Mr. Patrick Rodgers:

Fréa is a partnership between three leading Irish charities in the north of England. The Fréa mother and baby and county home institution programme aims to promote and facilitate access so as to ensure that former residents are aware of and can access the various strands of the Irish Government’s action plan. This includes the payment scheme and access to health-related payments. Fréa works closely with colleagues at the survivors project at the London Irish Centre as well as the Coventry Irish Society.

While we broadly welcome that former residents of mother and baby or county home institutions will be able to avail of a payment to help them to access healthcare, we are concerned that it may cause problems for those who receive means-tested benefits and are living in the UK.

Means-tested benefits from the Department for Work and Pensions in the UK are universal credit, pension credit, jobseeker's allowance, employment support allowance, housing benefit and council tax support. In order to access means-tested benefits, certain criteria regarding capital have to be met. These can be broken down into two parts, namely, capital and income.

To deal first with capital, the lower capital limits for benefits in Britain are £6,000 for benefits claimed by people aged under 66 and £10,000 for people aged over 66. After a person’s capital exceeds this amount, the benefit is reduced by £1 for every £500 the person has in savings. A person with capital in excess of £16,000 is no longer entitled to means-tested benefits, with certain exceptions. Any large one-off payment can adversely affect claimants as it has the effect of bringing them over the capital savings limits. There is scope to disregard certain income for the purposes of capital but it does not appear that these disregards apply to capital accrued as a result of mother and baby and county home payments. According to the Department for Work and Pensions, payments relating to capital can be indefinitely disregarded for persons who have been subject to historical institutional child abuse in the United Kingdom, among other reasons. Obviously, that would apply to the historical institutional abuse, HIA, payments.

We have examined alternatives such as setting up trust funds, but we have concerns this would not be eligible for a disregard. The rules on disregarding capital accrued through large payments and held in trust funds state that capital can be disregarded where a person has been awarded a sum in consequence of a personal injury to that person and the sum is held in trust, the amount shall be disregarded from the calculation of the person’s capital. Payments only come within this disregard where a claimant or partner for whom the payment was made suffered a physical and-or psychological injury. If there is any doubt regarding for what the payment was awarded, the decision maker should request sight of the papers awarding the amount. These should specify the basis on which the award was made.

Our concern is that any payment in this instance would be not regarded as the result of personal injury and would be counted as capital. Further, setting up a trust can be an expensive process, costing a minimum of £1,000. As a result, many of our clients would lose significant amounts money that should be used to address health needs as a result of their time in a mother and baby or county home.

Means-tested benefits also take income into account. In some cases, a one-off payment can affect a benefit claim. Where excess income is received, a claim can be stopped or no payment may be made for the following payment period. Income up to a certain level is allowable, although this is still taken into account and may reduce the amount of means-tested benefit.

To illustrate this point, we ask the committee to consider the situation of persons receiving universal credit. They have a monthly payment period. The amount a claimant of universal credit receives each month is based on numerous factors, including any income received during that monthly period. Where the claimant receives income, this will be taken into account when working out the monthly amount the claimant receives. Where a claimant receives a one-off payment of €3,000, or approximately £2,600 at current exchange rates, this would wipe out any payment the claimant would receive for a monthly period.

To put that into context, universal credit payments cover both day-to-day expenses and housing payments. In effect, receiving a one-off payment for health costs could negatively impact claimants as they would not receive a universal credit payment and they would need to use a healthcare payment to cover day-to-day living expenses and rent. There is scope for this income to be disregarded but it is unclear whether it can be disregarded as income. The payment does not appear to be covered as unearned income under British Government regulation. If it is covered as such, it may be that it can be disregarded for the individual payment periods and as such would not affect a claimant’s benefit payment.

However, this needs to be clarified with the Department for Work and Pensions prior to any payments being made. Furthermore, if this is the case, then it is essential that such information be communicated to the staff of the Department for Work and Pensions so they do not stop payments in error. To properly advise claimants, we need this to be clarified by the Department for Work and Pensions as a matter of the utmost urgency to facilitate a smooth process of accessing payment schemes.

We welcome the committee's support in liaising with the Department for Work and Pensions. This will ensure that there is equitable access to any payment scheme for all former residents and that those accessing welfare benefits entitlements in Britain will not be penalised in any way.