes is whether they live in the same household. A married couple or civil partner living in separate homes would not be aggregated because they do not share one household.

 

If both partners are living in the same residential care or nursing home they may be considered to be living in the same household. However, there may be exceptions, e.g. where one partner lives in a nursing wing and the other in a residential wing, they might be said to live in separate households.

 

If the Jobcentre Plus/the Pension Service Adjudication Officer has decided to aggregate the

couple’s resources Income Support/Pension Credit will be paid to one member of the couple

taking into account the needs of both members.

 

 

ANNEX C

Value of National Savings Certificates
Issue Number Unit Price

 

Year of Issue Value of each unit (in £’s) at:
1.7.98 1.7.99 1.7.00 1.7.01 1.8.02
 1st 15s.6d. 1916-1922

4.61

4.66

4.71

4.76

4.82

 2nd 16s. 1922-1923

4.54

4.59

4.64

4.69

4.74

 3rd 16s. 1923-1932

3.58

3.90

3.95

4.00

4.05

Conversion 16s. 1932

3.58

3.90

3.95

4.00

4.06

 4th 16s. 1932-1933

3.33

3.37

3.41

3.45

3.49

 5th 16s. 1933-1935

3.21

3.25

3.29

3.34

3.38

 6th 15s. 1935-1939

3.17

3.23

3.27

3.33

3.37

 7th 15s. 1939-1947

5.54

5.72

5.72

6.04

6.15

£ issue £1 1943-1947

5.54

5.72

5.72

6.04

6.15

 8th 10s. 1947-1951

3.56

3.68

3.68

3.88

3.97

 9th 15s. 1951-1956

4.63

4.79

4.79

5.05

5.17

10th 15s. 1956-1963

3.95

4.09

4.09

4.32

4.40

11th £1 1963-1966

5.15

5.32

5.32

5.63

5.73

12th £1 1966-1970

4.23

4.38

4.38

4.63

4.74

Decimal £1 1970-1974

3.93

4.06

4.16

4.28

4.36

14th £1 1974-1976

3.65

3.77

3.88

3.99

4.06

14th £1 1977-1979

3.08

3.18

3.26

3.36

3.45

Index-linked

 

Retirement

 

Issue £10 1975-1980

30.15

30.54

31.48

32.12

32.49

16th £5 1976-1977

19.08

19.68

20.18

20.78

21.17

18th £10 1979-1980

29.13

30.10

30.84

31.77

32.40

19th £10 1980-1981

28.55

29.49

30.22

31.14

31.75

Second index-

 

linked issue £10 1980-1985

20.61

20.88

21.52

21.96

22.22

21st £10 1981

25.86

26.71

27.37

28.20

28.76

23rd £25 1981-1982

67.47

69.62

71.40

73.54

74.91

24th £25 1982

59.75

61.75

63.25

65.16

66.44

25th £25 1982-1983

53.62

55.33

56.75

58.47

59.62

26th £25 1983-1984

54.12

55.85

57.28

58.99

60.09

27th £25 1984

50.48

52.15

53.45

55.07

56.15

28th £25 1984

54.66

56.41

57.85

59.58

60.70

29th

 

£25 1984-1985

50.99

52.67

53.98

55.61

56.70

3rd index-

 

linked issue£25 1985-1986

50.38

51.43

53.22

54.41

55.94

           30th £25 1985

51.69

53.34

54.70

56.33

57.38

31st £25 1986

46.50

48.03

49.22

50.71

51.71

4th index-

 

linked issue£25 1966-1990

39.95

40.79

42.20

43.16

44.15

32nd £25 1986-1987

47.83

49.35

50.61

52.12

53.10

33rd

 

re-investment£25 1987-1988

41.36

42.75

43.79

45.12

46.23

34th

 

re-investment£25 1988-1990

39.80

41.07

42.12

43.38

44.19

 

35th

 

re-investment  1990-1991

42.54

43.90

45.02

46.36

47.23

5th index-

 

linked issue

 

re-investment£25 1990-1992

36.14

36.72

37.81

38.47

39.16

36th issue          36th issue £25 1991-1992

38.91

40.19

41.19

42.44

43.28

re-investment

 

37th issue £25 1992

37.71

38.95

39.92

41.14

41.95

37th issue

 

re-invested£25 1992

37.71

38.95

39.92

41.14

41.95

           38th issue £25 1992

36.83

38.01

38.99

40.15

40.91

38th issue

 

re-investment£25 1992

36.52

37.75

38.67

39.85

40.83

39th issue £100 1992

141.06

145.71

149.34

153.87

156.89

39th issue

 

re-investment£100 1992

141.06

145.71

149.34

153.87

156.89

 

40th issue          re-investment£25 1992-1993

31.85

33.54

34.39

35.41

36.08

6th index-

 

linked issue£25 1992-1993

31.85

34.01

35.02

35.64

36.28

6th index-

 

linked –

 

re-investment

 

Issue £25 1992-1993

32.52

34.01

35.02

35.64

36.28

41st issue

 

re-investment£25 1993-1994

29.78

31.95

33.17

34.16

34.80

7th index-

 

linked issue£25 1993-1994

30.52

32.67

34.12

34.72

35.34

 

42nd issue         re-investment£100 1994 – date

110.28

116.70

125.11

133.85

137.14

8th index-

 

linked issue£100 1994 – date

112.86

117.95

126.92

133.44

135.83

re-investment£100 1994- date

112.86

117.95

126.92

133.44

135.83

43rd issue

 

re-investment£100 1996- date

104.83

109.41

115.20

122.77

130.78

9th index

 

-linked issue£100 1996-date

106.65

109.88

115.64

121.81

129.31

re-investment£100 1997-date

106.65

109.88

115.64

121.81

129.31

           44th issue          re-investment£100 1997-date

100.94

104.83

109.41

115.20

125.10

10th index-

 

linked issue£100 1997-date

100.00

107.51

112.79

118.07

126.78

re-investment£100 1997-date

104.55

107.51

112.79

118.07

126.78

11th index-

 

linked issue£100 1997-date

100.00

105.13

109.96

114.61

122.44

re-investment£100 1998-date

102.32

105.13

109.96

114.61

122.44

           45th issue £100 1998-date

100.00

104.61

108.91

114.31

121.25

re-investment£100 1998-date

100.90

104.61

108.91

114.31

121.25

12th index-

 

linked issue£100 1998-date

100.00

104.91

109.55

113.94

120.59

re-investment£100 1998-date

102.19

104.91

109.55

113.94

120.59

46th issue £100 1998-date

100.00

100.00

105.57

109.90

116.65

re-investment£100 1998-date

100.90

101.80

105.57

109.90

116.65

13th index-

 

linked issue£100 1998-date

100.00

100.00

105.75

109.17

113.85

re-investment£100 1998-date

102.19

101.58

105.75

109.17

113.85

47th issue £100 1998-date

105.54

109.63

114.13

re-investment£100 1998-date

105.54

109.63

114.13

14th index-         linked issue£100 1998-date

105.07

108.36

112.58

48th issue £100 1998-date

104.05

107.51

111.22

re-investment£100 1998-date

104.05

107.51

111.22

15th index-         linked issue£100 1998-date

105.04

106.44

109.89

49th issue £100 1998-date

103.80

107.04

110.50

re-investment£100 1998-date

103.80

107.04

110.50

50th issue £100 1999-date

104.05

106.61

110.23

re-investment£100 1999-date

104.05

106.61

110.23

51st issue £100 1999-date

103.30

105.93

110.55

re-investment£100 1999-date

103.30

105.93

110.55

52nd issue£100 1999-date

100.00

105.36

110.20

re-investment£100 1999-date

102.63

104.36

110.20

53rd issue £100 1999-date

100.00

104.94

110.33

re-investment£100 1999-2000

101.95

104.94

110.33

16th index-         linked issue£100 2000-date

100.00

105.16

108.74

re-investment£100 2000-date

103.58

105.16

108.74

54th issue £100 2000-date

100.00

104.10

108.47

re-investment£100 2000-date

101.03

104.10

108.47

17th index-         linked issue£100 2000-date

100.00

100.00

105.05

re-investment£100 2000-date

100.00

101.57

105.05

55th issue £100 2000-date

100.00

100.00

105.70

re-investment£100 2000-date

100.00

101.85

105.70

18th index-         linked issue£100 2000-2001

100.00

104.47

re-investment£100 2000-2001

101.12

104.47

56th index £100 2000-2001

100.00

128.22

re-investment£100 2000-2001

100.88

128.22

19th index-         linked issue£100 2000-2001

100.00

103.54

re-investment£100 2000-2001

100.61

103.54

57th issue £100 2000-2001

100.00

103.25

re-investment£100 2000-2001

100.00

103.25

20th index          linked issue£100 2001-date

100.00

100.00

re-investment£100 2001-date

100.63

102.20

58th issue £100 2001-date

100.00

103.40

re-investment£100 2001-date

100.00

103.40

59th issue £100 2001-date

100.00

re-investment£100 2001-date

102.63

60th issue £100 2001-date

100.00

re-investment£100 2001-date

102.51

61st issue £100 2001-date

100.00

re-investment£100 2001-date

101.60

62nd issue£100 2002-date

100.00

re-investment£100 2002-date

101.45

63rd issue £100 Current

100.00

re-investment£100 Current

101.55

21st index          linked issue£100 2001-date

100.00

re-investment£100 2001-date

101.65

22nd index         linked issue£100 2002-date

100.00

re-investment£100 2002-date

102.00

 

 

 

23rd index          linked issue£100 Current

100.00

re-investment£100 Current

102.10

 

Take the purchase price as the capital value if:                   •the value of the last preceding 1 July is shown as “-“; or     •the certificates are from a new issue not yet shown on this table.              A 17th issue was announced but not introduced, and a 22nd issue was not introduced.              This table is revised annually.  This table is issued at August 2002.

 

 

 

                                                                                                ANNEX D

HEALTH AND SOCIAL SERVICES

 AND SOCIAL SECURITY ADJUDICATIONS ACT 1983 (HASSASSA)

 

General

 

1.         Three Sections of this Act are relevant to the charging procedures for residential accommodation in England and Wales:

 

•           Section 21

 

•           Section 22

 

•           Section 24

Section 21, HASSASSA

 

2.         This Section applies where a resident has transferred an asset to a third party with the intention of reducing his liability for charges. It provides that the third party shall be liable for the difference between the amount assessed as due to be paid by the resident and the amount which the local authority receives from him for his accommodation.

 

            Deprivation of assets

 

2.1       In order for Section 21 to apply the local authority must have decided that the resident has transferred an asset to someone else with the intention of avoiding charges for accommodation. The transfer must have taken place no more than six months before admission to residential accommodation (or six months before resuming occupation in the case of a resident who has been absent from such accommodation). Also, the resident must either have received no consideration for the transfer or any consideration must have been less than the value of the asset.

 

The six months before residing in Part III accommodation rule for disposing of assets can only be applied from the date a local authority has assessed a person as needing residential care under the Part III of the National Assistance Act, and has arranged a placement in a local authority home or independent sector home. The six month rule does not apply where a resident is self funding in an independent sector home, has not been assessed, nor had their placement arranged by a local authority.

 

            Examples

A resident transferred his house to his daughter with the intention of avoiding a charge for accommodation and the daughter gave the father nothing in return. The HASSASSA powers can be used to make the daughter liable for the father’s charges.

 

A resident sold his right to receive an income of £5000 a year for a single payment of £200 with the intention of avoiding or reducing the charge for accommodation. The return for the transfer is less than the value of the asset so the HASSASSA powers can be used.

A resident paid for his own accommodation for 2 years, then gave

£20,000 to his daughter in March, and continued to self-fund until

December of that year. The resident then approached the LA for

support, therefore the 6 month rule does not apply. Although section 21

of HASSASSA does not apply in this case the LA does still have

recourse to regulation 25(1) of the National Assistance (Assessment of

Resources) Regulations 1992.  (see section 6.057)

Assets to be considered

 

2.2               The local authority can only consider using these powers if the asset disposed of is one which would have been taken into account for the purposes of assessing the charge.

 

2.3        The value of any asset, other than cash, shall be the amount which would have been realised had the asset been sold at the time of transfer on the open market by a willing seller. The value should take into account any debts secured on the asset and a reasonable amount in respect of the expenses of sale (10% as in the Assessment Regulations, see 6.011).

           

Transfer of liability

 

2.4        The amount for which the person who has received the asset should be held liable should be restricted to the benefit accruing to him from the transfer.

 

                        For example

 

A resident transferred his former home, valued at £65 000, to his son with the intention of avoiding a charge for accommodation. After the expenses of sale and the clearing of a debt secured on the property the value of the property is assessed as £40000. The son can be held liable for charges up to a total of £40 000.

 

2.5        If the asset has been transferred to more than one person, each person can be held liable for charges only up to the value of his share of the asset.

 

2.6        The amount of liability to be transferred to the third party should be the difference between the charge assessed including notional income or capital derived from the transferred asset and the amount actually being paid by the resident.

 

Section 22, HASSASSA

3.         This Section applies where a resident fails to pay an assessed charge for accommodation and has a beneficial interest in land.

 

3A.       It is the Welsh Government’s view that because a specific power to create a charge is contained in the Health and Social Services and Social Security Adjudications Act (HASSASSA) 1983, the general powers contained in section 111 of the Local Government Act 1972 cannot be used.  Interest cannot be charged during the resident’s lifetime on a debt which is covered by the creation of a charge on property under section 22 of HASSASSA.  HASSASSA requires interest to be charged from the day after the resident’s death.

 

Placing a charge on land

 

3.1        If a resident fails to pay a sum assessed as being due to be paid for accommodation and has a beneficial interest in land in England or Wales, the authority can create a charge in their favour on his interest, or on the proceeds of the sale of land held upon trust for sale. If a resident has more than one piece of land the authority can decide which piece to place a charge on.

 

3.2               The charge placed on the property can be changed from time to time as the amount of assessed charges outstanding changes.

 

3.3        A charge is created by the local authority declaring in writing that the charge is being

created.

 

3.4        If the local authority is considering placing a charge on a resident’s interest in land, the resident should be advised to or assisted to consult a solicitor about this procedure.

3.5        It is the Welsh Government’s view that where one person owns land then his interest is in the land itself and a charge can be registered against that interest under section 22 of HASSASSA. However where more than one person owns the same piece of land then their interest is technically in the proceeds of sale of that land and not in the land itself. In this case, section 22(8) of HASSASSA has the effect of preventing the registration of an interest in the proceeds of sale of land. It would seem that registering a caution (which affords less protection than a registered charge) is the best step an authority can take in such circumstances.  (refer to 7.012 and 7.014A on jointly- owned)

Section 24, HASSASSA

 

4.         This Section applies where a resident, on whose interest in a property a charge has been placed, dies.

 

            Charging interest

 

4.1        Where the local authority has placed a charge on property, they should charge interest on the sum, at a reasonable rate, from the day after the resident for whom they have provided accommodation dies to the date on which the debt is paid.

 

                        Example

 

A resident owned a property valued at £60 000; he refused to sell that property and, as a result, was unable to pay the £200 per week which was the standard charge. He was in the accommodation for 20 weeks and the local authority placed a charge for £4000 on the property. The resident died on 01/11/93. The local authority charges interest on the £4000 from 02/11/93 to the date on which the property is sold and the debt is paid.

 

 

It should be noted that for the purposes of deferred payments agreements, legal charges on property must be made under section 55 of the Health and Social Care Act 2001.


                                                                                                                                      ANNEX E

 

 

PAYMENT OF ATTENDANCE ALLOWANCE (AA)/DISABILITY LIVING ALLOWANCE CARE COMPONENT (DLA (CC)).

 

AA /DLA(CC) may be paid to residents on the following basis from admission to residential care:

 

      TYPE OF RESIDENT EFFECT ON AA / DLA (Care Component)

Residents in accommodation owned or managed by a local authority or independent sector accommodation where the local authority helps with the feesPayable for the first 28 days (if the person was already entitled to AA/DLA (Care) before admission to residential accommodation)Residents in local authority or independent sector accommodation who do not get help with fees from a local authority even if they are entitled to Income Support, Housing Benefit, income based Jobseeker’s Allowance or Pension CreditContinues to be payable for as long as they meet the conditions of entitlementResidents who are receiving a 12-week property disregard, are funded for that period by a local authority, and will become self-funding from the thirteenth week or earlier if the property is soldContinues to be payable for the first 28 days and will re-commence from the thirteenth week or when self-funding status re-commencesResidents in local authority or independent sector accommodation who are temporarily receiving help with the fees while a capital asset is being realised and/or have a Deferred Payments Agreement and where the local authority will be reimbursed their costs. N.B. From 6 October 2003 entitlement to Income Support, Housing Benefit, income based Jobseeker’s Allowance or Pension Credit will no longer affect a care home resident’s entitlement to AA/DLA (care component)Continues to be payable for as long as they meet the conditions of entitlement regardless of whether they are also receiving means tested benefits.

 

This information is meant as a guide only and should not be seen as an authoritative statement of the law relating to the payment of AA/DLA (CC).

 

Note:

 

Residents who are self-funding, who have not previously claimed AA/DLA and who make a successful claim will be able to continue to receive it while they remain self-funders.  Authorities may wish to advise and/or assist new residents to make claims and advise self-funding residents of the changes whereby receipt of Income Support, income based Jobseeker’s Allowance or Pension Credit will no longer affect their entitlement to AA/DLA (Care component).

 

The withdrawal of AA/DLA (Care component) after 28 days will apply to residents who are in a temporary placement such as respite care and this could lead to the removal of the additional amount for severe disability.

Residents who are funded by local authorities, and have AA/DLA withdrawn, keep underlying entitlement to it.  Local authorities should advise residents that if they have any periods away from the home e.g. to stay with relatives, it can be claimed for those periods.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ANNEX F

 

 

PAYMENTS OF INCOME SUPPORT/PENSION CREDIT AND RETIREMENT PENSION FOR PERIODS IN HOSPITAL

Income Support/Pension Credit and Retirement Pension. Effect of admission to hospital from 21 May 2003 1

 

 

Type of Accommodation Period in Hospital Income Support/Pension Credit Retirement Pension
All residents in local authority residential care homes and independent sector residential care and nursing homes. Immediately on admission No change to benefit immediately on admission No change to benefit immediately on admission
After 52 weeks2/3 Since 10 April 2006 (“A” day benefit is no longer be reduced to the hospital personal allowance. Since 10 April 2006 benefit is no longer be reduced to a personal requirements rate.

 

 

This information is meant as a guide only and should not be seen as an authoritative statement of the law relating to Income Support/Pension Credit and Retirement Pension

 

1. The changes were introduced with effect from 10 April 2006. This means that residents whose benefit was downrated after 52 weeks under the previous rules had their benefit reinstated from the payday on or after 10 April 2006.

 

2. This is the position for the majority of residents. However, there are different provisions for residents who have dependants and where all or part of the remaining benefit cannot be used by, or on behalf, of the resident. For full details please see the Department for Works and Pensions guidance contained in Chapter 24 of the Decision-Makers Guide

 

3. The 28 day linking rules was also abolished from 10 April 2006.

4. AA and DLA (Care component) continues to be withdrawn after 4 weeks in hospital, which will have an impact on self-funders and full fee payers.

 


                                                                                                                                      ANNEX G

 

LEGISLATION FOR PAYMENTS OF WAR WIDOWS AND WIDOWERS SPECIAL PAYMENTS

 

 

a)         the Naval and Marine Pay and Pensions (Special War Widows and Widowers Payment) Order 1990, made under section 3 of the Naval and Marine Pay and Pensions Act 1865;

 

b)         the Royal Warrant of 19 February 1990 amending the Schedule to the Army Pensions Warrant 1977;

 

c)         the Queen’s Order dated 26 February 1990 made under section 2 of the Air Force (Constitution) Act 1917;

 

d)         the Home Guard War Widows and Widowers Special Payments Regulations 1990 made under section 151 of the Reserve Forces Act 1980;

 

e)         the Orders dated 19 February 1990 amending orders made on 12 December 1980 concerning the Ulster Defence Regiment made in each case under section 140 of the Reserve Forces Act 1980.

 

f)          article 29(1A) of the Naval, Military and Air Forces etc. (Disablement and Death) Service Pensions Order 1983

 

g)         article 27(3) of the Personal Injuries (Civilians) Scheme 1983

 

h)         the dispensing Order in Council of 19th December 1881

 

i)          the Royal Warrant of 27 October 1884

 

j)          the dispensing Order by His Majesty of 14 January 1922

 

 

 

 

 

 

 

 

 

 ANNEX H

 

DEFERRED PAYMENTS AGREEMENT

 

[*to be read in conjunction with the Accompanying Notes attached*]

PART A

THIS IS AN AGREEMENT which starts on

………………………………………………………………………………200……

And is made between:

(1)               ………………………………….(“the Resident”) and

(2)               ………………………………….(“the Local Authority”) and

(3)               ……………………………………………. (“the Mortgagee”) and [Optional]

(4)               …………………………………………….. (“the Co-owner”) [Optional]

for the purpose of deferring residential care payments owed by the Resident to the Local Authority.

 

1.         RESIDENT’S AGREEMENT

1.1              The Property

The Resident used to live in the following property as his/her only or main residence:

 

…………………………………………………………………..……………………………………………………….( “the Property”) [and which is registered at the Land Registry with Title Absolute under Title Number [……].]

 

The Resident has a beneficial interest in the Property [subject to a Legal Charge in favour of the Mortgagee] [and which is subject also to the beneficial interest of the Co-owner]. Optional – delete items in square brackets if not applicable.

 

1.2       The Care Home

The Resident has agreed for the Local Authority to make arrangements for his/her residential accommodation, and for the Authority, on the Resident’s behalf, to enter into a contract with an appropriate care home to this effect under section 21 of the National Assistance Act 1948.

 

1.3           Delaying Payment of some of the Fees

The Resident understands that he/she is responsible for paying the Care Home’s fees.  However, the Resident cannot afford to pay the full fees now because his/her current income is insufficient.  The Resident would like to pay some of the fees from now on and the rest of the fees in the future.

 

1.4       Who pays what?

The Care Home’s fees are                                                        £                      per week*

The Resident’s assessed contribution is                         £                      per week*

The Authority will pay for the Resident the difference of £                      per week*

[* These figures may be subject to change – see the Accompanying Notes. Individual agreements may need to be amended to reflect other contributions.]

 

1.5                 Ending the Agreement and Repaying the Local Authority

The Resident understands that he/she can bring this Agreement to an end by giving notice to the Authority at any time, in which case he/she will state the day on which the Agreement ends.  The Resident will then repay the total amount that he/she owes the Authority up to that date.  If the Resident does not, he/she agrees that the Authority can charge interest of [  ]% for every day (equivalent to [  ]% per annum) that he/she is late in repaying the Authority, from the day after the agreement has ended.

 

The Resident understands that this Agreement will also end upon the date of his/her death, in which case he/she agrees that his/her estate will pay the total amount that he/she owes the Authority up to that date within 56 days of his/her death.  If the Resident’s estate does not, he/she agrees that the Authority can charge interest of [  ]% for every day (equivalent to [  ]% per annum) that it is late in repaying the Authority, from the 57th day after the Resident’s death.

 

1.6           Placing a Legal Charge on the Property

The Resident agrees that the Authority can place a Legal Charge on the Property as security for the money that the Authority pays for him/her under this Agreement. The Resident agrees to the form of Legal Charge in Part B of this Agreement. The Resident has made evidence of his/her ownership of the Property available to the Authority. 

 

1.7       No Other Beneficial Interest

 

The Resident confirms that there is no other beneficial interest whether by way of mortgage or otherwise affecting the property which will require the consent of any other third party to the creation of the Legal Charge which will be created by this Agreement. [Optional – If this clause is applicable than the optional sections below entitled Mortgagee and Co-owners can be deleted]

 

1.8       Independent Advice

The Resident has been advised by the Authority to seek independent legal and financial advice before signing this Agreement.

 

 

2.         MORTGAGEE’S AGREEMENT

The Mortgagee acknowledges and consents to the Resident entering into the terms of this Agreement and consents to the registration [at the Land Registry] [of a Land Charge at the H.M. Land Charges Registry in respect] of the Legal Charge which will be created under the terms of this Agreement. [Optional section – delete if no mortgagee]

 

 

3.         CO-OWNER’S AGREEMENT

The Co-owner consents to the Resident entering into the terms of this Agreement.  The Co-owner agrees that he/she will join as a party to the creation of the Legal Charge which will be created under the terms of this agreement.  The Co-owner agrees that he/she will do all things necessary and sign all forms of consent appropriate to securing the registration of the Legal Charge in favour of the Authority under the terms of this Agreement.

 

The Co-owner has been advised by the Authority to seek independent legal and financial advice before signing this Agreement and in this context ‘independent advice’ means advice from an advisor who is neither related to or acting on behalf of the Resident.

[Optional section – delete if no co-owner]

 

 

 

Signed : ……………………………..            Signed…………………………….

Name:…………………………………          Name: ………………………………..

Authorised Officer of the Authority                    The Resident or their authorised

Representative (attorney/receiver)*

*[Please state which]………………….

 

Signed : ……………………………..            Signed…………………………….

Name:…………………………………          Name: ………………………………..

Authorised Representative of the                       The Co-owner

Mortgagee

 

 

*Accompanying Notes to the Deferred Payments Agreement

 

Legal Basis for this Agreement

 

The Authority has made arrangements under section 21 of the National Assistance Act 1948 (“the 1948 Act”) for the provision of residential accommodation for the Resident.  The Resident’s liability to pay has been assessed in accordance with sections 22 or 26 of the 1948 Act.

 

The Authority considers that it is appropriate to enter into this agreement with the Resident in accordance with section 55 of the Health and Social Care Act 2001 (“the 2001 Act”).

 

Section 1.1

If the Resident has a beneficial interest in any property (usually where they used to live before entering permanent residential care), the value of this will be taken into account when calculating how much the Resident must pay towards the cost of their care. By signing this Agreement and the attached form of Legal Charge, the deferred payments will be secured on the Property until the deferred payments are repaid to the Authority.

 

Sections 1.3 and 1.4

The amount of the fees that can be deferred is:

The difference between

(a)     the payments that the Resident is liable to pay to the Authority calculated in accordance with the National Assistance (Assessment of Resources) Regulations 1992 (as amended), and

 

(b)     the payments that the Resident is liable to pay the Authority calculated in accordance with those Regulations but excluding the value of the Resident’s beneficial interest in the Property,

 

For any period in which residential accommodation is received by the Resident between the start date of this Agreement and the date when the Agreement ends (see section 1.5).

The figures specified in Section 1.4 should show the weekly amounts applicable at the date of the Agreement. These amounts may be subject to change if:

  • The cost of the placement increases

·         The Resident’s financial circumstances alter i.e. in April when the rates of state retirement pension and welfare benefits change.

 

 

Authorities should consider how best to update the deferred payments agreement over time, and ensure a record is available to the Resident.  Authorities may need to add other contributions to those of the Resident and Authority where appropriate. Examples include the NHS and family members acting as third parties. .

 

 

Section 1.5

 

The grounds on which a deferred payment agreement can be ended are set out in Section 55(4) of the 2001 Act and must be included in the Agreement.  The Authority is not allowed to terminate the Agreement, so there is no provision in the Agreement for this.

 

Section 1.6

The charge at Part B of the Agreement needs to be signed so the Authority can place the charge on the Property.  It is a condition of this Agreement that the Resident signs the Legal Charge to give the Authority security for the deferred payments made by it for the Resident’s residential accommodation. The charge will be removed when the Authority has received the full amount owing to it under the Agreement.

 

Section 1.7

This clause is appropriate to be included in the Agreement when there is no mortgage on the Property and there is no Co-owner.

 

Section 1.8

The Authority can provide details of advocacy and representation services through its local Social Services offices.  Authorities should also be able to provide information about legal services available in the local area, i.e. the Citizens Advice Bureau.

 

Section 2

This section should be included where there is a mortgage on the Property.  It is essential that the Mortgagee gives consent to the Legal Charge.

 

Section 3

This section should be included where the Property is jointly owned.  It is essential that the Co-owner joins as a party to the creation of the Legal Charge.  It is also very important that the Co-owner is advised to seek legal and financial advice independent to that received by the Resident.

 

PART B

 

 

HM LAND REGISTRY

 

 

[Administration Area:                                                                Title No.:                      ]

 

Property:                                                                                                                     

 

Date:                                                               

 

 

IN CONSIDERATION of the Deferred Contributions specified in the Deferred Payments Agreement made between the parties and dated                                                

(“the Agreement”) receipt of which is acknowledged.

 

 

I                                                                                               (“the Resident”)

Of                                                                                                         [Insert current address] and formerly of                                                                                   

                                                                        [Insert former home address] and

 

I _______________________________________________ (“the Co-Owner”)

Of_________________________________________________________________________________________ [Insert current address]

 

with full title guarantee CHARGE by way of legal mortgage the Property (as referred to in the Agreement) [being the land comprised in the title above referred to] with the payment to [Insert name of Authority] of [Insert address of Authority] (“the Authority”) of the total amount of Deferred Contributions owing from time to time by the Resident to the Authority with interest at the rate and payable at the times specified in the Agreement.

 

 

Signed as a deed

by [Insert name of Resident or their authorised

representative (attorney/receiver]:                                                                                 

 

Witness:                                                                                                                      

 

Name:                                                                                                                         

 

Address:                                                                                                                      

 

                                                                                                           

 

 

 

Signed as a deed

by [Insert name of Co-owner]:                                                              _____

 

Witness:                                                                                                                      

 

Name:                                                                                                                         

 

Address:                                                                                                                      

 

                                                                                                           

 

 

 

Signed as a deed

by Name of Authorised Authority Signatory:                                                     

 

Witness:                                                                                                                      

 

Name:                                                                                                                         

 

Address:                                                                                                                      

 

                                                                                                           

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Annex I

 

PENSION CREDIT

(for information only)

 

 

Pension Credit is an income-related benefit for people who have reached the minimum qualifying age who live in Great Britain that tops up their income, to a guaranteed level of income of £142.70 per week for a single person (£217.90 for a couple).  These amounts may be more for people who have caring responsibilities, are severely disabled or have certain housing costs.

The Pension Credit qualifying age is increasing from 60 to 65 alongside the increase in Women’s State pension age.  To find out when you get Pension Credit visit our website at www.direct.gov.uk/pensioncredit.

 

The State Pension age for both men and women will rise in the future.  The Government has announced new proposals for increasing State Pension Age to 66 by 2020, which will mean that women’s State Pension age will increase more quickly to 65 between April 2016 and November 2018.

Changes to the State Pension will affect Pension Credit qualifying age.

People aged 65 and over can also be rewarded for some of their savings and income they have for their retirement.  It gives pensioners a cash addition of 60p for every £1 of income they have above the savings credit threshold (£111.80 for a single person and £178.35 for a couple up to a maximum of £18.54 per week (£23.73 a week for couples).

 

After this, the maximum reward is reduced by 40p for every £1 of income above the income guarantee so that pensioners with incomes up to around £189.05 a week (£277.22 a week for couples) could still be entitled.  These amounts may be more for people, who have caring responsibilities, are severely disabled or have certain housing costs.

 

 

 

The values given in this Annex reflect the increase in Pension Credit from 9 April 2012.

 

For further details about Pension Credit, contact the Pensions Disability and Careers Service on 0845 606 0265.

 

For further details on the savings disregard please refer to paragraph 8.024 above and to the document Pension Credit and the Savings Disregard on:
www.dh.gov.uk/PolicyAndGuidance/OrgansiationPolicy/FinanceAndPlanning/ResidentialCare/fs/en. 

           

 

 

 

 

 

 

 

 

 

Annex J

 

THE QUALIFYING AGE FOR THE £20 DISREGARD

 

The qualifying age for the £20 disregard is increasing from 60 to 66 between 6th April 2010 and 5th April 2020 alongside the increase in women’s State Pension age.  The state pension age for women will rise as follows:

Born: State pension age reached:
6th April to 5th May 1950 6th May 2010
6th May to 5th June 1950 6th July 2010
6th June to 5th July 1950 6th September 2010
6th July to 5th August 1950 6th November 2010
6th August to 5th September 1950 6th January 2011
6th September to 5th October 1950 6th March 2011
6th October to 5th November 1950 6th May 2011
6th November to 5th December 1950 6th July 2011
6th December 1950 to 5th January 1951 6th September 2011
6th January to 5th February 1951 6th November 2011
6th February to 5th March 1951 6th January 2012
6th March to 5th April 1951 6th March 2012
6th April to 5th May 1951 6th May 2012
6th May to 5th June 1951 6th July 2012
6th June to 5th July 1951 6th September 2012
6th July to 5th August 1951 6th November 2012
6th August to 5th September 1951 6th January 2013
6th September to 5th October 1951 6th March 2013
6th October to 5th November 1951 6th May 2013
6th November to 5th December 1951 6th July 2013
6th December 1951 to 5th January 1952 6th September 2013
5th January to 5th February 1952 6th November 2013
6th February to 5th March 1952 6th January 2014
6th March to 5th April 1952 6th March 2014
6th April to 5th May 1952 6th May 2014
6th May to 5th June 1952 6th July 2014
6th June to 5th July 1952 6th September 2014
6th July to 5th August 1952 6th November 2014
6th August to 5th September 1952 6th January 2015
6th September to 5th October 1952 6th March 2015
6th October to 5th November 1952 6th May 2015
6th November to 5th December 1952 6th July 2015
6th December 1952 to 5th January 1953 6th September 2015
6th January to 5th February 1953 6th November 2015
6th February to 5th March 1953 6th January 2016
6th March to 5th April 1953 6th March 2016
6th April to 5th May 1953 6th July 2016
6th May to 5th June 1953 6th November 2016
6th June to 5th July 1953 6th March 2017
6th July to 5th August 1953 6th July 2017
6th August to 5th September 1953 6th November 2017
6th September to 5th October 1953 6th March 2018
6th October to 5th November 1953 6th July 2018
6th December 1953 to 5th January 1954 6th March 2019
6th January to 5th February 1954 6th July 2019
6th February to 5th March 1954 6th November 2019
6th March to 5th April 1954 6th March 2020
6th April 1954 to 5th April 1968 Age 66

                                                                                                 ANNEX K
CIRCULAR SUMMARY

 

NAfWC 19/00  CHARGES FOR RESIDENTIAL ACCOMMODATION – AMENDMENT No 11

This circular:

I.          Makes minor amendments to the Charging for Residential Accommodation Guide (CRAG);

II.                     Sets out the revised personal expenses allowances from 10 April

2000 for people provided with residential accommodation under Part III of

the National Assistance Act 1948;

III.       Clarifies certain areas of the existing regulations.

This circular is issued under section 7(1) of the Local Authority Social Services Act 1970.

NAfWC 3/01    CHARGES FOR RESIDENTIAL ACCOMMODATION – CRAG AMENDMENT No 12

This circular:

Announces the following change to the National Assistance (Assessment of

Resources) Regulations 1992:

Schedule 4 to the principle regulations has been amended in order that ex-gratia payments of £10,000 made on or after 1st February 2001 by the Secretary of State in consequence of a person’s imprisonment or internment by the Japanese during the Second World War, shall be disregarded as capital for the purposes of the ascertaining the total capital assets of a resident.

NAfWC 11/01  CHARGES FOR RESIDENTIAL ACCOMMODATION –

CRAG AMENDMENT No 13

NATIONAL ASSISTANCE (SUMS FOR PERSONAL REQUIREMENTS) (WALES) REGULATIONS 2001

NATIONAL ASSISTANCE ACT (ASSESSMENT OF RESOURCES) (AMENDMENT NO.2) (WALES) REGULATIONS 2001

This circular:

I.          Announces the revised Personal Expenses Allowance (PEA) of £16.05 that comes into force on 9 April 2001. It applies to everyone in residential care or nursing homes receiving help from local authorities, under Part III of the National Assistance Act 1948, to meet costs.

II.         Revises capital limits from £10,000 (lower) and £16,000 (upper) to £11,500 (lower) and £18,500 (upper) to come into force on 9 April 2001.

III.       Introduces a new three-month property disregard on permanent entry to residential and nursing care. This will come into force from 9 April 2001.

IV.       Introduces a disregard of compensation payments made to victims of variant Creutzfeldt-Jakob Disease (VCJD) and their families.

V.        Makes amendments to the Charging for Residential Accommodation Guide (CRAG). These concern:

           a) Increases the higher earnings disregard from £15 to £20 per week.
This will come into force from 9 April 2001

b) Clarification of mandatory property disregards at 7.003

c) Income support capital limit changes

d) Updating of DSS benefit rates in annex A of CRAG

e) Correction of annex F of CRAG concerning hospital downrating

VI        Clarifies existing guidance around the treatment of carers

NAfWC 14/02  CHARGES FOR RESIDENTIAL ACCOMMODATION – CRAG AMENDMENT No 14

NATIONAL ASSISTANCE (SUMS FOR PERSONAL REQUIREMENTS) (WALES) REGULATIONS 2002

NATIONAL ASSISTANCE (ASSESSMENT OF RESOURCES) (AMENDMENT) (WALES) REGULATIONS 2002

This circular:

I.          Announces the revised Personal Expenses Allowance (PEA) of £16.80 that comes into force on 8 April 2002. It applies to everyone in residential care or nursing homes receiving help to meet costs from local authorities (hereafter referred to as “authorities”), under Part 3 of the National Assistance Act 1948.

II.         Revises capital limits from £11,500 (lower) and £18,500 (upper) to £11,750 (lower) and £19,000 (upper), to come into force on 8 April 2002. Authorities are reminded of the effect on charges for home care.

III.       Reminds authorities of their responsibilities under section 42 of the National Assistance Act 1948 with respect to contributions to care costs that may be sought from spouses who are liable to maintain their partners in residential accommodation, and provides guidance.

IV.       Advises authorities on the transfer of responsibility for residents with preserved rights to authorities.

V.        Advises authorities on the recent judgement in the case of the Queen (on the application of personal representatives of Christopher Beeson) v Dorset County Council and the Secretary of State for Health.

VI.       Advises authorities of their responsibilities when residents may have to wait for admission to residential accommodation.

VII.      Advises authorities of the definitions of temporary and permanent care.

VIII.     Advises authorities of changes to social security benefit rates from 8 April 2002.

IX.       Advises authorities of up-to-date values of National Savings Certificates.

X.         Advises authorities of the impact of changes to Income Support regulations with respect to war widowers’ pensions and special payments.

NAfWC 19/2003  CHARGES FOR RESIDENTIAL ACCOMMODATION – CRAG AMENDMENT No 15

NATIONAL ASSISTANCE (SUMS FOR PERSONAL REQUIREMENTS) (WALES) REGULATIONS 2003

NATIONAL ASSISTANCE (ASSESSMENT OF RESOURCES) (AMENDMENT) (WALES) REGULATIONS 2003

This circular:

  1. Announces the revised Personal Expenses Allowance (PEA) of £17.80 that comes into force on 7 April 2003.  It applies to everyone in residential care or nursing homes receiving help to meet costs from local authorities with social services responsibilities (hereafter referred to as “authorities”), under Part 3 of the National Assistance Act 1948.  It reminds authorities of the purpose of the PEA.

 

  1. Revises capital limits from £11,750 (lower) and £19,000 (upper) to £12,250 (lower) and £20,000 (upper) to come into force on 7 April 2003.  Authorities are reminded of the effect on charges for home care.
  2. Advises authorities of how the financial assessment for residential accommodation should treat Supporting People payments and related payments from 1 April 2003.
  3. Advises authorities of a new disregard, from 1 April 2003, of the value of a resident’s interest in property occupied by a lone parent estranged/divorced from the resident.
  4. Announces an amendment to the treatment of arrears of benefits payments and related concessionary payments.  This amendment maintains the status quo.
  5. Advises authorities of how the financial assessment for residential accommodation should treat Working Tax Credit, Child Tax Credit and Guardian’s Allowance from 7 April 2003.
  6. Reminds authorities of the arrangements for NHS funded nursing care from 1 April 2003 and the implications for cross border placements.
  7. Announces an amendment with respect to the treatment of periodical payments paid to residents as a result of personal injury awards.
  8. Advises authorities of the introduction of statutory paternity pay and statutory adoption pay, and how these should be treated within the system for charging for residential care.
  9. Advises authorities on the recent Court of Appeal judgement in the case of the Queen (on the application of personal representatives of Christopher Beeson) v Dorset County Council and the Secretary of State for Health.
  10. Alerts authorities to the following benefit changes in October 2003:
  • The introduction of Pension Credit
  • The full abolition of residential allowance and Part 3 rate of Income Support
  • New arrangements for down-rating benefits for people in hospital.

XII       Advises authorities of changes to the social security benefit rates from 7 April 2003, the most recent values of National Savings Certificates, and Carer’s Allowance.

XIII      Advises authorities of the House of Lords judgement with respect to section 117 aftercare services.

NAfWC 21/2003CHARGES FOR RESIDENTIAL ACCOMMODATION – CRAG AMENDMENT NO 16

THE NATIONAL ASSISTANCE (RESIDENTIAL ACCOMMODATION) (ADDITIONAL PAYMENTS, RELEVANT CONTRIBUTIONS AND ASSESSMENT OF RESOURCES) (WALES) REGULATIONS 2003

The National Assistance (Residential Accommodation) (Disregarding of Resources) (Wales) Regulations 2003

THE NATIONAL ASSISTANCE (DEFERRED PAYMENTS) DIRECTIONS 2003

this circular:

 

  1. Introduces Regulations which allow deferred payments for residents with property that is taken into account by the means-test for residential accommodation, who do not wish to sell their homes, or cannot do so, in order to meet their care costs.  They will come into force from 7 April 2003.
  2. Introduces Directions which place a duty on local authorities to draw attention to, and offer deferred payments, to eligible or prospective residents.  They will come into force from 7 April 2003.

III.     Introduces Regulations which enable residents, in certain

circumstances, to top-up from income and assets disregarded by
the means test so that they may enter residential accommodation
that is more expensive than the authority would normally fund.  The
Regulations also confirm that third parties may top-up.  They will
come into force from 7 April 2003.

NAfWC 37/03  CHARGES FOR RESIDENTIAL ACCOMMODATION – CRAG AMENDMENT NO 17
NATIONAL ASSISTANCE (ASSESSMENT OF RESOURCES) (AMENDMENT) (NO 2) (WALES) REGULATIONS 2003
This circular:

  1. Announces a new savings disregard into the financial assessment for residential accommodation, to come into force on 6 October 2003.
  2. Announces a disregard of cash in lieu of concessionary coal for temporary residents into the financial assessment for residential accommodation, to come into force on 6 October 2003, and deals with other matters linked to the introduction of Pension Credit.
  3. Announces a disregard of payments under paragraph 3 of Schedule 4 to the Adoption and Children Act 2002 into the financial assessment for residential accommodation, to come into force on 6 October 2003, and covers other matters.
  4. Reminds local authorities of how the financial assessment for home care and other non-residential care services deals with the introduction of Pension Credit.

NAfWC 27/2004  CHARGES FOR RESIDENTIAL ACCOMMODATION – CRAG AMENDMENT NO 18

NATIONAL ASSISTANCE (SUMS FOR PERSONAL REQUIREMENTS) (AMENDMENT) (WALES) REGULATIONS 2004

NATIONAL ASSISTANCE (ASSESSMENT OF RESOURCES) (AMENDMENT) (WALES) REGULATIONS 2004

This circular:

  1. Announces the revised Personal Expenses Allowance (PEA) of £18.40 that comes into force on 12 April 2004.  It applies to everyone in care homes, including homes with nursing on the premises, receiving help to meet costs from local authorities with social services responsibilities (hereafter referred to as ‘authorities’), under Part 3 of the National Assistance Act 1948.  It reminds authorities of the purpose of the PEA.
  2. Announces the revision of the capital limits from £12,250 (lower) and £20,000 (upper) to £13,500 (lower) and £20,500 (upper), which are to come into force on 12 April 2004.  Authorities are reminded of the effect on charges for home care.
  3. Announces the revision of the savings disregard from up to £4.50 to up to £4.65 per week for individual supported residents aged 65 and over.  The savings disregard will also increase from up to £6.75 to up to £6.95 per week for couples.  The savings disregard provisions regarding the treatment of couples have also been amended so that the disregard does not apply where it is the resident’s partner who is in receipt of the savings credit.
  4. Advises authorities of a new disregard for ex-gratia payments from the Skipton Fund to people who have been infected with Hepatitis C as a result of NHS treatment with blood or blood products.  The date on which this scheme will begin is still to be finalised.

 

NAfWC 49/2004 CHARGES FOR RESIDENTIAL ACCOMMODATION – CRAG AMENDMENT NO 19

NATIONAL ASSISTANCE (ASSESSMENT OF RESOURCES) (AMENDMENT NO 2) (WALES) REGULATIONS 2004

This circular:

I           Announces the new disregard for student childcare grants for NHS funded students.

II         Announces the new disregard for the Age Related payments to pensioners over 70.  Local authorities are reminded of the same effect on charges for home care.

III        Reminds local authorities that the Skipton Fund payments came into force on 12 May 2004 to people who have been infected with Hepatitis C as a result of NHS treatment with blood or blood products.

IV        Reminds local authorities that as of 29 October 2004 Housing Benefit is payable to people who enter residential accommodation for a short period.

V         Reminds local authorities that Pension Credit can be backdated for 12 months.

NAfWC 13/2005 CHARGES FOR RESIDENTIAL ACCOMMODATION – CRAG AMENDMENT NO 20

NATIONAL ASSISTANCE (SUMS FOR PERSONAL REQUIREMENTS) (WALES) REGULATIONS 2005

NATIONAL ASSISTANCE (ASSESSMENT OF RESOURCES) (AMENDMENT) (WALES) REGULATIONS 2005

This circular:

  1. Announces the revised Personal Expenses Allowance (PEA) of £19.10 that comes into force on 11 April 2005.  It applies to everyone in care homes, including homes with nursing on the premises, receiving help from local authorities with social services responsibilities (hereafter referred to as ‘authorities’) to meet the cost of accommodation under Part 3 of the National Assistance Act 1948.  It reminds authorities of the purpose of the PEA.
  2. Announces the revision of the capital limits from £13,500 (lower) and £20,500 (upper) to £14,750 (lower) and £21,000 (upper), which are to come into force on 11 April 2005.  Authorities are reminded of the effect of the revised capital limits on charges for home care.
  3. Announces the revision of the savings disregard from up to £4.75 to up to £4.85 per week for individual supported residents aged 65 and over.  The savings disregard will also increase from up to £6.95 to up to £7.20 per week for couples.  These increases are to come into effect on 11 April 2005.
  4. Advises authorities of a new income and capital disregard for residential charging purposes to cover payments to special guardians or prospective special guardians under a new scheme to be introduced by the Department for Education and Skills.
  5. Advises authorities of the new disregard for residential charging purposes as a result of the amendment to the Income Support Regulations to take account of the new Armed Forces Compensation Scheme announced by the Ministry of Defence.
  6. Advises authorities that the weekly payment for NHS Funded Nursing Care paid by Local Health Boards for eligible residents in care homes with nursing is increased to £107.63 from 1 April 2005.
  7. Reminds authorities of the guidance in relation to residents who are unable to manage their own affairs and alerts them to the role of the Public Guardianship Office in this area.
  8. Reminds authorities of their powers to operate deferred payments arrangements.

NAfWC 36/2005 CHARGES FOR RESIDENTIAL ACCOMMODATION – CRAG AMENDMENT NO 21

NATIONAL ASSISTANCE (ASSESSMENT OF RESOURCES) (AMENDMENT NO 2) (WALES) REGULATIONS 2005

This circular:

Announces a new disregard for two current one-off Age Related payments by the Department of Work and Pensions (DWP) to people over 65 in residential accommodation and for future such payments.  Local authorities are also reminded of the request to equally disregard such payments from charges for home care.

NAfWC 16/2006 CHARGES FOR RESIDENTIAL ACCOMMODATION – CRAG AMENDMENT NO 22

NATIONAL ASSISTANCE (ASSESSMENT OF RESOURCES AND SUMS FOR PERSONAL REQUIREMENTS) (AMENDMENT) (WALES) REGULATIONS 2006

This circular:

  1. Announces the revision of the capital limits from £14,750 (lower) and £21,000 (upper) to £16,000 (lower) and £21,500 (upper), which are to come into force on 10 April 2006.  Authorities are reminded of the effect of the revised capital limits on charges for home care;
  2. Announces the revision of the savings disregard from up to £4.85 per week to up to £5.05 per week for individual supported residents aged 65 and over.  The savings disregard will also increase from up to £7.20 per week to up to £7.50 per week for couples.  These increases also came into effect on 10 April 2006;
  3. Announces an amendment to the regulations to take account of the Civil Partnerships Act 2004;
  4. Announces the planned updated disregard regarding adoption support payments, reflecting the implementation of the Adoption and Children Act 2002;
  5. Announces the revised Personal Expenses Allowance (PEA) of £20 per week that came into force on 10 April 2006.  It applies to everyone in care homes, including homes with nursing on the premises, receiving help from local authorities with social services responsibilities (hereafter referred to as ‘authorities’) to meet the cost of accommodation under Part 3 of the National Assistance Act 1948.  It reminds authorities of the purpose of the PEA;
  6. Reminds authorities that the weekly payment for NHS Funded Nursing Care paid by Local Health Boards for eligible residents in care homes with nursing is increased to £111.00 from 1 April 2006;
  7. Advises authorities of the encouragement to exercise their discretion NOT to apply the liable relatives rule, as set out at Section 11 of the CRAG;
  8. Reminds authorities of the disregard for the two current one-off Age Related payments by the Department for Work and Pensions (DWP) to people over 65 in residential accommodation and for future such payments.  Local authorities are also reminded of the request to equally disregard such payments from charges for home care.  This disregard was detailed previously in NAFWC 36/2005.

NAfWC 19/2007 CHARGES FOR RESIDENTIAL ACCOMMODATION – CRAG AMENDMENT NO 23

NATIONAL ASSISTANCE (ASSESSMENT OF RESOURCES AND SUMS FOR PERSONAL REQUIREMENTS) (AMENDMENT) (WALES) REGULATIONS 2007

This circular:

I.          Announces the revision of the capital limits from £16,000 (lower) and
£21,500 (upper) to £17,250 (lower) and £22,000 (upper), which are to
come into force on 9 April 2007.  Authorities are reminded of the effect
of the revised capital limits on charges for home care;

II.         Announces the revision of the savings disregard from up to £5.05 per
week to up to £5.25 per week for individual supported residents aged
65 and over.  The savings disregard will also increase from up to £7.50
per week to up to £7.85 per week for couples.  These increases also to

come into effect on 9 April 2007;

III.       Announces an amendment to the current disregard in the regulations in

relation to Child Benefit Payments;

IV.       Announces the revised Personal Expenses Allowance (PEA) of £20.88

per week that comes into force on 9 April 2007.  It applies to everyone

in care homes, including homes with nursing on the premises,

receiving help from local authorities with social services responsibilities

(hereafter referred to as ‘authorities’) to meet the cost of
accommodation under Part 3 of the National Assistance Act 1948.  It
reminds authorities of the purpose of the PEA;

V.       Reminds authorities that the weekly payment for NHS Funded Nursing Care paid by
Local Health Boards for eligible residents in care homes with nursing was increased to
£114.90 from 1 April 2007;

VI.       Reminds authorities of the encouragement to exercise their discretion
NOT to apply the liable relatives rule, as set out at Section 11 of the
CRAG;

WAGC 11/2008 CHARGES FOR RESIDENTIAL ACCOMMODATION – CRAG AMENDMENT NO 24

NATIONAL ASSISTANCE (ASSESSMENT OF RESOURCES AND SUMS FOR PERSONAL REQUIREMENTS) (AMENDMENT) (WALES) REGULATIONS 2008

This circular:

I.          Announces the revision of the lower capital limit from £17,250 to
£19,000 which is to come into force on 7 April 2008.  The current upper
capital limit of £22,000 is to be maintained.  Authorities are reminded of

the effect of the revised lower capital limit on charges for home care;

II.         Announces the revision of the savings disregard from up to £5.25 per

week to up to £5.45 per week for individual supported residents aged
65 and over.  The savings disregard will also increase from up to £7.85
per week to up to £8.15 per week for couples.  These increases also to

come into effect on 7 April 2008;

III.       Announces the revised Personal Expenses Allowance (PEA) of £21.38
per week that comes into force on 7 April 2008.  It applies to everyone
in care homes, including homes with nursing on the premises,
receiving help from local authorities with social services responsibilities
(hereafter referred to as ‘authorities’) to meet the cost of
accommodation under Part 3 of the National Assistance Act 1948.  It
reminds authorities of the purpose of the PEA;

IV.       Reminds authorities of the encouragement to continue to exercise their
discretion NOT to apply the liable relatives rule while these are being
repealed by Parliament; Section 11 of CRAG refers.

WAGC 11/2009 CHARGES FOR RESIDENTIAL ACCOMMODATION – CRAG AMENDMENT NO 25

NATIONAL ASSISTANCE (ASSESSMENT OF RESOURCES AND SUMS FOR PERSONAL REQUIREMENTS) (AMENDMENT) (WALES) REGULATIONS 2009

This circular:

I.          Announces the revision of the lower capital limit from £19,000 to
£20,750 which is to come into force on 6 April 2009.  The current upper

capital limit of £22,000 is to be maintained.  Authorities are reminded of
the effect of the revised lower capital limit on charges for home care;

II.         Announces the revision of the savings disregard from up to £5.45 per
week to up to £5.65 per week for individual supported residents aged
65 and over.  The savings disregard will also increase from up to £8.15
per week to up to £8.45 per week for couples.  These increases also to
come into effect on 6 April 2009;

III.       Announces the revised Personal Expenses Allowance (PEA) of £22.00

per week that comes into force on 6 April 2009.  It applies to everyone

in care homes, including homes with nursing on the premises,

receiving help from local authorities with social services responsibilities

(hereafter referred to as ‘authorities’) to meet the cost of

accommodation under Part 3 of the National Assistance Act 1948.  It

reminds authorities of the purpose of the PEA;

IV.       Alerts local authorities to the coming into force of section 147 of the
Health and Social Care Act 2008, which repeals sections 42 and 43
(the liable relatives rule) of the National Assistance Act 1948, with
effect from 6 April 2009;

V.        Reminds local authorities that they are expected to have a deferred
payments scheme in place and that they could be challenged if they
did not consider exercising their discretion to offer deferred payments
in individual cases.

WAGC 014/2010 CHARGES FOR RESIDENTIAL ACCOMMODATION – CRAG AMENDMENT NO 26

NATIONAL ASSISTANCE (ASSESSMENT OF RESOURCES AND SUMS FOR PERSONAL REQUIREMENTS) (AMENDMENT) (WALES) REGULATIONS 2010

This circular:

I.          Announces the abolition of the lower capital limit of £20,750 from 12th

April 2010.  The current upper capital limit of £22,000 is to be
maintained.  The affect of this is to produce a single capital limit of
£22,000 and thus remove the tariff system in Wales.  Authorities are
reminded of the effect of this single capital limit on charges for home
care;

II.         Announces the revision of the savings disregard from up to £5.65 per
week to up to £5.75 (maximum) per week for individual supported
residents aged 65 and over.  The savings disregard will also increase
from up to £8.45 per week to up to £8.60 (maximum) per week for
couples.  These increases also to come into effect on 12th April 2010;

III.       Announces the revised Personal Expenses Allowance (PEA) of £22.50
per week that comes into force on 12th April 2010.  It applies to
everyone in care homes, including homes with nursing on the
premises, receiving help from local authorities with social services
responsibilities (hereafter referred to as ‘authorities’) to meet the cost of
accommodation under Part 3 of the National Assistance Act 1948.  It
reminds authorities of the purpose of the PEA;

IV.       Advises of an amendment to the Regulations which removes the age
element of the capital disregard for the value of property where a
resident’s partner continues to reside in the property.  This is to come
into force on 6th April 2010;

V.        Advises of a consequential amendment to the Regulations which
follows an amendment to the Income Support Regulations 1987 that
make changes to the qualifying age for people who get a disability
premium.  This is to also come into force on 6th April 2010.

 

WGAC 010/2011CHARGES FOR RESIDENTIAL ACCOMMODATION – CRAG AMENDMENT NO 27

NATIONAL ASSISTANCE (ASSESSMENT OF RESOURCES AND SUMS FOR PERSONAL REQUIREMENTS) (AMENDMENT) (WALES) REGULATIONS 2011

This circular:

  1. Announces the revised Personal Expenses Allowance (PEA) of £23.00 per week that came into force on 11th April 2011.  It applies to everyone in care homes, including homes with nursing on the premises, receiving help from local authorities with social services responsibilities (hereafter referred to as ‘authorities’) to meet the cost of accommodation under Part 3 of the National Assistance Act 1948;
  2. Announces the revision of the single capital limit to £22,500 that came into force on 11th April 2011;
  3. Announces that the savings credit disregards will remain at their current level (i.e. up to £5.75 per week for individual supported residents aged 65 and over and up to £8.60 per week for couples);
  4. Announces an amendment to the regulations concerning disregards of certain capital and income, in particular capital and income derived from a personal injury compensation award;
  5. Announces an amendment to the regulations of a technical nature that provides clarity in respect of how individuals with capital below the single capital limit should be treated;
  6. Advises authorities of planned changes to ex-gratia payments made to people who have received contaminated blood and how these should be treated in the financial assessment for residential charging;
  7. Advises authorities of how Equitable Life compensation payments should be treated in the financial assessment for residential charging;
  8. Provides clarity on the entitlement to the £20 disregard for people who get a disability premium as a consequence to the rise in women’s pension age from 60 to 65 between 6th April 2010 and 5th April 2020
  9. Advises authorities to note a number of updates and amendments that have been made to the most recent version of the Charging for Residential Accommodation Guide (CRAG).  These updates and amendments do not reflect any policy changes but are undertaken as an updating exercise.

 

WGAC 006/2012  CHARGES FOR RESIDENTIAL ACCOMMODATION – CRAG AMENDMENT NO 28

NATIONAL ASSISTANCE (SUMS FOR PERSONAL REQUIREMENTS) (ASSESSMENT OF RESOURCES AND MISCELLANEOUS AMENDMENTS) (WALES) REGULATIONS 2012

This circular:

  1. Announced the revised Personal Expenses Allowance (PEA) of £24.00 per week that came into force on 9 April 2012.  It applies to everyone in care homes, including homes with nursing on the premises, receiving help from local authorities with social services responsibilities (hereafter referred to as ‘authorities’) to meet the cost of accommodation under Part 3 of the National Assistance Act 1948;
  2. Announced the revision of the single capital limit to £23,250 that came into force on 9 April 2012;
  3. Announces that the savings credit disregards will remain at their current level (i.e. up to £5.75 per week for individual supported residents aged 65 and over and up to £8.60 per week for couples);
  4. Announced some technical amendments to the National Assistance (Residential Accommodation) (Additional Payments, Relevant Contributions and Assessment of Resources) (Wales) Regulations 2003 to provide clarity on the operation of the single capital limit;
  5. Advised authorities of an addition to the list to ex-gratia payments made to people who have received contaminated blood and blood products and how they should be treated in the financial assessment for residential charging; and
  6. Advised authorities to note a number of further updates and amendments that have been made to the most recent version of the Charging for Residential Accommodation Guide (CRAG).  These updates do not reflect any policy changes but are undertaken to provide more clarity within CRAG of existing policy.