A recent decision from the Upper Tribunal highlights (and further clarifies) when a ‘closed-period’ supersession should apply. Martin Williams takes a look.
What is a closed-period supersession?
Basically, a closed-period supersession is a supersession following more than one relevant change in a claimant’s circumstances, where those changes took place before the supersession decision is actually made. The hallmark of a ‘closed-period’ supersession is where the claimant’s circumstances have changed but then changed again before the supersession is carried out, for example so that they would appear first to have lost then to have regained entitlement. The award is changed just for the now ‘closed’ interim period.
When should a closed-period supersession apply?
A claimant’s circumstances can change such that they either no longer meet the conditions of entitlement or they are entitled to a higher or lower sum. Ordinarily, a claimant will notify the relevant office of the DWP (or their local authority for a housing benefit (HB) case) of their new situation, and a supersession decision (for relevant change of circumstance) will be made amending or removing their award. The date from which that decision takes effect can depend upon various factors.
1The rules for ‘effective dates’ of supersessions are set out in Chapter 56 of the Welfare Benefits and Tax Credits Handbook under the heading When a supersession takes effect.But what happens when, before the supersession decision is made, the claimant’s circumstances change again, so that the amount they would be entitled to (or whether they were entitled at all) changes again? In such cases, a ‘closed-period’ supersession should apply. Here, the decision maker is required to apply the claimant’s circumstances down to the date on which the supersession decision is made – ie, to take account of both changes.
First change would have ended entitlement?
If the changes mean that for a period the claimant would just have been entitled to less benefit, and then later a further change would have increased their entitlement, that seems straightforward.
However, caselaw has consistently held that a closed-period supersession can also be conducted where the first change of circumstances was one which would have meant that the claimant ceased to be entitled to the benefit altogether, but a subsequent change before the supersession is carried out means that the claimant again meets the conditions of entitlement.
By contrast, had the first change of circumstances led to a supersession decision being made before the second change occurred, the resultant decision would have ended the award of benefit. The claimant would then, when their circumstances changed again meaning they again met the conditions of entitlement, have needed to make a new claim for the benefit at that point.
Example
Robert is getting employment and support allowance (ESA). He is doing permitted work but for a 20-week period in 2022, he works some overtime shifts, as a result of which his earnings exceed the threshold for the work to be permitted.
2Reg 45 Employment and Support Allowance Regulations 2008 But Robert does not declare the extra work until 2023 when, in an interview with his work coach, Robert explains he did the overtime, but is no longer doing so.
As by the time of the supersession in 2023 Robert is no longer working, a closed-period supersession is appropriate, taking into account both the starting and the stopping of the overtime. That leaves Robert with an ongoing award of ESA, but with an overpayment (which is probably recoverable) for the 20-week period in 2022 when he was not entitled according to the closed-period supersession.
By contrast, had Robert declared the work at the appropriate time (ie, when he started it in 2022), the ESA award would have ended from the start of the benefit week in which his hours or wages exceeded the permitted work limit (as Robert would have counted as not having limited capability for work.)
3Reg 40(1) Employment and Support Allowance Regulations 2008 The appropriate decision would have been simply to remove Robert’s entitlement for the period during which his hours or earnings exceeded the threshold.
In that case, Robert would have needed to try and reclaim benefits. That might have been difficult.
•If he could made a new claim for ESA then it would have only been awarded from a maximum of three months prior to when it was made, meaning that Robert would lose out if his hours or earnings had reduced to a level where he could again get ESA more than three months ago.
•But actually, Robert might not have been able to reclaim ESA at all.
◦Firstly, he did not have limited capability for work while he was working and so a new claim would have been in relation to a new period of limited capability for work which could change the relevant tax years in which Robert would need to have met the contribution conditions in such a way that he did not meet the conditions for ESA based on national insurance contributions.
◦Secondly, since the roll out of universal credit (UC), Robert would not have been able to claim an income-related ESA.
So, as a result of the application of a closed-period supersession, Robert is potentially in a better position than he would have been had the DWP been aware of his work while he was doing it in 2022 and made the supersession to end his award at that time.
A warning
Closed-period supersessions should not be regarded as an incentive not to disclose relevant changes in circumstances. Claimants are usually under a legal duty to report changes of circumstances which could affect the level of their entitlement. A failure to comply with that obligation, where a claimant knows it is relevant, can lead to overpayments and can be a criminal offence.
4ss111A(1B) and 112(1A)–(1B) Social Security Administration Act 1992An adviser telling a claimant not to report such a change may also commit such an offence. Thus, deliberately seeking to engineer a situation where a closed-period supersession is a possibility, by not reporting a change until a further change has occurred, should never be contemplated.
Caselaw
Before the introduction of the new decisions and appeals framework under the Social Security Act 1998, a number of decisions of the Social Security Commissioners (including CIB/5759/1999, CIB/5170/1999 and CIB4090/1999) had held that the correct approach under the then rules was similar to what is now referred to as a ‘closed-period’ supersession. In CSIS/745/2002,
5Text available at the Commissioner approved the Secretary of State’s submission that under the Social Security Act 1998 regime:
‘If, during the currency of an award, an overpayment arises because a claimant ceases to satisfy the conditions of entitlement, but later, and still within the currency of the award, he satisfies the conditions of entitlement, the disentitlement on revision or supersession is not indefinite because he has not made a new claim at the relevant time, but is instead limited to the period where the conditions of entitlement are not satisfied, unless some other ground for disentitlement arises.’
Most recently, the subject has been returned to in
SSWP v NC (ESA) [2023] UKUT 124 (AAC) (Bulletin 295, p12).
6 This concerned a prisoner on old-style contributory ESA. Judge Rowland first decides that entitlement should have ceased while the claimant was in prison due to a conviction (as he was to be treated as not having limited capability for work). But as no decision on entitlement had been made until after his release (ie, by which time he again satisfied the ESA conditions), the judge held that a supersession simply to terminate the ESA was wrong. Instead, a closed-period supersession should have been conducted, in which entitlement to ESA in the period between the claimant’s release and his subsequent claim for UC could be considered.
While the claimant would probably no longer have had an entitlement to old-style contributory ESA in that period (because different tax years would be used and he would not meet the national insurance conditions), the question remained whether the claimant could have been entitled instead to income-related ESA at any date prior to the date of the supersession decision. No ‘new’ claim for income-related ESA could have been made (due to the introduction of UC). But neither was that necessary, as the claimant’s still extant award of contributory ESA could have been superseded so as to award it. Judge Rowland held that it was an error of law for the DWP not to have considered this approach. It is also the first decision where a closed-period supersession has been said to be appropriate in circumstances where the claimant could not, had changes been taken into account timeously causing ESA to end while in prison, have made a new claim for income-related ESA when they again met entitlement conditions.
Guidance
Decision makers often do not consider further changes of circumstances that have occurred since the initial change which would have meant a claimant was no longer entitled to benefit. That might be because they are unaware of that further change or because they are unfamiliar with the concept of a closed-period supersession. In the latter cases, referring to the relevant guidance, in a revision request against the supersession which ends entitlement, can be helpful.
‘Supersession for closed period
A4180 A decision awarding benefit may be superseded for a fixed period to take account of a disadvantageous change of circumstances which has already come to an end by the time it has come to the DM’s attention. The supersession only replaces the original decision for that period.
A4181 The principle behind a closed period supersession relies on whether, at the end of the disallowance, the claimant would, in the absence of a new claim, be entitled to benefit. If there is no ongoing entitlement, a closed period supersession is not appropriate and the DM should make a “from and including” disallowance decision.’
The examples given relate to a person on JSA found to have worked for a past period during a fraud investigation (appropriate decision is removal of entitlement for that period) and an ESA claimant found to have worked for longer than 12 weeks in a past period who is not entitled to a closed-period supersession as they would not have met the conditions of entitlement had they claimed when they ceased working.
•The Decision Makers Guide (relevant to other DWP-paid benefits) has a similar passage with different examples at Volume 1, Chapter 4 at paragraph 04117.
8 •For HB, HB/CTB Circular A6/2009 also deals with the issue.
9 The circular refers to CIS/2595/2003 and goes on to state that:
‘A claimant does not need to make a new claim if you discover that there was no entitlement for a fixed period within an award. The award may be superseded for that period and the supersession only replaces the original decision to that extent.’
The two examples given relate to claimants who ceased to be entitled for a period due to earnings from work.