From the DWP Advisor website.
The Welfare Reform Bill currently going through Parliament is proposing two changes to contribution-based Employment and Support Allowance (ESA):
- to limit the amount of time that people in the Work Related Activity Group can receive contribution-based ESA to 12 months; and
- to remove the special contribution criteria for ESA “youth”.
If passed by Parliament these changes will be introduced in Spring 2012.
These proposed changes are not yet law. However, given their possible effect, Jobcentre Plus have decided to write to claimants to prepare them to this possible change. Starting on 19 September 2011 and running over a 4 week period, we will write to all claimants receiving contribution-based ESA to advise them that their contribution-based benefit may be limited to 12 months.
Claimants in the Work Related Activity Group whose entitlement to contribution-based ESA ends after 12 months will be able to get income-related ESA if they are eligible. There will always be a safety net to support those who have no means of supporting themselves.
What are the Proposed Changes?
The Welfare Reform Bill proposes to limit the time people in the Work Related Activity Group receive contribution-based ESA to a maximum of 12 months.
People who have already received contribution-based ESA for 12 months or more in the Work Related Activity Group will have their benefit stopped as soon as the change is introduced.
The Bill also proposes to remove the special rules that allow some young people to receive contribution-based ESA without paying National Insurance contributions. These are people aged between 16 and 20, or under 25 if in education or training at least 3 months immediately before turning 20.
If the Bill is passed, anyone from this age group claiming ESA will have to meet the same National Insurance contribution conditions as all other claimants. If they qualify for, or are already receiving, contribution-based ESA, and are placed in the Work Related Activity Group, the 12 month time limit will also apply.
The time-limiting proposal does not affect claimants in the Support Group or those receiving income-related ESA. Any time spent in the Support Group will not count towards the 12 months.
What is contribution-based ESA?
People receive contribution-based ESA if they have limited capability for work and have paid enough National Insurance contributions. It is different to income-related ESA which is paid to people depending on their income and savings.
What is the Work Related Activity Group?
If someone is in the Work Related Activity Group, it has been decided that work may not be appropriate for them now, but with support they can prepare for work in the future.
Who is going to receive this notification?
All people currently receiving contribution-based ESA in the Work Related Activity Group will receive this notification over a four week period starting on 19 September 2011. People making new claims to contribution-based ESA will also be informed of the proposed change by letter once a decision has been made to place them in the Work Related Activity Group.
What should claimants do?
Claimants do not need to do anything to continue receiving their current benefits. We will write to claimants again if the proposals will affect their benefit and tell them what they need to do.
What will happen if a claimant’s contribution-based ESA is stopped?
Claimants may be entitled to income-related ESA. They will not have to make a new claim, but we may have to ask them for more information. We will write to them before their benefit ends to tell them what to do to be considered for this.
If this change takes place, claimants who receive income-related ESA and contribution-based ESA will lose the contributory element. The income-related element of their ESA will be adjusted to take this into account and will continue.