DRO and PIP review in the news

twilightkate · 3 February 2018 at 10:45AM

Hi all,

thanks for your help with my questions so far - my debt releif order was approved :T my new questions/ concerns is:

i currently getting PIP £310 per month my spends is board payments of £250 and £30 for my mobile phone(from the low payments i have not put things down like clothing prescriptions food gas electric) Stepchange put in the rest of the money as care costs from my PIP. As you have probably seen in the news PIP is getting reviewed and i beleive this is going to affect me meaning my payments will go up and potentally backdated - I do know I have to let the IS know about these changes but will this revoke my DRO?

also, i have been told about another benefit i could apply for ESA (contribution-based) should i apply for this or forget it? I dont know what the IS or stepchange would see as care cost but before i was unwell i was paying £400 board i was buying food paying gas and electric but now i dont have enough but this is now causing issues with my partners income and outgoings. I hope I have explained this ok, Thank you

i will also post this on Sara debt camel.

fatbelly · 3 February 2018 at 11:55AM

The minister for disabled people, Sarah Newton, said the DWP was embarking on a "complex exercise and of considerable scale".

She added: "Whilst we will be working at pace to complete this exercise it is important that we get it right."

The review could cost £3.7bn by 2023.

I think the chances of anything happening while your moratorium is in place are remote.

What benefits are you on at the moment? What income do you have apart from PIP. If you are transitioning from Income Support or JSA to ESA then the amounts are the same.

If, however, you are starting a new claim for maybe contribution based ESA then it is worth running this past your intermediary.

Debt Camel is also very good.

twilightkate · 3 February 2018 at 12:06PM

Hi Fatbelly,

I had to stop working due to my mental health and for this reason take out the debt relief order

I have PIP £310 per month and no other benefits - a friend suggested that maybe i could qualify for contribution based ESA but i would not like to make a new claim if it would mean losing the debt relief order as contribution based ESA would only last 12 month and then im back to the start.

sourcrates · 3 February 2018 at 12:50PM

These reviews don't usually happen overnight.

At the moment i`d not bother applying for any other benefits, and just wait and see how the review pans out, if it does happen to change during the moratorium period, this is the view of the insolvency service :

The Insolvency Service says: the decision to revoke following a change of circumstances is no longer being so strictly applied, with revocation now only occurring if the creditors could be expected to benefit if the DRO was revoked.

A lump sum from benefits back-dating

These may sound large but they are often not a problem because this is treated as income over the period the back-dating relates to not capital. So the question is would you have exceeded the spare income of £50 limit if you had been getting the correct amount of benefits all the time.

twilightkate · 3 February 2018 at 2:50PM

HI Sourcrates,

thanks for the reply that all makes sense

Well step change did put my spare income as £1 as they put the rest as "care cost" from pip I would assume but you and fatbelly are right its not going to be over night and possible ending before they review it.

fatbelly · 3 February 2018 at 2:51PM

The lump sum rules are not so straightforward now but there is a lot of flexibility. At some point (probably not this year) a lot of people will be getting lump sums and I trust the OR will take a sensible view regarding those that are in a DRO.

The next General Election is 2022 so I expect it to get dragged out to the end of 2021.

On the ESA thing, part of the process of DROs is that you get advice from an experienced and qualified adviser. They will know that the process of debt advice starts with:

Income maximisation incl benefit check
Expenditure minimisation incl financial capability
Exploration of debts.

so your eligibility for CBESA should have been explored by your adviser. If you don't have any other benefits (HB, council tax support) then CBESA will increase your monthly surplus by 73.10 x 52/12 - about 300 per month. Generally this would be a good thing but unless your budget was minus 250 per month then yes this could cause difficulties and that's why I think you should talk to your intermediary who should have thought about this in the first instance!

twilightkate · 3 February 2018 at 3:06PM

Hi Fatbelly,

When i first had to leave my job i spoke to CAB who looked at what im entitled to so I think if this was an option they would have mentioned - it was just a recomendation from a friend not a professional.

thank you for helping with the PIP thing and I won"t think no more of the ESA thing

Incywincy21 · 16 May 2018 at 2:15AM

A lump sum from benefits back-dating

These may sound large but they are often not a problem because this is treated as income over the period the back-dating relates to not capital. So the question is would you have exceeded the spare income of £50 limit if you had been getting the correct amount of benefits all the time.

Sourcrates, sorry to jump on the thread, but the bit you mention above... is this regardless of how much the backdated amount is? I.e if it's over 8 years and a substantial amount, will they still divide it up as if it was paid monthly to assess if you've met the £50pm criteria?

Apologies for the question, lots of conflicting information around and currently in a complex situation. Thanks!:money:

DRO and PIP review in the news

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