Contribution Based ESA and pension income

The request was partially successful.

Dear Department for Work and Pensions,

Contribution-based ESA payments can be reduced using a formula based on occupational pension income. What information has been produced to:

a) explain the rationale/logic for this reduction – i.e. why it is regarded as reasonable to adjust for pension income but NOT, say investment income?

b) Detail any other types of income that can likewise reduce contribution-based ESA payments

Yours faithfully,

J Newman

DWP freedom-of-information-requests, Department for Work and Pensions

This is an automated confirmation that your request for information has
been accepted by the DWP FoI mailbox.
 
By the next working day your request will be forwarded to the relevant
information owner within the Department who will respond to you direct. 
 
If your email is a Freedom of Information request you can normally
expect a response within 20 working days.
 
Should you have any further queries in connection with this request do
please contact us.
 
For further information on the Freedom of Information Act within DWP
please click on the link below.
 
[1]http://www.dwp.gov.uk/freedom-of-informa...
 

show quoted sections

References

Visible links
1. http://www.dwp.gov.uk/freedom-of-informa...

DWP Strategy Freedom of Information, Department for Work and Pensions

1 Attachment

Dear J Newman,

Thank you for your Freedom of Information request. Please find enclosed our acknowledgment of its receipt.

If you have any queries about this letter please contact me quoting the reference number above.

Yours sincerely,

DWP Central FoI Team

------------------------------------------------------------------------------------------------------
Your right to complain under the Freedom of Information Act

If you are not happy with this response you may request an internal review by e-mailing [DWP request email] or by writing to DWP, Central FoI Team,
Caxton House, Tothill Street, SW1H 9NA. Any review request should be submitted within two months of the date of this letter. Please remember to quote the reference number above in any future communications.

If you are not content with the outcome of the internal review you may apply directly to the Information Commissioner’s Office for a decision. Generally the Commissioner cannot make a decision unless you have exhausted our own complaints procedure. The Information Commissioner can be contacted at: The Information Commissioner’s Office, Wycliffe House, Water Lane, Wilmslow Cheshire SK9 5AF
www.ico.org.uk/Global/contact_us or telephone 0303 123 1113 or 01625 545745

show quoted sections

DWP Strategy Freedom of Information, Department for Work and Pensions

1 Attachment

Please see the attached reply to your Freedom of Information request

Yours sincerely

DWP Strategy FoI team

show quoted sections

John Slater left an annotation ()

Perhaps I'm being over sensitive but did I detect an element of party politics in the answer? Surely all that was needed was too say from "April 2001". There was no need to mention the "previous administration".

J Newman left an annotation ()

Indeed, even after all these years in charge . . . . .

Dear Department for Work and Pensions,

Please pass this on to the person who conducts Freedom of Information reviews.
I am writing to request an internal review of Department for Work and Pensions's handling of my FOI request 'Contribution Based ESA and pension income'.

I’m not sure which administration is to blame has any relevance – certainly if the current one held a different view, it has had ample time to make any changes – as it has done with many other aspects of the ESA process. The conclusion must therefore be that it agrees with the principle.

I am asking for a review as I am looking for

1) a reasoned argument that explains why in this context private pension income is treated differently from other sources of unearned income (e.g. investment income) and

2) Why nobody saw fit to amend what is now a highly misleading title – contribution-based ESA is NOT solely NI contribution based. If there was a discussion and a conscious decision made to ignore the inevitable confusion, I would like to see what was minuted at the meeting. The only alternative is that that nothing was recorded suggesting that nobody wanted to highlight the obvious anomaly. IB did not suffer the same problem as it did not use the words “income” or “contribution” to describe its basis. One would of course naturally assume that all income related matters fell under the income-related heading, so I am trying to understand why such an obvious change in description did not take place.

A full history of my FOI request and all correspondence is available on the Internet at this address: https://www.whatdotheyknow.com/request/c...

Yours faithfully,

J Newman

DWP freedom-of-information-requests, Department for Work and Pensions

This is an automated confirmation that your request for information has
been accepted by the DWP FoI mailbox.
 
By the next working day your request will be forwarded to the relevant
information owner within the Department who will respond to you direct. 
 
If your email is a Freedom of Information request you can normally
expect a response within 20 working days.
 
Should you have any further queries in connection with this request do
please contact us.
 
For further information on the Freedom of Information Act within DWP
please click on the link below.
 
[1]http://www.dwp.gov.uk/freedom-of-informa...
 

show quoted sections

References

Visible links
1. http://www.dwp.gov.uk/freedom-of-informa...

DWP Strategy Freedom of Information, Department for Work and Pensions

1 Attachment

Thank you for your Freedom of Information REVIEW request; please see the attached acknowledgement.
If you have any queries about this letter please contact me quoting the reference number above.
Yours sincerely,

DWP Central FoI Team
------------------------------------------------------------------------------------------------------

Your right to complain under the Freedom of Information Act

If you are not happy with this response you may request an internal review by e-mailing [DWP request email] or by writing to DWP, Central FoI Team, Caxton House, Tothill Street, SW1H 9NA. Any review request should be submitted within two months of the date of this letter.

If you are not content with the outcome of the internal review you may apply directly to the Information Commissioner’s Office for a decision. Generally the Commissioner cannot make a decision unless you have exhausted our own complaints procedure. The Information Commissioner can be contacted at: The Information Commissioner’s Office, Wycliffe House, Water Lane, Wilmslow Cheshire SK9 5AF www.ico.gov.uk

show quoted sections

Dear Department for Work and Pensions,

Please pass this on to the person who conducts Freedom of Information reviews.

I am writing to request an internal review of Department for Work and Pensions's handling of my FOI request 'Contribution Based ESA and pension income'.
I already have an outstanding IRR (dated 21/08) regarding the response to my original question (raised on 10th August).
This request is to point out that your promised deadline for a response to the IRR by 19th Sept actually represents 21 working days discounting 25/08 as a Bank Holiday. Your method of calculating working days here has been challenged in the past and the ICO has ruled that it is incorrect. You have acknowledged receipt of the first IRR on 21/08, which makes it “day 1", NOT 22/08. Day 20 is therefore 18th Sept not 19th Sept.

A full history of my FOI request and all correspondence is available on the Internet at this address: https://www.whatdotheyknow.com/request/c...

Yours faithfully,

J Newman

DWP freedom-of-information-requests, Department for Work and Pensions

This is an automated confirmation that your request for information has
been accepted by the DWP FoI mailbox.
 
By the next working day your request will be forwarded to the relevant
information owner within the Department who will respond to you direct. 
 
If your email is a Freedom of Information request you can normally
expect a response within 20 working days.
 
Should you have any further queries in connection with this request do
please contact us.
 
For further information on the Freedom of Information Act within DWP
please click on the link below.
 
[1]http://www.dwp.gov.uk/freedom-of-informa...
 

show quoted sections

References

Visible links
1. http://www.dwp.gov.uk/freedom-of-informa...

John Slater left an annotation ()

Surely the DWP can't still be calculating the 20 days incorrectly?

Do you think the DWP got the calculation wrong as a special treat for you :-)

I'm sure the ICO would be delighted to know that the DWP is acting according to its decision notices!

Dear Department for Work and Pensions,

Please pass this on to the person who conducts Freedom of Information reviews.

I am writing to request an internal review of Department for Work and Pensions's handling of my FOI request 'Contribution Based ESA and pension income'.

To save you time, the ICO decision notice that makes the calculation methodology clear is at:

http://ico.org.uk/~/media/documents/deci...

A full history of my FOI request and all correspondence is available on the Internet at this address: https://www.whatdotheyknow.com/request/c...

Yours faithfully,

J Newman

DWP freedom-of-information-requests, Department for Work and Pensions

This is an automated confirmation that your request for information has
been accepted by the DWP FoI mailbox.
 
By the next working day your request will be forwarded to the relevant
information owner within the Department who will respond to you direct. 
 
If your email is a Freedom of Information request you can normally
expect a response within 20 working days.
 
Should you have any further queries in connection with this request do
please contact us.
 
For further information on the Freedom of Information Act within DWP
please click on the link below.
 
[1]http://www.dwp.gov.uk/freedom-of-informa...
 

show quoted sections

References

Visible links
1. http://www.dwp.gov.uk/freedom-of-informa...

DWP Strategy Freedom of Information, Department for Work and Pensions

1 Attachment

Please see the attached response to your Freedom of Information review request.

Many thanks,

DWP Central FoI Team
----------------------------------------------------------------------------------------------------------------------------

show quoted sections

Dear DWP Strategy Freedom of Information,

I would prefer not to raise this as another IRR, but would appreciate some clarification over what you have said in VTR IR 419.

Perhaps you do not know that it is perfectly possible to take income from a private pension at any point after the date prescribed in the terms and conditions whether one is working or not. The best course of action for any individual will depend on a cost/benefit calculation that is completely independent of their employment status. It will of course potentially attract income tax, but so (potentially) would any other source of income, including ESA itself. Income from a pension fund is therefore not unique in the way you suggest and it is concerning that legislation has been introduced based on a completely false premise.

Another example that shows how odd this decision is exists with a share portfolio. One can often decide to reinvest dividends in more shares to increase the underlying investment value, which is an option somebody in employment might favour. However, they could stop working through ill-health and receive ESA and then decide to take any dividends as income, but ESA would not be affected.

At some point in the past, this whole area of what should and shouldn’t affect contribution-based ESA payments would have discussed with the pros and cons being recorded to support the final decision. Can you please direct me to where I can find this document whatever form it may take? The absence of such an “audit trail” would be a great worry and indicate that the decision as it stands was made without all of the consequences being properly considered.

Yours sincerely,

J Newman

DWP Strategy Freedom of Information, Department for Work and Pensions

Thank you for your Freedom of Information request.

You can expect a reply by 30 September unless I need to come back to you to clarify your request or the balance of the public interest test needs to be considered.

If you have any queries about this letter please contact me quoting the reference number above.

Yours sincerely

Strategy Freedom of Information

------------------------------------------------------------------------------------------------------

Your right to complain under the Freedom of Information Act

If you are not happy with this response you may request an internal review by e-mailing [DWP request email] or by writing to DWP, Central FoI Team, Caxton House, Tothill Street, SW1H 9NA. Any review request should be submitted within two months of the date of this letter.

If you are not content with the outcome of the internal review you may apply directly to the Information Commissioner’s Office for a decision. Generally the Commissioner cannot make a decision unless you have exhausted our own complaints procedure. The Information Commissioner can be contacted at: The Information Commissioner’s Office, Wycliffe House, Water Lane, Wilmslow Cheshire SK9 5AF www.ico.gov.uk

show quoted sections

DWP freedom-of-information-requests, Department for Work and Pensions

Dear Mr Newman,

Thank you for your review and links to the ICO's calculation methodology, however I can find no issue with the handling of your case.

I should first point out that there is no statutory deadline in respect of internal reviews, so your references to the timing used by the ICO to calculate the 20 day period do not directly apply.

The Department does however use that process voluntarily for review timings and in doing so the timing provided to you does fit that criteria.

You submitted your review on 21/8 making that the date of receipt for that internal review. Using the criteria for requests the deadline would be the 20th working day following that date making:
Day 1: 22/08,
Day 2: 26/08
Day 3: 27/08
Day 4: 28/08
Day 5: 29/08
Day 6: 01/09
Day 7: 02/09
Day 8: 03/09
Day 9: 04/09
Day 10: 05/09
Day 11: 08/09
Day 12: 09/09
Day 13: 10/09
Day 14: 11/09
Day 15: 12/09
Day 16: 15/09
Day 17: 16/09
Day 18: 17/09
Day 19: 18/09
Day 20: 19/09

This obviously excludes 25/8 which being a bank holiday is not a working day following the date of receipt.

As such I find that the date provided to you by which you could expect a request was correct for DWP processes for handling a review, and would have also been the correct date has this applied to a new request, and therefore I uphold the handling of your previous review on it's timing in full.

Central FoI Team

show quoted sections

DWP Strategy Freedom of Information, Department for Work and Pensions

1 Attachment

Please see the attached response to your Freedom of Information request.

Many thanks,

DWP Central FoI Team
----------------------------------------------------------------------------------------------------------------------------

show quoted sections

Dear DWP Strategy Freedom of Information,
Thank you for the information, which gets me closer to what I am trying to locate. However:

1) Firstly, the SoS refers to IB, not ESA and whilst the latter has superseded the former, the latter’s scope is much broader. One cannot automatically assume that the rules for one apply to the other by default. If the intention was to replicate this view on private pension income from IB to ESA the differences are substantial enough to require specific discussion and agreement.

Please direct me to where this confirmation can be found. Without it there is no evidence to support the assumption that the rules for one apply to the other, nor indeed that the SoS intended this to be the case.

2) Secondly, although he does not say it, the SoS is obviously not suggesting the IB would FULLY replace lost income from work – merely that it would soften the blow and for higher earners this state ‘contribution’ could be relatively small – for someone just paying higher rate tax not much more than 10%, leaving a 90% shortfall in income. As often the onset of poor health can be quite sudden, there will be no opportunity to reduce outgoings pro-rata, if indeed this is possible at all, so for many people organising additional supplementary income would be an urgent necessity rather than in any way optional.

3) Thirdly, the Minister’s comments are clearly aimed at anyone ending their working life early, whether it be a voluntary decision or made necessary by ill-heath, with no intention and/or ability to work again – commonly referred to as “early retirement” and in this situation the proposition arguably contains some logic.
By contrast, it is clearly not aimed at alternative scenarios where additional income is needed to survive and therefore cannot be regarded as “duplication” as it is quite likely that IB + private pension still leaves a large income shortfall.

Yours sincerely,

J Newman

DWP Strategy Freedom of Information, Department for Work and Pensions

Dear J Newman,

Thank you for your Freedom of Information request.

You can expect a reply by 29/10/14 unless I need to come back to you to clarify your request or the balance of the public interest test needs to be considered.

If you have any queries about this letter please contact me quoting the reference number above.

Yours sincerely,

DWP Central FoI Team

------------------------------------------------------------------------------------------------------
Your right to complain under the Freedom of Information Act

If you are not happy with this response you may request an internal review by e-mailing [DWP request email] or by writing to DWP, Central FoI Team,
Caxton House, Tothill Street, SW1H 9NA. Any review request should be submitted within two months of the date of this letter. Please remember to quote the reference number above in any future communications.

If you are not content with the outcome of the internal review you may apply directly to the Information Commissioner’s Office for a decision. Generally the Commissioner cannot make a decision unless you have exhausted our own complaints procedure. The Information Commissioner can be contacted at: The Information Commissioner’s Office, Wycliffe House, Water Lane, Wilmslow Cheshire SK9 5AF
www.ico.org.uk/Global/contact_us or telephone 0303 123 1113 or 01625 545745

show quoted sections

DWP Strategy Freedom of Information, Department for Work and Pensions

1 Attachment

Please see the attached reply to your Freedom of Information request

Yours sincerely

DWP Strategy FoI team

show quoted sections

J Newman left an annotation ()

Just a couple of final points for anyone working through this.

1. Income based ESA payments do not rely on NI contributions, so one would imagine that contribution based ESA payments do not rely on income. Not so – beware!
2. The Secretary of State’s intentions are clear, although the various changes in pension legislation create some ambiguity, so DWP needs to update this area. Increasingly pensions are becoming just another form of investment that can be drawn upon as and when needed, so it is illogical to treat this source of income any differently from any other source of unearned income.
3. In the meantime, if you are forced to stop work and start claiming ESA, but need to make up at least some of the shortfall, avoid if you can taking income from any investment you have that is pension orientated or you will find that the ESA payment is reduced.