Explanatory Note
(This note is not part of the Order)
This Order amends the Income-related Benefits (Subsidy to Authorities) Order 1998 (S.I. 1998/562) (“the principal Order”) which provides for subsidy to be payable to authorities administering housing benefit and council tax benefit.
Sections 140C(4) and 140F(2) of the Social Security Administration Act 1992(c. 5) authorise the making, revocation or varying of an Order before, during or after the year to which it relates. The amendments made by this Order have effect from 1st April 2004.
Article 2 amends Part II of the principal Order which is concerned with claiming and paying subsidy. Article 8A is inserted by article 2(4) to make provision for balancing what has been paid by way of interim subsidy with what it is estimated will be the amount of final subsidy before the claim has been audited. Article 2(5) amends article 9 to provide that the payment of final subsidy should take into account the amounts paid or recovered pursuant to the new articles 8A and 9A, as well as interim subsidy that has been paid. Article 2(6) inserts a new article 9A, which provides a new transitional protection scheme of subsidy rates and rules effective from 1st April 2004.
Article 3 amends Part III of the principal Order which is concerned with the calculation of subsidy. Article 3(3) also amends article 12, to provide an addition to subsidy in recognition of the operation by local authorities of schemes under s134(8) and 139(6) of the Social Security Administration Act 1992 to disregard the income of those who receive war disablement and war widow’s pensions. Article 3(4) provides for a new rate of subsidy of 100 per cent of qualifying expenditure attributable to housing benefit and council tax benefit in article 13. Articles 3(5) and 3(7) increase the rates of subsidy for backdated benefits in article 14 and for homeless and short lease rebate cases in Article 17 to 100 percent. Article 16 has been amended by article 3(6) in order to abolish regulated rent allowance thresholds.
Article 3(8) provides for increases to rates of subsidy in Article 18 where there has been a departmental error overpayment. Article 3(8)(c) provides for variable rates of subsidy to be paid where there has been a local authority error overpayment. New paragraphs are inserted in article 18 clarify how much subsidy is payable when where there has been an overpayment and that authorities can reclassify overpayments in-year. Article 21 is amended by article 3(10) to refer to the Housing Benefit and Council Tax Benefit Security Manual, which encompasses those circulars which were previously listed in article 21. A number of other minor and consequential changes have been made to Part III of the principal Order.
Article 4 amends the Schedules to the principal Order. Article 4(1) substitutes the figures to be used in the calculation of subsidy which are outlined in Schedule 1 to this Order for those in Schedule 1 to the principal Order. Schedule 2 (adjustment for the prioritisation of claims) and Schedule 3 (calculation of subsidy in respect of period overruns) are omitted. Paragraph 6 of schedule 4 (rent officer determinations) has been amended to clarify that subsidy will be payable in certain circumstances where the local authority has not referred to the rent officer. Article 4(5) provides that for the purposes of this schedule the definition of “dwelling” in Schedule 4A (rent rebate limitation deductions) is the same definition as is used in the Housing Revenue Account Subsidy Determination. A number of other minor changes are made to the Schedules to the principal Order.
A full regulatory impact assessment has not been produced for this instrument as it has no impact on the cost of business.