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Four single mums win their Universal Credit challenge against the Secretary of State for Work and Pensions.
Four single mothers have won their case at the high court against the Secretary of State for Work and Pensions over the government’s universal credit scheme.
The claim for judicial review was filed by the Child Poverty Action Group on behalf of the mothers last March. It said the rigidity of the system resulted in some people being treated as receiving two monthly wages in one assessment period which affects the amount of their Universal Credit award.
The judges ruled that the Secretary of State “had wrongly interpreted” the relevant regulations. The ruling came on the same day that the Secretary of State, Amber Rudd, announced a partial reset on Universal Credit, including a u-turn on plans to extend the two-child benefits cap. She also said that the benefits freeze, in place since 2015, would end in 2020.
One of the mothers who took the case to the high court told the judge she had a UC assessment period which runs from the 30th of one month to the 29th of the next and was paid by her employer on the last working day of each month. As a consequence, there are some assessment periods when she was treated as receiving two monthly wages. The CPAG said this resulted in a dramatically reduced UC award, as she was treated as receiving twice the amount from income as was usually the case. It said this caused cash flow problems for people managing on a very tightly balanced budget.
The mother was also entitled to a working allowance so she also effectively lost out on the benefit of one working allowance against one month’s salary. This was not compensated by the fact that the following assessment period she was treated as receiving no wages and so got the maximum UC allowance.
Other claimants said their UC assessment period ran from 28th of one month to 27th of the next. They were paid monthly on the 28th, but when the 28th fell on a non-working day they were paid early resulting in two wages falling in one assessment period.
The CPAG argued that DWP’s refusal to adjust the claimants’ assessment periods to avoid this situation was discriminatory against working parents with children (one of the two groups who are entitled to a work allowance), as well as being irrational and undermining the legislative purpose of UC.
It said that, far from incentivising work, mirroring the world of work or ensuring consistency and predictability, the claimants’ fluctuating UC award meant that things would be much easier for them if they were not working and instead receiving, on a regular and entirely predictable basis, the maximum UC award.
CPAG’s solicitor Carla Clarke said: “Today’s result should mean that in future no one will lose out on their universal credit awards or face the hardship that my clients have faced simply because of when their payday happens to fall.”
Tessa Gregory, solicitor from Leigh Day who represented the first Claimant, Danielle Johnson, added: “In light of the judgment, Amber Rudd must take immediate steps to ensure that no other claimants are adversely affected and she should also ensure all those who have suffered because of this unlawful conduct are swiftly and fairly compensated.”