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Summary

The claimant had undergone natural migration from income-related employment and support allowance (ESA) to UC. Her UC included a transitional SDP element, as well as a carer element. In 2021, having notified a change in circumstances – namely, having been diagnosed with polymyalgia – the claimant was assessed as having limited capability for work-related activity (LCWRA) and awarded the LCWRA element. Accordingly, the carer element was removed. The effect of the addition of the LCWRA element, and erosion of the transitional SDP element by the full amount of that, was immediately to erode the transitional SDP element to nil with an overall reduction in the UC (the claimant’s UC went from £975.20 to £879.98). The claimant argued that the erosion decision, removing the whole of the transitional SDP element and leaving her worse off, breached her human rights under Article 14 of the European Convention on Human Rights (prohibition of discrimination) read with Article 1 of Protocol 1 of the Convention (rights to property). On appeal, the First-tier Tribunal agreed that she had been discriminated against because that decision treated her, as a carer entitled to the carer element, differently to someone who was not a carer but who became entitled to the LCWRA element. The tribunal substituted a decision that the transitional SDP element was instead to be eroded only by the difference between the carer element and the LCWRA element.

Judge West, having allowed the Secretary of State’s appeal on the basis of an error caused by a mistake about the facts at the tribunal, nevertheless remade the decision in the claimant’s favour. The tribunal had not erred in holding that the claimant had been treated unlawfully by way of discrimination. It was a ‘stark fact’ that the claimant’s total UC award had decreased despite her needs increasing (which did not happen to other transitionally protected claimants on a change of circumstances which resulted in an increase in their needs). The judge was satisfied that ‘there is no justification for such differential treatment, indeed there is no real explanation for it’ (paragraphs 80–81). The judge made extensive reference to the decision of Judge Church in SSWP v JA [2024] UKUT 52 (AAC). Although in a different factual context (involving the replacement of an award of housing benefit with the housing element of UC), both cases concerned discrimination in regulation 55 and both concerned ‘the cliff-edge erosion at a stroke’ of the claimant’s transitional protection (paragraph 123). In providing a remedy for the discrimination, the tribunal had correctly read the provisions about erosion at regulation 55(2) and (4) of the Universal Credit (Transitional Provisions) Regulations 2014 No.1230, as meaning that only the difference between the carer element and the LCWRA element should be taken into account.

The Secretary of State argued that there had been no discrimination. Rather, the claimant’s real complaint was that when the LCWRA element was included, she lost the carer element. But under regulation 29 of the Transitional Provisions Regulations, a person simply could not be entitled to the LCWRA element and the carer element at the same time. The Secretary of State also argued that, regarding the alleged discrimination, there was no real comparator for how the claimant had been treated. Judge West disagreed with both those arguments. The Secretary of State’s reliance on regulation 29 was not an answer to the claimant’s case ‘that she has been treated differently, and less favourably, than other transitionally protected claimants, none of whom suffer a loss of benefit on a change of circumstances which result in their needs increasing’ (paragraph 84). On comparators, before the Upper Tribunal the claimant argued that the valid comparators were a transitionally protected non-carer who becomes entitled to the LCWRA element, or any other person with a transitional element who then has a change regarding a UC element – for example, where they also already have LCWRA and become a carer). The judge agreed that her proffered comparators were ‘plainly in an analogous situation’ to her. ‘All,’ said the judge, ‘are persons who were recognised as severely disabled through an award of the SDP [severe disability premium] and are persons whom the Secretary of State accepted as a matter of policy ought to be awarded transitional protection to protect them from a cliff-edge’ (paragraph 91).

Comment from CPAG

The outcome is that someone entitled to the carer element who then becomes entitled to the LCWRA element should only have their transitional protection eroded by the difference between the elements. See our article, Erosion – where are we now?

Decision in brief

Applies only to claims made after the date of the coming into force of the Order on 9 February 2023 – claims made before that date still fall to be determined with reference to the previous rules (ie, which did not provide for claimants who were a cohabiting partner, as the requirement was that they were married to, or in a civil partnership with, the deceased partner)

Decision in brief

Tribunal deciding appeal for original claim made an award and correctly limited the period of the award to the day before the date of the second claim – GG v SSWP (PIP) [2019] UKUT 318 (AAC) applied and followed

Decision in brief

Regulation 6(33) of the Social Security (Claims and Payments) Regulations 1987 – after improved award of personal independence payment by a tribunal – claim must be made within three months of the tribunal decision – but in this case the claimant made the claim 11 days before the tribunal made its decision – so backdating on this basis could not apply

Decision in brief

Correct application of regulation 35 of the Disability Assistance for Working Age People (Scotland) Regulations 2022 (ie, the ADP regulations) was to make 13 January the commencement date of the award

Decision in brief

Client appealed having had her adult disability payment unexpectedly reduced – First-tier Tribunal for Scotland declined jurisdiction on basis that claimant had not made a valid request for a redetermination and so no valid redetermination decision – but no requirement for a request to be valid that the claimant’s intention was to have their whole claim reconsidered

Decision in brief

That followed contact from the client on 18 August 2021, leading to form being issued by DWP in September 2021, a supersession decision of 18 November 2021 and mandatory reconsideration of 21 June 2022 – under paragraph 14 to Schedule 1 of the Universal Credit, Personal Independence Payment, Jobseeker's Allowance and Employment and Support Allowance (Decisions and Appeals) Regulations 2013, a supersession for change of circumstances that is advantageous to the claimant and has been notified more than one month after it occurred takes effect from the date of notification – that applied in this case and so the effective date was 18 August 2021

Summary

This decision of the Court of Appeal holds that, regarding a claimant paid four-weekly, the universal credit (UC) rule setting the earnings threshold for exemption from the benefit cap with reference to a monthly calculation of the level of earnings was not unlawful. In so holding, it rejected the previous decision of the High Court (R (Pantellerisco and others) v Secretary of State for Work and Pensions [2020] EWHC 1944 (Admin)) in this case.

The claimant (represented by CPAG) worked 16 hours a week at the national minimum wage rate. Crucially, for this case, she was paid on a four-weekly cycle, rather than by the calendar month. For 11 months of the year she was unable to qualify for exemption from the benefit cap in UC, as provided for by regulation 82 of the Universal Credit Regulations 2013, SI No.376. This was despite the fact that she was working for 16 hours a week at the national minimum wage rate. The problem was that she was only receiving payment for her work over 28 days rather than the full calendar month, with the result that in 11 months the level of her earnings was below the threshold set by regulation 82.

The court rejected the claimant’s argument that the use of earnings received in the calendar month as the basis of the threshold was unlawful on grounds of irrationality (as had been ruled by the High Court) and that an hours-related threshold should be used instead. Giving the lead decision, Lord Justice Underhill held that that ‘would involve a wholesale departure from a fundamental policy choice of precisely the kind with which the court should be very slow to interfere…’ and that the Secretary of State’s reasons for using a monthly earnings-related threshold were ‘legitimate and cogent’ (paragraph 72). Using averaging of earnings rather than actual receipts in each month ‘would seem to be the most natural way’ of eliminating the problem, but it was not irrational for the Secretary of State not to have done so (paragraph 76). Making such an adjustment was ‘a question for the Secretary of State…and not the court… If it were established that there was a straightforward solution which it was irrational for the Secretary of State not to have pursued the court could and should nevertheless intervene; but that is not the case’ (paragraph 80).

The court had reference to the fact that irrationality had been the basis of the decision of the court (regarding inflexibility in the allocation of double payments of monthly wages) in R (Johnson) v Secretary of State for Work and Pensions [2020] EWCA Civ 778, reported as [2020] PTSR 1872. But that similarity been that case and this one was superficial. In Johnson, the challenge was not at any ‘fundamental feature’ of the UC scheme, but was rather due to the ‘quirk’ of double payment due to mechanics of bank payment, and the solution was essentially one of ‘fine tuning.’ ‘The problem in the present case, by contrast,’ said the judge, ‘arises from the fact the claimant is paid by reference to a period which does not correspond to the assessment period which is a cornerstone of the regulations. That is a real and fundamental mismatch’ (paragraph 82). There was therefore nothing irrational in not electing to provide a solution to the problem, and the rule in regulation 82 was not unlawful.

Comment from CPAG

The court noted that the problem suffered by the claimant would also be suffered by a claimant working 16 hours a week and earning at the national minimum wage but paid weekly or fortnightly, but did not make any distinction in its findings. Whether the court’s identification of averaging as a viable solution will be attended to by the Secretary of State remains to be seen. See the article in Bulletin 285, p4.

Note: an application for permission to appeal to the Supreme Court was refused, see our test case update: Universal credit, benefit cap and those paid 4 weekly.

Summary

In this decision, the Court of Appeal unanimously held that the requirement in the ‘proof of payment’ rule in universal credit (UC) (at regulation 33(1)(za) of the Universal Credit Regulations 2013, SI No.376) already to have paid childcare costs before they can lead to an award of the childcare element was not unlawful. In so holding, it reversed the previous decision of the High Court in this case.

The rule was not (contrary to the finding of the High Court) unlawful as indirect discrimination on grounds of sex. Giving the lead decision, Lady Justice Andrews held the possible indirect different treatment of women was objectively justified (and so not unlawful). The High Court had wrongly considered that the Secretary of State needed to justify not adopting an alternative (ie, proof of liability) to the proof of payment rule; rather, the challenge involved focusing on the lawfulness of regulation 33 itself. ‘In fact,’ said Justice Andrews, ‘this was a classic example of a case in which a substantial degree of deference should have been afforded to the judgment of the decision maker, especially as the impugned measure had been subjected to parliamentary scrutiny, notwithstanding that this deference would be tempered to some extent by the fact that the ground of discrimination complained of was on the basis of sex, which would require more cogent reasons to justify it than if the differential treatment were on the basis of some other non-suspect ground’ (paragraph 99). The court considered that the evidence of the Secretary of State, ‘provided ample justification for the adoption of the proof of payment rule. The reimbursement model of payment of costs actually expended on childcare fitted with the overall architecture of UC, it was simple to understand and operate and it significantly reduced the problems that had caused major difficulties with the legacy system. The judge’s critique of the justification put forward for the rule failed to accord the appropriate degree of respect for the measure of judgment afforded to Ministers in this area of policy…’ (paragraph 113).

The rule was also not (again contrary to the finding of the High Court), irrational in the sense described by the Court of Appeal in R (Johnson v Secretary of State for Work and Pensions [2020] PTSR 1872. The court did not accept the analogy with Johnson, which concerned an ‘acknowledged arbitrariness’ in the rules about treatment of monthly earnings paid on a non-banking day, and involved a challenge to the decision not to provide a solution to that acknowledged problem (paragraphs 115–116). The ‘narrow confines’ of Johnson had been highlighted by the recent decision of the court in R (Pantellerisco) v Secretary of State for Work and Pensions [2021] EWCA Civ 1454. The high threshold for an irrationality finding was not met. ‘The challenge in the present case is not to a decision refusing to “fine tune” the UC system to cater for an arbitrary harmful impact of the type identified in Johnson. Rather, as in Pantellerisco, it seeks to stigmatise as unlawful one of the elements of the system which was deliberately chosen, and which potentially gave rise to hardship for those who were unable to comply with its requirements or found it difficult to do so. The proof of payment rule was adopted in order to reduce fraud and error and promote simplicity. It fits within the overall scheme of UC as a benefit to be paid in arrears, akin to a salary, supplementing income from work’ (paragraph 126). In conclusion: ‘This was not a case where there was an obvious straightforward solution which it was irrational for the Secretary of State not to have pursued…it cannot be said that “precluding a system where eligibility is based on liability to pay” struck the balance in a way which no reasonable Secretary of State would have done’ (paragraph 127).

Summary

The claimant suffered from alcohol dependency which affected his functioning in various ways, both physically and mentally. His application for PIP was refused. That decision was upheld by the First-tier Tribunal (FtT), which although finding the claimant to be a credible witness who had alcohol dependency, nevertheless also refused to accept his evidence on a number of points, and considered his drinking to be a ‘lifestyle choice.’

Judge Clough allowed the claimant’s further appeal and remitted the case to a fresh tribunal. The tribunal had erred in particular in making seemingly contradictory findings and not explaining how it resolved the case. ‘It is fair to say,’ she said, ‘that in the absence of reasons for the conclusions reached by the FtT in this case, particularly the contradiction of the appellant’s “credible” evidence on the matter, as well as a finding of him suffering from alcohol misuse but that his limited functionality was due to a “lifestyle choice”, it is difficult to comprehend how this decision was reached. By failing to adequately reason its findings in these regards, the FtT have materially erred in law in this case’ (paragraph 29).

The judge went on to review how alcohol dependency may affect functioning and set out some guidance for tribunals in assessing PIP entitlement in such cases. This included noting that the relevant medical term is now ‘alcohol use disorder’ (AUD), and that essential caselaw is R(DLA) 6/06 and SD v SSWP (PIP) [2017] UKUT 310 (AAC). More widely, said the judge, it was ‘ imperative that the FtT do not make finding that the appellant is alcohol dependent, and [my emphasis] that the consumption of alcohol is a “lifestyle choice” as was the case in the current appeal. These two findings are oxymoronic in nature. To say that an appellant has alcohol misuse, and that his/her alcohol consumption is a lifestyle choice, is akin to saying that the appellant has arthritis in his knees, and this arthritis, with associated pain in his knees, is a lifestyle choice: it does not make sense’ (paragraph 46).

In summary, tribunals were required to undertake a careful process of fact finding. The judge said: ‘Alcohol use disorder is a complex mental health condition, which can have very serious implications for a patient. It may lead to secondary and/or possibly unconnected medical conditions, and will have mental and/or physical impacts on an appellant. It is these impacts which may affect the appellant’s functionality in general and in relation to each of the PIP activities and descriptors. When a tribunal makes a determination of eligibility for an alcohol dependent appellant, it must be sure to very carefully consider “reliability” under regulation 4 of the PIP Regulations 2013, as well as the 50 per cent rule under regulation 7 of the PIP Regulations 2013. Both physical and mental impacts must be taken into account, and the evidence must be adequately, yet respectfully, tested before it can be said to be credible and reliable’ (paragraph 76).

Comment from CPAG

This decision does not break new legal ground regarding alcohol dependency and PIP (in essence the approach in R(DLA) 6/06 and in SD v SSWP is approved). However, it does provide a comprehensive review of the most important authority and the detailed fact finding that needs to be undertaken by tribunals in such cases.

Summary

The claimant had a conviction for benefit fraud involving failure to declare savings. Subsequently, three applications for housing benefit (HB) by the claimant had been refused by the local authority on the basis of its belief that the claimant had excess capital, despite the claimant saying he had spent the money to get rid of gambling debts, and those decisions had been upheld by appeal tribunals. In September 2019, the claimant made a fourth claim for HB. That was again refused. The First-tier Tribunal noted that the claimant had requested a determination on the papers rather than a hearing, drew an inference that he had something to hide, and in September 2020 (having considered the appeal on the papers) refused his appeal.

Judge Wikeley allowed the claimant’s further appeal, setting the decision aside and referring the case to a new tribunal. This was not on the basis of any finding about the claimant’s capital, which would need to be considered afresh by the new tribunal. Rather, the tribunal had erred in not properly considering the claimant’s reasons for not requesting a hearing and the possible need to facilitate a hearing for example by telephone. In his reasons for appealing to the Upper Tribunal, the claimant said: ‘I had paper tribunal because of COVID not to hide.’ Taking this and other relevant circumstances into account, Judge Wikeley concluded that the tribunal had erred on the basis that it had not been fair to proceed without a hearing. As he told the claimant when granting permission to appeal:

‘The first national lockdown began on 23 March 2020 and was still very much in force when the appellant completed the hearing enquiry form on 20 April 2020. The file made it clear that you were aged 74 at the time and had serious medical conditions including the loss of an eye and PTSD [post-traumatic stress disorder]. On that basis surely the natural and obvious inference was that you were staying at home for your own safety and security (and indeed in accordance with official government advice). It may be the tribunal has not done enough here to justify its reasons for proceeding under rule 27 (see eg, FY v Secretary of State for Work and Pensions (ESA) [2017] UKUT 501 (AAC))’ (quoted at paragraph 7).

There were two further reasons for the unfairness. The first of these also related to the COVID pandemic and in particular the availability of telephone hearings, the second to authority on dealing with the credibility of a witness. Again, the judge had set these out when granting permission to appeal (quoted at paragraph 7):

‘11. First, as the pandemic spread, the First-tier Tribunal office began arranging virtual hearings by using telephone hearings or video-platform hearings. The hearing enquiry form issued here implies the choice was either a face-to-face hearing or a paper hearing and nothing in between. If the appellant had been offered a telephone hearing, it is entirely possible that he may have accepted, but he was not given any such opportunity. Caselaw shows that a tribunal which fails to consider the option of adjourning for a telephone hearing may (not necessarily will) have erred in law: see eg, LO’K v Secretary of State for Work and Pensions (ESA) [2016] UKUT 10 (AAC); [2016] AACR 31.

 

‘12. Second, it was obvious on reading the papers on file that the credibility of the appellant’s account was critical. The council understandably pointed to the fact that there was a prior criminal conviction for dishonest non-disclosure of capital assets and that three previous tribunals had refused similar appeals brought by the appellant. Certainly, the fact that a claimant has been found to have lied in the past may indicate a propensity to lie (see eg, SR (Iran) v Secretary of State for the Home Department [2007] EWCA Civ 460). However, being an inveterate liar does not necessarily mean that the person concerned is not telling the truth on this occasion: see KM (Somalia) v Secretary of State for the Home Department [2009] EWCA Civ 466. Arguably, the central importance of credibility meant that the tribunal needed to hear at first hand from the appellant so his account could be properly tested. It is also unclear whether he had ever been advised as to the type of evidence that he might bring forward to support his case – eg, was there evidence of any counselling for gambling addiction? Had he discussed the problem with his GP? Was there evidence that family members could provide about his gambling addiction and debts?.’

Comment from CPAG

This decision is noteworthy in setting out how a claimant’s choice of a paper determination may have been influenced by the COVID pandemic, and how tribunals should bear that and related matters in mind when deciding whether it is indeed in the interests of justice to dispense with a hearing.

Decision in brief

Tribunal also erred (regarding daily living Activity 9) in placing too much emphasis on claimant’s ability to engage with other people face to face in the specific context of when in a Warhammer games shop: ‘Just because he was found to be able to engage face to face with people he doesn’t know at the Warhammer shop, it doesn’t necessarily follow that he would be capable of engaging with unfamiliar people face to face more generally (including with people who are not part of the wargaming subculture).’