High Court chal­lenge to Univer­sal Credit for­mula

Western Daily Press (Saturday) - - Uk & World News - CATHY GOR­DON Press As­so­ci­a­tion

AM­BER Rudd has been urged to take “im­me­di­ate steps” over the way the con­tro­ver­sial Univer­sal Credit is cal­cu­lated fol­low­ing a High Court vic­tory for four work­ing sin­gle moth­ers.

A lawyer rep­re­sent­ing one of the suc­cess­ful women said the Work and Pen­sions Sec­re­tary should now “en­sure that no other claimants are ad­versely af­fected”.

Tessa Gre­gory, of law firm Leigh Day, who rep­re­sented part-time din­ner lady and mother-of-one Danielle John­son, of Keigh­ley, West York­shire, said the min­is­ter should also “en­sure all those who have suf­fered be­cause of this un­law­ful con­duct are swiftly and fairly com­pen­sated”.

Her com­ments came after two judges in Lon­don an­nounced on Fri­day that Ms John­son and three other sin­gle moth­ers – who say they are strug­gling fi­nan­cially be­cause of the way the wel­fare sys­tem op­er­ates – had suc­ceeded in their ju­di­cial re­view ac­tion against the Work and Pen­sions Sec­re­tary.

The women ar­gued that a “fun­da­men­tal prob­lem” with the scheme means that their monthly pay­ments vary “enor­mously” and they end up out of pocket.

They chal­lenged the method used by the De­part­ment for Work and Pen­sions when cal­cu­lat­ing the amount payable un­der the Univer­sal Credit Regulations 2013.

Lord Jus­tice Singh and Mr Jus­tice Lewis gave their rul­ing fol­low­ing a hear­ing in Novem­ber, when they were told the women are strug­gling to man­age their house­hold bud­gets, and some have fallen into debt or had to rely on food banks.

Lawyers for Ms John­son, Claire Woods, Erin Bar­rett and Katie Stewart said the prob­lem was likely to af­fect “tens of thou­sands of peo­ple” claim­ing Univer­sal Credit, which was in­tro­duced to re­place means-tested ben­e­fits in­clud­ing in­come sup­port and hous­ing ben­e­fit.

They said the prob­lem high­lighted by the case arose when claimants were paid by em­ploy­ers on a date that “clashes” with their as­sess­ment pe­riod for Univer­sal Credit.

For ex­am­ple, they pointed out that if a claimant was paid early be­cause of a week­end or bank hol­i­day, the sys­tem counted them as hav­ing been paid twice in one month and they re­ceived a “vastly re­duced” Univer­sal Credit pay­ment.

The judges con­cluded that the “Sec­re­tary of State had wrongly in­ter­preted the rel­e­vant regulations” and reached “flawed” de­ci­sions in the women’s cases. They ex­plained that as each of the women re­ceived her salary on or around ei­ther the last work­ing day or last bank­ing day of the month, there were times when salaries payable in re­spect of two dif­fer­ent months were paid dur­ing one monthly as­sess­ment pe­riod for Univer­sal Credit.

Claimants with child­care re­spon­si­bil­i­ties or lim­ited ca­pac­ity for work are al­lowed to re­tain a cer­tain amount of their earned in­come – known as a work al­lowance – for each monthly as­sess­ment pe­riod, with­out that af­fect­ing the amount of Univer­sal Credit to be re­ceived.

The le­gal ac­tion by the four cen­tred on de­ci­sions re­lat­ing to an as­sess­ment pe­riod when they were treated as re­ceiv­ing two months’ salary in that pe­riod and were al­lowed to re­tain only one work al­lowance – the sum of £192.

In a sum­mary of their de­ci­sion, the judges said the Sec­re­tary of State was “wrong to treat the com­bined salaries for two dif­fer­ent months as the amount of earned in­come re­ceived in re­spect of a sin­gle monthly as­sess­ment pe­riod, sim­ply be­cause both salaries hap­pened to have been re­ceived within that as­sess­ment pe­riod be­cause of the dates on which they were paid”.

Am­ber Rudd an­nounc­ing that plans to ret­ro­spec­tively ex­tend the two-child ben­e­fit cap to new Univer­sal Credit claimants are to be scrapped

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