Thousands of claimants could be due compensation following a legal dispute involving the Department for Work and Pensions (DWP). As many as 13,000 benefit recipients may be eligible for compensation after it was discovered that many lost income during a transition to Universal Credit.
To date, over 200 claimants have been awarded between £200 and £3,000 in damages. Those affected were transferred from ‘legacy benefits’ to Universal Credit before September 2019 and missed out on ‘severe disability premiums’ because the DWP did not implement a scheme that provided financial protection.
Some lost up to £180 a month in income due to missing out on the enhanced disability premium (EDP). Disability premium payments are typically added to certain legacy benefits such as Income Support and Housing Benefit for those living with specific disabilities.
It was available in three tiers: standard, severe, and enhanced, each with different eligibility criteria which are detailed here. Law firm Leigh Deigh previously represented two benefit claimants in the High Court who claimed to lose income as a result of the move and successfully won the case for consultation.
The same firm has now settled similar cases for 275 DWP claimants.
The DWP has launched a compensation scheme to recompense affected claimants, with estimates suggesting payouts could soar into the thousands. While the non-financial aspect of the claim has been resolved, compensation will now address the stress and emotional distress suffered in connection to the issue.
Ryan Bradshaw, a partner at Leigh Day, believes up to £13,000 claimants might qualify for compensation. “I am glad to have settled this claim on behalf of my clients,” he remarked.
“However, there are thousands of others who have been similarly affected who have not been in a position to bring a claim like this. They too will have suffered unnecessary stress.”
He urged for an immediate comprehensive scheme to compensate all those who faced discrimination by the DWP, insisting that such errors must not recur. A DWP spokesperson confirmed: “Following this ruling the department has begun the process of compensating affected claimants.”
Universal Credit is set to replace various legacy benefits for individuals below State Pension age, covering essentials from childcare to housing. The DWP will reach out to those on legacy benefits to transition them to Universal Credit, effectively phasing out the old system.
The primary legacy benefits impacted by this change include: Income-based Jobseeker’s Allowance (JSA), Working Tax Credit (WTC), Child Tax Credit (CTC), Housing Benefit (HB), Income-related Employment and Support Allowance (ESA), and Income Support (IS).
