Incapacity benefits to employment and support allowance: transfer and re-assessment

This factsheet gives you the basic information about the process under which most existing claims of benefit on the basis of incapacity for work are being transferred to claims for employment and support allowance (ESA), with entitlement re-assessed.

What claims are being transferred?

• Most ‘existing awards’ of IB/SDA/IS for incapacity for work are to be transferred. In fact, the IS awards that are being transferred are any IS awarded on ‘grounds of disability’, ie so will also include people getting IS on the basis of being registered blind or on the basis of being a disabled or deaf student.
• Disabled or deaf students being transferred from IS will be able to get ESA. whilst in education even if they do not get disability living allowance.
• Anyone with an existing award who is due to reach state pension age at any time before 6 April 2014 will not be transferred.
• Even people who are currently exempt from the personal capability assessment will be transferred, and will be subject to the standard WCA, which has a much more restricted list of exemptions.

When will the transfer take place?

• The rules actually allow the transfer of most claims of an existing award at any time. In practice, the transfer process will be triggered by the date the claimant is next due to have their fitness for work assessed under the personal capability assessment.
• People who are exempt from the personal capability assessment and who therefore do not have a date for their next assessment will be allocated a transfer date by the DWP.
• The majority of the transfers will take place between April 2011 and 6 April 2014.

How does the re-assessment process work?

• In advance of the transfer, claimants will be sent a notice informing them that their claim is to be transferred and their eligibility for benefit re-assessed under the WCA. Claimants will then get a telephone call to give them further information and advice about the process, and find out if they need extra help. Then they will be sent an ESA50 medical questionnaire to complete and return. They may later be required to attend a medical.
• Claimants who without good cause fail to return the questionnaire or attend the medical will be refused ESA and lose entitlement to their incapacity benefit.
• It will not be necessary actually to make a claim for ESA – that will be automatic.
• The transfer will involve re-assessment of the claimant’s fitness for work, by application of the work capability assessment (WCA). For a factsheet on the WCA see Work Capability Assessment factsheet.
• The normal WCA rules will apply to the re-assessment, with no special rules for people being transferred (some claimants who pass the personal capability assessment will not pass the WCA).
• Claimants who pass the WCA and the basic rules for ESA (with the exception of the national insurance contribution conditions for contributory ESA, which will not need to be re-satisfied) will have an award of ESA calculated. Claimants who fail the WCA or who are otherwise not entitled will be refused ESA and their incapacity benefit will terminate.
• The claimant will be sent a ‘conversion’ decision on their entitlement to ESA, ie, on whether they are entitled to ESA and if so how much. Before the decision is sent, claimants will get a telephone call from the decision-maker at the DWP to explain the decision and tell them what their options are. If there is any missing information, the decision-maker should ask about that before going on to make the conversion decision.
• Claimants who would be entitled to ESA but who wish to remain on IS on a ground other than disability can do so (and not transfer to ESA) if they indicate this to the DWP before the transfer occurs. However, the IS will not include a disability premium for incapacity for work and any IB/SDA will terminate.
• Claimants who are not entitled to ESA (in the majority of cases this will be because they have failed the WCA) may appeal in the usual way, as may other claimants who want to dispute the conversion decision, eg, regarding the calculation of their ESA.

What if the WCA is failed?

• The claimant will not be entitled to ESA, and their existing award of IB/SDA/IS will terminate.
• If a claimant would remain entitled to IS on a ground other than disability, eg as a lone parent, they will remain on IS on that ground if they wish to. However, the IS will not include a disability premium for incapacity for work and any IB/SDA will terminate.
• They will be able to appeal against the conversion decision saying that they have failed the WCA (or ask the DWP to revise it) under the usual rules. Claimants should be aware though that the time limit runs from the date of the conversion decision, not the date their existing award is terminated, which will not be until two-four weeks later.
• If they appeal against an actual failure of the ESA, they will be able to get ESA pending the appeal in the usual way (ie, at the assessment phase rate only). If they had an existing award of IB or SDA, they will be able to get contributory ESA pending the appeal without having to satisfy the national insurance contribution conditions. Alternatively they may claim JSA pending the appeal (ie, if they can satisfy the jobseeking conditions).
• If a claimant has been refused ESA because of failing to return the questionnaire or attend the medical, again they may appeal about that, but usually (unless their condition has significantly worsened or is new) there will be no automatic entitlement to ESA pending the appeal.

If ESA is awarded, how much can be awarded?

• Claimants may be entitled both to contributory ESA and income-related ESA, eg if they are transferred from IB topped up with IS.
• Calculation of ESA entitlement uses the usual ESA amounts. As usual, ESA does not include amounts for children or dependant adults, age additions or a disability premium.
• However, unlike in a new ESA claim, there is no assessment phase, so the claimant’s ESA includes the additional work-related activity component or support component from the start.
• The ESA may include a ‘transitional addition’. This is added if the ESA would otherwise be worth less than the IB/SDA/IS the claimant is being transferred from.
• To see if there should be a ‘transitional addition’, in transfers of IB/SDA to contributory ESA the DWP compares the full value of the existing award, including dependant’s additions and age additions, with the ESA; in transfers of IS to income-related ESA the DWP compares the IS applicable amount (not including amounts for children or housing costs) with the ESA applicable amount (also not including children or housing costs). In both cases, if the ESA is worth less then the difference is made up by the inclusion of a transitional addition of ESA.
• Transitional additions are not permanent. In effect, they are reduced by the amount of annual increases in ESA, and in any case will not be paid after 5 April 2020. They may also be reduced before then by other changes in circumstance which increase ESA amounts (eg, becoming entitled to another premium in income-related ESA) and, by the amount of child or adult dependant increases to IB/SDA where these applied before the transfer and certain relevant changes of circumstance (eg, child benefit stopping or separation from the adult dependant) occur. Although not affected by income, transitional additions are lost if ESA entitlement is lost altogether (eg, if the claimant fails the WCA).

What about other ESA rules, like work-focused interviews, tax and permitted work?

• If the transfer results in an award of ESA, then most of the standard ESA rules apply to that award.
• An exception is that disabled or deaf students transferred from IS can still get ESA whilst in education even if they are not entitled to disability living allowance.
• Another exception is that claimants transferred from IB who had their private pension ignored will continue to have that ignored in their contributory ESA.
• The claimant may be required to attend work-focused interviews.
• ESA permitted work rules apply.
• Contributory ESA is taxable, including any transitional addition – this will apply even if the claimant had been getting a non-taxable award of transitional long-term IB or SDA.

Rules and guidance

The main rules are contained in two set of regulations: The Employment and Support Allowance (Transitional Provisions, Housing Benefit and Council Tax Benefit) (Existing Awards) (No.2) Regulations, SI 2010 No. 1907 via http://www.legislation.gov.uk/uksi/2010/1907/contents/made; and the amendments made to those by The Employment and Support Allowance (Transitional Provisions, Housing Benefit and Council Tax Benefit) (Existing Awards) (No.2) (Amendment) Regulations 2010, SI 2010 No.2430, via http://www.legislation.gov.uk/uksi/2010/2430/contents/made.
A consolidated version of the rules is available via the ‘Blue Volumes’ on the DWP website at http://www.dwp.gov.uk/docs/a13-9401.pdf.

Currently, there is little official guidance available. Local authority staff administering housing benefit and council tax benefit have been issued with the following circulars: HB/CTB A16/2010, via http://www.dwp.gov.uk/docs/a16-2010.pdf; and HB/CTB A23/2010, via http://www.dwp.gov.uk/docs/a23-2010.pdf.

Official information for advisers and for claimants can be found at http://www.dwp.gov.uk/adviser/updates/ib-reassessing-claims/.