Early warning system e-bulletin - March 2021 | CPAG

Early warning system e-bulletin - March 2021

24 March 2021
March 2021

CPAG collates case studies in our Early Warning System to demonstrate the impact of changes in the social security system on the wellbeing of children, their families and the communities and services that support them.

In this edition of the e-bulletin, we look at the top issues emerging to date in 2021, and provide an update on habitual residence tests and National Insurance numbers.

  1. Work capability assessments
  2. Assessment periods and earned income
  3. Overpayments
  4. Habitual Residence Test
  5. National Insurance numbers

Tell us what’s happening in your cases by completing an online form or emailing the Early Warning System.

1. Work Capability Assessments

EWS has received a high number of submissions concerning the delays in work capability assessments (WCAs) being carried out.

Face to face assessments have been suspended since March 2020, in response to the coronavirus pandemic. The DWP are carrying out telephone assessments where possible, but the number of assessments carried out in the quarter to June 2020 was down 58% compared to the previous quarter. Even where a telephone assessment is carried out, unless the decision maker determines that the claimant has a limited capability for work related activity (LCWRA), no outcome decision is made, and the claimant must wait for a face to face assessment. No indication has been given of when the face to face assessments will resume.

While they are waiting to be assessed, claimants receiving universal credit (UC) will not receive the LCWRA element that they might otherwise be entitled to. However, claimants receiving new style employment and support allowance (nsESA) face the additional problem of reaching the end of their 365 day entitlement without being assessed. Unless a decision is made that they have LCWRA, they will lose entitlement to nsESA. In response to a written question in the House of Commons, Justin Tomlinson, Minister for Disabled People, Health and Work, stated that there was no intention to extend the time limit for those still waiting to be assessed, but that a team was in place to identify nsESA cases that could be progressed without a face to face assessment.

On 5th February 2021, the DWP published an update, stating that the types of cases that could go through to decision had been expanded, see here. The DWP state that this will result in an increase in the number of decisions made. In order for us to monitor the effectiveness of this update, and the ongoing issues with WCA delays, please keep telling us about your experiences by completing our online form or emailing the Early Warning System.

2. Assessment Periods and Earned Income

Following the Court of Appeal's decision in SSWP v Johnson, Woods, Barrett and Stewart [2020] EWCA Civ 788, where CPAG successfully represented a group of claimants whose UC was reduced when they received two payments from their employer in one assessment period, EWS continues to receive submissions from UC claimants experiencing problems due to the way their assessment period falls in relation to their pay cycle.

As a result of the decision in Johnson, the Universal Credit (Earned Income) Amendment Regulations 2020 came into force on 16th November 2020. These regulations amend reg 61 of the Universal Credit Regulations 2013, and allow a payment from an employer to be allocated to an assessment period other than the assessment period in which it was paid, for the purposes of maintaining a regular monthly payment pattern, if there would otherwise be two payments received in the same assessment period. However, we have received a number of reports from advisers and individuals who have continued to experience problems with this issue after the new regulations came into force.

One issue that several people have reported is that the payments cannot be reallocated pre-emptively. Most people know if they are going to be paid early and we have heard from a number of individuals who contacted UC before the end of their assessment period to state that they would be paid early and receive two payments in one assessment period as a result. The response received was that any problems with the amount of UC awarded could only be raised after the payment statement is issued. However, challenging the award after the statement is issued does not allow the early payment to be reallocated before the UC payment is due and so the claimant receives a low UC payment. While the payment is usually corrected later, not receiving the expected amount on the usual UC payment date can create budgeting problems for the claimant and cause them to fall into arrears.

For cases where the claimant has received a lower UC award than usual, due to their usual payday falling on a non-banking day and two payments falling into one assessment period as a result, a mandatory reconsideration template can be found on our website.

Other pay cycles

We have also been told about a number of cases where the claimant was not in the same situation as the claimants in Johnson, but who were nevertheless experiencing problems caused by their pay cycles. The most common issue is that the claimant is paid four weekly, meaning that they are paid 13 times per year, across 12 assessment periods. The result of this is that their pay is slightly lower in 11 of 12 assessment periods than it would be if they were paid monthly, meaning that their UC award is slightly higher and, in the 12th assessment period, they receive two payments from their employer, meaning their UC award is lower. Claimants in this situation often end up receiving more UC over the course of the year than they would if they were paid monthly. However, the sudden drop in income in the 12th assessment period can be very difficult to manage. The claimant can appeal against the low award, but the potential solution is less clear than it was in the Johnson case, as there is no assessment period that the additional payment can be allocated to without causing further problems. The claimant should understand that, if their wages were calculated monthly, their monthly UC award would be lower, and they may receive less UC over the course of the year.

See the table on the CPAG website for information on how various pay cycles are affected by the judgments in Johnson, and also R (Pantellerisco and others) v SSWP [2020] EWHC 1944 (Admin), where the claimant was affected by the benefit cap purely because of the fact that she was paid four weekly.

3. Overpayment Recovery

EWS has seen a rise in the number of cases concerning overpayment recovery.

Recovery following DWP error:

We have received submissions on cases where the DWP has incorrectly calculated income, resulting in overpayments. Several of these cases involved student finance, where the claimant declared all income when making the claim, but the student finance was not taken into account. In one case, the claimant was concerned that her UC award did not include a reduction for her student finance and contacted the DWP to check that the award was correct. A note was made on her journal stating that, as "loans and grants are treated as unearned income and therefore untaxed your award should be correct and without overpayment". This claimant, along with the claimants in the other cases, subsequently received a notification that she had received an overpayment. Similarly, we received a case where a claimant was incorrectly told that her widowed parent's allowance should not have been treated as unearned income and received a lump sum to cover this apparent underpayment. She used this money to clear a debt, but was then notified that she had been overpaid by £4,000. All of these payments are being recovered by the DWP.

Under UC, all overpayments are recoverable, even where the overpayment is caused by official error, as it was in the cases that CPAG has seen. However, the exact wording of s71ZB of the Social Security Administration Act 1992, which deals with recovery of overpayments, is as follows:

"(1) The Secretary of State may recover any amount of the following paid in excess of entitlement..." (emphasis added).

Therefore, even though the Secretary of State has the power to recover any overpayment, this power is discretionary. Chapter D1 of Advice for Decision Makers covers overpayments and recovery, but does not state that there is a discretion not to recover. The Benefit Overpayment Recovery Guide does state that the overpayment can be written off where recovery would be detrimental to the health or welfare of the debtor or their family. However, the guide also states that the circumstances for writing off a debt should be very exceptional and that there should be compelling grounds not to recover the debt.

If you have a case where an overpayment has occurred as a result of an official error and the DWP has not exercised its discretion not to recover the overpayment, you may want to send a pre-action letter threatening judicial review. A template letter is available on the CPAG website. If the DWP has considered writing off the debt but has decided that it is not appropriate in your client's case, there is no right of appeal.

Incorrect notification of overpayment:

We have also received a submission where a UC claimant was notified of two overpayments, one relating to the benefit cap and one relating to the child element. The claimant was not subject to the benefit cap and her child element was correct so she requested an explanation of how the overpayments arose. She did not receive a response to the notes posted on her journal and requested a mandatory reconsideration of the decision. She still received no response and asked her MP for support. The MP was told that recovery of the overpayment had been "cancelled", but the claimant was not informed of this directly and did not receive a mandatory reconsideration notice.

Overpayments deducted from money owed to claimant:

EWS has seen a number of submissions where a UC claimant is owed money, for example after a payment dispute, but receive only a small amount of what they are owed, because an overpayment has been deducted from the amount owed by the DWP. In these cases, the claimants had payment arrangements in place in respect of the overpayments but, when a decision or revision resulted in a payment being due to the claimant, a deduction was made from this payment without their agreement.

Deduction from payments of arrears is permitted by reg 11(8) of the Universal Credit Regulations 2013. However, there are circumstances where the DWP will not recover in this way as a matter of policy. These circumstances are set out in the Benefit Overpayment Recovery Guide, at 5.50.

If you have clients that have experienced difficulties caused by overpayment decisions, please let us know by completing our online form or emailing the Early Warning System.

4. Habitual Residence Tests

We continue to see cases involving problems the habitual residence test (HRT). We have received submissions about claimants who have failed the HRT while pregnant or sick, despite having retained worker status. We have also seen cases where issues with the HRT were exacerbated by administrative problems. For example, one claimant was unable to upload documents that provided evidence in support of her claim, despite making two requests for the upload function to be enabled. This resulted in her claim being refused, as the necessary evidence could not be provided. Another claimant had her claim refused and requested a mandatory reconsideration on the basis that she was a dependent family member of her son, who is an EEA worker. Six months on from the mandatory reconsideration request, she had still not received a decision, and had no income in the meantime.

Pre-Settled Status

The most common issue that is highlighted to EWS is claimants with pre-settled status failing the HRT.

The changes introduced by the Social Security (Income Related Benefits) (Updating and Amendment) (EU Exit) Regulations 2019 prevent reliance on pre-settled status to meet the residence conditions for means tested benefits, including UC. Following a challenge in which CPAG represented two claimants with pre-settled status, the Court of Appeal quashed the regulations that state that pre-settled status is not a sufficient right to reside for meeting the eligibility criteria for means tested benefits (Fratila and Tanase v SSWP & AIRE Centre [2020] EWCA Civ 1741). Once the quashing order takes effect, a benefit claimant with pre-settled status should not have their claim refused on the basis that they do not have a qualifying right to reside, causing them to fail the HRT.

However, following the Court of Appeal's decision, the SSWP was granted permission to appeal to the Supreme Court, and a stay of execution has been granted in respect of the Court of Appeal's judgment until the Supreme Court has made a decision on the case. This means that, although the Court of Appeal made an order quashing the amending regulations, the order is postponed until the Supreme Court has made a decision. The SSWP does not need to apply the judgment in the meantime, so claimants whose only right to reside is pre-settled status will not meet the eligibility criteria for the relevant benefits.

If you have a client with pre-settled status, they should still make a claim to protect their position. If your client's claim has been refused, request a mandatory reconsideration. If your client has already requested a mandatory reconsideration notice, they should appeal against the decision, relying on Fratila. Further advice for affected claimants, including advice on claims made after 31/12/20, can be found in this advice guide.

If you have a client with pre-settled status who has made a claim for UC, please let us know about their progress by completing our online form or emailing the Early Warning System.

5. National Insurance Numbers

We are still receiving a number of submissions concerning the requirement for a National Insurance number (NINo) in order to receive a UC payment.

As we have covered in previous e-bulletins, there is no legal requirement to have a NINo in order to receive UC. The NINo requirement set out in section 1(1A) to (1B) of the Social Security Administration Act 1992 states that the NINo requirement is satisfied if the claimant provides a NINo or evidence or information necessary to ascertain a NINo or, under s1(1B)(b) SSAA 1992, the person makes an application for a NINo to be allocated, accompanied by information or evidence that would enable the allocation of a NINo. In correspondence with the DWP, CPAG has been informed that claimants should not apply for a NINo before making a claim for UC, and that a NINo application would be made via an internal process for UC claimants who do not have a NINo, in order to avoid delays in payments.

However, we are still seeing cases where UC awards are delayed because of NINo problems. The most common issue is where existing UC claimants are joined by their partner, who does not have a NINo. The single claim ends but payments under the joint claim are not made while the partner's NINo application is processed.

A further issue is the lack of communication about the NINo application. Once the NINo application is made, claimants are experiencing problems getting updates via their journals. Because of the lack of communication, and in some cases lack of certainty about whether an application has actually been made, some claimants are then making their own NINo applications. This causes further confusion, as there are two NINo applications for the same person.

We have also received information about a case where a person was told over the telephone that he could not make a claim for personal independence payment (PIP) because he was unable to provide a NINo. The DWP's learning guide “PIP17 Paper Claims”, states that, if a PIP claimant does not have a NINo, they should be sent a paper version of the claim form, PIP1. We are interested to know whether this gatekeeping is common practice, so please do let us know if your clients have experienced this.

We understand that a significant number of delays are caused by the fact that the Jobcentre Plus makes the NINo referral towards the end of the assessment period. This reduces the possibility of the application being processed in time for the first payment to be made.

If your client has experienced delays to their payments, gatekeeping, or administrative issues relating to the NINo application process, please provide us with details by completing our online form or emailing the Early Warning System.

Do you have something to tell us?

Hearing about your cases has a profound impact on our work. If you have a case which shows how changes in social security affect you or your clients, please let us know.

Topics we are looking out for:

  1. £20 uplift – how will your clients be impacted when the additional £20 is lost?
  2. Deductions – have your clients' deductions reduced and has it made a difference?
  3. Benefit cap – are you seeing an increase in clients reaching the end of their grace period?

​Submit a case or email the Early Warning System​ to tell us what you're seeing and how we can help.

Do you need CPAG's advice?

Our staff are working remotely so you can still access our services:

Advice by telephone

020 7812 5231 Monday-Friday 10am-12 and 2pm-4pm

Advice by email

[email protected]

UC London Advice

020 7812 5221 Wednesday 10am-12 and 2pm-4pm

[email protected]


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