Court of Appeal upholds decision against DWP on backdated payments

Court of Appeal upholds decision that universal credit payments can be backdated on revision

but claimants risk still being thwarted by DWP IT design flaws
and those subject to managed migration face ‘double whammy’ loss of transitional protections and backdated payments

Universal credit (UC) claimants will continue to lose out on backdated payments, potentially worth thousands of pounds, unless the DWP changes the online UC claim form to address concerns raised in a Court of Appeal judgment today, Child Poverty Action Group (CPAG) warns.

The Court of Appeal today dismissed an appeal by the Secretary of State for Work and Pensions against an Upper Tribunal decision that an award of UC could be revised to include a backdated period of up to one month. However CPAG, who represented the UC claimant involved in the case, says that eligible claimants who do not receive advice about backdating could still miss out on one months’ entitlement because the online application form does not ask the right questions. And the consequences for those subject to managed migration onto UC could be even worse as they separately risk losing transitional protection.

Lynsey Dalton, solicitor at Child Poverty Action Group, said:

“We welcome the court’s decision that universal credit can be backdated on revision, meaning claimants can receive a month’s worth of additional payments. But DWP must urgently change the online claims form or else many, many more will miss out on this much needed financial support. It is unjust to make individuals pay the price for an inadequate application process, especially with hundreds of thousands of claimants being moved onto the universal credit system in the coming months.”

CPAG is calling for the claim form to be amended to help all claimants but particularly so this double whammy of vulnerable claimants losing both transitional protection and backdated payments can be avoided.

The decision

When a person makes a claim for UC, the payments can be backdated by up to one month where the claim could not have been made at an earlier date because of specified circumstances, which include having an illness or disability. There is nothing included in the online claim form that could identify whether the claimant meets the conditions, nor is there a free text box where a claimant could request backdating if they were aware of the possibility of backdating. Further, prior to today’s judgment, the DWP’s position was that, once a decision had been made on entitlement to UC, an eligible claimant could not ask for their award to be revised to include the additional month.

According to the DWP, the claimant could request backdating by making a note on their journal after making the claim, but before the decision on entitlement is made. The Court of Appeal stated that requesting backdating in this way “..can hardly be described as obvious…it will certainly not occur to everyone”, and ruled that a claimant can request revision of a decision not to backdate an award, as they would any other decision on entitlement.

This still only provides a solution for those claimants who are or become aware of the backdating rules and have the ability or support to request a revision. It does not resolve the issue of claimants not being asked the correct questions at the time of claiming, which would identify whether they qualify for backdating before the decision on the award is made. This was criticised by the Court of Appeal in this case, with the Court stating “It is very unsatisfactory that the system for claiming UC does not offer claimants any opportunity to ask to have their claim backdated”. The Court recognised that this issue also existed under legacy benefits, but found it regrettable that the opportunity was not taken to eliminate this problem with the introduction of the new UC system.

While this issue was not the subject of the case before the Court of Appeal, the Court’s rather strongly stated concerns should move the DWP to take action to resolve the problem:

“But I hope that the Court’s concern on this aspect will be drawn to the attention of the Secretary of State”.

Managed migration

The inadequacy of the claim form is of particular concern to charities and advisers at the moment, with managed migration from legacy benefits onto universal credit being rolled out rapidly and the DWP’s announcement of plans to send out 440,000 migration notices by September 2024. With so many new claims for UC being made in the coming months, it is worrying that the right questions are not being asked at the point of claim.

Under the managed migration process, claimants are sent a notice to make a claim for UC by a set deadline in order to avoid a gap in their benefits and secure transitional protection (which is intended to prevent a loss of income when claimants move to UC). On the deadline date, their legacy benefits end, regardless of whether they have made the claim for UC. The difficulties that may cause someone to miss their deadline, such as illness or disability or a period in hospital, are often the same difficulties that would qualify a claimant for backdating.

On missing their deadline date, these claimants will lose their transitional protection and will not receive any benefit payments until a claim for UC is made, potentially meaning several months of no income. It is therefore crucial that claimants who qualify for backdating are able to receive this additional payment quickly. Currently, they either need to be aware of the need to make a note on their journal before the award is decided or, following today’s judgment, they will need to request a revision and wait, possibly several months, for a decision on that revision request before receiving the backdated payment.

Notes to editor

The decision will be available online under case citation [2024] EWCA Civ 186

CPAG’s recent report on the managed migration process is available here

Contacts

Sara Ogilvie

07414 590449