Benefits Expert: ‘Her savings will be taken into account.’

Money, money, money

Money, money, money

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Q My wife is on Incapacity Benefit (IB) and is due to inherit some money from the sale of her mother’s house. How will this affect her benefit?

G (by Email).

A IB is based upon National Insurance Contributions and does not take account of capital, so she will not be affected immediately. But it could make a difference sometime in the future.

Like all people on IB, your wife will have to be tested for Employment and Support Allowance (ESA), which replaced IB and is paid to people who went sick after October 2008.

These tests are on-going and will continue until March 2014.

Your wife will be transferred to ESA if she is accepted as having a limited capacity for work. If she is accepted for ESA, she will be no worse off at first. After a year, however, her ESA will be means-tested unless she is severely disabled.

Her income and savings, as well as yours, will be taken into account. This means, for example, if she is not severely disabled, her ESA would stop if your joint capital were over £16,000.

Q You have said that Disability Living Allowance (DLA) is to be replaced by the Personal Independence Payment (PIP) from 2013 and that people aged 16 to 64 already on DLA will have to be tested for the new benefit. What will be the difference between the two?

Curious (Sunderland).

A DLA has three rates for care and two rates for mobility.

PIP will have two rates for ‘daily living needs’ and two rates for ‘mobility needs’.

The lower rates will be for people with ‘limited’ abilities while the higher rates will be for those with ‘severely limited’ abilities.

The Government has not yet announced what these rates will be.

A person’s entitlement to DLA is based upon what they say on their claim form about how their disability affects them, with supporting evidence from a carer and health care professional.

Whether a person is eligible for PIP, and for which rates, will be based upon how many points they score in a test of their capabilities.

They will also usually have a face-to-face consultation with ‘a trained independent assessor’.

For the Daily Living Component of PIP, people will be awarded points according to their ability to carry out such activities as preparing food, taking nutrition, washing bathing and grooming, dressing and undressing etc.

For the Mobility Component, people will be scored according to their abilities to plan a journey and to get about.

We do not yet know how many points someone would need to qualify for the different rates of PIP.