Becoming homeless because of the benefit cap

15 November 2013

Garden Court North Chambers’ Joseph Markus considers R (JS & Others) v the Secretary of State for Work and Pensions (CPAG and Shelter Children’s Legal Service intervening) [2013] and discusses challenges to the benefits cap.

The benefit cap in brief

The “Benefit Cap” (in the technical language of section 96 of the Welfare Reform Act (WRA) 2012, the “relevant amount”) places a limit on the total amount of state benefits a person can claim from a prescribed list of “benefit, allowance, payment or credit ” (section 96(10) WRA 2012).

The cap was implemented this year through regulations – the first of which was the Benefit Cap (Housing Benefit) Regulations 2012 – amending the Housing Benefit Regulations 2006.

The relevant amount is fixed at £350 a week for a single claimant and £500 a week for all others: regulation 75G HB Regs 2006.

The list of prescribed benefits contains (see regulation 75G): [Footnote 1]

  • Bereavement allowance;
  • Carer’s allowance;
  • Child benefit;
  • Child tax credit;
  • Employment and support allowance;
  • Guardian’s allowance;
  • Housing benefit;
  • Incapacity benefit;
  • Income support;
  • Jobseeker’s allowance;
  • Maternity allowance;
  • Severe disablement allowance;
  • Widowed mother’s allowance;
  • Widowed parent’s allowance; and
  • Widow’s pension.

All other benefits, by necessary implication, fall outside the cap and cannot presently be used by authorities in assessing whether the cap is met.

Wherever a claimant or a member of his or her household is receiving any one of the following benefits, regulation 75F provides that the benefit cap will not apply:

  • Employment and support allowance, including a support component;
  • Industrial injuries benefit;
  • Disability living allowance;
  • Personal independence payment;
  • Attendance allowance;
  • War widow’s or widower’s pension;
  • War pensions;
  • Armed forces compensation scheme;
  • Armed forces independence payment; and
  • Universal credit.

Similarly, regulation 75E provides that the cap will not apply where a claimant or a member of his or her household is entitled to working tax credit. Related to this, there will be a 39-week “grace period” for anyone who has been in work continuously for 12 months and loses their job through no fault of their own. During that period the cap will not apply.

R (JS & Others) v the Secretary of State for Work and Pensions (CPAG and Shelter Children’s Legal Service intervening) [2013] EWHC 3350 (QB)

Many organisations, including CPAG and Shelter, have opposed the introduction of the cap for the reason that it will create a hugely detrimental and apparently arbitrary hardship for large families (which may be drawn disproportionately from minority racial, ethnic or national groups), for single parents (overwhelmingly women) and for victims and survivors of domestic abuse.

In JS & Others the six claimants (three mothers and one each of their youngest children) challenged the lawfulness of the Regulations. The primary lines of attack relied on two fairly tightly drawn arguments relating to Articles 8 and 14 ECHR and Article 1 of the First Protocol (A1P1), in addition to a more general rationality challenge. Each challenge failed in the High Court. While, no doubt, the challengers are looking for ways to appeal the judgment, there are some avenues left open by the judgment as well as a few more positive comments that were made by the judges.

The decision

Each of the three sets of claimants had a pretty compelling set of facts. The judges remarked on this. However set against that was the generally broad nature of what was claimed – that the benefit cap scheme itself was either unlawful or required amendment to be made lawful.

Despite the circumstances of these claimants, the court did not accept that the policy was either generally unlawful or that it gave rise to a violation of ECHR rights on the facts.

The court accepted that, in view of the impact assessments conducted by the government, there could not have been any failure to consider or to appreciate the impact on children of the policy.

In relation to Article 8 and A1P1 the court was clear that while it did not “underestimate the difficulties” faced by the claimants, they saw it as “a pessimistic and premature assumption” to suggest that family life could not continue in any of their cases [67]. In support of that conclusion, the judges highlighting the following features of one claimant’s case – MG – in particular:

  • MG had secured a reduction in the rent payable to her landlord;
  • She was in receipt of a DHP;
  • By the time the DHP ends, “she might be able to obtain work”;
  • “She might possibly be successful in obtaining child maintenance payments from her estranged husband”; and
  • If she were homeless or threatened with homelessness, the local authority would be under a duty to secure suitable accommodation.

In that light the court concluded that “the circumstances fall well short of demonstrating a breach of Article 8” and that “even if the cap gave rise to a breach in any particular case, that would not of itself invalidate the scheme” [68].

Regarding Article 14, the test of justification established Stec v the United Kingdom (2006) 43 EHRR 1017 in relation to state benefits is whether the measure in question is “manifestly without reasonable foundation”. The test was translated into UK law in Humphreys v Revenue and Custom Commissioners [2012] UKSC 18. Even assuming some differential impact by reference to a protected characteristic, the court did not believe that the claimants had made out that the scheme was incapable of justification. The following observations were made:

  • The Secretary of State recognises that “the policy will bear particularly harshly on larger families and single parents”;
  • A significant rationale behind the cap is the goal “to change the welfare culture” and “remove disincentives to work”;
  • Benefits claimants must be “forced if necessary to take difficult decisions either to cut their spending requirements, perhaps by moving …, or to increase their income”;
  • DHPs are in general available to help “in the short term”;
  • The Part VII homelessness duty remains in the background as a safety net;
  • It was always part of the structure of the policy that “the comparison between the income for those in benefit and earnings for those in work inevitably meant that the latter would receive more money than the former”;
  • There will be “particularly hard cases” but they “are not typical of the effect of the policy in the country as a whole”;
  • The policy is cast in broad terms and while some “bright line” rules can lead to hardship or arbitrary outcomes, that fact alone does not render them disproportionate; and
  • If housing benefit and child benefit were excluded from the list of prescribed benefits, the scheme may not have achieved the statutory aims [83], [87], [92] and [93].

The upshot was, as the court put it, that:

“The division of the resources of the state and more particularly the question to what extent state funds should be made available to those in need for one reason or another is par excellence a political question.” [85]

The irrationality challenge was not found to add anything more to the human rights arguments. [100]

Things to look out for

General Article 8 points  Elias LJ makes a series of assumptions at [67]-[68]. He does not discount the possibility that the facts of a particular case may give rise to a violation of Article 8 ECHR. It is worth noting that given the ultimate safeguard of the homelessness duty it will be difficult to show that family life will be unable to continue. The type of case that might succeed under Article 8 could include, for example:

  • Where the household would be split up, thus damaging or destroying family life; and
  • Where some form of support that is truly fundamental to the household’s – or a member’s – family or private life would be lost.

Homelessness  Given the prominence of homelessness duties in the part of the court’s judgment relating to Article 8, it looks like the discharge of this duty will become one of the main areas in which benefit cap arguments come to light.

At [53]-[54] the court considered a preliminary issue of whether someone who is homeless or threatened with homelessness as a result of the imposition of the cap could be said to have become homeless intentionally.

Elias LJ, referring to R (Best) v Oxford City Council [2009] EWHC 608 (Admin), said this:

“[I]t seems to us inconceivable that an applicant, whether already housed or seeking housing, 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.” [53]

Absent some fairly unusual facts, this suggests that most people who become homeless through the operation of the benefit cap will not be intentionally homeless.

However, this does not alter the reality that those housing authorities most affected by the cap will struggle to permanently accommodate the homeless within their areas due to affordability issues. Questions over suitability of accommodation may, therefore, arise.

The authority will be able to consider all relevant factors, including central government policy on the benefit cap as well as the affordability issues. The authority will also be able to point to the fact that thegeneral impact on children was considered in the impact assessments leading up to the benefit cap legislation.

In considering the best way to respond to offers of out-of-area accommodation, bear in mind:

  • Article 3(1) of the UN Convention on the Rights of the Child – confirmed as generally applicable in the context of Article 8 in ZH (Tanzania) v the Secretary of State for the Home Department [2011] UKSC 4 and applicable more generally in Collins v the Secretary of State for Communities and Local Government [2013] EWCA Civ 1193 –requires a micro-level analysis of an individual child’s best interests, in addition to macro-level analysis in the context of policy-making. It does not matter that in creating the policy the government considered the best interests of children in general. As is acknowledged in JS & Others, there will be hard cases;
  • In considering the best interests of children, Article 3 sets a pretty exacting standard. A fairly recent UNCRC General Comment (No 14) sets out in detail what is expected. This could be a useful tool in identifying cases where an authority has not considered everything it should have (though, no doubt, authorities will consistently rely on Holmes-Moorhouse v Richmond LBC [2009] UKHL 7 to suggest that apparently inadequate reasons actually are not);
  • In relation to an offer of final accommodation under section 193(7) of the Housing Act 1996, advisers should always put forward the subjective suitability issues previously associated with the “reasonable to accept” test, set out in section 193(7F) before that section was amended by the Localism Act 2011: [Footnote 2] Supplementary Guidance on the homelessness changes (DCLG, Nov 2012) at [22];
  • The suitability of the location for all members of the household must be considered; whether it would be “possible” to secure accommodation closer to the authority’s district; the distance of the location from the district; the significance, in particular, of any disruption to education; whether the authority has sought to retain any established links with schools, doctors, social workers, etc: 2012 Supplementary Guidance at [47]-[49] and Homelessness Code of Guidance for Local Authorities (DCLG, Jul 2006) at [17.41];
  • Particular emphasis should be placed on minimising disruption to education of young people at “critical points in time”: 2012 Supplementary Guidance at [52] and the Code at [17.41]; and
  • Isolated accommodation should be avoided and account should be taken of support available in the household’s current location: 2012 Supplementary Guidance at [53]-[54] and the Code at [17.41].

In general terms the rule remains that “[s]o far as reasonably practicable” a housing authority shall in discharging its functions secure accommodation in-district: section 208(1) HA 1996.

Domestic Violence  Elias LJ mentions at [73] the facility under the HB Regs 2006 for temporary payment on two homes where a claimant is fleeing violence. Prima facie these payments would be caught under the cap. This is why the Benefit Cap (Housing Benefit) Regulations 2012 provide that the rent for a claimant in “exempt accommodation” is to be ignored. Some concerns remain that the scope of that exemption has been drawn too narrowly. The government, it appears, is looking into this.

However, Elias LJ does suggest that if no satisfactory resolution appears, the inclusion within the cap of rent payable for refuge accommodation may be suitable for challenge by way of judicial review. Such a challenge would most likely rely on Article 8, taken alone or in conjunction with Article 14 ECHR. It seems likely, in view of the government’s concession that the current exemption is too narrowly drawn, that any challenge could be settled fairly quickly either pre- or post-issue.

Possession  Elias LJ does not look at how the benefit cap might become relevant in possession proceedings. There are a few possibilities here:

Private landlords and ASTs  There could be some scope for continuing the argument started in Malik v Fassenfelt [2013] EWCA Civ 798 regarding the relevance of Article 8 ECHR in relation to possession proceedings and private landlords. In one of the exceptional cases in which Article 8 might render the application of the benefit cap unlawful, this could be an argument for getting the claim dismissed [Footnote 3] or at least for the exercise of the court’s powers under section 89 of the Housing Act 1980.

Public authority landlords  In any case concerning a mandatory ground for possession, it may be possible to argue a defence based on Article 8 ECHR. In these types of cases, points of significance are likely to be that there is no suitable alternative accommodation available, that the accrual of arrears is not the fault of the tenant, and that it is acknowledged by the government and the court in JS & Othersthat “bright line” policies can cause real hardship and arbitrary results in some cases.

It will be worth considering public law defences on the usual grounds. First, it will be worth seeing whether, if an application for an allocation of housing has been made, the authority has complied with its allocation scheme and any associated policy documents dealing with the accrual of rent arrears and benefits. [Footnote 4] Second, there may be a point to raise under section 149 and/or sections 35 and 15 of the Equality Act 2010. [Footnote 5] It will not necessarily be an answer to the proportionality question under section 15 that the court in JS & Others found the policy to be lawful and proportionate. In an individual case, it may not be. Third, if there is any doubt over whether an authority has considered the best interests of any directly or indirectly affected children, this point could also be raised. There could be two points here: first that the authority has failed entirely to consider the child’s best interests and, second, that even if they have, in conducting that assessment material factors have been ignored.

For discretionary ground cases, all the preceding factors can be raised in connection with the reasonableness assessment. Effective use could also be made in these cases of the court’s extended discretion – for example, to adjourn cases where there is some prospect of obtaining a DHP or where no suitable alternative accommodation has yet been located.


[1] Section 96(11) WRA 2012 expressly excludes state pension credit and retirement pensions from being specified as a prescribed benefit.

[2] Note that the old-form of section 193(7F) continues to apply in Wales.

[3] Subject to the difficulties regarding Article 8 and possession claims, and the particular difficulties likely to apply where the landlord has a competing right under A1P1.

[4] See, eg, Leicester City Council v Shearer – Recorder Maxwell QC, 10 January 2013, unreported (Court of Appeal hearing on 16 October 2013; judgment reserved).

[5] Though in all cases involving “disability benefits” the cap will not apply.

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