Under the supplementary welfare allowance (SWA) scheme a weekly supplement may be paid in respect of rent to any person in receipt of a social welfare or health board payment whose means are insufficient to meet their needs.
Entitlement to a rent supplement is determined by the health boards in accordance with the relevant legislation. Supplements are normally calculated to ensure that the person, after payment of rent, has an income equal to the rate of SWA appropriate to the family circumstances, less £6. This £6 represents the minimum contribution which a person is required to pay from his/her own resources towards accommodation costs.
In addition to the minimum contribution, all applicants, including pensioners, are required to contribute any assessable means in excess of the appropriate basic SWA rate towards their rent. This is known colloquially as "the claw-back rule" and the health boards do not have any general discretion in relation to this rule. The result is that in addition to the minimum £6 contribution, pensioners also contribute the difference between the rate of pension and the standard rate of SWA. If the rate of pension increases, for example if a pensioner's dependent spouse reaches pension age, the rate of SWA rent supplement will be reduced by the same amount.
The position in relation to annual budgetary increases is similar but with one important difference. The rate of SWA rent supplement payable to pensioners decreases only when the budgetary increase in pension rates is greater than the increase in the basic rate of SWA, as has been the case in recent years. For example, the personal rate of retirement and old age pensions increased by £7 per week in last year's budget while the personal basic rate of SWA increased by £4 per week. Consequently, the amount of SWA rent supplement payable to single pensioners fell by the difference between these two amounts or £3.
The effect is that, after paying their rent, all recipients of SWA rent supplement have £70 per week in the case of single people, £117 in the case of couples, plus an additional £13.20 per week in respect of each dependant child, regardless of what type of primary weekly payment they have.
Under the terms of the capital assistance scheme (CAS), capital grants are made available by the Department of the Environment and Local Government through local authorities to approved voluntary bodies to provide accommodation for persons accepted as qualified for local authority housing.