In a ruling which could benefit people declared bankrupt before May 2000, electrical contractor Robert Skuse was able to oveturn a Social Security decision which denied him income support.
Skuse was made bankrupt under the 1986 Insolvency Act and before the 1999 Welfare Reform and Pensions Act came into force, which meant his pension funds and retirement annuity were considered part of his estate.
As a result Skuse’s pension and retirement annuity were automatically paid to his Trustee, Numerica partner Nigel Mallett, for the benefit of creditors.
But when Skuse applied for income support after retirement, he was turned down because his annuity payments were considered to be ‘notional income’.
Numerica manager Matthew Frayne, who believed the decision was unfair, helped Skuse in a three and a half year campaign to get the decision overturned.
He explained: ‘According to the Benefits Agency, if a bankrupt’s pension was given to the Trustee in bankruptcy, the bankrupt was perceived to have voluntarily alienated his income – and therefore was denied income support.’
Following a series of appeals, which ended in a tribunal on 28 June, the social securities commissioner ruled Skuse’s annuity payments did not constitute income and overtuned the Benefits Agency decision. Skuse’s entitlement is now being recalculated and he will receive a lump sum in the near future.
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