2.2 The benefit system

Question 1

What two benefits are the UK’s benefit system divided into?

Answer 1

• contributory benefits

- non-contributory benefits

Question 2

What are contributory benefits?

Answer 2

Benefits paid to claimants that have paid the required number of NICs

Question 3

How do employees pay NICs

Answer 3

They are automatically deducted from their salaries by the employer

Question 4

What are non-contributory benefits?

Answer 4

Benefits paid to claimants who have either not paid enough NICs to claim contributory benefits or need a top-up payment because the contributory benefits do not meet their income needs

Question 5

Why did creators of the National Insurance system make it contributory?

Answer 5

• to fund the benefits

- some would be too proud to accept benefits unless they felt they were fully entitled

Question 6

Why are benefits paid at a flat rate?

Answer 6

• to keep costs of the system in check

- to avoid problems with means testing

Question 7

What is a means test?

Answer 7

A detailed examination of a persons income

Question 8

Under what circumstance are means-tested benefits reduced?

Answer 8

• if household income is above a certain level

- if you have more than £6,000 in savings

Question 9

What is jobseeker’s allowance?

Answer 9

The main benefit for those of working age who are not working full time but are able to

Question 10

Contributory and non-contributory JSA claimants receive the same weekly cash benefit - true or false?

Answer 10

True

Question 11

At what age is a higher JSA rate paid to claimants?

Answer 11

25 and over

Question 12

Requirements to be eligible for contributions-based JSA

Answer 12

• aged between 18 and retirement age
• work less than 16 hours a week
• not a full-time student
• able to work

Question 13

Who is income based JSA available to?

Answer 13

Unemployed people who have not paid the required amount of NICs

Question 14

What are the differences between income based JSA and contributions-based JSA?

Answer 14

• Contributions-based JSA is paid for only six months, income based JSA does not have a time limit
• to be eligible for income based JSA you must have less than 16,000 in savings and neither you or your partner should be working more than 24 hours a week on average

Question 15

Is income based JSA means tested?

Answer 15

Yes

Question 16

How can someone previously self-employed claim income based JSA

Answer 16

By showing that the business is no longer trading

Question 17

Statutory sick pay

Answer 17

a benefit that provides an income, via the employer when sickness or disability prevents an individual from working

Question 18

Your employer has to pay you SSP is you have been off sick for how many days?

Answer 18

four or more

Question 19

How is SSP paid?

Answer 19

At a fixed weekly amount for a maximum of 28 weeks

Question 20

Employment and support allowance

Answer 20

a benefit that provides an income directly from the state when sickness or disability prevents you from working

Question 21

How can you claim ESA?

Answer 21

If you have been getting SP for the maximum 28 weeks or if you are self employed and the illness/disability prevents you from working

Question 22

Is ESA contributions-based, non-contributions based or income-based?

Answer 22

Contributions-based or income-based

Question 23

How is ESA paid?

Answer 23

At a standard weekly benefit for the first 13 weeks for all claimants aged 25 or over and at a lower rate for those under the age of 25

Question 24

What happens after 13 weeks of receiving ESA?

Answer 24

Claimants are allocated into the work-related activity group or the support group

Question 25

Who does the work-related activity group include?

Answer 25

Those whose illness or disability is not considered too severe to prevent them from returning to work