Skip to main content

Compensation: Accidents

Volume 503: debated on Thursday 14 January 2010

To ask the Secretary of State for Work and Pensions what assessment she has made of the effect of an award of accident compensation on entitlement to (a) state benefits and (b) state pension; and if she will make a statement. (304306)

There is a capital disregard for personal injury payments in income support, jobseeker’s allowance, employment and support allowance, and in housing benefit and council tax benefit for claimants who have not reached the minimum qualifying age for pension credit.

The disregard applies indefinitely to the value of a trust fund where the personal injury payment has been put into a trust and also where there is the right to receive payments from the trust. Payments made from the trust would be treated as income and disregarded in full when they are received. This disregard only applies to personal injury payments if they were made in respect of the claimant or their current partner. Where the claimant receives a personal injury payment made in respect of a deceased partner the disregard does not apply.

Where a personal injury payment has not been put into trust it is disregarded for 52 weeks from the date it is paid to the claimant or their partner, or until they no longer have any part of the payment left, whichever date is sooner. Any subsequent payments made as a result of the same personal injury (for example, where instalments are made) would not have a separate 52 week disregard but would come under the original disregard period.

The capital value of any personal injury payments held under the Court of Protection, and the right to receive funds from that payment, are disregarded. Payments not in a trust and not held under control of the Court of Protection are treated as capital.

Entitlement to state pension is not affected by income or capital. For pension credit, and housing benefit and council tax benefit for those who have reached the minimum qualifying age for pension credit, any personal injury payments made for the claimant or their partner are disregarded indefinitely.