2013 09 Welfare Benefits

Tuesday 1 October 2013

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The 'Bedroom Tax'

The UN's Special Rapporteur on the Bedroom Tax

According to media reports, (click here), the UN's Special Rapporteur on Housing, Raquel Rolnik, recommended that the ‘Bedroom Tax’ should be abolished. On 11 September 2013, she told the Guardian (click here) that:

“It's so clear that the government didn't really assess the impact on lives when it took this decision … The mechanism that they have in place to mitigate it – the discretionary payment that they provide the councils with - doesn't solve anything, it's for just a couple of months, and the councils cannot count on that on a permanent basis, they don't know if it's going to be available next year, so it's useless.”

The Special Rapporteur later published a Full Press Statement which is available on the Office of the High Commissioner for Human Rights website (click here). The Statement ends with a Summary of Recommendation -

“First, and foremost, I would suggest that the so-called bedroom tax be suspended immediately and be fully re-evaluated in light of the evidence of its impacts on the right to adequate housing and general well-being of many vulnerable individuals.

Secondly, I would recommend that the Government puts in place a system of regulation for the private rent sector, including clear criteria about affordability, access to information and security of tenure.

Thirdly, I would encourage a renewal of the Government’s commitment to significantly increasing the social housing stock and a more balanced public funding for the stimulation of supply of social and affordable housing which responds to the needs.”

The Special Rapporteur will present a report with her conclusions to the UN human rights council in Geneva early next year.

More than half of families hit by bedroom tax pushed into debt

On 19 September 2013, the National Housing Federation reported that more than half of housing association tenants affected by the bedroom tax have been unable to pay their rent. According to the report available on their website (click here): (i) 51 per cent (32,432) of residents affected by the bedroom tax have been unable to pay their rent between April and June this year; and (ii) 25 per cent of those affected by the tax are in rent arrears for the first time.

Labour to abolish Bedroom Tax if re-elected

Ed Miliband has announced at the Labour Party Conference that his party is committed to abolish the bedroom tax if Labour wins the next election. See media reports – the Independent (click here) and the Guardian (click here) and the BBC (click here).

Early Decisions on the Bedroom Tax Appeals

The first rulings on the ‘bedroom tax’ by first-tier tribunals against Fife Council and Westminster Council have been the subject of various reports in the media (see below). These raise the question of the extent to which first-tier tribunals may be able to take the room size (by reference to housing legislation on overcrowding) and the intended use of the room into account when assessing housing benefit appeals against the bedroom tax.

  • 23 September 2013 - Inside Housing – Details of tribunal rulings on bedroom tax in appeals against Fife council - click here.
  • 23 September 2013 - ITV report on success of appeal by blind man who used extra room to store equipment – click here.
  • 23 September 2013 – the Guardian - Bedroom tax defeat for Westminster council in landmark case - Barrister Surinder Lall, who is blind, wins appeal as his spare room stores essential equipment and has never been a bedroom – click here.
  • 27 September 2013 – Inside Housing - Bedroom tax guidance panned – click here.

The DWP is to appeal against two bedroom tax tribunal decisions which found that spare rooms were too small to count as bedrooms

On 22 September 2013 the DWP issued Urgent Bulletin HB U6/2013 - Removal of the spare room subsidy. This advises local authorities that the only consideration should be the composition of the household and the number of bedrooms designated by landlord, but not by measuring the room – click here. See also media report dated 27 September 2013 – Inside Housing - Bedroom tax guidance panned - click here.

DWP to write off up to £161m of money spent on universal credit IT

Whilst giving evidence to the Public Accounts Committee, the DWP’s finance director general, Mike Driver, confirmed that the Department will have to write off up to £161m of the money spent on universal credit IT. Click here for the Guardian report dated 11 September 2013 – “Iain Duncan Smith accused of misleading MPs over cost of IT failures - Officials say up to £161m could be written off on universal credit IT system – four times'


In Lloyd v London Borough of Lewisham [2013] EWCA Civ 923, [2013] WLR(D) 317 (Arden, Jackson and McCombe LJJ), the claimant was medically retired from the Metropolitan Police following an assault. She was contractually entitled to an ‘injury benefit’ from the staff superannuation scheme in the form of an annual allowance of approximately £15,000. The Court of Appeal rejected an argument that a civil service "injury benefit" payment fell within the disregard in paragraph 14(1)(e) of Schedule 5 to the Housing Benefit Regulations 2006 (SI 2006/213) which provides:“a payment…. received by virtue of any agreement or court order to make payments to the claimant in consequence of any personal injury to the claimant’ (other than payments from a trust or annuity covered by sub-paragraphs (c) or (d)).” The central issue was whether the payments were received by the claimant by virtue of an ‘agreement’ within the terms of the disregard. Applying Malekout v SSWP [2010] EWCA Civ 162, which was concerned with a provision in the Income Support regulations using identical wording, the Court held that the disregard only excluded sums paid under agreements which were made after the injury occurred, and did not cover income paid pursuant to a pre-injury agreement under the claimant’s contract of employment. Click here for judgment.

In AP v Secretary of State for Work and Pensions (ESA) [2013] UKUT 293 (AAC) (Judge Turnbull) the claimant suffered from agoraphobia. An appeal tribunal refused to award points under descriptor 16(c) (engagement in social contact with someone unfamiliar is not possible for the majority of the time due to difficulty relating to others or significant distress). Allowing the appeal, the Upper Tribunal held the ‘significant distress’ in descriptor 16(c) did not have to be caused by the need to interact with others alone. Accordingly the descriptor could apply where the significant distress was caused by the claimant’s agoraphobia or some other cause, notwithstanding that the claimant was capable of social engagement when accompanied or in familiar surroundings. Click here for judgment.

In Westminster City Council v AT and Secretary of State for Work and Pensions (HB) [2013] UKUT 321 (AAC) (Judge Wright), the claimant was a child aged 4 who made a claim for housing benefit (HB) because her parents were unable to do so. Her father, who was the tenant, was in prison, and her mother was a ‘person from abroad’. The local authority refused the claim on the basis that it was not reasonable to treat the claimant as liable for rent under regulation 8(1)(c)(ii) of the Housing Benefit Regulations 2006 (SI 2006/213). A First-tier Tribunal allowed the claimant’s appeal, but the local authority appealed to the Upper Tribunal. The Judge held that the claimant was not entitled to HB because she had not satisfied the national insurance number requirement set out in section 1(1A) of the Social Security Administration Act 1992. Click here for judgment.

In IN v AP v Secretary of State for Work and Pensions (DLA) [2013] UKUT 249 (AAC) (Judge Fordham), the claimant regularly walked across the road without looking despite oncoming traffic and needed someone to prompt him to look both ways. Despite the evidence that there was a safety issue the appeal tribunal refused the lower rate mobility component of DLA on the basis that ”it was unlikely that the claimant would avail himself of the accompaniment of another person in mobilising nor pay much heed to any supervision or guidance”. Allowing the appeal, the Judge held that the tribunal had erred in law as it had failed to make any finding on whether supervision or guidance could not, even to some extent, overcome the danger the claimant faced when walking out of doors, or increase his capability to walk safely out of doors. The judge said the correct approach to the statutory test was that set out by the Court of Appeal for Northern Ireland in Mongan v DSD [2005] NICA 16, which held that supervision and guidance can include the monitoring of the claimant by a person capable of intervening where necessary, and that it was sufficient if assistance and supervision would overcome the disability to some extent, or increase the claimant’s capability. The Judge set aside the tribunal’s decision, and remitted the appeal for rehearing by a new tribunal. Click here for judgment.

The argument that there should be an individual proportionality review in a case of refusal of benefits based on a failure to meet the right to reside test has recently been rejected by the Court of Appeal in Mirga v SSWP [2012] EWCA Civ 1952. However, that decision now has to be read in the light of Pensionsversicherungsanstalt v Peter Brey (C-140/12) (19 September 2013) [2013] WLR(D) 352 (Third Chamber). Mr Brey, had moved from Germany to Austria in order to work, and had been denied a means-tested supplement on his retirement on the basis that his German state pension did not provide sufficient resources for him to support himself because he would become a burden on the “social assistance system” within the meaning of article 7(1)(b) of Directive 2004/38, in Austria, which meant he could not obtain the right to reside there. The additional supplement was payable to those who had a right to reside in Austria. The Court ruled that EU law precludes national legislation whereby nationals of other member states who were not economically active are automatically barred by the host member state from receiving a particular social security benefit, which did not enable the competent authorities of the host member state to carry out an overall assessment of the specific burden which granting that benefit would place on the social assistance system as a whole by reference to the personal circumstances characterising the individual situation of the person concerned. Click here for judgment.

Comment The effect of Brey is that in appeals where the claimant has been refused benefit (i.e.. because they are economically inactive and do not have a derived right), the appeal tribunal should carry out an overall assessment of the specific burden which granting the benefit in question would place on the social assistance system of the UK as a whole, by reference to the claimant’s personal circumstances.

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