A group of single mothers who work have won a test case against the government on Universal Credit (UC), after their pay cheques were wrongly counted twice.
The High Court declared the Department for Work and Pensions (DWP) rigid, automated method of assessing the women’s incomes to be unlawful, in R (Johnson & Ors) v Secretary of State for Work and Pensions [2019] EWHC 23 (Admin).
The women all had monthly paydays that clashed with the dates of their monthly UC assessment periods. This meant if they were paid early because their payday fell on a weekend or a bank holiday then the UC system automatically treated them as having been paid twice, and then as not being paid at all the next month. When this happened, the women lost their monthly work allowance (the amount claimants with children can keep before UC is tapered).
This flaw in the UC system caused the women major cash flow problems and, as they were already living on low incomes, led them to fall into debt.
However, the DWP refused to adjust its assessment periods, instead arguing its assessments were lawful and that employers rather than the DWP should remedy the issue.
The high court rejected the DWP’s arguments and held that it must adjust its calculations.
The judicial review was brought by the Child Poverty Action Group (CPAG) and Leigh Day solicitors.
CPAG solicitor Carla Clarke said: ‘Working parents on low incomes should not lose out on the support that Parliament intended them to receive because the DWP has designed a rigid process that is out of step with both actual reality and the law.
‘Our clients have been doing everything they can to support themselves and their young children through work but the rigid assessment system in UC has caused them untold hardship, stress and misery with them being forced repeatedly to manage on half of their usual total monthly income despite their fixed outgoings remaining the same. They have each ultimately questioned why they are even working. That it should have required them to go to court to challenge the DWP’s position is a testament to their commitment to bring up their children in a working household but it is a situation they should never have been put in.’
Tessa Gregory, solicitor at Leigh Day who represented one of the claimants, Danielle Johnson, said: ‘My client is a hard working single mum doing her very best to support her family.
‘She is precisely the kind of person UC was supposed to help, yet the DWP designed a rigid income assessment system which left her £500 out of pocket over the year and spiralling into debt due to a fluctuating income. It is extraordinary that when this issue was first raised, the Secretary of State did not act quickly to remedy the problem, instead choosing to fight these four women in court arguing that the system was fit for purpose despite the hardship being caused to working families.’
A DWP spokesperson said: ‘We are carefully considering the court’s judgment.’
