Supreme Court splits the baby over the benefit cap

Issue 245 (April 2015)

The Supreme Court’s judgment on the benefit cap in R (SG and others) was handed down on 18 March 2015. The Court was sharply divided over whether the benefit cap, which limits the amount of welfare benefits any family with children can receive to £500 a week, regardless of family size, breaches the Human Rights Act 1998. Mike Spencer comments.

A divided Court

Five judges heard the appeal brought by two single mothers and their children who had fled violent and abusive husbands. Shelter and CPAG intervened. All the judges agreed that the cap has a disproportionate impact on lone parents, who are overwhelmingly women. The issue for the Court was whether this brought the government in breach of its obligations under Article 14 of the Human Rights Convention (which prohibits discrimination on grounds of sex) and Article 3(1) of the UN Convention on the Rights of the Child (UNCRC) (which requires the government to treat the best interests of children as a primary consideration in all decisions).

The Court was split three ways. On one side were Lady Hale and Lord Kerr, who both gave strongly worded dissenting judgments. They would have allowed the appeal and declared that the regulations breach Article 14 of the European Convention. In introducing the cap, the government had failed to comply with its obligations under the UNCRC to treat children’s interests as a primary consideration. Lord Kerr said ‘it cannot be in the best interests of the children affected by the cap to deprive them of the means of having adequate food, clothing, warmth and housing’. Lady Hale thought that the children ‘suffer from a situation which is none of their making and which they themselves can do nothing about’. Seen in this light, the government’s justification for the discriminatory effects of the cap did not stack up:

‘Families in work are already better off than those on benefits and so the cap is not necessary in order to achieve fairness between them; saving money cannot be achieved by unjustified discrimination; but the major aim, of incentivising work and changing the benefits culture, has little force in the context of lone parents, whatever the age of their children. Depriving them of the basic means of subsistence cannot be a proportionate means of achieving it.’

On the other side were Lords Reed and Hughes. They found that the government had had the best interests of children in mind when introducing the cap. Further, the UNCRC was not incorporated into UK law and could not be relied upon in a case involving sex discrimination under the Human Rights Act. The courts should not interfere lightly with the decisions of parliament on issues of socio-economic policy and the government’s aims were legitimate. Although the short-term savings were a small proportion of the total welfare budget, they nevertheless contribute towards deficit reduction and the cap is also intended to change behaviour over the longer term.

That left Lord Carnwath to provide the swing vote. He agreed with Lady Hale and Lord Kerr that the government had not shown compliance with the UNCRC. Children’s benefits (such as child benefit and child tax credit) are intended for the children, not the parent:

‘The cap has the effect that for the first time some children will lose these benefits, for reasons which have nothing to do with their own needs, but are related solely to the circumstances of their parents.’

Tantalisingly, Lord Carnwath revealed that his ‘provisional’ view was that this also meant a breach of Article 14 and the cap was, therefore, unlawful. However, he changed his mind following post-hearing submissions. While he still thought the UK had not complied with the UNCRC, he agreed with Lord Reed and Lord Hughes that it could not be relied on in a case involving sex discrimination under Article 14 of the European Convention. As a result, the appeal was dismissed by a majority, with Lord Carnwath stating his hope that the government will reconsider the effect on children when it reviews the cap. The breaches of children’s rights would have to be settled ‘in the political, rather than the legal arena’.

So, we end up with what looks like a closely fought but unsatisfactory compromise: a majority found that the benefit cap breaches the UK’s international obligations towards children, but by another majority it is not unlawful under UK law.

What does this mean for the future of the cap?

As Lord Carnwath suggested, the Court’s finding that the cap breached the UNCRC may have political ramifications. The UK Children’s Commissioner and the UN Committee on the Rights of the Child may raise the issue with the government. There may be questions in parliament. A report from the Joint Committee on Human Rights, released on 24 March 2015 but drafted too late to take account of the judgment, was critical of the impact of austerity on children’s rights.

It is likely that the claimants will now apply to the European Court of Human Rights. Although traditionally the Court has left a wide margin of appreciation on matters of socio-economic policy, the strong dissenting judgments, together with the findings on the UNCRC, may embolden it to intervene in this case.

The judgment will also make it harder for any future government to lower the level of the cap. Any such reduction would have to be through primary legislation, as section 96 of the Welfare Reform Act 2012 links the figure to median earnings. A lower cap would mean more children would be effected and to a harsher extent, affecting the proportionality assessment under Article 14. Even Lord Reed for the majority linked the proportionality assessment to the fact that the cap was set at median earnings. The balance would be more likely to swing the other way should the cap be linked to a lower, more arbitrary amount.

 


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