Correct the non-UK benefit receipt docs page (#842)

changelog.d/842-non-uk-benefit-receipt-page-corrections.changed.md

@@ -0,0 +1 @@
+Corrected the non-UK benefit receipt planning page (`docs/book/assumptions/non-uk-benefit-receipt-plan.md`): Microcosm UK's resident State Pension series removes pensions paid abroad but still includes care-home residents, the Enhanced FRS keeps its own targets, fraud and error overpayments reach households, so they are treated separately, Winter Fuel Payment has not been paid abroad since winter 2025-26, Housing Benefit doesn't pay for a care-home place, Attendance Allowance can be paid abroad in limited cases, and the overseas share of State Pension spending has fallen since 2019-20.

docs/book/assumptions/non-uk-benefit-receipt-plan.md

@@ -4,14 +4,19 @@
 **Planning page.** The data behind PolicyEngine UK is calibrated so that
 household benefit totals match published **DWP/HMRC/OBR totals**.
 Some of that outturn doesn't go to **UK private households**. It
-goes to people living abroad (exported pensions), people in
+goes to people living abroad (exported pensions) and to people in
 institutional accommodation outside the FRS sampling frame (care homes,
-hostels), and a small administrative-leakage residual. This page
+hostels). Fraud and error overpayments are a separate issue: claimants
+receive them but aren't entitled to them. This page
 sets out the proposed treatment, tracked in
 [#842](https://github.com/PolicyEngine/policyengine-uk/issues/842) (still
-open, October 2026). Calibration targets are now set in
-[Microcosm UK](https://github.com/PolicyEngine/microcosm), so most of the
-work below belongs there.
+open, October 2026). Microcosm UK, the dataset in policyengine.py's
+certified UK bundle, sets its calibration targets in
+[Microcosm](https://github.com/PolicyEngine/microcosm), so most of the work
+below belongs there. policyengine-uk-data's Enhanced FRS, which this
+repository's microsimulation test jobs and aggregate-impact report still run
+on, keeps its own target set, which still includes the OBR State Pension
+line.
 ```
 
 ## Why this matters
@@ -24,58 +29,81 @@ on a household the FRS samples. It doesn't:
   State Pension they built up. DWP's benefit expenditure tables report
   the amount paid to recipients abroad, and Stat-Xplore gives the
   caseload by country. None of these people are in the FRS.
-- **Disability Living Allowance and PIP paid abroad**: limited cases
-  under reciprocal agreements (EU and EFTA countries and a handful of
-  others).
-- **Institutional residents**: care-home residents receive most
-  benefits but the FRS doesn't sample care homes. Their entitlements
+- **Disability and carer benefits paid abroad**: limited cases. The DLA care
+  component, the PIP daily living part, Attendance Allowance and Carer's
+  Allowance can be paid to people living in an EEA country or Switzerland
+  who are covered by the Withdrawal Agreement; the mobility parts can't be
+  paid abroad. DWP's tables report each benefit's spending outside the UK.
+- **Institutional residents**: care-home residents keep their State
+  Pension and can get some other benefits (Pension Credit, or Attendance
+  Allowance if they pay for their own care), but the FRS doesn't sample
+  care homes. Their entitlements
   feed into the DWP outturn but not into PolicyEngine's `state_pension`
   totals.
-- **Administrative leakage**: fraud, error and advance payments that
-  appear in DWP cashflow but never reach an entitled person.
 
 Where a target includes these groups, calibration pushes their spending
 onto FRS households and **overstates** what UK private households receive.
 
-**Already done for State Pension.** Microcosm no longer binds the OBR State
+**Fraud and error** is a different case. DWP counts overpayments as benefit
+spending although they go beyond what claimants are entitled to: 3.2% of
+benefit spending in its FYE 2026 estimates, against 0.4% underpaid through
+official error. That
+money does reach households, so it doesn't overstate what they receive, but
+it matters where the model simulates entitlement rather than receipt.
+
+**Already done for State Pension paid abroad.** Microcosm no longer binds the OBR State
 Pension line. State Pension is now bound to resident figures from DWP
 Stat-Xplore (Great Britain) and the Northern Ireland Department for
 Communities, and the OBR line and DWP's "paid outside UK" line are kept as
-diagnostics. The plan is
-[microcosm#1069](https://github.com/PolicyEngine/microcosm/issues/1069) and
-the change landed in
+diagnostics. The plan began as
+[microcosm#1069](https://github.com/PolicyEngine/microcosm/issues/1069), which
+now tracks the open follow-ups, and the change landed in
 [microcosm#1084](https://github.com/PolicyEngine/microcosm/pull/1084)
-(merged 2 October 2026). The same question is open for other programmes.
+(merged 2 October 2026). The resident series still includes care-home
+residents. The same question is open for other programmes.
 
 ## Scope
 
 ### Phase 1: quantify the gap by programme
 
 For each benefit programme the calibration targets, identify the share
 of the published total that goes outside UK private households. DWP and HMRC
-publish enough data to assemble a first-pass table:
-
-| Programme | UK private households | Overseas | Institutional | Admin / error |
-|-----------|----------------------|----------|---------------|---------------|
-| State Pension | published | DWP overseas tables | -- | -- |
-| Pension Credit | published | small | minimal | minor |
+publish enough data to assemble a first-pass table. The fraud and error
+column is recorded separately: that money reaches households, so it isn't
+part of the gap.
+
+| Programme | Published total | Overseas | Institutional | Fraud and error |
+|-----------|-----------------|----------|---------------|-----------------|
+| State Pension | published | DWP "paid outside UK" line | care-home residents | F&E published |
+| Pension Credit | published | small (Great Britain residence required) | care-home residents (unquantified) | F&E published |
 | Universal Credit | published | minimal | small | F&E published |
-| Housing Benefit | published | -- | care-home component | F&E published |
-| Child Benefit | published | EU-treaty residue | -- | -- |
-| Disability Living Allowance / PIP | published | reciprocal residue | -- | -- |
-| Attendance Allowance | published | -- | care-home residue | -- |
-| Winter Fuel Payment | published | overseas eligible cohort | -- | -- |
+| Housing Benefit | published | -- | hostels (Housing Benefit doesn't pay for a care-home place) | F&E published |
+| Child Benefit | published | EEA, Switzerland and agreement-country residue | -- | F&E published (HMRC annual report and accounts) |
+| Disability Living Allowance / PIP | published | DWP "outside UK" lines | care-home residue (self-funders; both mobility parts) | F&E published |
+| Attendance Allowance | published | DWP "outside UK" line | care-home residue (self-funders) | F&E published |
+| Winter Fuel Payment | published | none since winter 2025-26 (recipients must be ordinarily resident in England, Wales or Northern Ireland) | care-home residents | -- |
 
 Sources: DWP *Benefit expenditure and caseload tables* and Stat-Xplore
 (payments abroad), the DWP *Fraud and Error in the Benefit System* annual
-release, and programme-specific breakdowns.
+release, HMRC's annual report and accounts (Child Benefit fraud and error),
+programme-specific breakdowns, and the rules on care homes
+([Housing Benefit Regulations 2006 reg. 9(1)(k) and (4)](https://www.legislation.gov.uk/uksi/2006/213/regulation/9)
+and the [pension-age equivalent](https://www.legislation.gov.uk/uksi/2006/214/regulation/9);
+[PIP Regulations 2013 reg. 28](https://www.legislation.gov.uk/uksi/2013/377/regulation/28);
+[DLA Regulations 1991 reg. 9](https://www.legislation.gov.uk/uksi/1991/2890/regulation/9))
+and on Winter Fuel Payment residence
+([SI 2025/969 reg. 2](https://www.legislation.gov.uk/uksi/2025/969/regulation/2)
+for England and Wales;
+[SR 2025/142 reg. 2](https://www.legislation.gov.uk/nisr/2025/142/regulation/2)
+for Northern Ireland).
 
 ### Phase 2: subtract from calibration targets
 
 Once the gap is quantified per programme, each **calibration target**
 should be the **UK-private-household part** of the total, not the full
-total. Microcosm's State Pension change does this by binding a resident
-series instead. Where no resident series exists, the target can carry an
+total. Microcosm's State Pension change does this for pensions paid abroad
+by binding a resident series instead; that series still includes care-home
+residents. Where no resident series exists, the target can carry an
 explicit private-household share (0–1, default 1) with a cited source for
 each override.
 
@@ -110,12 +138,12 @@ changes in this repo are small:
 
 ## Open questions
 
-- Should the `private_household_share` be year-varying (e.g. overseas
-  State Pension share rose post-EU exit) or held flat?
-- For Universal Credit, where the FRS *does* sample some
-  institutionalised people (in supported accommodation), what's the
-  correct private-household-share value: strictly < 1, or 1 minus a
-  smaller residual?
+- Should the `private_household_share` be year-varying (e.g. the overseas
+  share of State Pension spending was 4.3% in 2019-20 and 3.9% in 2024-25 in
+  DWP's outturn tables) or held flat?
+- For Universal Credit, if the FRS samples some people in supported
+  accommodation, what's the correct private-household-share value:
+  strictly < 1, or 1 minus a smaller residual?
 - For the household-calculator (single-household) interface, the
   private-household-share correction shouldn't apply, because the user
   represents their own household. Confirm the correction is only on the
@@ -124,7 +152,8 @@ changes in this repo are small:
 ## References
 
 - DWP, [Benefit expenditure and caseload tables](https://www.gov.uk/government/collections/benefit-expenditure-and-caseload-tables): spending by benefit, including payments abroad.
-- DWP, [Fraud and Error in the Benefit System](https://www.gov.uk/government/collections/fraud-and-error-in-the-benefit-system): administrative leakage estimates.
+- DWP, [Fraud and Error in the Benefit System](https://www.gov.uk/government/collections/fraud-and-error-in-the-benefit-system): estimates of benefit overpaid through fraud and error and underpaid through official error.
 - DWP, [Stat-Xplore](https://stat-xplore.dwp.gov.uk/): caseloads by benefit, including State Pension recipients by country of residence.
-- HMRC, [Tax credits and Child Benefit statistics](https://www.gov.uk/government/collections/personal-tax-credits-statistics): EU-treaty Child Benefit residue.
-- Issue: [#842](https://github.com/PolicyEngine/policyengine-uk/issues/842). Related: [#1621](https://github.com/PolicyEngine/policyengine-uk/issues/1621) (UK pipeline alignment) and [microcosm#1069](https://github.com/PolicyEngine/microcosm/issues/1069) (State Pension on resident figures).
+- HMRC, [Annual reports and accounts](https://www.gov.uk/government/collections/hmrcs-annual-report-and-accounts): Child Benefit error and fraud estimates.
+- GOV.UK, [Child Benefit if you leave the UK](https://www.gov.uk/child-benefit-abroad): when Child Benefit is paid for families abroad (EEA, Switzerland and social security agreement countries).
+- Issue: [#842](https://github.com/PolicyEngine/policyengine-uk/issues/842). Related: [#1621](https://github.com/PolicyEngine/policyengine-uk/issues/1621) (UK pipeline alignment) and [microcosm#1069](https://github.com/PolicyEngine/microcosm/issues/1069) (UK pensions follow-ups after #1084).