Give Council Tax Reduction and Income Support their own pension contribution shares

changelog.d/2515.fixed.md

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+- Council Tax Reduction and Income Support read their own pension contribution deduction shares (one-half in each scheme) instead of a hard-coded 0.5, and the Council Tax Reduction pensioner earnings disregards cap at net earnings with the scheme's own share, so a reform of Housing Benefit's share no longer moves them.

policyengine_uk/parameters/gov/dwp/income_support/means_test/pension_contribution_deduction_rate.yaml

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+description: Income Support deducts this share of pension contributions when it calculates a claimant's net earnings and a self-employed earner's net profit.
+values:
+  1988-04-11: 0.5
+metadata:
+  period: year
+  unit: /1
+  label: Income Support net earnings pension contribution deduction rate
+  economy: false
+  reference:
+    - title: The Income Support (General) Regulations 1987, regulation 36(3)(b) (employed earners)
+      href: https://www.legislation.gov.uk/uksi/1987/1967/regulation/36
+    - title: The Income Support (General) Regulations 1987, regulation 38(1)(b)(ii), (3)(c) and (9)(b) (self-employed earners)
+      href: https://www.legislation.gov.uk/uksi/1987/1967/regulation/38

policyengine_uk/parameters/gov/local_authorities/england/council_tax_reduction/default_scheme/means_test/pension_contribution_deduction_rate.yaml

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+description: The England Council Tax Reduction default scheme deducts this share of pension contributions when it calculates an applicant's net earnings and a self-employed earner's net profit, for pensioners and for applicants who are not pensioners and have no award of Universal Credit. The default scheme applies where a billing authority has made no scheme of its own.
+values:
+  2013-04-01: 0.5
+metadata:
+  period: year
+  unit: /1
+  label: England Council Tax Reduction default scheme pension contribution deduction rate
+  economy: false
+  reference:
+    - title: The Council Tax Reduction Schemes (Default Scheme) (England) Regulations 2012 Sch. para. 42(2)(b) and (c) and (5)(c) (employed earners who are pensioners)
+      href: https://www.legislation.gov.uk/uksi/2012/2886/schedule/paragraph/42
+    - title: The Council Tax Reduction Schemes (Default Scheme) (England) Regulations 2012 Sch. para. 52(3)(b) and (c) and (6)(c) (employed earners who are not pensioners)
+      href: https://www.legislation.gov.uk/uksi/2012/2886/schedule/paragraph/52
+    - title: The Council Tax Reduction Schemes (Default Scheme) (England) Regulations 2012 Sch. para. 61(1)(b)(ii) and (c)(ii), (3)(c) and (9)(b) (self-employed earners)
+      href: https://www.legislation.gov.uk/uksi/2012/2886/schedule/paragraph/61
+    - title: Local Government Finance Act 1992 Sch. 1A para. 4 (the default scheme applies where a billing authority has made no scheme)
+      href: https://www.legislation.gov.uk/ukpga/1992/14/schedule/1A/paragraph/4

policyengine_uk/parameters/gov/local_authorities/england/council_tax_reduction/pensioners/means_test/pension_contribution_deduction_rate.yaml

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+description: The England Council Tax Reduction scheme for pensioners deducts this share of pension contributions when it calculates an applicant's net earnings and a self-employed earner's net profit.
+values:
+  2013-04-01: 0.5
+metadata:
+  period: year
+  unit: /1
+  label: England Council Tax Reduction pensioner pension contribution deduction rate
+  economy: false
+  reference:
+    - title: The Council Tax Reduction Schemes (Prescribed Requirements) (England) Regulations 2012 Sch. 1 para. 19(2)(b) and (c) and (5)(c) (employed earners)
+      href: https://www.legislation.gov.uk/uksi/2012/2885/schedule/1/paragraph/19
+    - title: The Council Tax Reduction Schemes (Prescribed Requirements) (England) Regulations 2012 Sch. 1 para. 29(1)(b)(ii), (2)(c) and (8)(b) (self-employed earners)
+      href: https://www.legislation.gov.uk/uksi/2012/2885/schedule/1/paragraph/29

policyengine_uk/parameters/gov/local_authorities/kingston_upon_thames/council_tax_reduction/means_test/pension_contribution_deduction_rate.yaml

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+description: The Kingston upon Thames Council Tax Reduction scheme deducts this share of pension contributions when it calculates the net earnings and self-employed net profit of a working-age applicant.
+values:
+  2026-04-01: 0.5
+metadata:
+  period: year
+  unit: /1
+  label: Kingston upon Thames Council Tax Reduction pension contribution deduction rate
+  economy: false
+  reference:
+    - title: Council Tax Reduction Scheme 2026 - 2027, paras. 52(3)(b) and (c) and (6)(c) (employed earners) and 61 (self-employed earners)
+      href: https://www.kingston.gov.uk/sites/default/files/2026-03/Council%20Tax%20Reduction%20Scheme%202026%20-%202027.pdf

policyengine_uk/parameters/gov/local_authorities/merton/council_tax_reduction/means_test/pension_contribution_deduction_rate.yaml

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+description: The Merton Council Tax Support scheme deducts this share of pension contributions when it calculates the net earnings and self-employed net profit of a working-age applicant.
+values:
+  2026-04-01: 0.5
+metadata:
+  period: year
+  unit: /1
+  label: Merton Council Tax Support pension contribution deduction rate
+  economy: false
+  reference:
+    - title: The London Borough of Merton Local Council Tax Support Scheme Rules 2026, paras. 52(3)(b) and (c) and (6)(c) (employed earners) and 61 (self-employed earners)
+      href: https://www.merton.gov.uk/sites/default/files/2026-03/Council%20Tax%20Reduction%20Scheme%20L%20B%20Merton%202026-27.pdf

policyengine_uk/parameters/gov/local_authorities/newham/council_tax_reduction/means_test/pension_contribution_deduction_rate.yaml

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+description: The Newham Council Tax Reduction scheme deducts this share of pension contributions when it calculates the net earnings and self-employed net profit of a working-age applicant.
+values:
+  2026-04-01: 0.5
+metadata:
+  period: year
+  unit: /1
+  label: Newham Council Tax Reduction pension contribution deduction rate
+  economy: false
+  reference:
+    - title: Council Tax Reduction Scheme 2026, paras. 52(3)(b) and (c) and (6)(c) (employed earners) and 61 (self-employed earners)
+      href: https://www.newham.gov.uk/downloads/file/10753/council-tax-reduction-scheme-2026

policyengine_uk/parameters/gov/local_authorities/oxford/council_tax_reduction/means_test/pension_contribution_deduction_rate.yaml

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+description: The Oxford Council Tax Reduction scheme deducts this share of pension contributions when it calculates the net earnings and self-employed net profit of a working-age applicant who does not receive Universal Credit. An applicant who does is assessed on the net earned income DWP provides (Appendix 3), which the model does not yet do (issue 2520).
+values:
+  2026-04-01: 0.5
+metadata:
+  period: year
+  unit: /1
+  label: Oxford Council Tax Reduction pension contribution deduction rate
+  economy: false
+  reference:
+    - title: Oxford City Council Council Tax Reduction Scheme 2026 to 2027, Part 1 para. 18 (50% of contributions to occupational or personal pension schemes)
+      href: https://www.oxford.gov.uk/council-tax-reduction/council-tax-reduction-scheme-2026-27
+    - title: Oxford City Council Council Tax Reduction Scheme 2026 to 2027, Annex 5 (one half of personal pension scheme payments, self-employed earners)
+      href: https://www.oxford.gov.uk/council-tax-reduction/council-tax-reduction-scheme-2026-27/3
+    - title: Oxford City Council Council Tax Reduction Scheme 2026 to 2027, Appendix 3 (applicants who receive Universal Credit)
+      href: https://www.oxford.gov.uk/council-tax-reduction/council-tax-reduction-scheme-2026-27/4

policyengine_uk/parameters/gov/local_authorities/scotland/council_tax_reduction/means_test/pension_contribution_deduction_rate.yaml

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+description: The Scotland Council Tax Reduction schemes deduct this share of pension contributions when they calculate an applicant's net earnings and a self-employed earner's net profit, for applicants of pension age and for applicants under pension age with no award of Universal Credit.
+values:
+  2013-04-01: 0.5
+metadata:
+  period: year
+  unit: /1
+  label: Scotland Council Tax Reduction pension contribution deduction rate
+  economy: false
+  reference:
+    - title: The Council Tax Reduction (State Pension Credit) (Scotland) Regulations 2012 reg. 33(2)(b) and (c) and (4)(c) (employed earners of pension age)
+      href: https://www.legislation.gov.uk/ssi/2012/319/regulation/33
+    - title: The Council Tax Reduction (State Pension Credit) (Scotland) Regulations 2012 reg. 36(1)(b)(ii), (2)(c) and (8)(b) (self-employed earners of pension age)
+      href: https://www.legislation.gov.uk/ssi/2012/319/regulation/36
+    - title: The Council Tax Reduction (Scotland) Regulations 2021 reg. 50(3)(b) and (c) and (5)(c) (employed earners under pension age with no award of Universal Credit, from 1 April 2022)
+      href: https://www.legislation.gov.uk/ssi/2021/249/regulation/50
+    - title: The Council Tax Reduction (Scotland) Regulations 2021 reg. 51(9) (self-employed earners under pension age with no award of Universal Credit, whose net profit reg. 51(9) takes from SSI 2012/303 regs. 37 and 38)
+      href: https://www.legislation.gov.uk/ssi/2021/249/regulation/51
+    - title: The Council Tax Reduction (Scotland) Regulations 2012 reg. 35(3)(b) and (c) and (6)(c) and reg. 37(1)(b)(ii), (3)(c) and (9)(b) (persons under pension age, to 31 March 2022)
+      href: https://www.legislation.gov.uk/ssi/2012/303/contents/made

policyengine_uk/parameters/gov/local_authorities/wales/council_tax_reduction/means_test/pension_contribution_deduction_rate.yaml

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+description: The Wales Council Tax Reduction scheme deducts this share of pension contributions when it calculates an applicant's net earnings and a self-employed earner's net profit, for pensioners and for applicants who are not pensioners and have no award of Universal Credit.
+values:
+  2013-04-01: 0.5
+metadata:
+  period: year
+  unit: /1
+  label: Wales Council Tax Reduction pension contribution deduction rate
+  economy: false
+  reference:
+    - title: The Council Tax Reduction Schemes and Prescribed Requirements (Wales) Regulations 2013 Sch. 1 para. 13(2)(b) and (c) and (5)(c) (employed earners who are pensioners)
+      href: https://www.legislation.gov.uk/wsi/2013/3029/schedule/1/paragraph/13
+    - title: The Council Tax Reduction Schemes and Prescribed Requirements (Wales) Regulations 2013 Sch. 1 para. 23(1)(b)(ii), (2)(c) and (8)(b) (self-employed earners who are pensioners)
+      href: https://www.legislation.gov.uk/wsi/2013/3029/schedule/1/paragraph/23
+    - title: The Council Tax Reduction Schemes and Prescribed Requirements (Wales) Regulations 2013 Sch. 6 para. 15(3)(b) and (c) and (6)(c) (employed earners who are not pensioners)
+      href: https://www.legislation.gov.uk/wsi/2013/3029/schedule/6/paragraph/15
+    - title: The Council Tax Reduction Schemes and Prescribed Requirements (Wales) Regulations 2013 Sch. 6 para. 24(1)(b)(ii) and (c)(ii), (3)(c) and (9)(b) (self-employed earners who are not pensioners)
+      href: https://www.legislation.gov.uk/wsi/2013/3029/schedule/6/paragraph/24
+    - title: The Council Tax Reduction Schemes (Default Scheme) (Wales) Regulations 2013 Sch. paras. 39, 49 and 58
+      href: https://www.legislation.gov.uk/wsi/2013/3035/schedule
+    - title: The Council Tax Reduction Schemes and Prescribed Requirements (Wales) Regulations 2012 Sch. 1 paras. 13 and 23 and Sch. 6 paras. 15 and 24 (2013-14 schemes; revoked from 1 April 2014)
+      href: https://www.legislation.gov.uk/wsi/2012/3144/contents/made

policyengine_uk/parameters/gov/local_authorities/westminster/council_tax_reduction/means_test/pension_contribution_deduction_rate.yaml

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+description: The Westminster Council Tax Support scheme deducts this share of pension contributions when it calculates the net earnings and self-employed net profit of a working-age applicant. The council's published scheme says the default scheme forms the basis of its working-age scheme and does not restate this rule, so the default scheme's one-half is used.
+values:
+  2026-04-01: 0.5
+metadata:
+  period: year
+  unit: /1
+  label: Westminster Council Tax Support pension contribution deduction rate
+  economy: false
+  reference:
+    - title: Council Tax Support scheme for 2026/27, section 4 (the Default Scheme Regulations 2012 form the basis of the working-age scheme)
+      href: https://www.westminster.gov.uk/sites/default/files/media/documents/council-tax-support-scheme-for-2026-27.pdf
+    - title: The Council Tax Reduction Schemes (Default Scheme) (England) Regulations 2012 Sch. para. 52(3)(b) and (c) and (6)(c)
+      href: https://www.legislation.gov.uk/uksi/2012/2886/schedule/paragraph/52
+    - title: The Council Tax Reduction Schemes (Default Scheme) (England) Regulations 2012 Sch. para. 61
+      href: https://www.legislation.gov.uk/uksi/2012/2886/schedule/paragraph/61

policyengine_uk/tests/policy/baseline/finance/benefit/family/income_support/pension_contribution_deduction_rate.yaml

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+# Income Support deducts one-half of pension contributions from net earnings
+# (IS Regs 1987 reg 36(3)(b)) and net profit (reg 38(1)(b)(ii), (3)(c) and
+# (9)(b)), with no reference to Housing Benefit's share. The rates below 0.5
+# are model reforms, not current law.
+#
+# Each person earns 10,000 a year, below the personal allowance and the primary
+# threshold, so no income tax or National Insurance is due. The single
+# claimant's earnings disregard is 5 a week (260 a year) and a couple's 10 a
+# week (520 a year).
+
+- name: At current law Income Support deducts half of pension contributions
+  # 10,000 - 0.5 x 2,000 - 260 = 8,740. The same claimant without the
+  # contribution has 9,740 (means_test_income_members.yaml).
+  period: 2026
+  absolute_error_margin: 0.01
+  input:
+    people:
+      claimant:
+        age: 40
+        employment_income: 10_000
+        personal_pension_contributions: 2_000
+    benunits:
+      benunit:
+        members: [claimant]
+    households:
+      household:
+        members: [claimant]
+  output:
+    pension_contributions: 2_000
+    income_tax: 0
+    national_insurance: 0
+    income_support_applicable_income: 8_740
+
+- name: A reform of the Income Support share moves Income Support applicable income
+  # Model reform, not current law: 10,000 - 0.25 x 2,000 - 260 = 9,240, which is
+  # 500 more than at half: 2,000 x (0.5 - 0.25).
+  period: 2026
+  absolute_error_margin: 0.01
+  input:
+    gov.dwp.income_support.means_test.pension_contribution_deduction_rate: 0.25
+    people:
+      claimant:
+        age: 40
+        employment_income: 10_000
+        personal_pension_contributions: 2_000
+    benunits:
+      benunit:
+        members: [claimant]
+    households:
+      household:
+        members: [claimant]
+  output:
+    income_support_applicable_income: 9_240
+    # Housing Benefit keeps its own half: 10,000 - 0.5 x 2,000.
+    housing_benefit_net_earnings: 9_000
+
+- name: A reform of the Housing Benefit share leaves Income Support applicable income
+  # Model reform, not current law. Housing Benefit net earnings become
+  # 10,000 - 0.25 x 2,000 = 9,500; Income Support keeps 8,740.
+  period: 2026
+  absolute_error_margin: 0.01
+  input:
+    gov.dwp.housing_benefit.means_test.pension_contribution_deduction_rate: 0.25
+    people:
+      claimant:
+        age: 40
+        employment_income: 10_000
+        personal_pension_contributions: 2_000
+    benunits:
+      benunit:
+        members: [claimant]
+    households:
+      household:
+        members: [claimant]
+  output:
+    housing_benefit_net_earnings: 9_500
+    income_support_applicable_income: 8_740
+
+- name: A reform of a Council Tax Reduction share leaves Income Support applicable income
+  # Model reform, not current law. The claimant lives in England outside the
+  # councils whose schemes are modelled, so Council Tax Reduction reads the
+  # England default scheme's share: 10,000 - 0.25 x 2,000 = 9,500. Income
+  # Support keeps 8,740.
+  period: 2026
+  absolute_error_margin: 0.01
+  input:
+    gov.local_authorities.england.council_tax_reduction.default_scheme.means_test.pension_contribution_deduction_rate: 0.25
+    people:
+      claimant:
+        age: 40
+        employment_income: 10_000
+        personal_pension_contributions: 2_000
+    benunits:
+      benunit:
+        members: [claimant]
+        would_claim_uc: false
+    households:
+      household:
+        members: [claimant]
+        country: ENGLAND
+  output:
+    council_tax_reduction_applicable_income: 9_500
+    income_support_applicable_income: 8_740
+
+- name: A couple's contributions are summed at the Income Support share
+  # 20,000 - 0.5 x (2,000 + 1,000) - 520 = 17,980.
+  period: 2026
+  absolute_error_margin: 0.01
+  input:
+    people:
+      head:
+        age: 40
+        employment_income: 10_000
+        personal_pension_contributions: 2_000
+      partner:
+        age: 40
+        employment_income: 10_000
+        personal_pension_contributions: 1_000
+    benunits:
+      benunit:
+        members: [head, partner]
+    households:
+      household:
+        members: [head, partner]
+  output:
+    income_support_applicable_income: 17_980
+
+- name: A couple's Income Support applicable income falls by contributions times the change in share
+  # Model reform, not current law: 20,000 - 0.25 x 3,000 - 520 = 18,730, which
+  # is 750 more than at half: 3,000 x (0.5 - 0.25).
+  period: 2026
+  absolute_error_margin: 0.01
+  input:
+    gov.dwp.income_support.means_test.pension_contribution_deduction_rate: 0.25
+    people:
+      head:
+        age: 40
+        employment_income: 10_000
+        personal_pension_contributions: 2_000
+      partner:
+        age: 40
+        employment_income: 10_000
+        personal_pension_contributions: 1_000
+    benunits:
+      benunit:
+        members: [head, partner]
+    households:
+      household:
+        members: [head, partner]
+  output:
+    income_support_applicable_income: 18_730