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Summary

In this decision, the Court of Appeal dismissed the appeal of the Secretary of State against the previous decision of the Upper Tribunal (SSWP v AT (Aire Centre and IMA intervening) [2022] UKUT 330 (AAC)). The Upper Tribunal had held that the right to ‘dignity’ under Article 1 of the Charter of Fundamental Rights of the European Union (‘the Charter’) continued, after Brexit, to apply in certain circumstances, so that a refusal of benefit (in this case, universal credit (UC)) was capable of breaching the right of the claimant to live in ‘dignified conditions’. The claimant was a Romanian national whose only right to reside was pre-settled, had suffered trauma and was living in a refuge, and had only child benefit as income. 

The Secretary of State challenged the Upper Tribunal decision essentially on the basis that: (1) the Charter simply no longer applied following the transition period after Brexit; (2) even if it did, there was a sufficient defence that ‘in principle’ the UK’s existing law was capable of providing sufficient support, even if it did not in practice, and that in any event it was the responsibility of local authorities to provide such support so that any alleged breach must be enforced against them on judicial review and not against the Secretary of State for Work and Pensions; and (3) that in any event the only fundamental right that could apply was under Article 3 of the European Convention on Human Rights (ECHR) (on degrading and inhuman treatment), with the facts in this case coming nowhere near to breaching that. 

The Court of Appeal unanimously rejected the Secretary of State’s arguments and dismissed his appeal. Giving the lead decision, Lord Justice Green held that, on a ‘normal interpretation’ of the terms of the Withdrawal Agreement between the UK and the European Union, the Charter continued to apply, albeit within limits (paragraph 82). The Upper Tribunal had correctly identified that the Court of Justice of the European Union (CJEU) in Case C-709/20 CG v The Department for Communities in Northern Ireland EU:C:2021:602 (15 July 2021) had applied Charter rights to someone who had rights under the Agreement. That included that, when refused one form of support, the host state must determine whether the person was in need of other support to ensure their dignity and make their residence viable (paragraph 91); and that right was a ‘continuing’ right and not one (as argued by the Secretary of State) that ended with the close of the ‘transition period’ on 1 January 2021 (paragraphs 96–97). The Charter right to dignity in Article 1 was not co-extensive with Article 3 of the ECHR, despite the possibility of some overlap, and ‘the benchmark’ for determining whether there was a breach of Article 1 was that taken by the CJEU in CG (paragraph 113). 

The Secretary of State’s ‘in principle’ argument (ie, that whether other support was actually available to the claimant was irrelevant) was inconsistent with the decision of the CJEU in CG, with Article 4 of the Withdrawal Agreement and with principles governing how fundamental rights were to be protected. Also, the UK system as presented by the Secretary of State did not seem ‘even in principle’ to be capable of protecting a person such as the claimant (paragraph 123). For example, a person only with pre-settled status was ineligible for housing and homelessness support and child benefit (the latter of which seemed to have been paid in error in this case). Although a claimant with a child might theoretically be entitled to local authority support under section 17 of the Children Act 1989, the Upper Tribunal had correctly held that whether that did indeed prevent a breach of the claimant’s Charter rights depended on the evidence in the individual case. The Court of Appeal went on to conclude that the arrangements under the Children Act were ‘subject to serious legal and financial constraints’ and that, on the evidence, allocation of responsibility to local authorities did not meet the test for meeting the continuing duty to ensure the claimant’s Charter rights were effective (paragraph 169). The Upper Tribunal had also been right to say that an ‘individualised assessment’ of the claimant’s position was required in every case and that was mandated by the CJEU decision in CJ. That court had referred to a need to check that the claimant and the children for which they are responsible are not exposed, by the refusal of support, to ‘an actual and current risk’ of violation of their Charter rights. Here, ‘risk’ involved an element of forward looking, so that it did not only arise when it actually occurred, and other state support was only to be taken into account ‘if they are available there and then’ (paragraphs 153–156). 

Comment from CPAG

In effect, this decision leaves the decision of the Upper Tribunal in this case intact, and consequently the legal position of claimants with rights under the Charter unchanged. See the article in Bulletin 297, p7 for more.

For further details see our test case update: Destitute EU nationals with PSS can rely on EU Charter of Fundamental Rights to obtain universal credit.

Summary

The claimants argued that, by refusing to consider a reduction (on grounds of hardship) in an individual case of the deduction for court fines from an award of universal credit (UC), the Secretary of State unlawfully fetters her discretion under the law. The Secretary of State argued that she has a policy of deducting at a fixed rate; any change must be achieved by the individual applying to the magistrates’ court to vary the rate of payment of the fines.

In the High Court, Mr Justice Kerr allowed the claimants’ applications for judicial review. The Secretary of State was unlawfully fettering her discretion in the way the claimants argued. The possibility of the claimant applying to the court did not alter that. Deductions from court fines for UC were permissible under regulation of the Fines (Deductions from Income Support) Regulations 1992. They allow deductions from a range of rates, from a minimum of 5 per cent of the claimant’s standard allowance to a maximum of £108.35 a month. The Secretary of State insisted that the only factor meaning that the rate selected should be changed was the policy of not making overall deductions of more than 30 per cent of the standard allowance – ie, so that a request for a lower deduction for court fines on the basis of hardship would not be considered if that limit was not engaged. Mr Justice Kerr held that that policy was to fetter the discretion provided, in an individual case, by the regulations: ‘I conclude that the Secretary of State's policy and practice are not lawful in their present form. There would be no legal difficulty if the deductions policy admitted of exceptions, even rare exceptions, in individual cases. The claimants themselves accept that. But it does need revising to enable that to happen’ (paragraph 92).

The judge rejected other arguments made by the claimants. He held that the policy was not unlawful on the basis that it was irrational: ‘The Secretary of State is right to say that it is a matter for her judgment what policy to adopt and how to strike the balance between effective fine collection and any financial hardship that may cause in individual cases’ (paragraph 100). He also rejected an argument by one of the claimants that the policy constituted discrimination against him on grounds of disability under the Equality Act 2010: ‘The evidence is not sufficient to support a finding by this court of “particular disadvantage” for indirect discrimination purposes and “substantial disadvantage” for the purposes of the reasonable adjustments duty’ (paragraph 117). Finally, he rejected an argument by one of the claimants that the policy was unlawful because the Secretary of State, by failing to carry out an equality impact assessment before adopting the policy of an overall 30 per cent limit to deductions, had has failed to perform her duty (regarding disabled people on UC) under section 149 of the Equality Act. It was true that there had not been such an assessment and in that sense the Secretary of State had failed in her duty. But to have done so on this point would not have made a substantial difference to the outcome for the claimant and people in his position. The judge considered it ‘highly likely that the deductions policy would have been adopted anyway’ (paragraph 132).

Comment from CPAG

The judge did not hold that the policy of making deductions from UC for court fines was unlawful. Rather, the policy of not considering requests for variation of the rate of deduction on the grounds of hardship in an individual case was to fetter the discretion that should apply. It is understood that the Secretary of State has permission to appeal.

Summary

This decision of the Upper Tribunal for Scotland concerns ADP and the approach adopted by the First-tier Tribunal for Scotland (FTS) in considering the appeal. 

The claimant in her claim for ADP reported a number of mental health problems, including anxiety and PTSD. Her GP, having been contacted by Social Security Scotland (SSS), said that the claimant had reported such problems, that she had declined medication and had been signposted to the local Mental Health Wellbeing Hub. The initial decision scored the claimant insufficient points to qualify for any award of ADP. That decision was not changed on redetermination and the claimant appealed to the FTS. Although SSS now submitted to the tribunal that the claimant should qualify for the enhanced rates of both components of ADP, the FTT considered the case on the papers and (without calling for any further evidence) refused the appeal, actually reducing the points originally awarded. 

Lady Poole allowed the claimant’s further appeal and remitted the case to a new FTS. The tribunal had, on the facts of the case, erred ‘by acting with procedural impropriety’, by failing to consider its powers to call for further evidence (paragraph 35). At the heart of the FTS’s decision it had stated that if the claimant’s condition were as bad as she had claimed, there would have been extensive records with her GP; but that no such records, or letters from a consultant psychiatrist or clinical psychologist had been provided to indicate a severe and enduring mental health diagnosis. Lady Poole considered that, given the admitted gaps between what the claimant reported and much of the evidence before it, the FTS ‘erred by failing to consider whether it should exercise any of its procedural powers to obtain further evidence’ (paragraph 21). For example, it could have issued a direction that the claimant should be given the opportunity to mandate the obtaining of medical records from the GP, and to attend an oral hearing to give evidence in person. 

Parties should be given a proper opportunity to participate in an appeal. In this case, the claimant had said that she had not requested an oral hearing because she thought the appeal would be allowed. That was due to her misunderstanding the status of the submission to the tribunal (now supporting the appeal) by SSS, which was not binding on the tribunal. Here, it was a ‘reasonable inference’ that she would have been open to attending an oral hearing had she correctly understood the position, and the FTS erred in ‘failing to consider exercising its inquisitorial powers to recover further evidence and enable further participation’ (paragraph 23). Finally, Lady Poole pointed out that the ADP rules adopted the same framework for entitlement as did personal independence payment (PIP), and that PIP caselaw ‘may provide guidance when considering similar concepts’ in the ADP rules (paragraph 34). In this case, SSWP v GJ [2016] UKUT 8 (AAC) was likely to be of assistance in considering the ADP daily living activities 7 and 9, and MH v SSWP [2016] UKUT 531 (AAC) in considering mobility activities. 

Comment from CPAG

It is inherent, even though not explicitly stated, in this decision that for ADP (as for PIP) it is not required have a formal diagnosis in order to be regarded as having a disability. It would seem as if the First- tierTribunal also neglected that point.

Summary

In this judicial review case in the High Court, it was held that the requirement in the universal credit (UC) rules already to have paid childcare costs (referred to as the ‘proof of payment’ rule) before they can lead to an award of the childcare element was unlawful. The rules were in breach of the claimant’s human rights and were irrational. It was, however, for the Secretary of State to devise a remedy.

The claimant was a single mother who wished to work but was unable to do so without help to cover childcare charges. She was liable for childcare costs that would have been eligible for the childcare costs element, but said that, because of the proof of payment rule (at regulation 33(1) of the Universal Credit Regulations 2013, SI No.376), she could not afford to pay the fluctuating costs of childcare, had incurred debts and ultimately had to reduce the number of hours she works. She argued that, by failing to provide for the payment of childcare charges which have been incurred but not paid, the Secretary of State had: (1) subjected her to unlawful indirect discrimination on grounds of sex, contrary to Article 14, read with Article 8 and/or Article 1 of Protocol 1 to the European Convention on Human Rights, and (2) acted irrationally in the sense described by the Court of Appeal in R (Johnson) v Secretary of State for Work and Pensions [2020] PTSR 1872.

The rules required the claimant to have actually paid the childcare charges before the childcare element became payable. This was in contrast to the rules on the housing costs element, which required liability for relevant housing costs, but not their payment, before the element became payable. Mr Justice Chamberlain approached the issue by deciding it showed that it ‘is conceptually possible to have a system based on liability to pay (rather than actual payment) which is consistent with the principle of payment in arrears’ (paragraph 27(c)).

The judge considered that the proof of payment rule was indirectly discriminatory on grounds of sex. The claimant’s evidence (which was a mix of official data and qualitative evidence) showed that the rule ‘has material adverse (and therefore "prejudicial") effects on a significant number’ of those entitled to the childcare element (paragraph 152). Further, that had a disproportionate effect on women, as the evidence showed that those claiming the childcare costs element were overwhelmingly female. This was in contrast to the housing costs element, where the Secretary of State had chosen instead to require liability rather than upfront payment, and there was no evidence of a gender disparity in claimants. Further (because of pay disparity between men and women), the rules meant that ‘women are substantially more likely than men’ to be denied access to the childcare costs element (paragraph 159). This discrimination could not be justified. Applying the test of whether the measure (in this case, the decision to apply the proof of payment rule without exceptions) was ‘manifestly without reasonable foundation’, there was no evidence that ministers had ever considered whether to require liability rather than actual payment. Neither was it immediately apparent that requiring liability would be prejudicial to concerns to avoid fraud and error. The rule therefore lacked a reasonable foundation and was not objectively justified (paragraphs 167–174).

The proof of payment rule was also unlawful because it was irrational. As Rose LJ held in Johnson, the key question is very similar to that which arises when considering objective justification: ‘has a reasonable balance been struck by the SSWP [Secretary of State for Work and Pensions] – or rather is it possible to say that no reasonable Secretary of State would have struck the balance in the way the SSWP has done in this case?’ Rejecting direct payment of childcare charges or vouchers was a rational choice. But the same was not true of the decision to require prior payment rather than liability. There was no evidence that ministers had considered that and no evidence that requiring liability instead would be prejudicial to accuracy or disproportionately expensive, while there was evidence that the prior payment rule had the antithetical result of forcing some claimants to reduce hours of work in order to reduce their childcare costs. The judge concluded that the proof of payment rule, ‘insofar as it precludes a system where eligibility is based on liability to pay, is irrational’ (paragraphs 175–178).

Comment from CPAG

Although the judge held the prior payment rule to be unlawful, he left it for the Secretary of State to devise a remedy. But permission to appeal against the decision has been granted.

Summary

The claimant was found to have failed the work capability assessment and so considered not to have limited capability for work. She had scored some points for being unable to get to an unfamiliar place without being accompanied by another person. On appeal, the First-tier Tribunal found that the ‘substantial risk’ exceptional circumstance (located, in the UC context, at paragraph 4(1) of Schedule 8 to the Universal Credit Regulations 2013, SI No.376) did not apply to the claimant. That was because the tribunal considered that the risk to the claimant’s health of travelling on an initially unfamiliar journey to a new job could be negated by the claimant’s being accompanied by a friend or family member. The tribunal did not consider whether there might be a substantial risk to the claimant (having been found fit for work) having to travel to and from the job centre.

Judge Wright allowed the claimant’s further appeal and remitted the case to a new tribunal. The tribunal had erred in assuming, rather than actually establishing on the evidence, that the claimant could in practice actually be accompanied by a friend or family member on an initially unfamiliar journey to a new job (so that the risk to her health would be negated). As had been held (regarding a similar question in the context of limited capability for work-related activity) in MP v SSWP (ESA) [2016] UKUT 502 (AAC), the tribunal must enquire into the actual availability of the third-party support, and not simply assume that it will be available.

Also, the tribunal had erred in failing to consider the risk to the claimant’s health from travelling to and from the job centre. Such a risk could be relevant to whether the claimant is held to have limited capability for work by virtue of the ‘substantial risk’ rule. In so holding, he addressed a split in the caselaw authority. In NS v SSWP (ESA) [2014] UKUT 115 (AAC), reported as [2014] AACR 33, Judge White had endorsed the finding of Judge Mark in IJ v Secretary of State for Work and Pensions (IB) [2010] UKUT 408 (AAC) that the relevance of considering whether substantial risk arises (as per the rule) from the claimant being found not to have limited capability for work meant that health problems of having to take part in interviews at the job centre could be relevant. That approach had been rejected by Judge Lane in MW v SSWP (ESA) [2015] UKUT 665 (AAC), who held that as a matter of law the only relevant risks were those associated with finding work, travel to and from that work and (in rare cases) the reaction to the ‘fit for work’ finding. That was based on Judge Lane’s reading of the Court of Appeal’s decision in Charlton v Secretary of State for Work and Pensions [2009] EWCA Civ 42. However, in the present decision Judge Wright held that MW was wrongly decided and declined to follow it. Apart from the fact that NS was reported authority and that other authorities (eg, JT v SSWP (ESA) [2018] UKUT 124 (AAC)) had followed that rather than the approach in MW, the approach in NS and in IJ was correct as a matter of statutory construction. The judge held: ‘The test is not a narrower one of “were the claimant found work or a job”. It is a wider test founded on a forward-looking exercise of considering the rational evidential consequences that may arise if the claimant is found not to have limited capability for work and the risks to health that may arise from those consequences because of the claimant’s ill health’ (paragraph 28). The test did not exclude taking into account travelling to and from the job centre and ‘engaging with others in so doing and at the job centre or job interview’ (paragraph 29).

Comment from CPAG

This decision should settle any remaining doubts as to the balance of authority on whether ‘substantial risk’ from travelling to the job centre and taking part in relevant interviews may be relevant. The balance of that authority is clearly that such matters can be relevant, in the context both of UC and employment and support allowance and the tests of limited capability for work and limited capability for work-related activity.

Decision in brief

Tribunal cited fact that the DLA evidence was five years old and that claimant had not requested the evidence – clear from CH and KN v SSWP [2018] UKUT 330 (AAC) that ultimately it is for the tribunal to make its own judgement as to whether DLA evidence might be relevant in a PIP appeal – it would be relatively rare for the Upper Tribunal to seek to interfere with decisions about that – but where the tribunal does expressly consider whether to obtain DLA evidence, it ought offer ‘a simple and succinct, perhaps even very succinct’ explanation of a decision not to do so – on facts of this case, the tribunal had narrowly failed to give an adequate explanation.

Decision in brief

A £50 civil penalty was also imposed under section 115D of the Social Security Administration Act 1992 regarding the failure to disclose – tribunal erred in both in failing to find that the claimant had ‘reasonable excuse’ for the failure, and in not exercising discretion about whether the penalty, even if applicable, should in fact have been applied – Secretary of State’s argument that the only criterion in the latter question is the amount of the overpayment (in particular whether it exceeded the Secretary of State’s ‘small overpayment threshold’) rejected as too narrow and restrictive – on the facts, claimant had a reasonable excuse for the failure to disclose in the light of his health problems; alternatively, a penalty should not have been applied on the particular facts of the case.

Decision in brief

It is correct (and accepted by the Secretary of State) that the claimant’s refugee status was voidable only prospectively and, on the facts, that was only from after the benefit awards had ceased anyway – however (even though the claimant was not a person subject to immigration control at the relevant times), the claimant had been overpaid benefit – claim by a person that was not real meant that the claims provisions in section 1 of the Social Security Administration Act 1992 not satisfied – the overpayments were recoverable from the claimant as use of a false identity to claim benefits was a ‘material fact’ for purpose of section 71 of the Act.

Summary

On 2 October 2017, the claimant’s entitlement to carer’s allowance (CA) was removed, on the basis that the daily living component of personal independence payment (PIP) was no longer payable to the disabled person being cared for. That PIP decision had subsequently been overturned on appeal. On 24 April 2020, the Secretary of State refused to reinstate the CA from 2 October 2017 (it would seem that decision was on the basis that the 2 October 2017 decision was not considered to have arisen from an official error). The First-tier Tribunal refused the claimant’s appeal. 

Judge Wright allowed the claimant’s appeal and remitted the case to a fresh tribunal. The tribunal had failed to apply the relevant law. It was not disputed that the tribunal had, and has, jurisdiction to consider the 24 April 2020 decision to determine whether the 2 October 2017 decision arose from an official error. The decision in PH v SSWP (DLA) [2018] UKUT 404 (AAC), reported as [2019] AACR 14, seemed to support that and the new tribunal should proceed on that basis. 

Regarding whether the 2 October decision arose from an official error, authority was to be found in CH/943/2003 and GH v Scarborough BC (HB) [2015] UKUT 197 (AAC). Those cases had considered whether there were grounds for a revision of a decision for ‘official error’ under regulation 1(3) of the Social Security and Child Support (Decisions and Appeals) Regulations 1999. The tribunal had erred in failing to apply those decisions. They were both in the context of overpayments of housing benefit but were nevertheless relevant as they considered whether an official error can be said to have arisen in a decision maker’s decision where an appeal tribunal later overturns a linked decision. Judge Wright referred in particular to paragraphs 22–25 of GH (which, although not reproduced or described by Judge Wright in the present decision, provide that ‘official error’ has occurred in these circumstances). 

Comment from CPAG

Although this decision is short and leaves it for the new tribunal to decide whether the claimant should succeed, it would seem to support the view that where, as here, a decision (eg, regarding entitlement to CA) is based on a linked decision (eg, regarding entitlement to PIP) which is later overturned on appeal, then the decision will fall to be revised on the basis of official error.

Decision in brief

Fear of dogs – may in principle be taken into account if a fear of dogs sufficient to lead to overwhelming psychological distress is present when a person is unaccompanied outdoors and attempting to follow the route of a journey, and is attributable to a physical or mental condition, and does impact adversely upon a person’s ability to follow the route of a journey, and is capable of being sufficiently reduced by the presence of another while the route is being followed.

Decision in brief

It did not matter for this purpose that at the time of the relevant decision, regulation 23(4)(b)(i) of the Child Benefit (General) Regulations 2006 referred to the Immigration (European Economic Area) Regulations 2006, when they had been replaced by Immigration (European Economic Area) Regulations 2016 (Schedule 7 to the 2016 Regulations ensured that regulation 23(4)(b)(i) was taken to refer to the 2016 Regulations).

Decision in brief

Backdating of disabled child element for previous tax years for ‘official error’ – failure of information sharing system between DWP and HMRC not an ‘official error’ for purposes of the Tax Credits (Official Error) Regulations 2003 (AG v HMRC [2013] UKUT 530 (AAC) cited) – claimant was under a duty to report changes and to correct notifications sent to her by HMRC – failure by claimant to notify a change of circumstances was the cause of the underpayment (AM v HMRC (TC) [2015] UKUT 345 (AAC) and JP v HMRC (TC) [2013] UKUT 519 (AAC) cited)