universal credit and small pension

diamond_dave

Can someone explain this,- my son had to retire from the NHS on health grounds and cannot work.He has a small pension of around 5k a year but cannot get UC as the pension is not earned income. Anyone working and earning this small amount would be entitled to UC. Surely this is unfair?

poppy12345

Whether it's unfair or not, it's the law that a pension is classed as other income and will reduce means tested benefits £1 for £1. It was always the same for the old Income Related benefits such as ESA/JSA and Income Support.

If he's paid the correct amount of NI contributions from working in tax years April 2019 to March 2021 then he can claim New style ESA. As it's a contributions based benefit pension of up to £85/week will be ignored, for every £1 over this amount the ESA will reduce by 50p. He will need a fit note from his GP to claim this.

https://www.gov.uk/guidance/new-style-employment-and-support-allowance

If he's unable to claim the ESA because of lack of NI contributions if he has no other income than his pension he can claim UC, report his health condition, send in fit notes and start the work capability assessment process off. If found to have LCWRA there's an extra £354.28 per month from the 4th month of his claim on top of the standard element of £334.91/month. (single person) There will be a small amount of UC payable each month after the deduction.

If he has savings/capital of more than £16,000 then he's excluded from claiming. If he lives with a partner they claim as a couple and their joint circumstances will be taken into consideration, so the figures would be different. He can use a benefits calculator to check entitlement.

If he claims both ESA and UC together the ESA will be deducted in full from the UC.