The High Court has found in the case of Roberts v The Secretary of State for Work and Pensions that the way in which the Department of Work and Pensions (DWP) makes deductions from individuals’ Universal Credit payments to landlords for ongoing rent payments and towards rent arrears is unfair, and therefore unlawful, because the DWP authorises these deductions without first consulting the person affected by the deductions.

The DWP decided to make deductions from Mr Roberts’ Universal Credit in March 2024, for ongoing rent payments and towards rent arrears, following an application by his landlord. At the time that these deductions were made, Mr Roberts was engaged in a dispute with his landlord about his liability for rent, and a date for him to move out of the property had been agreed. The DWP later (after this judicial review claim had been lodged) refunded Mr Roberts and admitted that these payments were taken in error. Mr Roberts, however, continued to challenge the lawfulness of the policy that had overseen the decision making in his case, and the many thousands of similar deductions that are made each year.

Following a judicial review hearing at Manchester Civil Justice Centre on 3-4 December 2024, Fordham J found that the way that the DWP has been making these deductions is unfair. As set out in the judgment, there were several factors which led the court to conclude that the DWP’s scheme was unfair, including:

It being recognised that the UC-claimant may have something to contribute, the decision-maker may be deprived by the process of information which could be about: (a) whether the rent is payable (b) whether it has been paid (c) whether there is some related dispute (d) whether a statutory precondition or policy guidance criterion is unmet (e) whether holding off or deferring may for some identifiable reason be in the UC-claimant’s actual best interests (f) whether there is or is not in fact a risk of eviction (g) whether the UC-claimant has plans to leave the accommodation (h) something else. [52]

The statutory scheme, the framework of policy guidance and the SSWP’s own practices all reflect a clear recognition that the decisions to make and implement a Diversionary-MPTL and a Recoupment-TPD are designed to protect the interests of the UC-claimant. Not the landlord. Yet, when a landlord makes a request, it is the UC-claimant who is then unnotified and unheard until the decision is made and implemented. Except under the Post-2017 Practice. This is an exclusion, and a disempowerment, of the very person sought to be protected. It is inconsistent with the ethical value, where the person’s rights and interests are supposed to be central. [53]

The decision-making process allows information to be elicited unilaterally from someone – a landlord – with an interest which may not align with the interests of the UC-claimant; giving one side of a story; the protection of whose interests are not the rationale of the payment they will receive. They are likely to be an organisation in an unequal relationship with the UC-claimant. It is quite right to hear from them; but it is unfair to hear exclusively from them. Indeed, in the context of a disrepair dispute, where withholding rent may be the only leverage which a tenant has, SSWP may very well be unwittingly and unknowingly cutting across a protection. [56]

As a result of the judgment, the way that the DWP makes deductions of this type will need to change: all Universal Credit claimants, including those in social sector housing, should be given the opportunity to make representations prior to a decision to make a deduction from their benefit to their landlord.

This judgment follows on from the earlier Court of Appeal judgment in which the DWP’s ‘third party deductions’ policy, relating to how deductions from employment and support allowance (a ‘legacy’ benefit) were paid to third parties such as utility companies, was found to be similarly unlawful.

Emma Varley from our Public Law and Human Rights team, and who represented Mr Roberts, said:

This is an important judgment which confirms what Mr Roberts felt sure of from the outset: that it was unfair of the DWP to make deductions from his benefit without first asking him what he thought about them. This judgment should lead to fairer, and better, decision-making by the DWP, which should positively impact the many thousands of people that receive Universal Credit benefit that are at risk of experiencing these types of deductions.

Mr Roberts is represented by Emma Varley, associate, and Eve McMullen, trainee solicitor, of Bindmans, and Tom Royston of Garden Court North Chambers as counsel.