ON APPEAL FROM THE HIGH COURT OF JUSTICE
Mrs Justice May
Strand, London, WC2A 2LL
B e f o r e :
LADY JUSTICE ROSE
LORD JUSTICE ARNOLD
| The Queen (on the application of TD, AD and Patricia Reynolds)
|- and -
|Secretary of State for Work and Pensions
Mr Edward Brown and Mr Jack Anderson (instructed by the Government Legal Department) for the Respondent
Hearing date: 23 April 2020
Crown Copyright ©
Lord Justice Singh:
"31. TD is a single parent. She used to work as a laboratory research chemist until she gave up work in 2015 to look after her daughter, AD. AD has sickle cell anaemia and epilepsy. She requires monthly blood transfusions and needs to attend other regular medical appointments. At the beginning of 2017, TD was entitled to income support, carer's allowance and child tax credit, with a disability element. Her total entitlement (excluding housing benefit) was £1005.45 per month. She also received disability living allowance, on behalf of AD, of £333.23 per month.
32. From 25 March 2017 the SSWP stopped TD's award of income support. Her Job Centre advised her that she should claim UC, which was awarded to her from 27 April 2017. TD later successfully challenged the decision to stop her income support but the application of Regulations 8 and 13 described above, precluded her from receiving or claiming any legacy benefit after 27 April 2017.
33. TD was awarded UC of £872.90 per month, which was £136.99 per month less than the amount to which she had been entitled under the legacy system. The loss of entitlement on transfer to UC was because of the less generous treatment of some children with disabilities under UC compared with legacy benefits.
34. Subsequently, on 18 August 2018 the SSWP revised the level of AD's disability living allowance (DLA) upwards. This revision had consequences for TD's UC entitlement, entitling her to the highest rate of the disabled child element of child tax credit up to 27 April 2017 and thereafter at the highest rate of the disabled child element of UC. The effect of this has been that the household's combined entitlement is now at the same level under UC as it would have been had TD continued to receive her legacy benefits. Notwithstanding this increase in her UC payments, TD contends that her claim is not academic as she and AD continue to seek a declaration and damages for the distress caused to them resulting from the drop in income at the time of transfer; the declaration sought would also benefit others in the same position as TD/AD but who remain on a lower entitlement under UC."
"35. PR lives on her own. She is severely affected with rheumatoid arthritis, spondylitis, depression and panic attacks, the effect of which caused her to give up work in 2015.
36. In March 2017 PR was receiving ESA [Employment and Support Allowance], with SDP [Severe Disability Premium] and support component, and was also entitled to a personal independence payment.
37. On 17 March 2017, the SSWP stopped PR's ESA. PR challenged that decision; in the meantime she claimed UC on 17 April 2017 as that was the only income replacement benefit available to her pending determination of her challenge to the ESA decision. The ESA decision was reversed on 7 August 2017 but the operation of Regulations 8 and 13 described above precluded PR from receiving or claiming any legacy benefits after 16 April 2017.
38. At the time of her transfer to UC, PR's legacy benefits entitled her to receive £814.67 per month. She was awarded UC of £636.58 per month, which is £178.09 less than she had formerly been receiving. The lower UC entitlement is attributable to the less generous treatment of some adults with disabilities in UC than under the legacy system."
The Welfare Reform Act 2012
"1 – Universal credit
(1) A benefit known as universal credit is payable in accordance with this Part.
(2) Universal credit may, subject as follows, be awarded to—
(a) an individual who is not a member of a couple (a 'single person'), or
(b) members of a couple jointly.
(3) An award of universal credit is, subject as follows, calculated by reference to—
(a) a standard allowance,
(b) an amount for responsibility for children or young persons,
(c) an amount for housing, and
(d) amounts for other particular needs or circumstances."
"Provision … may secure that where an award of universal credit is made … —
(a) the amount of the award is not less than the amount to which the person would have been entitled under the terminated award, or is not less than that amount by more than a prescribed amount."
The Universal Credit (Transitional Provisions) Regulations 2014
"8. – Termination of awards of certain existing benefits: other claimants
(1) This regulation applies where—
(a) a claim for universal credit (other than a claim which is treated, in accordance with regulation 9(8) of the Claims and Payments Regulations, as having been made) is made; and(b) the Secretary of State is satisfied that the claimant meets the basic conditions specified in section 4(1)(a) to (d) of the Act (other than any of those conditions which the claimant is not required to meet by virtue of regulations under section 4(2) of the Act).
(2) Subject to paragraph (3), where this regulation applies, all awards of income support, housing benefit or a tax credit to which the claimant (or, in the case of joint claimants, either of them) is entitled on the date on which the claim is made are to terminate, by virtue of this regulation—
(a) on the day before the first date on which the claimant is entitled to universal credit in connection with the claim; or(b) if the claimant is not entitled to universal credit, on the day before the first date on which he or she would have been so entitled, if all of the basic and financial conditions applicable to the claimant had been met.
(5) Where an award terminates by virtue of this regulation, any legislative provision under which the award terminates on a later date does not apply."
"13. – Appeals etc relating to certain existing benefits
(1) This regulation applies where, after an award of universal credit has been made to a claimant—
(a) an appeal against a decision relating to the entitlement of the claimant to income support, housing benefit or a tax credit (a 'relevant benefit') is finally determined;(b) a decision relating to the claimant's entitlement to income support is revised under section 9 of the Social Security Act 1998 ('the 1998 Act') or superseded under section 10 of that Act;(c) a decision relating to the claimant's entitlement to housing benefit is revised or superseded under Schedule 7 to the Child Support, Pensions and Social Security Act 2000; or(d) a decision relating to the claimant's entitlement to a tax credit is revised under section 19 or 20 of the 2002 Act, or regulations made under section 21 of that Act, or is varied or cancelled under section 21A of that Act.
(3) Where the claimant is not a new claimant partner and, as a result of determination of the appeal or, as the case may be, revision, supersession, variation or cancellation of the decision, the claimant would (were it not for the effect of these Regulations) be entitled to a relevant benefit on the date on which the claim for universal credit was made, awards of relevant benefits are to terminate in accordance with regulation 8.
The Human Rights Act 1998
"The enjoyment of the rights and freedoms set forth in [the] Convention shall be secured without discrimination on any ground such as sex, race, colour, language, religion, political or other opinion, national or social origin, association with a national minority, property, birth or other status."
"1. Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.
2. The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties."
Grounds of Appeal
i) Ground 1 – her approach to what justifies discriminatory treatment;
ii) Ground 2 – her finding that the position of the Appellants had been adequately considered by the Respondent; and
iii) Ground 3 – her approach to the appropriate comparators to the Appellants.
i) the future group of managed migrants; and
ii) non-disabled people.
Submissions for the Respondent
"The central issue in this case was whether the Respondent had justified discriminatory treatment between two groups of benefit claimants."
It is argued that this does not properly describe the exercise before the court below. It is necessary: (i) to identify what the "groups" are; (ii) determine whether they are sufficiently comparable; (iii) determine whether the treatment is on the ground of that status, before justification is considered: see Elisabeth Laing J in R (Parkin) v Secretary of State for Work and Pensions  EWHC (Admin), at para. 90. The justification exercise requires careful consideration of the relevant differential treatment. It is submitted that the Judge applied the correct approach; the Appellants by contrast, simply ask the court to consider whether some parts of the scheme are justified.
"The specific circumstances of claimants (such as TD and AD) whose challenge to legacy decision succeeds after their migration to UC has been specifically highlighted and considered by the Department and Ministers ..."
i) precludes the Respondent's argument that there was no differential treatment in the present case;
ii) precludes the Respondent's argument regarding the ratio of the decision of Lewis J in R (TP and AR) v Secretary of State for Work and Pensions  EWHC 1474 (Admin) ("TP (No. 1)");
iii) precludes the Respondent's argument regarding "no turning back" as a justification;
iv) illustrates that neither "cost" nor "administrative practicability" justify the discrimination against the Appellants.
The application to file a Respondent's Notice
"Where a conscious, deliberate decision by a government department is taken on the distribution of finite resources, the need for restraint on the part of a reviewing court is both obvious and principled. Decisions on social and economic policy are par excellence the stuff of government. But where the question of the impact of a particular measure on social and economic matters has not been addressed by the government department responsible for a particular policy choice, the imperative for reticence on the part of a court tasked with the duty of reviewing the decision is diminished."
(i) whether there is differential treatment
(ii) on grounds of other status
(iii) in relation to a matter falling within the scope, or ambit, of Article 14 [she must have meant A1P1], which
(iv) the defendant cannot show is objectively justified.
"It is the discriminatory impact of a policy, rather than the policy itself, that must be shown to be manifestly without reasonable foundation."
For that proposition, she referred to the decision of the Supreme Court in R (SG) v Secretary of State for Work and Pensions  UKSC 16;  1 WLR 1449, at para. 188. In that passage Lady Hale JSC cited the very important statement of principle in A v Secretary of State for the Home Department  UKHL 56;  2 AC 68, at para. 68 (Lord Bingham of Cornhill), of which sight must never be lost. As Lord Bingham explained, in a discrimination case, what must be justified is the difference in treatment; it is not enough to show that the underlying policy is justified.
"Mr Brown responded that the SSWP did not need to show that it was more difficult to provide transitional protection to persons who had transferred following a decision that was later corrected. The SSWP needed to do no more, he pointed out, than to demonstrate that proper consideration had been given to persons in the position of the Claimants." (Emphasis added)
"it is no doubt more likely than not that a judge who directs himself correctly on a certain aspect of the law in the earlier part of his judgment will apply the relevant principle properly later in his judgment when the occasion for its application arises. Failure by a judge to act in this way is, however, not unknown …"
The Respondent's Notice
"… there was—and there still remains—clear authority both in the Humphreys case  1 WLR 1545 and in the bedroom tax case  1 WLR 4550 for the proposition that, in any rate in relation to the Government's need to justify what would otherwise be a discriminatory effect of a rule governing entitlement to welfare benefits, the sole question is whether it is manifestly without reasonable foundation. Let there be no future doubt about it."
"Although it is not immediately obvious how the 'manifestly without reasonable foundation' test relates to the assessment of proportionality that the court must undertake, the explanation may be that the court is required to ask whether the difference in treatment is manifestly disproportionate to the legitimate aim. This would accord with the statement of the European Court in Blecic v Croatia (2005) 41 EHRR 13, para 65, that it will accept the judgment of the domestic authorities in socio-economic matters 'unless that judgment is manifestly without reasonable foundation, that is, unless the measure employed is manifestly disproportionate to the legitimate aim pursued' (emphasis added). It also reflects how the Supreme Court applied the test in the recent case of In re McLaughlin  1 WLR 4250, paras 38–39 (Baroness Hale PSC) and para 83 (Lord Hodge JSC)."
"In April 2012 you agreed that we should award TP [Transitional Protection] to claimants who move to Universal Credit and are subsequently successful with an outstanding reconsideration or appeal on their claim to a legacy benefit which means that their award of legacy benefits would have been greater than their entitlement to UC."
"you agreed in August 2012 that the necessary transitional arrangements should be separated so that we would proceed, at that time, with making provisions that govern new claims and natural migrations to UC but that regulations that cover managed moves and TP would be laid at a later date. After August 2012, the roll out plans were developed further with the introduction of a phased approach which would allow the UC Programme flexibility to learn from each phase before implementing the next. As part of this approach you agreed that regulations relating to managed migration and TP would not be introduced until we were more certain on the final implementation decisions for moving to this phase."
"This is not in line with your original decision of April 2012."
Lady Justice Rose:
Lord Justice Arnold: