Law Centre successfully challenges DWP on Universal Credit rules

Thursday, March 18th 2021

Five Pound Note

Hackney Community Law Centre (HCLC) successfully represented a client in a judicial review claim against the Department for Work and Pensions (DWP).

The question before the court was how to balance the public interest of recovering sums such as fines from claimants' Universal Credit payments and enabling those claimants to afford basic necessities. This legal issue affects thousands of people a year who face fine deductions that push them into hardship, but they are given no way of asking DWP to reconsider the rate of deduction.

HCLC's client was unable to afford basic necessities such as food and bills because DWP applied a rigid policy of deducting 30% of their client's Standard Allowance in recovery of a fine. The Law Centre had told DWP that that the deductions were creating severe hardship to their client, but the departmnet was unwilling to reduce the deduction rate. In response, the Law Centre assisted their client to bring a judicial review claim, seeking executive accountability and justice for their client.

Giving judgment yesterday, the Judge emphasised that this was not a matter of whether the fine would be recovered, but rather a qusetion of what amount of monthly recovery was lawful. Parliament had granted discretion to the Work and Pensions Secretary to deduct between 5% and 40% of a claimant's Universal Credit Standard Allownace, to adapt to the particular circumstances of an individual. Accordingly, the department's policy of simply deducting a flat rate of 30% in every case, did not accord with the purpose of Parliament's legislatin because it was a 'fettering of discretion'. 

Hackney Community Law Centre solicitor Beya Rivers represented the claimant and worked alongside the charity Shelter to bring this important litigation, that will set a precedent positively affecting many Hackney residents. She said:

“It is inhumane for Universal Credit recipients to be put in a position by the government where they are forced to survive without basic necessities, often choosing between essentials such as food and electricity.”

DWP was granted permission to appeal this decision to the Court of Appeal. In granting permission, the court did not stay its declaration that the policy was unlawful. This means that, for the time being, when claimants face hardship because of the flat rate deduction, they can request an exception in their case in order to decrease the burden of the deductions.

Hackney Community Law Centre maintains that the policy was unlawful and will contest DWP's appeal in the Court of Appeal.


The Guardian - "Fixed universal credit cuts are unlawful, high court in UK rules"

Judgment (on BAILII) - R (Day) v Secretary of State for Work and Pensions [2021] EWHC 608 (Admin)