Financial hellp for single parents who are not working due to ill health - full version

What financial help is available?

Some complex rules associated with financial support if you are ill or have a disability could
not be covered in this factsheet.Please call our Single Parent Helpline for more detailed information about financial support if:

• you are aged over 60 or under 20;
• you claim an ill-health-related benefi t underthe pre-27 October 2008 rules (see sections on Incapacity Benefi t and IncomenSupport );
• you have a disability and claim or want information on disability benefits;
• you are caring for someone who has a disability;
• you are pregnant or have a pregnancy related illness;
• you have a terminal illness;
• you are a student;
• you have been told you are not entitled to claim because you do not have the right to reside in the UK.

Statutory Sick Pay (SSP)

This is paid to you by your employer for up to 28 weeks for a period of sickness lasting four days or more. You must earn at least £95 per week to be entitled. If you meet the criteria you are entitled to £79.15 per week. You may be paid more than this due to your particular employment contract. The extra amount is known as contractual sick pay.

Working Tax Credit

This is paid by Her Majesty’s Revenue and Customs if you are off sick from work for up to 28 weeks, and worked for at least 16 hours a week immediately before you were off sick.

Employment Support Allowance

This is the new benefit paid by Jobcentre Plus if your ability to work is limited by ill health or
disability and you do not work or your employer cannot pay you. See page 2 for more detailed information about this.

Jobseeker’s Allowance

Claim this benefit from the Jobcentre if you are looking for work and capable of work. You are still entitled to claim if your illness is very short term lasting less than two weeks.

Council Tax Benefit and Housing Benefit

Paid by your local council, these can help to pay your council tax bill and/or rent if your income is low. As your income often reduces due to sickness, you may become entitled to Housing Benefit and Council Tax Benefit for the first time or a higher rate than you have been getting.

Help to pay the mortgage interest on your home

This can only be claimed as part of either an Employment Support Allowance, Jobseeker’s Allowance or Income Support claim. Remember that even if you are not entitled to receive a personal allowance on these benefits due to your income or savings, you may still be entitled to help towards your mortgage interest after a waiting period.

Incapacity Benefit from the Jobcentre

This is the benefit that was claimed before 27 October 2008 if you were sick and were incapable of work and had paid enough National Insurance contributions. If you already claim this you can continue to claim under the pre-27 October 2008 rules until you are moved on to Employment Support Allowance between 2009 and 2013.

Income Support

This benefit could be claimed before 27 October 2008 if you were sick and incapable of work and had not paid enough National Insurance contributions to claim Incapacity Benefit. If you already claim this due to your ill health you can continue to claim it, including any disability premiums for long-term sickness under the pre 27 October 2008 rules until, you are moved on to Employment Support Allowance in the future. You can also claim this to top up Statutory Sick Pay in some circumstances.

Claiming Employment Support Allowance (ESA)

What is ESA and who can claim it?

The Employment Support Allowance (ESA) is a new benefit that was introduced on 27 October 2008 to replace new claims for both Incapacity Benefit and Income Support on the grounds of being incapable of work. It is paid if you are found to have a ‘limited capability for work’ due to ill health or disability. Once you are found to have a limited capability for work you may have to take part in some form of work-related activity but you may not be expected to undertake this if it is found that you have a ‘limited capability for work-related activity’.

To qualify for ESA, you must meet all these basic conditions of entitlements:

• Your ill health means you have a ‘limited capability for work’.
• You must be in Great Britain and satisfy the habitual residence test.
• You are not working or you are off sick from work and you are not entitled to Statutory Sick Pay from your employer (see above).
• You must not be claiming Income Support or Jobseeker’s Allowance.

You must also meet at least one of the following conditions:

• You have paid enough National Insurance (NI) contributions in the past (if you have had limited capability for work from a young age you may not have to meet this condition).
• You have low income and capital (such as savings and investments) below £16,000.
  

The ‘assessment phase’ and ‘main phase’ of ESA

The first 13 weeks after you make your claim is called the assessment phase, in which you undergo the Work Capability Assessment (WCA). You also have to participate in a work-focused interview after the eighth week of the claim, in which you have to discuss your work prospects and the support available to you to move into work.

After the assessment phase, if it is confirmed that you are entitled to ESA, you move into the main phase.

What is the Work Capability Assessment (WCA)?

The WCA determines whether you are entitled to ESA and, if you are, where you are placed in the main phase. You will be sent an ESA50 questionnaire to complete, which asks for details about your physical and mental health, and you will then usually be required to attend a medical examination with a doctor from the Department for Work and Pensions’ (DWP)Medical Service who will conduct the WCA. It has three parts:

• The first part of the WCA looks at whether you have ‘limited capability for work’. It determines whether or not you are entitled to go on receiving ESA. It is a points-related assessment of your physical and mental health according to a range of activities. Points are awarded on the basis of any limitations with respect to a listed activity and if you reach 15 points or more, you are assessed as having a limited capability for work. If you are found not to have limited capability for work you will not be entitled to go on receiving ESA. You will have to consider claiming another benefit such as Jobseeker’s Allowance or Income Support, if you meet the conditions of entitlement for those, or you can appeal against the decision that finds you do not have a limited capability for work and continue to receive the basic ESA allowance until the appeal decision is made. Some people are automatically deemed to have a limited capability for work without undergoing this part of the assessment - people who are terminally ill, for example.
  

• The second part of the WCA looks at whether you have a ‘limited capability for work-related activity’. After establishing you have a limited capability for work, this part decides your place in the main phase. This assessment has a list of activities related to your physical and mental health. If you meet at least one of these, you are considered to have limited capability for work-related activity and should be placed in the ‘support group’ of claimants. If you do not meet one of these activity limitations, it is determined that you are capable of work-related activity and should be placed into the ‘workrelated activity group’ of claimants. The amount of ESA you will receive differs depending on which group you are placed in. Again some people, such as those who are terminally ill, are automatically deemed to have a limited capability for work-related activity without undergoing this part of the assessment.
• The third part of the WCA is a work-focused health related assessment. This applies only if you are placed into the ‘work-related activity group’. The assessment looks at barriers to work and what support you need to help you move into work.
  

The support group

If the DWP doctor (who will carry out the assessment) finds that you do have limited capability for work-related activity you will not be expected to prepare for a return to work, although you can volunteer to do so. You will receive ESA with an additional ‘support group component’. You will receive a higher rate of ESA than those in the work-related activity group.

The work-related activity group

If you are found to be capable of work-related activity you will have the work-focused health-related assessment part of the WCA. You must take part in a series of six work-focused interviews. You will receive ESA with an additional ‘work-related activity component’. If you do not participate in the work-related activity you will face a benefit cut called a sanction’.

What is a work-focused interview?

You will be expected to participate in an intial work-focused interview with a personal adviser from the Jobcentre in around the eighth week of your claim for ESA. If you are placed in the work-related activity group you will be expected to take part in a further five work-focused interviews, the second at 14 weeks and then usually monthly after that. At each of these interviews you will meet a personal adviser who may be from a private or voluntary sector organisation contracted to do this work. You are expected to explore the barriers to work and identify support to assist you to move towards work, such
as training or education.
You are not expected to take part in work-focused interviews if you are placed in the support group of claimants or if you are likely to start work very soon.

The interviews can be deferred with the agreement of the personal adviser if they are scheduled at inappropiate times for you.

An Action Plan is the written record of the steps you are willing to take to enhance your job prospects.

What happens if I do not attend?

If you do not take part in the work-focused interview, your ESA could be reduced, unless you can show you had ‘good cause’ within five working days for your failure to participate or attend. Good cause may include looking after an ill relative, ill health, a medical appointment or transport difficulties, amongst other possible reasons.

The reduction is applied only after the 13-week assessment phase. The reduction ceases to apply once you have participated in a work-focused interview or you are placed in the support group. The reduction means you will receive only 50 per cent of the work-related activity component for the first four weeks. If you still have not attended a work-focused interview after four weeks, you will no longer receive the work-related activity component.

You can appeal against a decision that you failed to take part in a work-focused interview. You can also appeal against a decision that you did not show good cause for failing to take part in a work-focused interview within five days of the interview. Use form GL24 from the Jobcentre to make your appeal. You have one month from the date of the decision to lodge your appeal. Alternatively, you can ask the Jobcentre to reconsider and change their decision. You also have one month to do this and, if they do not reconsider in your favour, you can appeal.

If you are outside the one-month time limit for appealing or asking the Jobcentre to reconsider their decision, you should seek advice. It may be possible for the decision to be changed after the time limit.

How do I claim ESA?

You are expected to start your claim for ESA by calling the Jobcentre Plus claim line on 0800 055 6688. The claim details are taken over the phone and a statement is sent which confirms your details for you to check and sign. If you cannot use the telephone you can ask for a paper claim form (ESA1) or claim online at www.dwp.gov.uk/eservice

You do not need a medical certificate for the first seven days of any limited capability for work. Once you have had a limited capability for work for seven days, you must forward a medical cetificate (form med 3) from your doctor to the office dealing with your claim. You should ensure that your sick notes are up to date.

If you work for an employer and do not get paid Statutory Sick Pay (SSP), you will also need to send form SSP1 (from your employer) as well as a medical certificate from the first day of your claim.

How much will I be paid?

ESA is paid at different rates. There are two types of ESA: contributory ESA and income-related ESA. You may be entitled to both types at the same time. This can happen if the amount of entitlement to income-related ESA is greater than the amount of entitlement to contributory ESA.

Contributory ESA is payable if you have paid enough National Insurance contributions. It is not affected by savings or income, except for part of any occupational or personal pensions. In some cases you may qualify for contributory ESA without having paid National Insurance contributions if your limited capability for work began before the age of 25.

Income-related ESA is means tested. It does not depend on National Insurance contributions, but your income (for example, child maintenance over £20 per week) and capital (savings or investments over £6,000) can affect your entitlement.

ESA is not usually payable for the first three days unless, before the claim, you were getting Income Support, Jobseeker’s Allowance, Statutory Sick Pay, Carer’s Allowance, Maternity Allowance, your claim is linked to an earlier ESA claim up to 12 weeks ago or you are terminally ill.

During the initial assessment phase your ESA is calculated using a basic weekly personal allowance of £64.30 per week (if you are over 18). If you are entitled to income-related ESA, on its own or on top of contributory ESA, additional amounts can be included in the calculation for disability, caring for a disabled person, and for mortgage interest. The mortgage interest payments are included only after a waiting period, and these amounts are payable direct to your mortgage lender. You must claim income-related ESA if you want this help towards mortgage payments.

For more information about additional amounts in income-related ESA, call the Gingerbread Single Parent Helpline.

After the assessment phase, if you are still entitled to ESA, you enter the main phase and you are entitled to an additional weekly payment depending on whether you are in the work-related activity group or the support group. The calculation will then include either:

• ‘work-related activity component’: £25.50 per week if you are placed in the work-related activity group;
  or
• ‘support group component’: £30.85 per week if you are placed in the support group.

If you receive the ‘support group component’ and you are entitled to income-related ESA, an additional £13.40 per week ‘enhanced disability premium’ will be included in the calculation.

Contributory ESA can be reduced by personal/occupational pension or health insurance payments.

Income-related ESA can be reduced by many types of income including some benefits, and earnings above the permitted work earnings limit if you are doing permitted work (see below).

You are paid ESA fortnightly in arrears straight into your bank account.

Can I do some paid work or voluntary work?

ESA claimants are not allowed to work and still receive ESA unless it is exempt work such as voluntary work or ‘permitted work’. Any earnings from work over £20 per week may affect your entitlement to ESA, though in principle you may be entitled to earn £92 per week without it affecting your ESA. Seek advice from the Jobcentre.

You can undertake voluntary work and still be entitled to ESA as long as you only receive payment to cover your expenses and have no earnings. You can also be a carer of a relative, a councillor or foster carer and still be entitled to ESA.

What can I claim in my circumstances?

I am employed for 16 hours per week or more and am off sick for less than 28 weeks

Ask your employer about Statutory Sick Pay (SSP). SSP is paid to you by your employer for a period of sickness lasting four days or more. It can be paid for up to 28 weeks. You must earn at least £95 per week to be entitled. If you meet the criteria you are entitled to £79.15 per week. You are not paid for the first three days of sickness. You may be paid more than this due to your particular employment contract. The extra amount is known as contractual sick pay.

If you cannot get SSP because you are self-employed or are not entitled for another reason, you may be able to receive ESA – see Claiming Employment Support Allowance.

You will still be treated as if you are in work while you are off sick, so you may continue to be or become entitled to Working Tax Credit, including help with childcare. As your income may be lower while you are off ill, you may also become entitled to or have increased entitlement to Housing Benefit and Council Tax Benefit.

I am thinking of leaving work due to sickness

My youngest child is 12 or over

If you leave work and are no longer sick and you are looking for work, claim Jobseeker’s Allowance (JSA). If you claim JSA, you will have to show you left work with good reason or you may not be awarded benefits for up to 26 weeks if it is decided that you left work voluntarily, although you should be able to claim a reduced hardship amount during this period. If you are too sick to look for work, claim ESA. You may also claim Council Tax Benefit, and Housing Benefit for help with your rent. Mortgage interest payments may also be paid after a waiting period as part of the JSA or ESA claim.

My youngest child is under 12

Whether sick or not, you may wish to claim either Income Support (IS) as a single parent or, if you are ill, you could decide to claim ESA. It is advisable to claim both initially as the ESA may be more than IS and IS will be paid if you decide you do not wish to claim ESA due to the work-related requirements that may be imposed. You cannot get paid both at the same time.

You may also claim Council Tax Benefit and Housing Benefit for rent. Mortgage interest payments may also be paid after a waiting period as part of a JSA, ESA or IS claim.

See Further help and information for details of an employment helpline called Working
Families, that you can contact for advice if you feel that your employer is putting pressure on you to give up work.

I am unemployed and am too ill to look for work

My youngest child is 12 or over

You can claim JSA if you will only be sick for up to two weeks. If you are likely to be ill for longer and have limitations with looking for work, you are advised to claim ESA. You may also claim Council Tax Benefit and Housing Benefit for rent. Mortgage interest payments may also be paid after a waiting period as part of the JSA or ESA claim.

My youngest child is under 12

Whether sick or not, you may wish to claim either IS as a single parent or, if you are ill, you could decide to claim ESA. You can claim both initially as the ESA is paid at a higher rate than IS after 13 weeks and the IS can be paid instead if you decide that you no longer wish to claim ESA due to the work requirements that may be imposed. You cannot get paid both at the same time – see Claiming Employment Support Allowance.

You may also claim Council Tax Benefit and Housing Benefit for rent. Mortgage interest payments may also be paid after a waiting period as part of the JSA, ESA or IS claim.

I am claiming an ill-health-related benefit and am looking for work for 16 hours per week or more

Personal support to help me fi nd work

Jobcentres have Disability Employment Advisers to assist you to find employment. Support available includes: personal learning and careers advice from nextstep, work experience placements, help with finding voluntary work in the UK, access to work, New Deal for Disabled People, work preparation programme, and over 50s support. You can arrange to speak to a Disability Employment Adviser at the Jobcentre for more information about what they can offer you.

Working Tax Credit (WTC)

If you move from ESA into work of 16 hours or more a week, your ESA will end and, depending on your income and circumstances, you may be entitled to WTC of up to £120 per week. This amount includes a disability element for those who have been in receipt of ESA for 26 weeks before starting work. If you do not get the disability element, you will get £48 per week less from WTC.

An example of how a single parent’s benefits change when  moving from ill-health-related benefits to in-work benefits

Lynne’s income when she is not working

Income                                               2009/10
ESA basic amount                                £44.30
ESA work-related component              £25.50
Child Benefit                                        £33.20
Child Tax Credit                                   £96.32
Housing Benefit                                    £120
Council Tax Benefit                              £20.77
Child maintenance                                £40
TOTAL (weekly)                                £380.09

Lynne would also be entitled to free school meals worth £20 per week and free prescriptions and dental treatment.

If Lynne did not receive child maintenance, she would have £20 less income than the above total.

Lynne’s income if she worked 16 hours a week

Income                                                       2009/10
ESA basic amount                                          £0
Child Benefit                                                   £33.20
Child Tax Credit                                             £96.32
WTC (including disability element)                  £120.54
Housing Benefit                                              £55.87
Council Tax Benefit                                        £1.04
Child maintenance                                          £40
Earnings                                                         £111.78
TOTAL (weekly)                                         £458.75

Lynne would not be entitled to free school meals but she is entitled to free prescriptions and dentaltreatment.

Extra short term financial help for Lynne: Lynne will also be entitled to a £250 Job Grant, full Housing and Council Tax Benefit for four weeks because she has been in receipt of benefits for at least 26 weeks before moving into work and the Return to Work Credit of £40 per week on top of her benefi ts, tax credits and earnings for the fi rst year that she is in work. There may also be fi nancial help of up to £300 available from the In Work Emergency Discretionary Fund at the Jobcentre during her first 26 weeks of employment.

Other things that Lynne takes into account when making her decision whether to take up employment

• She has travel costs to work and workrelated expenses, such as lunch, that amount to £15 per week.
• If Lynne needed any registered childcare, for example a childminder or nursery, she would also have to pay at least 20 per cent of the costs (80 per cent of her childcare costs could be paid with her tax credits, as long as her overall childcare costs are no more than £300 a week).
• If Lynne did not receive child maintenance she would have £40 less income than the above total.

Further help and information

Gingerbread Single Parent Helpline

0808 802 0925
(Open Mondays to Fridays, 9.00am–5.00pm, with extended opening on Wednesdays to 8.00pm)
Free information on a range of issues including maintenance, benefits, tax credits, debt, employment, education, legal rights and holidays.

Gingerbread Single Parent Information Online

All our information for single parents available online.

Child Maintenance Options

0800 988 0988
www.cmoptions.org
Information about making arrangements for child support.

Childcare Link

0800 234 6346
www.childcarelink.gov.uk
Information about the different types of childcare and what is available in your area.

Citizen’s Advice Bureau

Check your telephone directory for your local bureau or find details at www.citizensadvice.org.uk, for information and advice on a wide range of issues including benefits and tax credits.

Community Legal Advice

0845 345 4345
www.communitylegaladvice.org.uk
Telephone advice on benefits, housing, employment, debt, welfare benefits and family law for people who are eligible for public funding.

One Parent Families Scotland Lone Parent Helpline

0808 801 0323 
www.opfs.org.uk
Provides confidential advice and information for single parents in Scotland.

Department for Work and Pensions

Jobcentre Plus Benefits Enquiries: 0800 055 6688
Minicom: 0800 023 4888
www.jobcentreplus.gov.uk
Processes new claims and claim renewals for welfare benefits.

Benefit Enquiry Line (only for disabled people and their carers): 0800 882 200; Textphone: 0800 243 355
For general information and claim forms.

DIAL UK (Disability Information and Advice Line)

01302 310 123
Email: dial-uk@hotmail.co.uk
Refers queries to your local DIAL for information and advice for people with disabilities and their families and friends. Advice is available on a range of issues, including benefits, daycare and clubs, mobility aids, equipment and adaptations, holidays, social services and medical services.

Immigration Advice

The Immigration Advisory Service

www.iasuk.org

OISC

www.oisc.gov.uk
For information on organisations/solicitors that give immigration advice.

Refugee Council

020 7346 6700
Advice for refugees and asylum seekers.

HMRC Tax Credit Helpline

0845 300 3900
www.hmrc.gov.uk/taxcredits
For information about tax credits and to request claim forms.

Working Families

0800 013 0313
www.workingfamilies.org.uk
Advice on benefits and employment law.

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