Saturday, October 21, 2017
You are here: Isle of Man > Isle of Man News
Isle of Man News
General News
Help For Those On The Margins 28 June 2007

At its July sitting, Tynwald will be asked to agree to the introduction of a Variable Rate Winter Bonus scheme. This scheme will provide additional help by way of an annual lump sum payment to pensioners and certain others, such as the long-term sick and disabled, whose income is just above their applicable amount for income support. The lump sum payment may be as much as £300.

Currently, a pensioner who is entitled to income support is also entitled to a Winter Bonus of £300 payable in January each year. Tynwald has recognised that it is inherently unfair that a pensioner who has made additional financial provision for their retirement, such that their weekly income is just above the threshold for income support, is actually worse off than a pensioner who is entitled to income support, because they lose out on the Winter Bonus worth around £6 per week. Tynwald asked Government’s Low Incomes Working Group to come up with a solution to address this anomaly.

The Variable Rate Winter Bonus Scheme will provide that the maximum Bonus of £300 will be reduced by £15 for every £1 of weekly income a pensioner has above their applicable amount of income support. The applicable amount is, broadly speaking, what the law says a person and their family needs to live on, including housing costs. So, for example, if a pensioner has £5 of weekly income above their applicable amount they would, upon application, be entitled to a Variable Rate Winter Bonus of £225, as the maximum of £300 would be reduced by 5 times £15 (i.e., £75).

Commenting on the measure, Minister for Health and Social Security, Eddie Teare MHK, said

“This scheme will provide that no pensioner who just misses out on the Winter Bonus will be worse off than a pensioner who receives income support and therefore the £300 Winter Bonus. We have to ensure that saving for retirement is worthwhile and that any perverse disincentives to save are addressed. It will be a condition of entitlement to the Variable Rate Winter Bonus that a person makes a claim for income support in the first instance, as the Department’s officers need certain information to be able to assess entitlement. If it transpires that an applicant is entitled to income support then that benefit will be awarded to them and they will automatically be considered for the maximum £300 Winter Bonus. If not, then the officers will go on to assess entitlement to the Variable Rate Winter Bonus. Given Tynwald approval, the first payments of Variable Rate Winter Bonus will be made in January next year.”

Political Member of the DHSS with special responsibility for social security, Juan Watterson MHK, said

“I am delighted with the solution that the Low Incomes Working Group has come up with and I commend it to fellow Members of Tynwald. This Scheme will provide an appropriate level of assistance to those in the so-called “grey area”. It will also help to ensure that the more a person is prepared to save for their retirement, the better off they will be. The rules will allow for claims to be made each year from the beginning of December up to the end of January of the following year. We plan to run advertisements in the local press nearer the time, giving illustrative examples and encouraging those who think they may qualify to make claims. The Variable Rate Winter Bonus is not taxable and will not affect entitlement to the income tax personal allowance credit.”

More stories >>>  

Related News Articles
UK Measles Outbreak: The Need for Action Now 23 April 2013
The UK Measles Outbreak continues in South Wales and other parts of the UK. [More]
Chief Minister's statement to the House of Keys on support for the Sefton Group 23 April 2013
Mr SpeakerIn the absence of the Economic Development Minister on Government business, I and the Treasury Minister gave a presentation on Friday to Members of Tynwald on the reasons for Council of Ministers’ decision to support the Sefton Group. [More]
Public Services Commission Consultation 22 April 2013
In line with Government’s Agenda for Change programme and in particular its policy to reduce bureaucracy, the Civil Service Commission has launched a public consultation on the proposal to establish a Public Services Commission (PSC). [More]
Government acts to protect local economy and jobs 19 April 2013
GOVERNMENT is backing the financial restructuring of a prominent Island business group to help protect the local economy, Chief Minister Allan Bell MHK announced today (Friday April 19, 2013). [More]
Isle of Man signs Double Taxation Agreement with Luxembourg 18 April 2013
As part of the Isle of Man Government’s ongoing programme of signing Double Taxation Agreements (DTAs) and Tax Information Exchange Agreements (TIEAs), the Isle of Man has signed a comprehensive DTA with Luxembourg. [More]

Other Guides by Maxima Systems Ltd: Disney World