The Impact of Welfare Reform

Jonathan ManningArden Chambers7 December, 2015

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Basic welfare reform propositions

• Local Housing Allowance maximum size provisions mean that HB will be based on the cost of a property no larger than permissible under the rules. Landlord may reduce the rent.

• The social sector size criteria rules are similar but do not operate in the same way. If accommodation larger than permissible, HB is reduced regardless of the rent. Only size reductions will avoid the reduction.

• The overall benefit reduces overall benefit-derived income for working-age claimants to the level of a cap, currently £26,000 for families – to be reduced to £23,000 (London) or £20,000 (everywhere else) – by way of reducing HB.

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Is it legal?

• Three showpiece challenges to the schemes– Burnip (LHA, unlawful discrimination)– MA (Bedroom tax, justified discrimination)– JS/SG (Benefit Cap, justified discrimination…

just)

• The FTT does what it wants...

• The Upper Tribunal has been a kill-joy.

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Burnip v Birmingham CC [2012] EWCA Civ 629

• This was an appeal from the FTT not a JR.• Court of Appeal held that

– The analogous provisions of the LHA maximum rent was discriminatory for the purposes of Art 14 and A1P1, because of the disparate impact on disabled people were not entitled to the size of accommodation they needed

– DHPs were not sufficient justification for the discrimination.

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Burnip per Henderson J at [46] – [47]

• Discretionary housing payments “cannot come anywhere near providing an adequate justification for the discrimination in cases of the present type.”– The payments are purely discretionary– Their duration is unpredictable– They are payable from a capped fund– Their amount, if they are paid at all, cannot be

relied on to cover the full amount of the shortfall. – Housing is a long-term commitment so that the

severely disabled need a reasonable degree of assurance as to future affordability

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R (MA) v SSWP [2014] EWCA Civ 13

• Social Sector Size Criteria Rules (Bedroom tax)• Discrimination (Art 14 and A1P1)

– adverse impact on a group– justification

• Failure to undertake proper PSED• Discretionary housing payments

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R (MA) v SSWP – the SoS arguments

• Was Burnip limited to the severely disabled?• Different and more generous DHP pot (£150m)• No established facts as MA was a judicial review

claim whereas Burnip had been an appeal from the Upper Tribunal

• Discrimination argument needed to take account of the whole range of benefits available to claimants, not just the effect of the SSSCRs.

• Local benefit authorities are subject to the same non discriminatory and PSED duties as the SoS, so dissatisfied claimants should JR them instead.

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R (MA) v SSWP

• The Divisional Court and Court of Appeal held:– Where state benefits were concerned, in

considering the justification of the scheme and therefore its proportionality, the Government enjoyed a wide margin of appreciation, so that the test was whether the policy was “manifestly without reasonable foundation”: Humphreys v HMRC [2012] 1 WLR 1545

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R (MA) v SSWP

• There was no precisely identified class of persons said to be the victims of discrimination – not “all disabled people”.

• This was important - a powerful factor on justification, and unlike Burnip where the Court could look at individuals.

• SoS entitled to conclude that the welfare bill needed reducing. Required to consider what steps needed to be taken in relation to disabled and other people who would face real difficulties.

• Provision of extra funding for DHPs was a proportionate response.

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R (JS) / (SG) v SSWP

• Benefit Cap challenge• Discrimination under A14 and A8/A1P1 ECHR

– Breach of A8– UN Convention on the Rights of the Child A3(1)

• CPAG, as intervener, ran a different argument based on the contention that the asserted comparison with average earnings was not a proper comparison, so that the policy did not meet its aims (fairness, savings, incentive to work) and the discrimination was unjustified.

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R (SG) v SSWP

• Alleged discrimination against women.• SoS conceded that there was a discriminatory effect

in relation to women – lone parents– domestic abuse.

• Once again, the Divisional Court and Court of Appeal’s responses were conditioned by Humphreys.

• The policy was justified. The Secretary of State was entitled to seek to change the welfare culture.

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R (SG) v SSWP

• Nor was it manifestly without reasonable foundation:– DHPs provided short term mitigation– People could move elsewhere in the country– Local authorities have homeless duties which

would pick up those who could not pay their rent because of the impact of the cuts.

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R (SG) v SSWP – Supreme Court

• The case turned out to be about – A14 together with A1P1– A3(1) UNCRC:

“In all actions concerning children, whether undertaken by public or private social welfare institutions, courts of law, administrative authorities or legislative bodies, the best interests of the child shall be a primary consideration.”

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SG v SSWP – Supreme Court [2015] UKSC 16

• 2-1-2 split– Reed/Hughes - discrimination justified; even if in

breach of UNCRC, the rights of children living with single fathers no different.

– Carnwath – SoS had breached A3(1) UNCRC but that did not render the measure unlawful, because discriminated against mothers not children.

– Hale/Carr – In the light of a breach of UNCRC the discrimination against women could not be justified. Can’t distinguish between rights of dependent children and those of the parent who must look after them.

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Other cases

• Other cases in the High Court– R (Rutherford) v Secretary of State [2014] EWHC

1631 (Admin) • Grandparents caring for disabled grandson

requiring overnight care. Long term DHPs in place and secure.

– R (Cotton) v Secretary of State [2014] EWHC 3437 (Admin) • Children of separated parents. DHPs in place.

• Both suggest that the availability of DHPs in the specific case are relevant to justification.

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The Tribunals

• Not concerned with the legitimacy of the overall scheme so much as its application to individual cases.

• Could still be discrimination or other illegality in individual cases.

• Decisions of fact also fall to be made e.g. what is a bedroom? What are the needs of the claimant?

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Upper Tribunal Appeals

• CSH/188/2014 • CSH/589/2014• The latter two were Scottish appeals and applied MA

faithfully, i.e. that the scheme was compliant, but – no proper representation – no consideration of the differences between

Burnip and MA.– nor reference to Rutherford.

• See also SSWP v Nelson and Fife Council [2014] UKUT 0525 (AAC)

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The Future – the Benefit Cap and homelessness

• A person who has accommodation may nonetheless be homeless if it is not accommodation that they can reasonably be expected to continue to occupy (s.175(3), HA 1996).

• A person who leaves accommodation is not intentionally homeless unless it was reasonable to expect them to continue to occupy it (s.191(1), HA 1996).

• Accommodation secured for a person under Part 7, HA 1996 must be suitable, which includes affordability and location (s.206(1), HA 1996; Homelessness (Suitability of Accommodation) Orders 2006 (2006/3204) and 2012 (2012/2601).

• An authority may impose a reasonable charge for accommodation secured (s.206(2), HA 1996).

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The benefit cap and homelessness

• Does the benefit cap exist? – Yekini v Southwark LBC [2014] EWHC 2046 Admin – SG (High Court – [53]): “…it [is] inconceivable that an

applicant…could properly be regarded as intentionally homeless where the rent has become unaffordable simply through the application of the benefit cap. Moreover, it would no longer be reasonable to expect them to remain in the accommodation.”

– SG (CA – [81] ) “…the bottom line is that the local authority will retain an obligation to find some accommodation which the family can afford.”

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The benefit cap and homelessness

• SG (Supreme Court at [36]) At HC committee stage of the Welfare Reform Bill:

– “The minister explained that, whatever the cost of the accommodation might be, the local authority could pass on only a charge that the applicant could afford. The issue of housing costs for those in temporary accommodation was being considered.”

• But issues of the cause of homelessness and suitability are matters for the local authority.

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The Future

• MA in the Supreme Court• The tribunals• The benefit cap and local authority duties

– DHP policies– DHP decisions– homelessness

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Intentional homelessness – people who don’t

Welfare Reform and Homelessness decision-making

Jonathan ManningArden Chambers8 June 2015