Wider family matters

Chapter 8: Financial help

Have you come from abroad?
If you have come from abroad to live in the UK, you should check that your immigration status does not prevent you from applying for benefit - and that any claim for benefit will not harm any application you are making to the Home Office. You should get specialist advice from your immigration solicitor, if you have one, or an advice centre like a Citizens Advice Bureau (CAB).

Managing money can be complicated especially when dealing with welfare benefits and when local authorities are involved in the lives of families. This chapter explains what extra money you may be able to get to help you raise a child who is not your own.

Social security law is very complicated and the rules change often. It is not possible to cover all of the benefit rules here. For more comprehensive benefits advice, contact the relevant financial helpline, your local advice centre (See Money and Legal sections). Foster carers may also find it helpful to read the Fostering Network's detailed pamphlets on benefits, and on allowances and income tax.

A. Help from the Local Authority

You may be able to get extra money from the Local Authority to help you with the costs of looking after a child. This section will give you information about this financial help.

Will I be able to get any extra money from the Local Authority because I have my grandson living with me?
There are many different reasons a child may come to live with you, and many different types of legal arrangements that may apply. The type and amount of financial help you get will depend on what the arrangement is. Table C sets out what help you may be able to get.

Do I have to ask the Local Authority for financial support?
If the Local Authority has placed a child with you, they should carry out an assessment of your circumstances including your financial needs. If they do not do so, you should ask for an assessment. If a child has come to live with you without any Local Authority involvement and you are in need of additional support, you should approach them and ask them to undertake a ‘child in need' assessment (see Chapter 6). You will find the details of your Local Authority Children's Services Department in your phone book.

If you think you may be eligible we suggest you write to Children's Services along the lines of the letter set out in Appendix A.

Section 17 payments

As outlined in chapter 6, the Local Authority has the duty to identify, safeguard and promote the welfare of ‘children in need' in its area and to support their upbringing by their families by providing a range of services under section 17 Children Act 1989. It has discretion as to which families it supports and what services it provides. It can also pay for other organisations to provide services. ‘Children in need' has a specific legal definition and includes disabled children and children whose health or development is likely to be significantly damaged if they do not receive services.

The Local Authority can make payments in 'exceptional circumstances' to children in need and their families. These are likely to be payments for specific items such as clothing or bedding, or a payment in a crisis, rather than regular income. Section 17 payments are not classed as income. Section 17 payments do not affect benefits or tax credits

You can ask for the reasons for the Local Authority's decision and you can use its complaints system if you are not happy with the decision. You can also speak to a solicitor about it or an organisation such as your local Citizens Advice Bureau or Family Rights Group.

How will the Local Authority decide whether to make me a payment?
There are some payments, like fostering allowances to foster carers, which local authorities have a legal duty to pay. Other payments are discretionary. This means that the Local Authority will look at your needs and your financial situation, including your income, and at their own policy. They will then make a decision on whether or not to make any payments to you. Any decision they make should be reasonable and respect certain fundamental human rights. Otherwise, it may be challengeable in court.

Residence and special guardianship order allowances

Who is financially liable for a child who is subject to a residence or special guardianship order?
Parents remain financially liable for a child who is subject to a residence or special guardianship order. The special guardian is not financially liable in legal terms although they may take on financial responsibility in practice. The carer will be able to receive child benefit for the child and to apply for child tax credit and/or other relevant benefits.

The Local Authority has suggested I apply for a residence order. Do they have to pay me a residence order allowance?
The Local Authority has the power to pay a carer with a residence order an allowance, but they do not have to by law. Different authorities vary considerably up and down the country. If the Local Authority has asked you to apply for a residence order then you should be in a strong position to negotiate an allowance with themy, but make sure that any agreement is set out in writing.

As a special guardian, what kind of financial support could I get?
The Local Authority has the power to provide financial support to special guardians :
1. To enable you to become a special guardian and, after the order is made, to enable the special guardianship to continue, where either the Local Authority:

• ‘considers it necessary' to ensure that the special guardian can look after the child; or
• considers that the child needs special care, because of an illness, disability, or emotional or behavioural difficulties.

2. Where the Local Authority ‘considers it appropriate' to contribute to your legal costs (including court fees) in relation to the making or discharge of a special guardianship order, or any application, such as in relation to contact with the child. The Local Authority may assist you with your legal costs regardless of your income.

3. Where the Local Authority considers it necessary to contribute to the cost of accommodating and maintaining the child. This could be through a single payment or periodically where the need is likely to lead to recurring expenditure.

If you have previously been a foster carer for this child, you may also be able to receive an additional reward element for up to two years (or, exceptionally, for even longer) if you previously received this as part of your fostering allowance.

Whether or not you get financial support will depend on the Local Authority assessment of the child's needs and your circumstances, including your financial resources such as eligibility for benefits, tax credits etc. We recommend that you get the Local Authority to present its proposals for the amount and duration of the allowance in writing to the court before the special guardianship order is made. Because this allowance is discretionary, it can be harder to get the local authority to agree to pay you once the court case is finished. Judges will generally want to know that if they appoint you to be a special guardian you are going to be in a position to provide the child with financial security. They will therefore see it as reasonable for you to raise the issue of local authority financial support.

If you as the special guardian secure ongoing financial support from the Local Authroity you must tell them straightaway if there is any change in your circumstances and must give them an annual financial statement on your financial situation and the financial needs of the child.

Adoption allowances

I am going to adopt a child. Is there any specific financial help I can get?
You have the right to ask for an assessment from your Local Authority and an adoption allowance (or fostering, if relevant) may be paid to you if it is considered that the adoption would not otherwise be possible or practical. Any payment made on this basis will be discretionary.

If you are working, you may be able to get 12 months' adoption leave, with statutory adoption pay paid at a flat rate for the first 39 weeks. If you have a partner, s/he may be able to get two weeks' statutory paternity pay and leave. For more information, look at the Department of Trade and Industry's interactive employment website www.tiger.gov.uk, or contact the British Association for Adoption and Fostering. If the child you are adopting is less than 12 months old you may qualify for the £500 Sure Start maternity grant.

Challenging decisions on discretionary payments

How can I challenge a decision about discretionary payments that I disagree with?
You should ask the Local Authority for the reasons for their decision. If you disagree with the decision and/or the reasons given, you should follow the Local Authority's complaints procedure. The worker you have been dealing with should give you a copy of the complaints procedure. The law in this area is complex. If you still think the decision is unreasonable or in breach of the Human Rights Act 1998, you should seek advice from a solicitor on the Children Panel specialising in child care and administrative
law or from Family Rights Group's advice service.

B. Tax credit/social security benefits

You may be able to get extra benefits to help you with the costs of looking after a child. This section will give you information about the additional help you may be entitled to.

Will I be able to get any additional benefits to help with the extra costs of caring for my grandson?

The main benefits available to people caring for children are child benefit and child tax credit. Whether or not you will get these will depend upon the legal arrangements for your granson whilst he is living with you.

Table D sets out your possible entitlement to these benefits and whether any Local Authority allowance you get for the care you are providing will affect your child benefit, child tax credit or any other benefits you may be receiving.

The following section sets out in more detail information about child benefit, child tax credit and other benefits that you may be entitled to claim.

Child benefit

Child benefit is paid to people who are raising a child/young person who is:

• aged under 16;
• already 16, up to the end of August following their 16th birthday;
• agee 16-18 and in full-time further education or on a programme of approved training;
• aged 16 or 17, has left full-time education or approved training, and has registered with Connexions or the Careers Service for work, education or training
• aged 19, and in full-time further education or approved training which started before their 19th birthday.

It is not means tested and so it is paid whether or not you are working and whatever your income.

If you are the full time carer of a child you should receive child benefit. If there is confusion as to who the child is living with, there are what are called ‘priority rules' which set out who should get child benefit when more than one people could be entitled. The rules relevant to family and friends carers say:

• The parent whom the child lives with has 'first' priority.
• A parent who has a child living wiht them has priority over a person who contributes towards the child's upkeep.
• A child will count as living with his/her parents if s/he spends more than 56 days in any 16-week period wiht them.
• A parent has priority over a non-parent where care is shared.
• Child benefit can be paid to any other person who is caring for the child if those entitled to claim child benefit agree.

If the child has come to live with you, you should make a claim as soon as possible.

My granddaughter is now living with me. How do I obtain child benefit if her mother is still continuing to claim it?
This was a big problem experienced by the grandparents in our survey. HM Revenue and Customs are responsible for child benefit. It is now paid directly into a bank, building society or post office card account (POCA), and no one has a book any longer. You do not need to provide your grandchild's birth certificate if her mother has already been claiming. You do however need evidence that your granddaughter is living with you.

 If you are the full-time carer you should receive the child benefit. If, however, a decision is made against you, you can appeal to the board of HM Revenue and Customs. You can also claim an ex gratia payment if HM Revenue and Customs wrongly advised you. You can also complain to your MP and ask him/her to make a complaint on your behalf to the HM Revenue and Customs or the Parliamentary Ombudsman.
How to claim: You will need to complete form CH2. You can do this online at www.hmrc.gov.uk or you can phone 0845 302 1444 and ask for the paper form.

Child tax credit

Nine out of ten families with children can get child tax credit. The lower your income the more child tax credit you should get. You can get child tax credit whether or not you are working. To avoid future over or underpayments you need to inform HM Revenue and Customs of changes of income.

How to claim: You will need to complete form TC600. You can do this online at www.hmrc.gov.uk/taxcredits or you can phone 0800 500 222 and ask for a paper form. To find out more about tax credits you could ring the tax credits helpline on 0800 300 3900.

Guardian's allowance

You do not need to be the child's legal guardian to get the guardian's allowance. You may be able to get guardian's allowance as well as child benefit and child tax credit if you are caring for a child in one of the following circumstances:

• Both parents are dead.
• One parent is dead and the other cannot be traced despite efforts to do so.
• One parent is dead and the other sentenced to prison for at least two years or detained through the courts in a mental hospital.
• The mother has died, was not married to the father, and he is unknown.

If you are a step-parent, you may be entitled to guardian's allowance for your stepchild. Local Authority foster carers cannot claim guardian's allowance for children they are fostering.
How to claim: You will need to complete form BG1. You can do this online at www.hmrc.gov.uk or you can phone 0845 302 1464 to ask for the paper form. To find out more about guardian's allowance, call the guardian's allowance unit on 0845 302 1464.

Income support

I have had to give up my job to care for my niece and nephew who have come to live with me. What additional benefits can I claim?

You may be able to get income support. This is a means-tested benefit, therefore your income and capital is taken into account in calculating your entitlement to this benefit.

You can only qualify for income support if you fall within certain categories, for example if you are a lone parent, caring for a disabled person or child, or incapable of work because of sickness or disability. If you do not fall into one of the categories, you will have to sign on and claim jobseeker's allowance. If you are aged over 60, you should claim pension credit instead.

If you have a mortgage, you may be able to get extra income support or income-based jobseeker's allowance to help with the cost of your mortgage.

How to claim: You need to complete form A1, which you can get from your local Jobcentre Plus office. You will find the address in your telephone directory.

Housing and council tax benefit

You may be able to get housing and council tax benefit if you pay rent and/or are liable for council tax. These benefits are paid to people who have a low income whether or not they are working. You can claim these benefits from your Local Authority.

Working tax credit

If you are a Local Authority foster parent, the care you are giving to the children can be treated as work and you may be able to get working tax credit. Your fostering allowances will not be taken into account when your tax credit is calculated. You should get advice as to whether you would be better off claiming working tax credit or income support.

Allowance disregards

Will the allowances I get for providing care affect the income support or income-based jobseeker's allowance I get for myself?
Since April 2004, adoption allowance, residence order allowance and special guardianship allowance are ignored completely when your income support or jobseeker's allowance is worked out.

However, there are a small number of adults who were claiming income support or jobseeker's allowance before April 2004 whose benefits include an amount for the children they are caring for. If you are in this situation you will not be getting child tax credit, and any residence, special guardianship or adoption allowance you get may reduce the amount of income support/jobseeker's allowance you are entitled to.

If you are getting a fostering allowance from the Local Authority, this should be ignored completely when your benefits are worked out. If you are fostering a child privately, any money you get from the child's parents will be treated as maintenance and will probably affect your income support or jobseeker's allowance.

I am over 60 - will the allowances I get for providing care affect the benefits I get for myself?
If you or your partner are aged 60 or over all adoption allowances, fostering allowances, special guardianship allowances and residence order allowances are completely ignored when your pension credit, housing and council tax benefit are worked out. Pension credit has replaced income support for those aged over 60 and guarantees a minimum income.

Will the allowances I get for providing care affect my housing benefit and council tax benefit?
Housing benefit and council tax benefit are calculated to include an amount for any child living with you. Therefore, unless you or your partner are aged 60 or over, your housing benefit/council tax benefit may be reduced if you receive adoption allowance, residence order allowance or special guardianship allowance. Contact your Local Authority, give them details of the allowance you are receiving and ask them to confirm if and how your housing/council tax benefit will be affected.

School and other education costs

The information on this is in Chapter 9.

The Social Fund

You may be able to get a grant that does not have to be paid back or an interest-free loan from the Social Fund. There are different payments available in this fund that are set out below:

Sure Start maternity grant
This is a £500 payment available to help pay for the needs of a baby if your income is low. The grant can be claimed up to three months after a baby's birth, or for a child less than 12 months old if the baby has been adopted or is looked after under a residence or special guardianship order. To qualify you have to be getting pension credit, income support, income-based jobseeker's allowance or child tax credit of more than the family element. Claim on form SF100 (Sure Start) from your local Jobcentre Plus.

Community care grant
This is a discretionary payment that does not have to be repaid. You may qualify if you need essential items and can show that getting the item will help you, or someone you are looking after, live independently. For example, you may be able to get money for a bed if a child unexpectedly comes to live with you. To qualify you must be getting pension credit, income support or income-based jobseeker's allowance. Claim on form SF300 from your local Jobcentre Plus.

Budgeting loans
These are interest-free loans available to help you buy things that you have not been able to save for while on benefits. To qualify you must have been getting pension credit, income support or income-based jobseeker's allowance for at least 26 weeks. Claim on form SF500 from your local Jobcentre Plus.

Crisis loans
These are interest-free loans to help people with immediate short-term needs. You do not have to be in receipt of a benefit to apply.

Child Support Agency

Non-resident parents living elsewhere in the UK or working abroad for a UK-based employer are legally responsible for providing financial support for their child. This is called child support maintenance.

If you are a relative raising a child you can choose whether or not to put in a claim to the Child Support Agency, unless you are receiving income support in which case special rules apply. You can also decide whether to claim from one parent or both. If you make a claim, the parent is legally obliged to pay. However, in certain circumstances such as a parent being on low income with other children, or being a student, the parent may only be obliged to pay a small flat rate or may even have a nil assessment. Some carers decide not to make a claim because they believe the child's parent(s) are not in a situation where they can make any contribution or because they fear it will create further tensions. Major reform to the Child Support Agency is planned so that in future it is targeted at non-resident parents who regularly refuse to contribute to their children's upkeep.

Childcare costs

Can I get any help with the costs of childcare for my grandson who I am raising?
All three and four-year olds are entitled to a free part-time nursery place; this is for a minimum of five two-and-a-half-hour sessions a week, 38 weeks a year. You can read more about this and about nursery education grants in Chapter 9.

If you are a lone parent working at least 16 hours a week, or you have a partner and you both work at least 16 hours a week, then you may also qualify for the childcare element of working tax credit. You will not be able to get all of your childcare paid for, but the lower your income the more help you will get. In order to qualify for this help, the childcare you are using must be registered. Local Authority foster carers cannot claim childcare costs for children they are fostering.

To find out about what childcare is available locally and to get information about help with paying for childcare you should speak to your local Children's Information Service. To find your local service, telephone 0800 096 0296, and to search for childcare online log on to www.childcarelink.gov.uk.
How to claim: To claim the childcare element of working tax credit you will need to complete form TC600 if you have not already made a tax credits application. You can do this online at www.hmrc.gov.uk/taxcredits or you can phone and ask for a paper form on 0800 500 222. If you are already getting tax credits ring the helpline and tell them you now want to claim for childcare costs. To find out more about tax credits you could ring the tax credits helpline on 0800 300 3900.

Is my grandson entitled to a child trust fund?

If your grandson was born on or after September 1, 2002 then he will have a child trust fund. If he was in the care of the Local Authority when the child trust fund voucher was awarded, then the Inland Revenue will have opened an account for her and invested £500. Otherwise, whoever was claiming child benefit on his behalf will have been sent the voucher - for either £250 or £500 depending on their financial situation.

This person should have invested the money; if the money has not been invested within a year, the Inland Revenue will do so on the child's behalf. The child trust fund can be added to, but cannot be accessed until he reaches 18.

My grandson who I am raising has a disability - is there any extra help we can get?

Disability living allowance (DLA)
Whether or not you can get any additional benefits will depend on the extra needs your grandchild has as a result of his disability.

DLA is the main benefit paid to disabled people who need help to look after themselves and/or get around. It is made up of two parts: care and mobility. The care component is paid at three rates for three different levels of need. The mobility component is only paid for children aged five years or over, and is paid at two rates for two different levels of need. To get DLA for a child, you must be able to show that s/he has higher needs than other children of the same age.

How to claim: To claim DLA for a child you need to complete form DLA1 child. You can get this form by ringing the benefit enquiry line on 0800 88 2200. The form is long, and you may find it useful to get help with filling it in from somewhere like a Citizens Advice Bureau. If the child you are looking after is awarded DLA, you will be able to get extra child tax credit, and additional housing/council tax benefit. To get this extra money you should let the Inland Revenue and the Local Authority know about the DLA award.

Carer's allowance
If you are caring for a child who is getting the middle or higher rate care component of DLA, and you are not working (or working part time and earn below a set amount), you may be able to get carer's allowance.

If you qualify for carer's allowance and you and your partner are not working full time, you may also be able to get income support. If you are already getting income support or pension credit, you may be able to get an extra amount in these benefits because you are a carer. Benefits for carers are complicated and you should get specialist advice.

How to claim: You could visit your local advice centre or you could contact Carers UK on 0808 808 777 or log on to www.carersuk.org.

Child Tax Credit
You can get an additional disability element in your child tax credit for any child in your family who receives DLA or is registered blind. You will get a severe disability element for each child who gets the highest rate of the care component of DLA.

The Family Fund
You may be able to get a grant from the Family Fund if you have a household income of less than £23,000 (2006/7).The Family Fund is a charity that gets its money from the government. They provide discretionary grants for things like holidays, special play equipment or household goods to families with disabled children.

How to claim: You can get an application form from their website at www.familyfund.org.uk, or by phoning them on 0845 130 4542.

Children's Services: children with disabilities
You may be able to get help from your local Children's Services department if you are raising a child with disabilities. They may be able to help, for example, with respite care and household adaptations. You will need to ask them to do an assessment of your needs as a carer as well as an assessment of the child you are looking after. There is more detail on this and how to apply in Chapter 6 in the section on children in need assessments and services.

Further sources of advice

See chapter 9 for further information about help you may be able to receive with day care, schooling and highest education costs for a child.

You can also contact your local Citizen's Advice Bureau (CAB), visit another local advice centre, or, for legal matters, contact the Community Legal Service (CLS). There are details of how to contact the CAB and CLS and a wide range of helplines and specialist organisations in the Money and Legal sections in Chapter 11.

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