Entitlement to disability payment – clarification
Entitlement to severe disability payment within state pension credit when a person is resident of a publicly-funded care home
DB (as executor of the estate of OE) v Secretary of State for Work and Pensions and Birmingham City Council (SPC):  UKUT 46(ACC)
Judge Mitchell set aside the decision of the FTT made on the 9th July 2015, citing an error on a point of law which related to the issue of whether Miss E, who was resident in a publicly funded care home, continued to be entitled to an additional amount for severe disability within state pension credit. The judgment also gave guidance about the exercise of the DWP’s power to make a person an Appointee for social security benefits when someone else holds an Enduring Power of Attorney (‘EPA’) that extends to welfare benefits matters.
On the 12th June 2007 Miss E made an EPA appointing her nephew Mr B as her Attorney. The EPA had no restrictions or conditions. Miss E also executed a Will appointing Mr B as her Executor. In 2004 Miss E completed a state pension credit form and correctly stated on the application that she was not living in a care home. It should be noted that the form did not inform Miss E that she had to inform the DWP if she began to live permanently in a care home. The EPA was registered with the OPG on the 21st September 2010 as Miss E had become mentally incapable. Miss E was admitted to a care home on the 20th March 2012 and a Local Authority (‘LA’) document which authorised the placement gave a start date as 20th March 2012. As Practitioners are aware, LA provision for care home accommodation is means-tested. When an LA resident is in receipt of welfare benefits, they may be liable to pay at least part of their benefit income to the LA.
On the 27th June Birmingham City Council’s Appointee and Court Deputies Department applied to be Miss E’s social security appointee. On the 8th August 2012 the DWP granted the Council’s application and they were made Miss E’s appointee and the DWP began paying Miss E’s state pension credit to the Council. Until the 26th September 2012 the payments included an additional amount for severe disability. On the 14th November 2012 Mr B wrote to the DWP asking why Miss E had not been paid state pension credit since 16th August 2012. The payments had been made but to the LA directly. Mr B sent a copy of the EPA to the DWP and was informed that they were not able to discuss the matter with him as he was no longer ‘the appointed representative’. Miss E died on the 25th February 2013 and Mr B as executor administered her estate.
FREE monthly newsletter
Wills | Probate | Trusts | Tax | Elderly & Vulnerable Client
- Relevant learning and development opportunities
- News, articles and LawSkills’ services
- Communications which help you find appropriate training in your area
By a letter dated 18th April 2013 the DWP informed Mr B that (a) between 23rd August 2012 and 27th February 2013, Birmingham City Council received £821.28 in state pension credit payments as Appointee and (b) they also received £900 in attendance allowance payments and the DWP advised Mr B that they wanted to undertake a review. The DWP decided that from 20th April 2012 Miss E was not entitled to the severe disability amount within state pension credit. The date was chosen as in the DWP’s view a) it was 4 weeks after Miss E entered the care home and b) entitlement to the premium ceased on that date. The DWP stated in a letter to Mr B that they believed Miss E had entered the care home on the 20th March 2012 although Mr B informed the DWP that he was unsure of the date. The DWP superseded Miss E’s award on this basis and contended that it generated an overpayment which the estate had to pay back.
Mr B appealed to the First-tier Tribunal and stated that the DWP assumed without clear supporting evidence that Miss E was admitted to the care home on the 20th March 2012 but this was inconsistent with her AA ceasing August/September 2012. Mr B supplied the FTT with diary entries indicating that he had visited his aunt at her own home on the 9th April 2012 and then at the care home on the 22 December 2012.
He also wished to challenge the DWP’s decision to make BCC her appointee for welfare benefits as the decision did not take into account the EPA. The DWP contended that Miss E’s state pension credit award was superseded and reduced from April 2012 because by that point she was no longer entitled to the additional amount for severe disability. The FTT made BCC a party to the proceedings. On the 25th March 2015 the DWP contended that Mr B, as Miss E’s Attorney had failed to discharge a duty to inform the DWP that she had been admitted to a care home.
The FTT dismissed the appeal ruling that the only issue was the date on which Miss E was admitted to the care home. Mr B’s complaints about BCC appointment were outside the Tribunal’s jurisdiction. Although Mr B was regarded as a reliable witness, the Tribunal ruled that he had made a mistake in relation to the dates that he had visited his aunt and that Miss E had begun to reside in a care home on the 20th March 2012. This was a material change of circumstances and the DWP correctly superseded Miss E’s award of state pension credit to remove he additional amount for severe disability 4 weeks after this date. Mr B appealed to the UTT.
Section 2 of the State Pension Credit Act 2002 requires the guarantee element of state pension credit to be calculated by reference to a claimant’s ‘appropriate minimum guarantee’(S2(2)). This guarantee is the sum of the standard minimum guarantee and ‘such prescribed amounts as may be applicable’ (s2(3)). Section 2 (7) requires the prescribed amounts to include an amount for a claimant with a ‘sever disability’.
Sections 64 to 67 of the Social Security Contributions and Benefits Act 1992 and the Social Security (Attendance Allowance) Regulations 1991 (‘1991 Regulations’) deal with the entitlement to and payment of Attendance Allowance. Section 67(2) authorises Regulations to provide that AA shall not be payable to certain care home residents. Regulation 7(1) of the 1991 Regulations provides that a person shall not be paid any amount of AA for any period during which he is resident in a care home and the costs of the ‘qualifying services’ are publicly funded. By Reg 8(1), the Reg 7(1) prohibition on payment does not apply for the first 28 days of residence in a care home.
Regulation 33 of the Social Security (Claims and Payments) Regulations 1987 confers power on the Secretary of State on written application to appoint a person to exercise on behalf of one who is unable to act ‘any right to which that person may be entitled and to receive and deal on his behalf with any sums payable to him’. The power can be revoked under Regulation 33(2)(a). However, the Secretary of State’s general power of appointment is not exercisable if a Deputy with power to claim or receive benefits has been appointed under MCA 2005. However, the Universal Credit, Personal Independent Payment, Jobseeker’s Allowance and Employment and Support Allowance (Claims and Payments) Regulations 2013 prohibit an appointment if an Attorney has been appointed with power to receive or claim benefits If Miss E had claimed a benefit under the 2013 Regulations BCC would not have been appointed her Appointee by the DWP.
The matter went to the Upper Tier Tribunal (‘UTT’) and the legal issue which Judge Mitchell had to rule concerned the date on which entitlement to the amount of severe disability, within state pension credit, ceases upon a claimant’s admission to a publicly funded care home. Entitlement is linked to AA payment of which ought to end 28 days after a person’s admission to a publicly-funded care home. However, in this case AA continued to be paid months after Miss E became resident.
Judge Mitchell ruled that the FTT decision involved an error on a point of law. He stated that the FTT misdirected itself in law by assuming entitlement to the severe disability premium ceased automatically once Miss E had been resident in her care home for 28 days. He ruled that under the 2002 Regulations the question was whether Miss E continued to be in receipt of AA. Miss E remained entitled to AA after she resided in the care home for 28 days although she had no right to be paid after this date. Judge Mitchell stated that ‘in receipt of’ as used in paragraph 1 of Schedule 1 to the 2002 Regulations means what it says. ‘it is not synonymous with ‘payable’.
Accordingly, he set aside the FTT’s decision and ruled that Miss E:-
- remained entitled to the amount for severe disability within her state pension credit award until 12 September 2012:
- as from the 13th September Miss E was not entitled to an amount for severe disability within her award of state pension credit and;
- from 13th September 2012 Miss E was not in receipt of AA and therefore did not satisfy the conditions for the amount for severe disability in paragraph 1 of Schedule 1 to the State Pension Credit Regulations 2002
Judge Mitchell also made some observations on the way BCC’s application to be made Miss E’s Appointee was handled. He sympathised with Mr B about the DWP’s decision to make the Council Miss E’s Appointee despite their application being unsupported by medical evidence and failing to answer the question about whether family members were made aware of the application.
He advised that if there is no good reason for the different approaches in the 1987 and 2013 Regulations that the Secretary of State may wish to bring forward amendments to align the Regulations so that if there was already a Deputy or Attorney in place, the appointment of an appointee would be barred.
- The decision confirms that entitlement to the additional amount for severe disability within pension credit for a person who is resident in a local authority home is determined by reference to the date on which a person stopped receiving attendance allowance which may not always be 28 days after the person became resident in the care home.
- Judge Mitchell gave practical guidance in his remarks about the different approaches of the 1987 and 2013 Regulations which he believes should be sensibly aligned to ensure that if a Deputy or Attorney is already in place and has power to deal with benefits then the DWP’s power to make someone an appointee will be barred.
The LawSkills Monthly Digest
Subscribe to our comprehensive Monthly Digest for insightful feedback on Wills, Probate, Trusts, Tax and Elderly & Vulnerable client matters
Not complicated to read | Requires no internet searching | Simply an informative pdf emailed to your inbox including practice points & tips
Subscribe now for monthly insightful feedback on key issues.
All for only £120 + VAT per year
(£97.50 for 10+)