Worth waiting for?

Gary Vaux hails a benefit that could boost the
income of five million older people – but not until 2003.

Do you remember supplementary benefit? It was
replaced by income support. Eventually the government decided that
income support had a negative image among pensioners, so they
called it the minimum income guarantee (MIG) instead. And now? Get
ready for pension credit from April 2003.

The key element of pension credit is that it
operates in a completely different way to income support, in that
it gives more money to people with some savings or works pensions –
up to certain limits.

The estimate is that pension credit will
improve the financial position of up to five million pensioners.
There is likely to be an immense impact on the work of social
services staff when the new benefit is introduced. And the
preparation work needs to start soon, if we are not to be caught
off guard.

Because pension credit is a new means-tested
benefit that effectively sits on top of MIG, there will be a strong
need to promote take-up.

Direct advice from welfare rights staff and
other front-line workers in social services, housing, health, the
voluntary sector and so on will be far more effective in persuading
people to claim than Department of Health publicity. Many of those
who could claim pension credit will already be in receipt of
housing or council tax benefit. This means liaison with housing
benefit sections to identify pensioners who are currently just
above MIG levels, who could gain from pension credit.

The recent DoH paper on home care charging was
disappointing, as it made no reference to pension credit. This is
despite the government being well aware of its imminent
introduction in relation to its suggested date for revised home
care charging policies (first stage October 2002, second stage
April 2003). In considering any revision to councils’ home care
charging policy, the impact of pension credit will have to be
considered, otherwise the process will inevitably be flawed.

The abolition of the capital limits for income
support for pensioners, and the introduction of pension credit with
no upper savings limit, may lead to a similar shift in residential
care charging policies, which you will also need to be alert to. If
such a change occurs, there would be a reduction in the number of
“self-funding” residents, for example, which would impact on social
services budgets.

Incidentally, much has been made of the new
MIG claim form, introduced in October 2001. Much reduced in size,
the form is supposed to make claiming easier. It does too, but
beware – if your client’s circumstances are out of the ordinary,
the initial MIG form will act as a trigger for one of the following
four supplementary forms:

– MIG2: temporary stays in residential home or
nursing home.

– MIG3: if there is any other income (other
than occupational pensions) – for example, from boarders and
lodgers, insurance policy.

– MIG4: other people who live with the
claimant – for example, children.

– MIG5: for pensioners who are working.

According to the Department for Work and
Pensions, it will not be sending these additional forms to clients
to complete. Instead, benefits agency staff will collect the
additional information over the phone or by home visit. Social
workers might need to be aware of this, particularly when arranging
temporary residential care. It might even be worth asking your
local benefits agency office for copies of the MIG2 in

Gary Vaux is head of money advice,
Hertfordshire Council. He is unable to answer queries in person,
either by post or by telephone. If you have a question to be
answered in Welfare Rights, please write to him c/o Community

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