Out Of Work?




There’s an interesting article in the Guardian today about unemployed professional people and Jobcentres.

Key point: Some people are being told they don’t qualify for Job Seekers Allowance (JSA) because they have savings, or their spouse is working. But contributory JSA of ?64.30 a week is payable to anyone who has paid national insurance for the preceding two years.

This guy wasn’t told about it though:

Magazine editor David Freedman, 38, from London, was made redundant in December and has also struggled to get help. “It’s my first time out of work since I was 24,” he says. “It was quite a shock and, because I’d only been in my job 14 months, I didn’t get redundancy pay.”

Freedman did sign on at his local Jobcentre – but only in order to qualify for the mortgage protection insurance he had taken out while working….

Freedman, whose wife is disabled but works part-time, says it took “forever” to sort out his claim and he was then told he wasn’t entitled to any form of JSA due to his wife’s salary and the fact that she had savings. “I’ve had no income for six months,” he says. “Thank God I took out mortgage protection insurance or I’d have to sell my house.”

According to government guidelines, Freedman should be entitled to weekly contributory JSA of ?64.30, irrespective of his wife’s earnings or any savings. It’s not much but it can make a difference if you are struggling, yet Freedman says he wasn’t told this.

About the author, admin

  • As I currently work in the Fraud Department of a local authority investigating Housing and Council Tax Benefit Fraud and have powers that enable me to investigate DWP benefits, prior to this working as a Claim Processor for the DWP, I am fairly qualified to comment on this post.

    In order to claim a contribution based DWP benefit (JSA (C), the former Incapacity benefit and ESA), the last two RITYS (Relevent Income Tax Years) are looked at, in those 2 years adequate NI contributions must be paid at a class 1 rate (employed), Self Employed generally pay class 2 contributions which are adequate for State Pension, but not contribution based benefits.

    Savings and earnings DO play a part in benefits – as a married person he would not receive £64.30 as that is what a single person claiming would get, he would have had to put in a joint claim for benefit affording him £100.95 in benefit. Generally, part time earning, may have an effect on the amount of benefit paid. Savings under £6,000 would not necessarily affect benefit, but savings over £16,000 would give you a nil entitlement to benefit. There is usally a sliding scale for reduction of benefit from £6,000 to the £16,000 threshold.

    If anyone disagrees with a decision whether it be from the DWP of their Local Authority, they have the right of appeal, but this must be made in writing within one calendar month of date of notification to the relevant agency.

  • Corey i beleive that you are mixing up the contribution based and the income based JSA. The Contribution based JSA is not means tested as the extraxt from the CAB below states.

    The two types of Jobseeker’s Allowance

    There are two types of Jobseeker’s Allowance, contribution-based (non-means-tested) Jobseeker’s Allowance and income-based (means-tested) Jobseeker’s Allowance. When you apply for Jobseeker’s Allowance, the Jobcentre Plus office will work out which type you should be paid. You may get contribution-based Jobseeker’s Allowance on its own, income-based Jobseeker’s Allowance on its own, or a mixture of contribution-based and income-based Jobseeker’s Allowance.

    Contribution-based Jobseeker’s Allowance

    Whether you get contribution-based Jobseeker’s Allowance will depend on your national insurance contributions. If you have been working and paying national insurance contributions within the last couple of years, you may qualify.
    Contribution-based Jobseeker’s Allowance is not affected by any savings you have. However, if you have part-time earnings or an occupational or personal pension, this may affect how much contribution-based JSA you get. For example, the amount of contribution-based JSA that you get is cut pound for pound for any occupational pension that is over £50 a week. If you earn too much, you will not get contribution-based Jobseeker’s Allowance at all.
    You only get contribution-based Jobseeker’s Allowance for yourself, so you do not get an amount for your partner if you are claiming as a member of a couple. However, you may get income-based Jobseeker’s Allowance on top of your contribution-based Jobseeker’s Allowance if you have a partner, or because of your personal circumstances – for example, if you are disabled or caring for a disabled person or have housing costs.
    Contribution-based Jobseeker’s Allowance is paid for a maximum of six months. After that, you may get income-based Jobseeker’s Allowance, depending on your income and savings.

    Income-based Jobseeker’s Allowance

    You may get income-based Jobseeker’s Allowance if you do not have enough national insurance contributions to get contribution-based Jobseeker’s Allowance. You can also get it on top of contribution-based Jobseeker’s Allowance because you have a partner, or because of other personal circumstances -for example, if you are disabled or caring for a disabled person or have housing costs. Whether you can get income-based Jobseeker’s Allowance depends on the amount of your income and capital.

  • With all due respect Michael, I deal with benefits for a living – although my area of expertise is in Housing and Council Tax benefits, I do also work alongside the DWP on joint working cases and am empowered to investigate all DWP benefits – you are correct with regards to longevity of contribution based JSA. As I mentioned in my original post any contribution based benefit is decided on RITYS – it is simply a case of missing one NIC during that two year period will result in insufficient credits to allow benefit payment (nb: as companies have 9 months by law to provide NIC data at the end of the financial year – the current NICs that count are 2007/2008 and 2006/2007.

    I question how upto date the information you posted (which was obtained via the Citizens Advice Bureau website) is! Rules are changing regularly, and as the CAB do not post a date they updated this information, I would not hold it as being 100% reliable.

    All claims for JSA are evaluated on Contributions first, if criteria is not met, then automatically evaluated on Income Based. Therefore on that basis all partners have to put on the claim – in that regard it is a joint claim and he would receive the married persons allowance. As he has not been awarded benefit, and based on the information given in the paper. These would be my findings as an Investigator in the Benefits Sector.

    1. He has not paid sufficient NICs in the relevant RITYS – therefore no entitlement to JSA (C). He would have received it if he had.

    2. Wifes earnings and savings exceed limits, therefore not entitled to JSA (IB).

    3. Entitled to Credits only claim to JSA. This means he will still be receiving NI credits to ensure 100% SRP.

  • Yes but the guardian story was about, as far as I remember, people who had paid the full NIC contributions. I will re-read the story (if it is still on the net as I no longer have the paper) and if i am wrong will post again.

    I am not disagreeing about your expertise in any area but just the comemnt that the Guardian story was wrong.

  • I have just re-read the article and it is as I remeber.

    Although Mr Freedman had only been in the job he was made redundant from for 14 months he had previously been working as the article states that it was his first time out of work since he was 24 (he is now 38). I have taken this to mean his national insurance is fully paid up for those 14 years. He would then be entitled to contributions based JSA which, the CAB states, is not means tested and is for £64.30 per week.

    You can also check this on the government sites as well, but as withall government sites it is not nearly as clearly put as the CAB site.

    As you say, if Mr Freedman had not had paid the required NIC contributions he would then have to claim Income Related JSA.

  • Unfortunately the Guardian doesn’t tell us the type of employment he has been doing? If he had been an employee without break he would have sufficient RITYS as class 1 contributions would have been paid – I wonder if he was a contractor/self employed prior to this spell of employment – if that is the case, he would have paid class 2 contributions which unfortunately do not count for anything except State Retirement Pension (which many self employed are not made aware of).

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