Pension Credits entitlement for disabled pensioner

LaurenceFrancisKelly

Good afternoon folks, I am enquiring on behalf of my father who is a profoundly disabled pensioner with learning difficulties who lives alone in Northern Ireland.
At the moment, he currently gets Pension Credit of £16.80 per week and full housing benefit so he no longer has to pay any housing rates. When he initially applied back in 2020, he had nearly £34,000 in a savings account but this has since decreased to around £27,000 as he has had to dip into his savings with his living expenses having increased significantly as he has been paying privately for overnight care which is costly. He gets PIP (Daily Living & Mobility) of £156.90 per week and state pension of £185.15 per week.

I spoke with a local citizens advisor who suggested that my father should be entitled to significantly more Pension Credit than £16.80 per week because he is severely disabled (daily living component of PIP) and there is currently nobody claiming carers allowance for him. The advisor also seemed to be of the opinion that this should be back-dated. Do you think I should contact the Pensions department to see if his entitlement should be increased, or would he not really have a case here?

poppy12345

It sounds like he's already claiming the SDP but there's a deduction for the amount of savings he has. There's a £1 deduction for every £500 or part there of over £10,000.

Pension credit will top up his income to £244.40 per week. When he first claimed PC if he had savings of £34,000, this would be a £48 per week deduction.

Because he now has less savings than he did when he claimed PC then he needs to ring them to report the changes. They will then recalculate his PC with the revised savings amount.

For the amount of savings he has there will be a £34 per week deduction in PC. The figures will be as follows. Total Income for SP and PC £244.40 per week - £34 savings. Total revised amount £210.40 per week. Amount he receives at the moment is £201.95. Based on my calculations they will owe him some money but how much will depend on when his savings decreased. They will ask for bank statements to prove the reduced amount of savings.

whizzywoo

LaurenceFrancisKelly said:

Good afternoon folks, I am enquiring on behalf of my father who is a profoundly disabled pensioner with learning difficulties who lives alone in Northern Ireland.
At the moment, he currently gets Pension Credit of £16.80 per week and full housing benefit so he no longer has to pay any housing rates. When he initially applied back in 2020, he had nearly £34,000 in a savings account but this has since decreased to around £27,000 as he has had to dip into his savings with his living expenses having increased significantly as he has been paying privately for overnight care which is costly. He gets PIP (Daily Living & Mobility) of £156.90 per week and state pension of £185.15 per week.

I spoke with a local citizens advisor who suggested that my father should be entitled to significantly more Pension Credit than £16.80 per week because he is severely disabled (daily living component of PIP) and there is currently nobody claiming carers allowance for him. The advisor also seemed to be of the opinion that this should be back-dated. Do you think I should contact the Pensions department to see if his entitlement should be increased, or would he not really have a case here?

I'm not sure if the rates are different in Northern Ireland but this is what the rates would be if your father was living in England.

Standard minimum guarantee for one person:                £177.10
Add Severe Disability Premium for one person:              £ 67.30

Equals an appropriate minimum income guarantee of £244.40 per week.  This £244.40 is what your father should have coming in every week. 

He would only get the £67.30 because receives PIP Daily Living Allowance and no one receives Carer's Allowance for looking after him.  He must also live alone (unless the other person/persons also receive a qualifying benefit such as Attendance Allowance, PIP Daily Living or DLA Daily Living allowance.)

Your father's State Pension of £185.15 is deducted from the £244.40 per week leaving £59.25 per week.

However because his savings are over £10,000 there is a further amount deducted.  For every £500 or part of £500 over the threshold, a further £1 per week is deducted.  Therefore an amount of £34 per week is deducted in respect of the £17,000 savings over the threshold.

That should leave an amount of £25.25 Pension Credit due to your father.  There may also be an amount of Savings Pension Credit due as well but that can be more complicated to calculate.

I suggest you contact the Pension Credit Helpline and discuss this with them.  Are you an appointee for your father ?

LaurenceFrancisKelly

I have enduring power of attorney for my father so can act on his behalf and handle his affairs. It sounds like my father is already getting the maximum that he is entitled to other than the small decrease in his savings. I don't fully understand how the savings work though, surely when he applied for pension credit back in 2020 they hardly expected the amount in his savings account to stay exactly the same. If it wasn't for the fact that he was having to pay privately for overnight care, his savings would actually be increasing on a monthly basis as he would be spending less than he was earning and I wouldn't leave the excess money sitting in his current account. I wonder how many bank statements would be required to prove that his savings account now has less money in it or how far back would they want to check?

poppy12345

How many bank statements needed would depend on when his savings started to decrease. Bearing in mind the £1 deduction for every £500 or part there of.

LaurenceFrancisKelly said:

surely when he applied for pension credit back in 2020 they hardly expected the amount in his savings account to stay exactly the same.

They wouldn't know this unless he reports the changes.

Do bear in mind that POA is not the same as appointeeship for a benefits claim. Becoming his appointee will mean that you will take charge of his benefits claims and be responsible for reporting changes etc etc. https://www.gov.uk/become-appointee-for-someone-claiming-benefits

calcotti

LaurenceFrancisKelly said:...surely when he applied for pension credit back in 2020 they hardly expected the amount in his savings account to stay exactly the same. 

They rely on the claimant, or appointee, to keep them informed about changes and it is the responsibility of the claimant, or appointee, to do so.

LaurenceFrancisKelly

Thanks guys I genuinely didn't realize that my father was supposed to contact the Pensions department every single time his bank account figures changed. Essentially that would mean contacting them on a monthly basis when he made small savings or needed to dip into his savings as he typically only keeps enough money in his current account to cover his essential bills. My father currently has around £27,000 in savings, although he had approximately £34,000 in savings when he first applied for Pension Credit in mid-2020. He also gave me a few thousand in late 2020 / early 2021 to help towards a deposit on my first house as I had moved away from home. I didn't realize there was anything wrong with him doing so as he had given my sister money towards her house deposit 5 years ago before he had reached state pension age. I actually haven't spent any of that money as of yet because I did not find a suitable house to buy and I am living away from home so decided to rent for a while to see if I settle in a new place. Perhaps I should give this money back to my father rather than risk him getting into trouble with the Pensions department? This was a genuine gift to help me with a house deposit which seemed fair since he had done the same for my sister previously. It was not a deliberate attempt to deprive himself of assets to get more pension credit as he still has well beyond the £10,000 threshold for getting maximum pension credit. If he ever had to go into a nursing home he would still have some savings plus he owns his own house mortgage-free which he could sell to help pay for his nursing home fees. What do you guys recommend I should do in this situation?

calcotti

LaurenceFrancisKelly said:

Thanks guys I genuinely didn't realize that my father was supposed to contact the Pensions department every single time his bank account figures changed. 

Only when the amount crosses the £500 thresholds to affect the amount of tariff income.

He will not get into ‘trouble’ for giving money away. He may however be treated aside he still has if (which effectively he has been because the reduction in savings was never reported).

LaurenceFrancisKelly

Of course I am going to come clean to the Pensions department about this mess, it was all a genuine mistake made out of naivety and ignorance on my part. I will send them the bank statements for my father's savings account and offer to forfeit the money which he had gifted to me to help me with a house deposit. I hope they believe me that this was all a genuine mistake and hope they don't make me return the money as it was an innocent gift from father to son and we didn't knowingly realize there was anything wrong with a parent gifting money to their child provided they didn't leave themselves without other assets.

poppy12345

Unless you are your father's appointee then it will be his responsibility to report the changes. He won't get into any trouble for gifting any money to you but he will still be classed as having it and his pension credit will be reduced. You won't have to return the money to him either and they definitely can't make his do that. His pension credit is already being reduced anyway.

If your father isn't capable of looking after his own claim then you can become his appointee. See link https://www.gov.uk/become-appointee-for-someone-claiming-benefits

calcotti

LaurenceFrancisKelly said:

Of course I am going to come clean to the Pensions department about this mess, ...we didn't knowingly realize there was anything wrong with a parent gifting money to their child ..

It really isn’t much of a ‘mess’. He has been getting less PC than he is entitled to, not the other way around.

He is perfectly entitled to gift you money but, as explained, may be treated as still having it when his PC is recalculated. He can only be treated as having deprived himself of capital if it is thought a motivating factor was to increase benefit entitlement. If he explains that he gifted you some money as a house deposit then that may be accepted (logically it’s difficult to argue a motivating factor was to increase benefit entitlement give s that he didn’t report the change at the time).

All he needs to do is contact PC and say he’s realised that he should have kept them up to date without changes in his capital, give them the details and they will then works what he is due.