DWP to Pay Compensation to Universal Credit Claimants That Lost Out on Severe Disability Premium

A recent ruling in England could assist those that had been in receipt of receipt of disability premiums with legacy benefits and who have since migrated to Universal Credit.

The Department for Work and Pensions (DWP) has agreed to pay compensation to two Universal Credit claimants who had their income reduced after migrating to the new scheme, as there is no equivalent for Severe Disability Premium (SDP) or Enhanced Disability Premium (EDP) under Universal Credit.

Last month, the High Court of England and Wales ruled that the Secretary of State unlawfully discriminated against the claimants (full transcript of the proceedings available here). The claimants, had to claim Universal Credit following a move into an area where Universal Credit was in place, as a result of this they experienced a dramatic reduction in income due to there being no equivalent to SDP or EDP under Universal Credit.

Following this ruling, DWP has agreed to pay damages for the pain and distress the claimants experienced, in addition to a further payment reflecting the amount of income already lost as a result of migrating to Universal Credit.

This will go alongside with ongoing monthly payments of £170, to mitigate against the future reduction in income they will experience. While this case is not legally binding in Northern Ireland, it does provide a persuasive precedent. If housing advisers discover claimants in a similar position, they should cite this ruling in their representations.

Practitioners may also be interested in the Social Security Advisory Committee (SSAC)’s current consultation on The Universal Credit (Transitional Provisions) (Managed Migration) Amendment Regulations 2018.

Under the proposed amended regulations, Regulation 63 is set to prevent any further natural migration of legacy benefit claimants who are in receipt of SDP. Instead, these claimants are proposed to migrate to Universal Credit under the managed migration process (due to commence in 2019). This means Transitional Protection will be available to top up their award of Universal Credit. It is also proposed that those legacy benefit claimants in receipt of SDP who have already naturally migrated will have Transitional Protection retrospectively applied to their Universal Credit award and backdated.

Advice practitioners can read more about the SSAC’s consultation and respond to the consultation on the draft-amended regulations here.

The closing date for this consultation is 20 August 2018.