At a glance 50: Reimbursements and payments for service user involvement

Published: October 2011

Review date: October 2014

Key messages

  • Service user involvement refers to service users and carers participating in consultations and events.
  • Barriers to involvement have been eased for service users and carers who are in receipt of state benefits.
  • Service users and carers who are paid for involvement may be reimbursed out-of-pocket expenses without affecting their benefits.
  • Service users and carers who are involved may now decline an offer of a payment, ask to be paid a lower amount, or ask for the payment to be made to a charity, without ‘notional earnings’ being applied.
  • Changes to expenses and notional earnings only apply where the paid involvement is required by law.
  • Service users who are in receipt of certain incapacity related benefits may now earn up to £97.50 a week for up to a year at a time or for longer. Neither their incapacity related benefits or housing benefits are affected providing they follow benefit procedures.

Introduction

This At a glance briefing looks at benefit changes that can make it easier for service users and carers to get involved in paid participation for social care consultations and events.

When service users and carers are in receipt of state benefits they must keep to benefit rules. These rules were originally designed for people who wished to undertake some part-time work. Some of the rules were found to be inappropriate for involvement as it differs from part-time work in many ways.

Organisations have faced considerable difficulties in ensuring that service users and carers who get involved in social care events do not have their benefit entitlement adversely affected. Complex systems were required for administrating offers of payment and covering expenses.

The Social Care Institute for Excellence (SCIE) in partnership with Care Quality Commission (CQC), Skills for Care (SfC), General Social Care Council (GSCC), Office for Disability issues (ODI), Carers UK and Shaping Our Lives worked with the Department for Work and Pensions (DWP) to make changes to the regulations which govern the treatment of expenses and application of notional earnings. Changes were secured through legislation in 2009.

Organisations have faced considerable difficulties in ensuring that service users and carers do not have their benefit entitlement adversely affected.

Changes secured in 2009 only apply to the treatment of reimbursed expenses and application of notional earnings when a public authority is required by law to involve service users and carers or to involvement that is commissioned on their behalf. As a result certain organisations and the people they involve are not helped by the changes. This is explained further in the section on notional earnings.

In 2010, the disregarded level of earnings for people who are in receipt of housing benefits together with incapacity based benefits, was raised from £20 a week to £97.50 a week. This change allows involvement for a day or two a week if desired, rather than the short periods of involvement imposed by the £20 limit.

This briefing will explain the circumstances when:

Service users and carers who are paid for involvement may be reimbursed out-of-pocket expenses without affecting their benefits.

The changes

Organisations with payment policies for involvement may be able to simplify their administrative systems as a result of three helpful changes to benefit rules:

1. Treatment of reimbursed expenses to people who are paid for involvement

Previously the benefit rules treated reimbursed expenses as earnings. This meant that a payment for involvement and the reimbursement for expenses were totalled. Any excess of ‘earnings’ over the personal benefit limit on earnings led to benefit reductions. People who offered their involvement in improving public services could be left worse off as a result.

Legislation introduced by the Department for Work and Pensions (DWP) for involvement means that service users and carers who are paid for involvement may be reimbursed out-of-pocket expenses without risk of affecting their benefits. Reimbursements of expenses incurred for involvement are now disregarded.

Service users and carers who are involved may now decline an offer of a payment, ask to be paid a lower amount, or ask for the payment to be made to a charity, without ‘notional earnings’ being applied.

2. Notional earnings

Previously the benefit rules treated an offer of payment as ‘notional earnings’. The offer was treated as money received even though the person declined to accept the amount.

Service users and carers who are involved may now decline an offer of a payment, ask to be paid a lower amount, or ask for the payment to be made to a charity, without ‘notional earnings’ being applied.

Please note: The changes to legislation described above in paragraphs 1 and 2 will only apply where the paid involvement is required by law. See below for further detail.

Service users who are in receipt of Incapacity Benefit or Employment and Support Allowance may now earn up to £97.50 a week.

3. Level of payments for involvement

Previously the benefit rules limited many service users to earnings of £20 a week. This limit restricted the amount of time that a service user could offer for involvement.

Service users who are in receipt of Incapacity Benefit or Employment and Support Allowance may now earn up to £97.50 a week for up to a year at a time or for longer. Neither these benefits or their housing benefits are affected, providing they follow benefit procedures.

People can also use this rule for part-time work. Unfortunately this does not apply to Income Support or Jobseeker’s Allowance.

People who receive incapacity based benefits are required to get Jobcentre Plus advice before earning any money.

People who are in receipt of incapacity based benefits must get Jobcentre Plus advice on notifying paid involvement before they go ahead.

Public authorities that are required by law to involve service users and carers

Changes to the benefit rules on reimbursed expenses and notional earnings only apply where an organisation is required by law to involve service users and carers.

The following organisations are required by law to involve service users and carers:

Where these organisations involve people or they commission involvement to be carried out by another organisation, the helpful benefit changes will apply.

However, this list is not complete. The legislation provides some more examples. If a public authority or type of organisation is not listed, it is best to check if the involvement is commissioned by an organisation that is required by law to involve service users and carers.

Where involvement is required by law, either directly or commissioned, any reimbursement of necessary and exact expenses is disregarded by benefit rules, including:

Again, this list is not complete. Reimbursements of all necessary expenses will be disregarded. These expenses are ignored whether the person is paid for involvement or volunteers for involvement. These changes apply to receipt of all state benefits.

Example: Expenses which are ignored

Brian Peak is a full time carer for his wife who is severely disabled. He is invited to participate on a national steering group that is developing good practice guidelines for respite care. The public authority is required by law to involve service users and carers. Brian is paid a fee of £20 for his time. He is reimbursed his travel expenses of £90 and £60 for the cost of a replacement carer for the time that he will be away. Brian notifies Jobcentre Plus, as is required.

Brian’s benefits have an earnings limit of £20 a week. As the reimbursed expenses are disregarded and Brian has not exceeded the limit on earnings, Jobcentre Plus advises him that his benefits are not affected.

Where involvement is required by law, either directly or commissioned, notional earnings will not be applied to an offer of a payment for involvement

An offer of payment for involvement will not be treated as notional earnings and will not affect the person’s benefits if payment is:

Please note: This benefit rule only applies to involvement. It does not apply to part-time work..

Public authorities that involve people as good practice (but are not required to by law)

Changes to the benefit rules on reimbursed expenses and notional earnings do not apply where an organisation involves service users and carers as good practice and policy only.

For example, the benefit changes do not apply to involvement with:

Example: Notional earnings

Donna Daniels and Leigh Barlow are asked to help with improving discharge and aftercare services at their local NHS trust psychiatric hospital. The trust is required by law to involve service users and carers. Donna and Lee both have experience of being admitted as an in-patient and of aftercare services. The trust invites Donna and Lee to participate in a planning seminar. The trust offers them each a payment of £120 as a fee and offers to reimburse their travel expenses.

Donna cannot accept £120 as her benefit limit on earning is £97.50 a week. She asks to be paid £97.50 for her time. She also accepts a reimbursement of £5 for her exact travel expenses. Donna notifies Jobcentre Plus as required. Her benefits are not affected as notional earnings are not applied to the payment that was offered. The reimbursement of her travel expenses is disregarded.

Lee does not want to be paid at all. He asks the trust to make a donation of £120 to a local charity instead. Lee accepts a reimbursement of £10 for his exact travel expenses. He notifies Jobcentre Plus as required. His benefits are not affected as notional earnings are not applied.

This list is not complete. If there is doubt it is best to check with the organisation.

When the benefit changes do not apply, and involvement is paid, any reimbursed expenses will be treated as earnings. If a payment is declined, Jobcentre Plus will treat the offer as if it had been accepted.

However, if the involvement is commissioned on behalf of an organisation that is required by law to involve service users, but is carried out by another organisation that is not required by law to involve service users, the benefit changes will apply.

Example: Commissioned involvement

An NHS trust (involvement required by law) commissions a local charity (involvement not required by law) to involve service users in monitoring a mental health service. As NHS trusts are required by law to involve service users, the changes to the benefit rules will apply. Reimbursed expenses to service users are ignored. Notional earnings may not be applied where service users decline an offer of payment.

Organisations that are not covered by benefit changes

It is advisable for organisations that are not covered by the changes to benefit rules on expenses and notional earnings to continue to administrate payments with great care and to cover expenses directly where they involve people who are in receipt of state benefits. This is because the provision of travel tickets and direct payments to a replacement carer or personal assistant are not treated as the earnings of the person who is involved.

It is advisable for organisations that are not covered by the changes to benefit rules to cover expenses directly where they involve people who are in receipt of state benefits.

Explanatory note

The Department for Work and Pensions has used terminology in the legislation to describe service users and carers that is clarified in their staff guide (Decision makers’ guide). Where the legislation refers to ‘service user groups’ the Department for Work and Pensions intends this to refer to individual service users and carers who are involved as well as to service user groups.

References

Legislation

Guidance

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