Written question asked by Lord Morris of Manchester (Labour), in the House of Lords. It was answered by Lord Drayson (Labour) on Monday, 18 July 2005.

Armed Forces Compensation Scheme

Question: Whether a lump sum award under the Armed Forces Compensation Scheme may be placed in a personal injury trust; and, if so, whether the award would then be disregarded for state benefit calculations, particularly the calculation of care, mobility and housing awards.

Answer: The rules of the Armed Forces compensation scheme do not prevent an individual placing an award in a personal injury trust. It is for the individual in receipt of an award to decide how he or she wishes to use it. Such an award, whether or not it is placed in a trust fund, does not affect entitlement to either the care component or the mobility component of disability living allowance. In addition, capital in trust funds that derives from payment in compensation for personal injury may be disregarded for the purposes of assessing entitlement to income-related benefits. However, the detailed application of the relevant rules is a matter on which the individual should seek advice from the Department for Work and Pensions or from one of the ex-service organisations which can assist on such matters.

Secondary information

Type: Written question
Reference: 1030; 673 c181WA
Session: 2005-06
Subjects: Disability living allowance Compensation Armed forces Benefits rules Eligibility Personal injury Social security benefits Trusts Armed forces compensation scheme
Link: View this Written question on www.publications.parliament.uk