Deferred State Pension Lump Sum treated as capital?

That's it, really. A friend of ours recently applied for Help with Health Costs, having received a few months before a DSPLS. The application was rejected on the grounds that it was/is over £16,000 and that it's treated as capital. Seems unfair to me, isn't income, per se, is state pension to last for rest of life. 
Filiss

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