Question to the Department for Work and Pensions:

To ask the Secretary of State for Work and Pensions, what assessment he has made of (a) the impact of off-setting private pension income against income-based employment and support allowance earnings for people who have been able to draw their pension early due to ill health and (b) the potential merits of allowing people who have drawn their pension early due to ill health to retain their employment and support allowance earnings.

Entitlement to income related Employment and Support Allowance (ESA (IR)) is based on financial need and both income and capital will affect entitlement. Any pension income received is deducted from the amount of ESA (IR) payable. Cash lump sums taken from a pension savings are deemed to be capital. Claimants are not entitled to ESA (IR) if their household has capital of more than £16,000. Capital in excess of £6,000 and up to £16000 reduces the amount of ESA (IR) payable.