A Welfare Benefits Update: Changes following COVID-19

As the global pandemic continues to cause a lengthy economic downturn in the UK, it has become increasingly apparent that low-income households and those claiming welfare benefits are being hit hardest. With the greater likelihood of low-income households living in densely populated areas, a shortage of unskilled work available during lockdown and the lower likelihood of these individuals having cash reserves, these groups have been disproportionately affected. We are mindful that the majority of our clients, who are wards of the Court of Protection, are claiming welfare benefits to maintain their standard of living and it is important that we remain abreast of any changes to social welfare provisions that may affect them.

Following the Coronavirus Act 2020, which came into force on 25 March 2020, and the government’s announcement of an extensive bail-out package for the U.K., we have highlighted below the most notable changes made to welfare benefits.

Jobcentre Interviews and Medical Assessments

The DWP has advised that there is no need to attend Jobcentre Plus locations for any medical assessments, interviews or any other face to face appointments during the outbreak. This applies to those who were already in receipt of payments as well as new claimants. The change was initially advised to be for a period of 3 months following the decision in March, therefore this is likely to be under current review at the time of writing.

For any new claims or even changes to claims, the DWP will endeavour to assess you without seeing you face to face and will request other documentational evidence in support of your application to be sent to them. Any end dates to benefits being claimed have been postponed by 6 months in order to mitigate the impact on individuals. Overpayments or budgeting loan repayments have been paused automatically by the DWP, meaning the individual will receive the full sum without reduction for the time being.

Housing Benefit/Local Housing Allowance

For those individuals who require assistance with rent payments, rates for the above benefits have been increased to at least the 30^th percentile of the market rents in each area. This is a welcome change at a time when there are increasing concerns about the rising levels of poverty. The Food Foundation thinktank estimates that levels of food insecurity have quadrupled during this crisis period, which is a startling statistic. An increase in housing-related benefits will hopefully assist in easing the burden on these households.

Carer’s Allowance

Individuals will continue to receive Carer’s Allowance, even if they have had to stop caring for someone due to contracting the virus or having to shield.

Universal Credit

The government has increased the standard allowance for Universal Credit by £20 per week, in addition to the usual annual increase (Working Tax Credit has seen the same increase). The increase for all claimants will last for one year and will mean that the standard allowance for a single claimant will increase from £317.82 to £409.89 per month, which is a mark-up of £1,040 per person, per annum.

In recent news regarding Universal Credit, the Court of Appeal handed down judgment in the case of R (Johnson, Woods, Barrett & Stewart) v SSWP [2019] EWHC23 (Admin); SSWP v Johnson, Woods, Barrett & Stewart [2020] EWCA Civ788 on 22 June 2020. The case concerned four single working mothers whose Universal Credit payments fluctuated greatly during months when their salaries were paid a day or two early (to take account of non-banking days). The Universal Credit system erroneously recognised this as the claimants receiving double their salary in one month and thereby applied significant reductions to their benefits. The Court ruled that the Secretary of State for Work and Pensions had acted irrationally and unlawfully by failing to address the problem. Lady Justice Rose’s lead judgment concluded that:

“This case is, in my judgment, one of the rare instances where the Secretary of State for Work and Pension’s refusal to put in place a solution to this very specific problem is so irrational that I have concluded that the threshold is met because no reasonable SSWP would have struck the balance in that way.”

We are pleased that these flaws in the structure of welfare benefits are being addressed and dealt with appropriately to correct the disadvantages many claimants are facing.

These changes have been greatly beneficial to our clients, most of whom are shielding and are particularly susceptible to the virus. However, although the increases have been widely welcomed, there are concerns about those who have been left out, including claimants for Employment and Support Allowance and Personal Independence Payment. Organisations such as Citizens Advice and Child Poverty Action Group have called for increases to other benefits and similar recommendations have been made by various political parties.

We do hope that all improvements to welfare benefit systems remain in place after the pandemic is under control to ensure that vulnerable people can continue to be supported as far as possible.

* Disclaimer: The information on the Anthony Gold website is for general information only and reflects the position at the date of publication. It does not constitute legal advice and should not be treated as such. It is provided without any representations or warranties, express or implied.*