The Department for Work and Pensions (DWP) must overhaul its method of deducting housing costs from Universal Credit payments after a High Court ruling deemed the current practice 'unfair' and 'unlawful'. The DWP will now be required to communicate with claimants before diverting funds to landlords for alleged rent arrears.
A landmark High Court ruling has compelled the Department for Work and Pensions ( DWP ) to revamp its method of deducting housing costs from Universal Credit payments. The court deemed the DWP 's practice of automatically approving landlord requests to garnish Universal Credit payments without engaging claimants to be 'unfair' and 'unlawful'. Consequently, the DWP is obligated to communicate with claimants before diverting funds from their payments to landlords for alleged rent arrears .
The legal challenge against the DWP was initiated on January 16, 2025, by a Universal Credit recipient and tenant named Nathan Roberts. In early 2024, Roberts experienced over £500 being deducted from his Universal Credit payment following his landlord's request. At that time, Roberts, who holds a law degree and previously worked in a police control room, was embroiled in a dispute with his landlord over alleged property repair neglect. Roberts' monthly Universal Credit income amounted to £1,218, comprising a basic allowance of £364.74, a housing element of £459.64 for rent, and an additional £390.06 due to his disabilities. The landlord informed the DWP that he was owed two months' rent, placing the tenant at risk of eviction should the arrears escalate. In such situations, the DWP deducts money from a person's monthly payments to cover the rent and mitigate the arrears, aiming to prevent debt accumulation, reports the Mirror. Roberts was notified by the DWP that his housing component would be suspended, with an additional deduction of £44.74 to address the rental arrears. Roberts argued that the DWP had authorized the deduction without considering whether it was in his best interest and had not initially informed him about the application for the deduction. He maintained that he had no arrears and was engaged in a 'genuine rent dispute' with the landlord regarding the property's habitability. Nonetheless, the DWP's actions were deemed intentional, reflecting department policy. DWP decision-makers are guided by a computer program to input specific data, and the system dictates the outcome. Claimants are not contacted prior to decisions, which are often automatically approved for both social and private landlords. A legal representative from Garden Court North Chambers representing Roberts stated that the DWP could be making 'hundreds of thousands of deductions' from Universal Credit annually without prior consultation with individuals, characterizing the practice as 'clearly arbitrary and an abuse of process.
Social Welfare UNIVERSAL CREDIT DWP HIGH COURT HOUSING COSTS LANDLORDS TENANTS RENT ARREARS LEGAL CHALLENGE WELFARE SYSTEM
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