Erosion of disabled carer’s TSDPE due to addition of LCWRA element and removal of carer element
Current status
The case was heard in the Upper Tribunal on 30 October 2024. Judgment is awaited.
Overview
CPAG represents the claimant, MJ, in her response to an appeal by the Secretary of State for Work and Pensions to the Upper Tribunal. MJ is a carer who is herself disabled and was previously in receipt of employment and support allowance (“ESA”) with the severe disability premium (“SDP”). She received ESA whilst she appealed against a decision she was fit for work but that ended when the Tribunal dismissed her appeal. She then had to claim universal credit (“UC”), which was awarded with the carer element and a transitional SDP element included. Subsequently, the SSWP determined that MJ had limited capability for work and work related activity (“LCWRA”). The addition of the LCWRA element resulted in the removal of MJ’s carer element and also eroded MJ’s TSDPE in its entirety meaning she was worse off following being found to have LCWRA. MJ appealed the SSWP’s decision to erode the whole of MJ’s TSDPE to the FTT. The FTT found that she had been unlawfully discriminated against on the basis that she was a carer and that her TSDPE should only erode by the amount by which her maximum UC had increased (ie the difference between the carer element and the LCWRA element). The SSWP appealed the FTT decision to the Upper Tribunal and that appeal was heard on 30 October 2024. Judgment is awaited.
Background facts
The respondent, MJ, is 61 and single. She has a number of serious and longstanding health problems. She began caring for her disabled adult son in 2017.
MJ was previously in receipt of ESA with the SDP. On 10 February 2018, MJ claimed UC due to her ESA ending on dismissal of her appeal against a decision she was fit for work (so she was a natural migrant to UC). She was awarded UC, which included a Carer Element (“CE”) as well as a transitional SDP amount that, on conversion day, converted into a transitional SDP element (“TSDPE”).
On 25 October 2021, following a Work Capability Assessment (WCA), the SSWP determined that MJ had limited capability for work-related activity (“LCWRA”). Consequently, the SSWP decided in respect of MJ’s next assessment period to add a LCWRA element to her UC, which resulted in the removal of CE as well as the erosion of the TSDPE in its entirety. MJ’s UC award went from being £975 from the previous assessment period to being £879.87.
MJ requested a mandatory reconsideration of the SSWP’s decision on 24 February 2022 and following the SSWP’s refusal to revise the decision appealed it to the First-tier Tribunal (FtT). The FtT found that the SSWP’s decision to erode the whole of MJ’s transitional element was in breach of Article 14 read with Article 1 Protocol 1 (A1P1) ECHR. In particular, it stated that the DWP’s decision to erode the whole of MJ’s transitional element was discriminatory. It did not accept the DWP’s justification that the transitional element was only a transitional measure to align MJ’s UC with that of other UC claimants, and therefore could not be discriminatory. It also did not accept the DWP’s argument that LCW and LCWRA were health-related elements and so should be distinguished from the carer’s element. The FTT concluded that in her case the Universal Credit (Transitional Provisions) Regulations 2014 (UC (TP) Regs) should be read such that her TSDPE element only reduced by the amount by which her UC maximum amount had incrased (the difference between the CE and the LCWRA). The FTT gave the SSWP permission to appeal to the Upper Tribunal.
Legal issues
The UT hearing took place on 30 October 2024. MJ, represented by CPAG who have instructed Julia Smyth of Landmark Chambers as counsel, argues that she had been discriminated against on the basis of her status as a carer (or a person who meets the conditions for the carer element), or alternatively, as anyone else in receipt of a transitional element who undergoes a change of circumstances in that the total of her UC amount decreased when her circumstances got worse whereas other claimants would either have their total UC amount remain the same or increase. She argues this is discriminatory contrary to Article 14 (the right not to be discriminated against) read with Article 1 Protocol 1 ECHR (the right to peaceful enjoyment of possessions, including welfare benefits). In particular, she argues she is:
- Treated less favourably than someone who is not a carer who subsequently gets LCWRA; and
- Treated less favourably than anyone else in receipt of a transitional element who undergoes a change of circumstances.
MJ emphasises that the SSWP must justify the relevant difference in treatment, or the failure to treat different cases differently, rather than the policy of erosion of transitional protection on the whole.
The specific legislative provisions being challenged are reg 55(2)(b) and (c) of the Universal Credit (Transitional Provisions) Regulations 2014, which make provision for the amount of the transitional element to be reduced by “the sum of any relevant increases.” “Relevant increase” is defined as any of the amounts that are included in the maximum amount of UC under s.9 and 12 of the Welfare Reform Act 2012 (“WRA 2012”), subject to the exception in reg 55(5) and (6) which provides that where the LCW element is replaced by the LCWRA element, the “relevant increase” is the difference between the amount of those elements rather than the full amount.
Comparator 1 – Non-carer who gets LCWRA
MJ submits that someone who is not a carer who previously had TSDPE, who subsequently had a LCWRA element added, would experience erosion of their TSDPE. However, this would lead them to either be financially better off (if their TSDPE in the assessment period prior to the effective date of the supersession was less than the LCWRA element); or at least no worse off (if their TSDPE in the assessment period prior to the effective date of the supersession was equal to or more than the LCWRA element).
By contrast, MJ, who is a carer, found herself financially worse off after having LCWRA added to the calculation of her UC award. This is because the addition of LCWRA resulted both in the removal of her carer element and the erosion of her TSDPE. In other words, she suffered a reduction in her overall benefit income at the point she was recognised as having additional needs, whereas her comparator had those needs taken into account and recognised in an increase in their award (or at least no decrease).
Comparator 2 - Anyone else in receipt of a transitional element who undergoes a change of circumstances
MJ also compares herself to anyone else in receipt of a transitional element who undergoes a change of circumstances causing the change in an element of UC. Specifically, she raises the example of someone who, from their first UC assessment period, has LCWRA, who later becomes a carer. Like them, MJ undergoes a single change of circumstances which causes her transitional element to be eroded. However, unlike these claimants who will not suffer a reduction in benefit, MJ and others with her status are the only group who undergo a change of circumstances which means their needs are recognised as having increased via the inclusion of a new element but who then suffer an overall reduction in their award of benefits.
Difference in treatment to non-carers and anyone else in receipt of a transitional element who undergoes a change of circumstances unjustified
Discrimination can be produced by the combined effects of rules which, if they are applied alone, do not produce discrimination. In this case, MJ argues that the interaction of TSDPE, the LCWRA element, and the carer element altogether results in disabled carers having their benefits reduced. Once discrimination is established, it will be unlawful unless it has an objective and reasonable justification. MJ argues that the result of these combined rules does not further their respective legitimate aims, and instead thwarts them.
First, MJ refers to the policy reasoning behind the rule that LCWRA and CE cannot be included in a UC award simultaneously in respect of the same claimant, which is that the purpose for which these elements are paid overlap (difficulty accessing work). MJ also refers to DWP policy briefings setting out its intention that LCWRA should lead to a higher award of benefit than that received by others.
Second, MJ refers to the policy objective of transitional protection, which is to align entitlement to UC for those who migrate to UC with that of new claimants, without resulting in “cliff edge” cash reductions in claimants’ amounts of benefit.
Contrary to both policy objectives, MJ 1) does not receive more UC when her additional needs due to LCWRA are recognised; and 2) in fact sees a “cliff edge” style reduction in her benefit. MJ submits that this is not a rational result, and cannot be justified as treatment which is pursued as the result of a legitimate aim.
The DWP’s argument in response focuses primarily on the policy rationale for why a person cannot receive the carer element and LCWRA at the same time. However, this is not the subject of MJ’s complaint, and she emphasises that the DWP must justify the specific difference in treatment she experiences as a result of the interaction of TSDPE, LCWRA, and the carer element, which she argues is discriminatory.
Remedy
With reference to RR v SSWP [2019] UKSC 52, [2019] 1 WLR 6430, which established that the Tribunal can disapply a provision of secondary legislation if it is incompatible with Convention, MJ argues that the UT should disapply the words ‘any of the amounts that are included in’ in regulation 55(4) of the Universal Credit (Transitional Protection) Regulations. This will mean that her TSDPE is eroded by the difference between the Carer’s Element and the LCWRA element rather than by the full amount of the new LCWRA element.
Alternatively, she argues that the UT should remit the matter to the SSWP with directions that he resolve the discrimination.
What this means for claimants
Any claimant in a similar position who has already seen their UC reduced overall due to being awarded LCWRA element and losing both the CE and their transitional protection, can seek a revision (“mandatory reconsideraion”) of the decision to do this. If that revision application is refused such claimants should appeal. Provided the revision is conducted before the judgment in this case is given, and assuming MJ is successful, then the FTT in such cases would be able to give a full remedy – only reducing the TSDPE by the difference between LCWRA and CE elements with effect from when the original decision was made in the claimants case.
The position is more complicated for those whose cases are at a different stage:
- Claimants who have had a decision to reduce their UC because TSDPE was eroded by full amount of LCWRA element despite fact CE was also removed but who have not been refused revision of that decision before SSWP v MJ gets decided. For these claimants then the anti-testcase rules may mean that they can only have the decision corrected (assuming SSWP v MJ succeeds) with effect from when the testcase is decided.
- Claimants who have not yet been awarded LCWRA but who have CE and transitional protection. If such claimants were to seek to get the LCWRA element added before SSWP v MJ is decided will see a loss of benefit (like that MJ experienced). Furthermore, unless they can challenge that decision and are refused revision before the judgment in MJ is handed down, and assuming the testcase is successful, then the anti-testcase rule could mean that their awards are not subsequently amended for any period between when their UC was reduced and the date MJ is decided. Accordingly, it may not be wise for such claimants to seek to have the LCWRA element added unless and until SSWP v MJ succeeds.
Advisers with further queries can contact CPAG's advice services or relevant access to justice project.