Botched transfer had knock-on effect on councils’ financial assessments
Disabled and chronically ill benefit claimants who were left thousands of pounds out of pocket by a government error may have also been overcharged by their local authorities for social care, it has emerged.
At least 110,000 benefit claimants were underpaid an average of £5,000 following a botched overhaul of incapacity benefits which began in 2011, according to the latest figures.
The error occurred when Department for Work and Pensions (DWP) officials transferred people from older benefits on to the wrong kind of employment support allowance (ESA), meaning they missed out on premium payments they were eligible for.
The Guardian understands that, as a knock-on effect, the error will have skewed financial assessments many councils undertake to determine how much these claimants should have contributed towards their social care costs.
Pat Sawh, 65, has received a refund of more than £2,000 from Enfield council, in north London, which is believed to be the first to begin addressing this issue. Her sons Stephen, 31, and Kris, 29, both have autism, while Stephen also has epilepsy and multiple allergies.
“Both my sons still live at home and my husband and I are pensioners,” she said. “This extra money is helping them a lot – without it they could not do as much.”
Wendy Berry, 75, helps run a group for carers of learning disabled adults in Enfield and helped Sawh bring her case to the attention of the council.
“The problem with this issue is that councils probably do not even realise that the DWP error had an impact on social care charging. It is very complicated. We suspect that very few councils have really thought about it,” she said.
“Charging for social care is always a difficult area because it takes money from the disability benefits paid to the most vulnerable people, who need support to live in their own homes. To ensure people are paying what they are supposed to be paying is critical.”
Enfield council has since sent letters to other residents it suspects have been affected by this issue, which could number as many as 200 people, according documents seen by the Guardian.
In 2014, local authorities gained the power to introduce charges to recoup costs they incur from contracting care and support services. These charges are typically deducted from the benefits of people receiving social care.
Councils who charge must conduct financial assessments to ensure that they do not cause a person’s income to drop below the statutory minimum set by the Department of Health (pdf), although they also have discretion to have more generous charging rules.
Many, though not all, councils now charge for adult social care. Among the factors considered when calculating a person’s minimum income guarantee is whether they are receiving a premium, such as the enhanced disability premium.
Those who, like the Sawhs, missed out on premiums because the DWP transferred them on to the wrong type of ESA, may have had a reduced minimum income guarantee. As a result, they may have been overcharged for care by their local authority.
While the DWP has compensated those who missed out on premiums – to the tune of £5,000 on average – there appears to have been no government effort to address this knock-on effect.
Marsha de Cordova, the Labour MP and disability rights campaigner, said: “This is a scandal. It is a responsibility of the DWP to ensure that all local authorities are compensating or refunding any ill or disabled persons affected.
“I would worry for the ill and disabled people that have fallen into debt, destitution or poverty because of this error by the DWP.”
Kamran Mallick, Disability Rights UK’s chief executive, said: “Now that the DWP have finally recognised the thousands of disabled people who have been underpaid ESA, we urge local authorities to refund the overpaid charges for social care that have been paid by many of these same disabled people.
“It’s monstrous that many of the poorest people in our society have faced a double whammy of not receiving their full entitlement and being hit by social care overcharging.”
A DWP spokesperson said: “We have worked hard to ensure that all those entitled to ESA receive the benefits they are entitled to.
“We urge anyone who believes their social care payments may have been affected by this issue to contact their local council.”
Figures released last month revealed that 5,000 people died before they could be reimbursed for the DWP’s ESA error.
Enfield council was contacted for comment.