The Social Security (Income and Capital Disregards) (Amendment) Regulations 2026

Published: Fri 9th Oct 26

Amended social security regulations to exclude Church of England abuse redress payments from income and capital assessments for means-tested benefits.

These Regulations amend various social security frameworks to ensure that redress payments made by the Church of England under the Abuse Redress Measure 2025 are disregarded when calculating a person's income and capital for benefit purposes.

The instrument applies to claimants of State Pension Credit, Housing Benefit, Employment and Support Allowance, and Universal Credit.

By introducing these disregards, the Department for Work and Pensions ensures that receiving such compensation does not result in the reduction or loss of means-tested financial support.

Arguments For

The Explanatory Note states that these amendments ensure payments from the Church of England redress scheme do not reduce a claimant's entitlement to means-tested benefits.
The document indicates that the Social Security Advisory Committee agreed that these proposals did not require formal referral, suggesting an absence of regulatory objection to the disregard mechanism.
The regulations align the treatment of these redress payments with existing disregards for other compensation programs, such as the Mother and Baby Scheme.

Arguments Against

Legal analysts might note that the regulations only apply to the specific scheme established under the Abuse Redress Measure 2025, potentially excluding other forms of voluntary or private settlements not administered by the named redress body.
The effective date is contingent on the commencement of section 12 of the Abuse Redress Measure 2025; if that legislation is delayed, the benefit disregards will not take effect on the planned date of 31 October 2026.

Citation, commencement and extent

-(1) These Regulations may be cited as the Social Security (Income and Capital Disregards) (Amendment) Regulations 2026.

(2) These Regulations come into force on 31st October 2026 or, if later, the day on which section 12 of the Abuse Redress Measure 2025( 7 ) comes into force.
(3) These Regulations extend to England and Wales and Scotland.

This section establishes the official name of the regulations and sets the date they become law.

The rules take effect on 31 October 2026, unless the primary legislation establishing the redress scheme starts later, in which case they begin on that later date.

The regulations apply across Great Britain.

Amendment of the State Pension Credit Regulations 2002

-(1) The State Pension Credit Regulations 2002( 8 ) are amended as follows.

(2) In regulation 1(2) (citation, commencement and interpretation)-

(a) after the definition of 'child abuse payment' insert-

''Church of England Redress payment' means a payment by the scheme administered by the redress body under the Abuse Redress Measure 2025;';

(b) in the definition of 'qualifying person' for 'or a Mother and Baby Scheme payment' substitute ', a Mother and Baby Scheme payment or a Church of England Redress payment'.

(3) In Schedule 2 (housing costs), in paragraph 14(8) after sub-paragraph (bg) insert-

'(bh) any Church of England Redress payment;'.

(4) In Schedule 5 (income from capital), in paragraph 15-

(a) in sub-paragraph (1A) after 'Mother and Baby Scheme payment' insert ', Church of England Redress payment';
(b) in each of sub-paragraphs (2) to (5) and (6) for 'or a Mother and Baby Scheme payment' substitute ', a Mother and Baby Scheme payment or a Church of England Redress payment'.

This section modifies the rules for State Pension Credit by defining Church of England Redress payments and adding them to the list of ignored funds.

It ensures these payments do not count as capital or income when determining eligibility or calculating housing costs for pensioners.

The disregard also extends to 'qualifying persons' such as partners or family members who might otherwise be affected by the claimant's receipt of the money.

Amendment of the Housing Benefit Regulations 2006

-(1) The Housing Benefit Regulations 2006( 9 ) are amended as follows.

(2) In regulation 2(1) (interpretation)-

(a) after the definition of 'the Children Order' insert-

''Church of England Redress payment' means a payment by the scheme administered by the redress body under the Abuse Redress Measure 2025;';

(b) in the definition of 'qualifying person' for 'or a Mother and Baby Scheme payment' substitute ', a Mother and Baby Scheme payment or a Church of England Redress payment'.
(3) In regulation 42(7A) (notional income) after sub-paragraph (g) insert-

(h) a Church of England Redress payment.'.

(4) In regulation 46(6) (income treated as capital) after 'a Mother and Baby Scheme payment' insert ', a Church of England Redress payment'.

(5) In regulation 49(4A) (notional capital) after sub-paragraph (h) insert-

(i) a Church of England Redress payment.'.
(6) In regulation 74(9) (non-dependant deductions) after sub-paragraph (bg) insert-
'(bh) any Church of England Redress payment;'.

(7) In Schedule 5 (sums to be disregarded in the calculation of income other than earnings), in paragraph 35-

(a) in sub-paragraph (1A) after paragraph (g) insert-

(h) Church of England Redress payment.';
(b) in each of sub-paragraphs (2) to (6) for 'or a Mother and Baby Scheme payment' substitute ', a Mother and Baby Scheme payment or a Church of England Redress payment'.

(8) In Schedule 6 (capital to be disregarded), in paragraph 24-

(a) in sub-paragraph (1A) after 'Mother and Baby Scheme payment' insert ', Church of England Redress payment';
(b) in each of sub-paragraphs (2) to (5) and (6) for 'or a Mother and Baby Scheme payment' substitute ', a Mother and Baby Scheme payment or a Church of England Redress payment'.

This section applies the same disregards to Housing Benefit for people of working age.

It prevents the redress payments from being treated as 'notional income' or 'notional capital'—money the law assumes someone has even if they have not yet received it or have given it away.

It also ensures that deductions for non-dependants living in the household are not triggered by these payments.

Amendment of the Housing Benefit (Persons who have attained the qualifying age for state pension credit) Regulations 2006

-(1) The Housing Benefit (Persons who have attained the qualifying age for state pension credit) Regulations 2006( 10 ) are amended as follows.

(2) In regulation 2(1) (interpretation)-

(a) after the definition of 'the Children Order' insert-

''Church of England Redress payment' means a payment by the scheme administered by the redress body under the Abuse Redress Measure 2025;';

(b) in the definition of 'qualifying person' for 'or a Mother and Baby Scheme payment' substitute ', a Mother and Baby Scheme payment or a Church of England Redress payment'.
(3) In regulation 55(10) (non-dependant deductions) after sub-paragraph (bg) insert-

'(bh ) any Church of England Redress payment;'.

(4) In Schedule 6 (capital to be disregarded), in paragraph 16-

(a) in sub-paragraph (1A) after 'Mother and Baby Scheme payment' insert ', Church of England Redress payment';
(b) in each of sub-paragraphs (2) to (5) and (6) for 'or a Mother and Baby Scheme payment' substitute ', a Mother and Baby Scheme payment or a Church of England Redress payment'.

This section updates Housing Benefit rules specifically for claimants who have reached the state pension age.

It aligns their capital and non-dependant deduction rules with the new disregards for Church of England redress payments.

This ensures consistent treatment across different age groups within the Housing Benefit system.

Amendment of the Employment and Support Allowance Regulations 2008

-(1) The Employment and Support Allowance Regulations 2008( 11 ) are amended as follows.

(2) In regulation 2(1) (interpretation)-

(a) after the definition of 'child tax credit' insert-

''Church of England Redress payment' means a payment by the scheme administered by the redress body under the Abuse Redress Measure 2025;';

(b) in the definition of 'qualifying person' for 'or a Mother and Baby Scheme payment' substitute ', a Mother and Baby Scheme payment or a Church of England Redress payment'.

(3) In regulation 107(5A) (notional income - income due to be paid or income paid to or in respect of a third party) after sub-paragraph (g) insert-

(h) a Church of England Redress payment.'.
(4) In regulation 112(8)(b) (income treated as capital) after paragraph (vii) insert-

(viii) Church of England Redress payment.'.

(5) In regulation 115(5A) (notional capital) after sub-paragraph (h) insert-

(i) a Church of England Redress payment.'.
(6) In Schedule 6 (housing costs), in paragraph 19(8)(b), after 'Mother and Baby Scheme payment' insert ', Church of England Redress payment'.

(7) In Schedule 8 (sums to be disregarded in the calculation of income other than earnings), in paragraph 41-

(a) in sub-paragraph (1A), after paragraph (g) insert-

(h) Church of England Redress payment.';
(b) in each of sub-paragraphs (2) to (6) for 'or a Mother and Baby Scheme payment' substitute ', a Mother and Baby Scheme payment or a Church of England Redress payment'.

(8) In Schedule 9 (capital to be disregarded), in paragraph 27-

(a) in sub-paragraph (1A) after 'Mother and Baby Scheme payment' insert ', Church of England Redress payment,';
(b) in each of sub-paragraphs (2) to (5) and (6) for 'or a Mother and Baby Scheme payment' substitute ', a Mother and Baby Scheme payment or a Church of England Redress payment'.

This section amends the rules for Employment and Support Allowance (ESA), a benefit for people with disabilities or health conditions.

It mandates that redress payments are not counted as income or capital, preventing the compensation from reducing the claimant's ESA payments.

It also covers technical aspects like notional income and housing cost calculations within ESA.

Amendment of the Universal Credit Regulations 2013

-(1) The Universal Credit Regulations 2013( 12 ) are amended as follows.

(2) In regulation 76(1A) (special schemes for compensation etc.)-

(a) omit the 'or' at the end of sub-paragraph (f);
(b) after sub-paragraph (g) insert-

'; or

(h) the scheme administered by the redress body under the Abuse Redress Measure 2025.' .

This section amends Universal Credit regulations to include the Church of England redress scheme under the list of 'special schemes for compensation'.

This classification means that payments from the scheme are officially excluded from the financial assessments used to determine a claimant's Universal Credit award.

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