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Updated September 2011
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R(CPAG) v Secretary of State for Work and Pensions – Housing benefit challenge
With effect from 1/4/11 the Government has introduced new rules in the Housing Benefit (Amendment) Regulations 2010 and the Rent Officers (Housing Benefit Functions) Amendment Order 2010 which together make the following changes to the housing benefit scheme.
a. They reduce the maximum size of a dwelling which can be paid for by housing benefit to 4 bedrooms.
b. They cap the LHA rates payable for each category of property to the following wherever the property is situated in the country:
- One bedroom in shared house £250
- One bed self contained £25
- Two bed £290
- Three bed £340
- Four bed £400
c. They remove the provision which allows a claimant to retain up to £15 where they rent a property below the LHA rate
d. They reduce the LHA rate from the median of rents in each BRMA to the 30th percentile, saving £1.201 billion over 4 years.
e. They allow for an additional room to be included in the size criteria for a non-resident carer of a disabled claimant, costing £60 million over 4 years.
The rules allow for the rate of HB to be protected for up to 9 months for existing claimants.
The issues in this case
CPAG has brought a case by judicial review challenging the first two of these changes; the reduction to 4 bedrooms and the overall cap. The case was heard on 21st and 22nd July and a decision is awaited.
The legal basis for CPAG’s challenge is as follows:
- The changes are contrary to what parliament intended the fundamental purpose of the housing benefit scheme to be; it was meant to be a national scheme to prevent homelessness. The overall cap would mean that a large area of central London would no longer be accessible to housing benefit claimants in the private rented sector.
- The Government has failed to have due regard to the general equality duties under the Race Relations Act 1976 and the Sex Discrimination Act 1975. It is likely that black and minority ethnic groups and lone parents will be disproportionately hit by both cuts being challenged.
R(CPAG) v 1. Secretary of State for Work and Pensions 2. Secretary of State for Education – Child Poverty Act Challenge
Section 2 Child Poverty Act imposes a duty on the Secretary of State to ensure that the targets set out in sections 3-6 are met by the target year of 2010. Sections 3-6 set out a series of statistical targets, as follows; that less than 10 per cent of children live in relatively low-income households; less than 5 per cent of children live in combined low-income and materially-deprived households; less than 5 per cent in absolute low-income households; reduce children in persistent poverty (target to be decided by 2015).
By s 9 Child Poverty Act 2010 the Secretary of State was obliged by 24th March 2011 to publish and lay before Parliament a UK strategy describing the progress s/he considered needed to be made to meet the targets in relation to the target year. The Act also establishes a duty to set up a Child Poverty Commission, which the government had to consult on the Child Poverty Strategy. The government had not set up a Child Poverty Commission by 24th March, and has still not established a Commission. On 5th April it published a strategy, which in CPAG’s view, does not describe the progress that needs to be made in relation to the targets.
Proceedings for judicial review have been issued challenging the government’s failure to comply with the terms of the Act.
The government is currently consulting on plans to introduce a reformed Commission which would have a reporting, rather than an advisory role.
JS v Secretary of State for Work and Pensions
The issue in this case is whether a French national who became temporarily unable to work due to pregnancy and childbirth and had no continuing employment rights retained a her status as a “worker” in EU law and therefore her right of residence in the UK when she claimed income support on grounds of pregnancy. The appeal was dismissed by the Upper Tribunal in JS v Secretary of State for Work and Pensions file reference CIS/339/2009.
This case was heard by the Court of Appeal on 20th June 2011. In a deeply disappointing judgment dated 13th July 2011 the Court of Appeal held that:
It was bound by its own decision in Secretary of State for Work and Pensions v Dias that Article 7(3) Directive 2004/38/EC was a complete codification of the circumstances in which someone can retain worker status.
Any discrimination against women caused by this interpretation is indirect, and is capable of justification.The court accepted the DWP’s justification that women in the late stages of pregnancy could be encouraged to come to the UK, find work for a week or two, and obtain worker status, and then claim benefits.
Further as it had been held by the Supreme Court in Patmalniece that discrimination in social security on the basis of residence is justified, therefore the argument that the rules discriminated against her on grounds of nationality did not apply.
CPAG believes this judgment is wrong in law for the following reasons:
1. The Court of Appeal was wrong to hold that it was bound by its own decision in Secretary of State for Work and Pensions v Dias [2009] EWCA Civ 807 [2010] 1 CMLR 4. The relevant part of that decision relates to a situation where the claimant did not return to work following a period of maternity leave. That situation is factually and legally distinct from the situation in this case, where the claimant ceased working because of pregnancy. That is firstly because both EU and UK legislation recognise that there comes a point in a pregnancy where a woman is incapable of work by reason of the pregnancy, which is unlike the situation where a woman is capable of work but decides not to return because of childcare responsibilities. Secondly only women can be affected by pregnancy, whereas either women or men can be affected by childcare responsibilities.
2. The Court of Appeal was wrong to hold that any discrimination was indirect; the effect of interpreting Article 7 of Directive 2004/38/EC so as to exclude women who are unable to work because of pregnancy from retaining their status as workers, and therefore to deny them a right of residence in these circumstances, is different and detrimental treatment on grounds of pregnancy and constitutes direct discrimination on the grounds of sex, see for instance C-177/88 Dekker.
3. The Court of Appeal was wrong to hold that any discrimination was justified by the aim of defeating benefit tourism and in particular that the Secretary of State was entitled to exclude the possibility that a national of another member state could come to the UK in an advanced state of pregnancy, work for a week, and then claim income support. It is submitted that this scenario is so far fetched as not to constitute reasoned justification at all; it is hardly likely that a woman in an advanced state of pregnancy will travel to another country where she has no links with any medical services, no family, no friends, no home and no job, merely in order to claim a few weeks' income support. In the unlikely event that a woman were to travel in these circumstances, the Appellant's evidence was that it is virtually impossible for a woman in an advanced stage of pregnancy to find work.
The claimant has applied for permission to appeal to the Supreme Court. The court of appeal’s judgment can be found here:
http://www.bailii.org/ew/cases/EWCA/Civ/2011/806.html
Potter v Secretary of State for Work and Pensions, joined with Minter v Hull City Council on appeal from Kingston upon Hull City Council v DLM (HB) [2010] UKUT 234 (AAC) And Secretary of State for Work and Pensions v JP [2010] UKUT 90 (ACC)
These cases are about how equal pay settlements made to local authority part time workers are to be treated for benefit purposes, whether they are to be treated as income or capital, and whether they are to be attributed to past or future periods.
In Minter in the Upper Tribunal, Judge Howell held that the compensation was to be treated as earnings attributable to a past period and that this created an overpayment which was recoverable from the claimant.
In Potter in the Upper Tribunal, Judge Jacobs held that similar compensation was to be treated as income and attributed as earnings over a future period.
In EM v London Borough of Waltham Forest [2009] UKUT 245 (AAC), a decision was taken by Judge Wikeley that two single status payments of £3,817.96 and £2,125.46 were to be treated as capital for housing benefit purposes. This case was not appealed further.
There were therefore three Upper Tribunal decisions all of which came to different conclusions about the treatment of these types of payment.
The case was heard by the Court of Appeal on 19th July 2011. A decision is awaited.
CIS/339/2009
The issue in this case is whether a woman who becomes temporarily unable to work due to pregnancy and childbirth and has no continuing employment rights has a right of residence in the UK. The appeal was dismissed by the Upper Tribunal. Permission to appeal to the Court of Appeal has been granted and an appeal has been lodged. We are waiting for a hearing date.
JB v Oxford City Council and SSWP (JSA) [2011] UKUT 96 (AAC) File no CIS/1936/2010 – meaning of “sheltered” accommodation
This case is about what “sheltered” accommodation means for the purposes of the housing benefit regulations. By paragraph 5 Schedule 1, service charges for fuel are ineligible to be met by housing benefit, unless they are in respect of services for communal areas. By paragraph 8 “communal areas” mean areas of common access in sheltered accommodation.
In this case the claimant, who had severe learning difficulties, was a housing association tenant who lived in a property with 4 other tenants, all with learning difficulties. They each had their own bedroom and shared a kitchen, bathroom, two toilets, two sitting rooms and one other room. Care, support and supervision were provided 24 hours a day with a room reserved exclusively for staff.
The local authority held that because the claimant was not in “sheltered accommodation” the part of the rent that was for service charges for fuel and cleaning relating to communal rooms could not be included in the claimant’s HB.
The claimant’s appeal was allowed by the UT. It was held that there was no statutory definition of “sheltered accommodation”; it was to be given a meaning consistent with the underlying purpose of the scheme, which was about financial assistance to enable people to be or remain in their accommodation and it was not to be given a narrow or technical meaning.
The local authority has applied for permission to appeal to the Court of Appeal..
Punakova C-148/11 (Joined with Czop C-147/11) – self employed workers and “Baumbast” rights
These cases are about whether a previously self employed carer of children in education has a right to reside in the UK following the ECJ’s decisions in Ibrahim C-310/08 and Teixeira C-480/08. The issue has been referred to the European Court of Justice. We expect it to be heard in the New Year.
SSWP v JS (IS) [2010] UKUT 347 (AAC) (file reference CIS/647/2009 – Whether A8 nationals who have worked less than 12 months have “Baumbast” rights
The Upper Tribunal held that the right to reside as the primary carer of a child in education who is the child of a migrant worker can apply to an A8 national, even where s/he has not complketed 12 months’ registered work. The child’s right to reside derived from Article 12 Directive 1612/68 and that right was not removed (or derogated from) by the legislation relating to Poland’s (in this case) accession to the EU.
B -v- Secretary of State for Work and Pensions
Overpayment caused by failure to disclose – whether overpayment recoverable – whether failure reasonable
This was an appeal to the Court of Appeal from the Tribunal of Commissioner's decision in CIS/4348/2003.
The claimant had been overpaid income support for her children when she failed to disclose that they had been taken into care. The appeal tribunal found that disclosure was not reasonably required of the claimant until she had been advised by a social worker to report the change as prior to that her learning difficulties had reasonably prevented her from appreciating the need to inform the DWP of this change.
Reversing this decision, and 20 years of case-law, the commissioners held that a duty to disclose information for the purposes of s 71 Social Security Administration Act 1992 arose under regulation 32(1) Claims and Payments Regulations. They further held that this duty was not subject to any test of reasonableness, and that providing the claimant knew the fact in question, she had breached this duty, and the overpayment was recoverable from her.
The Court of Appeal upheld the Commissioners’ decision. In their view the meaning of “failure to disclose” in section 71(1) admitted of no qualification in favour of claimants who did not appreciate that they had an obligation to disclose something once they were aware of it. Non-compliance with regulation 32 was not only a necessary but also a sufficient condition of the Secretary of State’s entitlement to recover under s 71(1). The Court said the DWP would have to decide as a matter of discretion, whether to recover overpayments in cases like this one, where the claimant did not realise whether they were being overpaid. It was told that the DWP had a policy on how the discretion should be exercised. The Court said that it should be made available to organisations such as CPAG and Cit A. See the article from the Welfare Rights Bulletin summarising the guidance and a copy of the guidance.
Leave to appeal to the House of Lords was refused. The claimant has made an application to the European Court of Human Rights. Observations have been submitted by both parties.
The issues before the ECtHR are:
- Whether the Secretary of State’s determination to recover an overpayment created an enforceable chose in action which interfered with her right to peaceful enjoyment of her possessions
- Whether the construction given to section 71 of the SSAA 1992 by the Court of Appeal discriminated against those incapable of understanding the requirement to disclose because they were treated in the same way as those who were capable of doing so and/or because they were treated differently from persons who were not aware of the material fact.
CIS/1224/2007– Regulation 1408/71, Directive 2004/38/EC
The issues in this case are as follows:
- Whether Article 10a EC Regulation 1408/71 means that an EU national who is habitually resident in the UK has a right to receive special non-contributory benefits
- Whether an EU national who is unable to work due to his/her partner’s illness retains a right of residence
This case has been stayed pending the outcome of the Court of Appeal’s decision in Patmalniece, the appeal against CPC/1072/2006.
McCambridge v 1. LB Hounslow 2. SSWP – File reference CH/2631/2008
This case was heard by the Upper Tribunal on 30th March 2010. The claimant lives with her adult daughter, who is treated as her non-dependent for HB and her granddaughter. The claimant’s daughter receives the childcare element of tax credits which she uses to pay for childcare. The issue in the case is whether the childcare element should be taken into account as the income of the non-dependant. The argument is that the housing benefit regulation which takes into account in full as a source of income for the claimant a non-dependent’s child care element paid to her (for her child care costs) in her working tax credit is unlawful (and ultra vires the Tax Credits Act 2002) because that Act only allows that sum to be used to pay for child care.
The claimant’s appeal has been dismissed in this case.
The claimant has been granted permission to appeal to the Court of Appeal on the issue of the meaning of “income”, and has filed a notice of appeal together with an application for permission to appeal on a second ground, which is whether this interpretation of the rules discriminates against women.
Test
cases needed
Child benefit delays
We are interested in challenging cases where there is an ongoing delay in dealing with child benefit claims. Citizens Advice has published a report on delays – see link below; which identifies the following areas of delay:
- Claims switching from one claimant to another
- New claims from people from Eastern Europe
- New claims from foreign nationals with new immigration status (eg asylum seekers who are granted refugee status or leave to remain)
We would be interested in hearing about cases where a delay is still ongoing and the claim has not yet been processed. Advisers should check first with HMRC whether the claim is likely to be assessed soon. If the claim has been assessed after a long delay, advisers may want to consider making a complaint to the parliamentary ombudsman.
http://www.citizensadvice.org.uk/index/campaigns/
policy_campaign_publications/evidence_reports/er_benefitsandtaxcredits/
child_benefit_delays__the_impact_on_cab_clients-2
Limitations on LHA room sizes
We are interested in challenging cases where families have had their housing benefit reduced following the introduction of a limit on the number of rooms allowed under the local housing allowance to five, in April 2009. Families had six months’ transitional protection when the change was introduced.
Right to reside cases
- EU nationals divorced from other EU nationals who claim IS as LPs or because they can't work for some other reason. Either "old" EU nationals or A8 nationals where either the claimant or their partner has done registered work for a year, or is self employed.
- EU nationals married to UK nationals and supported by them for over 5 years, then divorced and unable to work. "Old" EU nationals or A8 nationals after April 2009.
- Pregnancy cases – we are still looking for cases where claimant has to stop work because of pregnancy and claim IS in pregnancy period either because they have been dismissed or because they are doing heavy work, and has no continuing employment rights. Either "old" EU nationals or A8 nationals where claimant has done registered work for 12 months or is self employed.
- A8 nationals who are divorced or separated from UK nationals and have been refused jobseekers allowance on the basis that they do not have a right to reside in the UK.
If you are an adviser and you would like to refer a test case to us, please contact:
sclarke@cpag.org.uk or gtegg@cpag.org.uk
Scottish test cases
Please note that regrettably we cannot take referrals of test cases from Scotland. The reason for this is that CPAG’s only solicitor is based in London and we cannot apply for legal aid in Scotland or instruct counsel there.
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