Pensions and state benefits.

Discussion in 'Armed Forces Pension Scheme' started by Crazy Warren, Jul 26, 2012.

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  1. Im looking for a bit of advice from those with indepth knowledge of the various pension schemes regulations and/or someone whose good at decoding legislative wording into english!

    Basic situation, was invalided out in 2008 initially awared SIP. Later awarded a war pension scheme gratuity as assessed 6-14% disablement. My SIP was then paid tax free.

    Unfortunately i lost both my jobs recently and am struggling to make ends meet, so have been forced to look at what state benefits i may be able to claim until i can get a job again.

    Any of you who have done similar will know you get **** all from the job centre as most forces pensions pay too much over their income thresholds - no surprises there.

    However housing benefit/council tax benefit in war pension cases can offer more than the standard £10 disregard and most councils waive the entire amount of any pensions classed as a "war disablement pension".

    initially and as in previous post-service unemployment, i assumed id get sweet FA as i earn too much. To my surprise when i signed on to get my NI Stamp, i soon recieved a letter from the council about housing benefit saying that if i can provide information on the status of my pension then they may be able to disregard some or all of it.

    this was surprising as I only get a tax free sip.

    What i basically need to know is am i barking up the wrong tree completely. The following will be long!

    however a bit of googling and i came up with this social security commissioners decision:
    CIS 276/98 [1998] UKSSCSC 6 (15th September, 1998

    in essence its about a serviceman applying for benefits (in this case income support, but the general references are all general social security so basic definitions apply to all) who has a war pension gratuity like me and a tax free SIP. He successfully argued using case law that his tax free SIP was a "war disablement pension" for the purpose of the regulations.

    Now it gets a bit more complicated because i thought "well he doesnt have war pension just gratuity so how does that work" but essentially its a play on words with the social security legislation using the phrase "war disblement pension" to include more than just the traditional war pensions and the newer AFCS equivilent.

    Some of the legislation references are out of date so i had to look up new ones but the crux of it is this:

    from social security act 1986:

    "'war disablement pension' means -
    (a) not relevant bit

    (b) without prejudice to paragraph (a) of this definition, any retired pay or pension to which sub-section (1) of section 365 of the Income and Corporation Taxes Act 1970 applies".

    The social security act was amended in 1987 and absorbed into the act in 1992. The 1970 act has been updated several times and is now the ITEPA 2003 section 641 but the words are pretty much the same. The relevant bits are:

    (1) No liability to income tax arises on–
    (a) a wounds pension granted to a member of the armed forces of the Crown;
    (b) retired pay of a disabled officer granted on account of medical unfitness attributable to or aggravated by service in the armed forces of the Crown;
    (c) a disablement or disability pension granted to a member of the armed forces of the Crown, other than a commissioned officer, on account of medical unfitness attributable to or aggravated by service in the armed forces of the Crown;

    The rest of the list is WWII era and before.

    So by that definition in the ITEPA, my tax free SIP would logically be tax free under paragraph C. There is nothing else written in the ITEPA on income tax exemptions for service pensions so again by logic my SIP has to be "granted on account of medical unfitness attributable or aggrevated by service........"

    so by that logic as i read it, because i have income tax -free status, then according to the 1986 act qouted above, i must by that definition fulfil the criteria of paragraph b) meaning that my tax-free SIP counts as a war disablement pension.

    The commissioner in that report came to the same conclusion even stating how the 1986 act definition was still valid despite the regulations being absorbed into the new act.

    The cynic in me then comes out and says that despite the regulations being posted as is, and despite the commissioners report, there must be a catch somewhere. I can only reason that perhaps since the decision in 1999 there has either been a significant change to to the regulations or his decision was overturned as an error. I can find no evidence of the latter, and the former as explained above uses the latest references i can find.

    So i looked into the housing benefit regulations themselves as they never used to exist as a seperate act and it wouldnt surprise me if over the years definitions have changed.

    Helpfully the housing benefit WP disregard regs 2009 include a table of the allowable pensions included as a War disablement pension for the mandatory and discretionary disregards. It is as follows:

    1. The war disablement pensions prescribed are–
    (a) any retired pay or pension or allowance payable in respect of disablement under an instrument specified in section 639(2) of the Income Tax (Earnings and Pensions) Act 2003(4);
    (b) any retired pay or pension payable, to a member of the armed forces of the Crown in respect of a disablement which is attributable to service, under–
    (i) an Order in Council made under section 3 of the Naval and Marine Pay and Pensions Act 1865(5),
    (ii) the Army Pensions Warrant 1977(6),
    (iii) any order or regulations made under section 2 of the Air Force (Constitution) Act 1917(7),
    (iv) any order or regulations made under section 4 of the Reserve Forces Act 1996(8),
    (v) any instrument amending or replacing any of the instruments referred to in paragraphs (i) to (iv), or
    (vi) any power of Her Majesty otherwise than under an enactment to make provision about pensions for or in respect of persons who have been disabled or have died in consequence of service as members of the armed forces of the Crown; and
    (c) a payment made under article 14(1)(b) of the Armed Forces and Reserve Forces (Compensation Scheme) Order 2005(9).

    part a) is wwII era pensions again so not relevant.

    However paragraph b i-iii) are the perogative instruments for paying pensions to armed forces personnel rather than individual pension schemes. They do not contain the full rules, refering to the scheme legislation for the WPS and AFCS.

    In effect ALL pensions wether normal retirement or invaliding are paid via those statutory instruments. Thats how it reads to me.

    if that is how they intended it to read, then by paragraph b) above, my tax-free SIP (shown to be "attributable to service" by the income tax exemption) should count on the list of pensions to be disregarded.

    Ive been and spoken to the council housing benefit assessor (we have walk ins here for just such cases) and quite frankly he doesnt have a ******* clue. He seemed friendly enough and spent 45 minutes with me discussing this but as soon as i got into the regulations and legislation it seemed to go over his head and he simply isnt prepared to make a decision on it. My council has very few war pension cases. He suggested i speak with SPVA to see if they can write a letter or similar to clarify things. SPVA were baffled as they cannot make a statement or claim about benefits as its not something they deal with, and all they can do is send a new letter outlining the status and type of awards i already have. The SPVA couldnt understand why the council would not be able to get thier head round the terminology which on the SPVA letters is fairly clear to see.

    So any ideas where i go from here?

    Does anyone know of any other (easier to read) references or policys that i could use to support my case and help them understand.

    Also does anyone have any views on the interpretation of the legislation and the intent. ie did they intend the tax free SIP to count as a WDP or is it an anomoly/mistake in the rules.

    Any help would be gratefully appreciated!!!
  2. Speak to TRBL
  3. Im Interested on knowing the answer.
  4. It's a mine field.

    The best advice I can offer is to contact your County HQ, Royal British Legion and ask to speak to a Welfare Officer/Rep.

    Go to County do not ask the question in your local RBL Club, (2 different aspects of the Legion).

    Welfare Officers/Reps will do a home visit. They also have local knowledge of the state of play in your area, should for example the Council etc are not playing the game.

    You do not need to be a member of the RBL to ask for advice, only to have served in the Armed Forces.
  5. SPVA Welfare will also give you advice over the phone or visit you at home if necessary.
  6. Thats why i posted it as i was always led to believe, that if you didnt get 20% disability then you didnt have a war disablement pension in any ones eyes and i always thought the SAP/SIP were taken into account in everything benefits wise.

    I was told by welfare originally to view the war pension payment as entirely seperate to AFPS SIP. he explained that to view AFCS or WPS as "compensation" and anything AFPS as "occupational pension".

    I do think if i can get a definitive answer it might help quite a few people hence the post.
    Ive rung them today and they are going to ask around to find out the person with the best knowledge on benefit regulations and pensions. They said it might get referred back upto the pension side of things first then get dealt with by a benenfit and money advice side of things.

    I dont really need a home visit per se. All the documents are publically available on and other government web sites so over the phone or email will be fine IMO.
  7. small update.

    Ive escalated it into a full appeal with the council as the benefit officers just either didnt understand what i was saying or werent prepared to commit to making a decision.

    After a discussion with the appeals officer, i have contacted SPVA to get their pensions team to write a letter explaining what pension i have been awarded. This is despite the council having the original award letters from when i was discharged, as well as current legislation and documents about the pensions! I guess they dont want to make a decision and want someone to spell it out to them. The guy from SPVA was baffled as to how they cannot understand the award letters in relation to the benefit legislation as the phrase "attributable or aggrevated by service" is clearly written in both!

    They claimed i will have a letter within 10 working days so hopefully i will get some answers to this fairly soon.

    Contacted TRBL when i first posted on here, but havent heard back from them so might have to chase them up. I was hoping TRBL guy who looks into it would make initial contact fairly quickly before he gets into books too heavily as i have done a lot of research into the primary legislation which could save him some time reading up if hes not familiar with it already.
  8. pretty certain that a council with large military formation within its bounderies will give you answers - suggest colchester as they have fighting elements of 16 air assault located in the town.
  9. The local council dont care about other councils policys. I had example policys from other councils that explained their reasoning in terms my local council would understand. They wouldnt even read it as they said different councils do it different ways.

    stupid really when you consider the pension list is in the regulations and all councils have to follow the same regulations. They cant pick and choose which pensions count. Its either on the list or not. However they can choose wether to give a discretionary disregard in addition to the mandatory disregard. Only 2 councils in the UK dont give a full discretionary disregard to compensation payments and attributable disability pensions.

    They just dont want to make a decision that could cost them a fair bit of money and later find out they screwed up so because they arent 100% confident they are choosing the safe option of rejecting the claim rather than spending the time to clarify thier own position.
  10. Bit of an update. The letter promised by SPVA has arrived today. Happy they sent it in time, not happy they spelt my name wrong and got half the address wrong!


    Wasnt as much of an explanation as i was hoping but it is clear that my pension is a service attributable SIP.

    However im hoping the council will actually see some sense but if not i know EXACTLY what their next question will be!

    The HB regs state in regards of pensions:
    They will im sure accept the first sentance of paragraph b) but if being awkward the question they will ask is "can you prove your pension is paid under one of the regulations under part i-iv) ???"

    I had asked SPVA to include the statutory instrument my pension was paid under in the letter and they havent done so.

    So I shall ring the council and try and let them actually talk to the relevant benefits officer (they usually refuse to let you past the call centre) and see if they will now accept the letter in its current form.

    if not back to SPVA for them to correct thier spelling errors and also to add the paragraph i asked about the statutory instruments.....

    we shall see!

    It really shouldnt be this complicated to claim a simple benefit like housing benefit.
  11. It really shouldn't be this complicated to claim a simple benefit like housing benefit.[/QUOTE]

    Best of luck mate, hopefully you will get there in the end.
  12. Thanks EScotia, You know the SI, i know the SI, its just the council that are being either stupid or deliberately **** about following things to the letter.

    All service pensions pre AFPS05 are paid under a SI under the HB regs qoute i posted. Thats the point. ie as long as its a forces pension that is service attributable then it fits the bill.
  13. finally we have an answer!


    And backdated to the start of my claim too!!

    Hopefully it will be helpful for other veterans to know that a tax free SIP does count as a "War Pension" for the purposes of housing benefit regulations.

    Sure it might not be much money per week, but while im unemployed and when im working upto about £350 a month, its an extra £200 a month in my pocket to help while on a low income.

    A lot of hassle for only £200 a month, but on my pension and where i live, its the difference between paying the bills each month or not paying everything.

    Sure most veterans will get a lot more potentially too. Because im under 35 and live in one of the cheapest places in the UK the benefit rate is quite low.

    So eventually got a positive result despite the whole thing being a waste of SPVA's and my time as the letter said no more than my original award letters just worded in a different order.

    The only thing i can think is they were either being pedantic ********* or they didnt want to make a decision on the basis of paperwork that is 4 years old and hence wanted recent confirmation of the pension.
    • Like Like x 4
  14. Just out of interest Crazy Warren, what line of work are you looking for? I may be able to help out.

    I was in the same boat as you six years ago, things may not look too good now, but give it time mate.