In the last INOU e-bulletin, Issue 58 we had an article on the organisation’s submission to the Joint Committee on Social Protection, Community and Rural Development and the Islands on the issue of means testing for social welfare payments. In our recent Regional Discussion Forums we have been exploring this issue, the complexities facing people depending on their circumstances, and what happens if those circumstances change. The following examples highlight the dramatic changes that people can experience when either their personal circumstances change or they are no longer eligible for the payment they are on or their payment changes at different stages of their lives.
Mary seeks to move from a Jobseeker’s Allowance payment to Disability Allowance:
- Mary is single and living alone on Jobseekers Allowance (JA)
- She applied for Disability Allowance (DA) and was refused. JA remains payable pending DA decision
- Mary has exhausted the review process and is formally appealing to the SWAO
- Mary has self-declared that she is not Genuinely Seeking Work (GSW) and so does not qualify for JA
- Mary has applied for Supplementary Welfare Allowance (SWA) pending the outcome of her appeal
- Mary has €18,000 in savings in the post office
- Under the JA means test her €18,000 did not affect her JA as there is a €20,000 disregard on the capital means test for this payment
- However, under the SWA means test her SWA payment will be affected
- The capital disregard for SWA is €5,000 - assessable savings = €13,000
- Effect on weekly SWA = €10,000 @ €1 per ‘000 and €3,000 @ €2 per ‘000 (up to €25,000)
- Basic SWA rate reduced by €16 per week to €214 per week versus €230 standard payment
- If Mary’s appeal is successful the Disability Allowance means test applies (€50,000) and the SWA means deduction will be recovered.
Paula is on a Jobseeker’s Transition Allowance payment and will be moved to a Jobseeker’s Allowance payment once her youngest child turns 13:
- Paula is in receipt of Jobseeker’s Transition Allowance (JST) and has €20,000 in savings
- At the moment Paula works 5 mornings per week earning €30 per day (€150 per week)
- The income from employment does not affect her JST (max earnings €165 pw)
- When she transfers to Jobseekers Allowance she can only work a maximum of 3 days per week; and if she earns more than €20 per day it will affect her weekly payment.
- Paula must be Genuinely Seeking Work (GSW) full-time employment, and she will be subject to any relevant activation / engagement measures relevant.
- The impact on Paula’s income when she is moved from JST to JA will be as follows:
- JST: Employment €150 + JST (two children) €232 + €108 (children) = Total €490 per week
- JA: Employment €90 (3 days) + Adjusted JA €214 + €108 (children) = Total €412 per week
- Savings of €20,000 will not affect Paula’s JA as the capital means test is the same on Jobseeker’s Transitions Allowance (JST) and Jobseeker’s Allowance (JA).
Tom is being moved from Disability Allowance to Jobseekers Allowance:
- Tom is single and has been on Disability Allowance (DA) for 4 years
- Tom has savings of €50,000 in the post office
- His claim was reviewed, it was determined that he no longer qualifies for DA and he was advised of JA option
- JA application requires the applicant to be Genuinely Seeking Work (GSW) in comparison to Disability Allowance which focuses on the capacity / ability of the applicant
- DA disregard is €50,000 – JA savings disregard is €20,000 – Difference €30,000
- JA – means assessed value of €50,000 = €70 per week - (€10 + €20 + €40)
- Payment outcome based on means testing = DA €232 pw versus JA €162 pw
- Tom decides to appeal this decision
- He applies for Supplementary Welfare Allowance (SWA) which has a capital means test disregard of €5,000
- SWA means on €50,000 (€45,000 assessable) = €90 means per week – (€10 + €50 + €40)
- Payment change based on means = DA €232 (€0 means) vs SWA €140 pw (€90 means)
- If DA appeal successful, DA means test applies for SWA period and arrears would be due
- However, appeals can take weeks / months and accessing SWA can take weeks to receive a payment.
Robin is moving from Carer’s Allowance to Jobseekers Allowance:
- Robin is in receipt of Carer’s Allowance and has €35,000 in savings (CA limit €50,000)
- Robin’s caring duties have ceased and she will be applying for Jobseeker’s Allowance
- At the moment Robin works 2 mornings per week earning €50 per day (€100 per week)
- The income from employment does not affect Robin’s CA (max earnings €450 pw)
- When Robin transfers to Jobseekers Allowance she can only work a maximum of 3 days per week on Jobseekers Allowance; if she earns more than €20 per day it will affect her weekly JA payment
- Robin must be Genuinely Seeking Work that is full-time employment and will be subject to any relevant activation / engagement measures applicable
- Savings of €50,000 will affect Robin’s Jobseeker’s Allowance payment, as there is a €30,000 difference between the capital tests on these two payments
- The impact on Robin’s income when she moves from CA to JA will be as follows:
- CA: Employment €100 (2 days) + Carer’s Allowance €248 = Total €348 per week
- JA: Employment €100 (2 days) + Adjusted JA €196 (from €232) = Total €296 per week.
Liam is trying to move from Jobseeker’s Benefit to Jobseeker’s Allowance:
- Liam is single and has been on Jobseeker’s Benefit (JB) payment for 9 months, so his claim is exhausted
- Liam has money from redundancy of €60,000 which did not affect his JB claim, as JB is a social insurance payment
- Liam has applied for Jobseekers Allowance, pending processing applies for Supplementary Welfare Allowance (SWA)
- JA means test will assess €40,000 of €60,000 as means – first €20,000 disregard
- €10,000 = €10; next €10,000 = €20; Excess over €40,000 = €80 = Total €110 pw
- Jobseeker’s Allowance payable on €60,000 (€40,000 means) = €122 per week
- Under the SWA means test his SWA payment will be affected
- SWA means test will €55,000 of €60,000 as means – first €5,000 only disregard
- €10,000 @ €1 per ‘000; €25,000 @ €2 per ‘000; Balance @ €4 per ‘000 = €140 per week
- SWA payable on €60,000 (€55,000 means) = €90 per week
- Payment Difference based on means: JA €122 versus SWA €90 per week
- If JA application successful, JA means test applies for SWA period and arrears would be due.