Roberts v Secretary of State for Work and Pensions (2025) EWHC 51 (Admin)
A quick note on this judicial review of DWP policies on implementing ‘diversionary’ payments (direct payments of rent element of Universal Credit to landlords) and ‘recoupment’ payments (deductions from Universal Credit for arrears, paid to landlords).
DWP policy had been as follows:
For ‘diversionary payments’, for social landlords only, not private landlords, the DWP would implement the payment to landlord, notify the tenant claimant and offer them a chance too request a reconsideration (which could take about 50 days or more).
For ‘recoupment payments’, for both social and private landlords, the DWP would implement the deduction, notify the tenant claimant, and offer reconsideration.
The High Court found this to be unlawful. While the principle of the deductions was ‘in the tenant’s best interests’, as likely to preserve the tenancy, the tenant claimant had to be notified of the landlord’s request for deductions and given the opportunity to raise whether there was a dispute as to the amount of arrears, payability of rent amount, or some other dispute with the landlord underlying the arrears. (eg, an example given in the judgment is
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.
(I’ll come back to this below).
Not to give the tenant claimant the opportunity to make representations before imposing the deduction (and then only offering reconsideration of the decision) was procedurally unfair.
The Court made a declaration in the following terms
The Defendant’s policy of directing her decision makers that it is unnecessary to give Universal Credit claimants an opportunity to make representations before making payments to landlords under reg.58 and/or Sch.6 Universal Credit, Personal Independence Payment, Jobseeker’s Allowance and Employment and Support Allowance (Claims and Payments) Regulations 2013 is unlawful, because it is procedurally unfair.
Comment
While the judgment certainly makes sense, and it is hard to see why the policy had differed between social and private landlords on implementing direct payment of the rent element of UC to the landlord, from a housing lawyer’s point of view, it is interesting to see both the Court and indeed the DWP accepting that withholding rent in a housing conditions dispute is a valid course of action by the tenant.
As well as the Court’s mention of this, above, the DWP’s supposed ‘new’ policy, mentioned in the judgment, said
“We have agreed to a request from your landlord to pay your rent to them directly. You can only challenge this decision if one of the following applies to you: (i) your rent payments are up to date; (ii) you are in a disrepair dispute with your landlord. To challenge our decision, contact us using your journal or call us on xxx. You will be asked to provide evidence of either your dispute or your rent payments. If you do not contact us, we will pay your rent to your landlord.”
This was criticised by the Court as overly restrictive – no arrears or a disrepair dispute were not the only possible reasons for the tenant to dispute arrears or the amount of arrears, but again, the withholding of rent in a disrepair/conditions dispute is officially acknowledged.
This, of course, sounds odd to housing lawyers. The usual (indeed universal) advice is that the breach of an obligation by the landlord does not permit the breach of the rent obligation by the tenant, such that the tenant could easily face a rent arrears possession claim which a housing conditions counterclaim may well not extinguish.
We also know, in practice and from experience, that the rent is rarely ‘withheld’ in the sense that it is saved away, ready to be paid when the landlord complies with its obligations.
But there we are, everyone, even the DWP, needs a housing lawyer with them at all times.
As someone relatively new to housing law and policy, may I ask, has the government ever considered implementing a scheme where rent was paid into some kind of escrow account, “saved away, ready to be paid when the landlord compiles with his obligations”? I’ll bet that the finance companies who already supply deposit protection services would be only too happy to hold on to tenants’ money in this way. And it might incentivise quicker repairs, especially in the private sector.
No, on the basis that it would be legally a mess and financially impractical.
Mind you, Wales has legislated for rent not being payable when the property is not fit for human habitation (if the landlord includes that clause) and that has already caused havoc – https://nearlylegal.co.uk/2024/11/it-must-have-consequences/
Great idea, i thought of this myself, but the Renters Rights Bill has put pay to that , by stating a landlord or agent cannot ask the tenant to pay advanced rent to a third party.
It is very welcome to see a challenge (after 11/12 years?) to the iniquitous practice of deducting instalments without discussion with the resident or regards for their circumstances, with the minimum amount going from £3.25pw (for social housing) to 10-20% of rent. This slipped into judicial thinking.. unless challenged. There is further to go. However, sanctioning non payment of rent in disrepair cases? Mad.
From a local authority landlord point of view, I have mixed feelings about this. On the one hand I would agree with the principle that a UC claimant should be allowed an opportunity to argue about an APA or TPD before it’s set up. Although there is never any such right for HB claimants (with an LA landlord). But a sensible social landlord should always try to discuss an APA with the tenant before applying on the Landlord Portal anyway (although I would be the first to admit that not all social landlords are sensible or are driven by what is right and good).
When I read this judgment the first thing that struck me was how clear it is that the DWP doesn’t know what its own processes are – changing their story literally all through to the end. This wouldn’t be a surprise to anybody working in benefits advice. But I also was struck by the judge’s assertion that it’s appropriate to withhold rent due to disrepair (or some other dispute) – which goes against the advice I would have given when working on that side, and may be over-optimistic about the likelihood that such money will be put aside and paid when everything is sorted.
I think it is harmful to encourage people to make a direct link between rent and repair; either way you look at it. I have heard people working for social landlords (who really should know better) saying they shouldn’t have to do repairs for people with rent arrears. wrong + wrong = 2wrong.
How does this play out now? UC have proved again and again that they don’t know much about housing law and are not always best placed to make a decision about what’s in a tenant’s best interests. Given the difficulty of bringing a disrepair claim or even counterclaim (particularly in Legal Aid deserts), and the recent beefing-up of the social housing regulatory regime, I would suggest that a council tenant with a complaint about disrepair would be better off raising it as a complaint, and following that through to the Ombudsman if necessary, but keep on paying the rent. The tenant might feel (incorrectly, but understandably) that the only leverage is withholding rent. How can a UC Case Manager make a meaningful decision on this? In practice does this mean the DWP will end up being over-cautious about APAs and TPDs? And I worry about the knock-on effect of the DWP affirming decisions to withhold rent. It is not always easy to explain things to unhappy tenants, and it’s not going to be made easier if they start saying, “The DWP agrees I don’t have to pay rent because I have a disrepair complaint.”
I would say that most of the tenants we ask are very happy to have an APA – especially if they have come over from HB. And much of the time we apply at the tenant’s request. So perhaps it won’t be a significant issue.
DWP – UC, – a Govt computerised system, what could go wrong !
I don’t think m- any, would disagree that since UC, things have been made harder for Tenants, in that the difficulties and inefficiencies of DWP in administering U.C. has had an understandable business aversion from choosing Tenants on benefit. Those who wish to pontificate about the legal or moral aspects of discrimination, can do so.
However, in the practical world of Tenants on benefit being able to find PRS accommodation open to them ( bearing in mind the already 97% or so Shelter quote, properties for rent that are above the LHA threshold ) when L.A’s wanted to persuade a Landlord to offer a tenancy, the promise of direct payment of Housing benefit was a strong attraction. Lets not kid ourselves about PRS property rent being above Social Housing, who are allowed and claim up to 33% above LHA rate for providing ‘Affordable Housing’ – because Social housing providers had told Govt that they cannot afford to provide Social housing at LHA rate. Whilst those who berate private landlords for ‘taking state paid housing allowance, Social Housing are sometimes actually paid more of Tax-payers money for providing same accommodation.
Business will always make decisions in their best financial interest and legislation that attempts to circumvent this will eventually fail, if not indirectly through related impact – consequences ( e.g. higher asking rents, market rates, as a whole. Or reduction of available property, combined – exacerbated by ever increasing excess demand. )
No amount of Socialist lefty legislation like the Renters RIGHTS Bill will change this. Its all well and good having ‘Rights’ but they are of no use when there isn’t any property / enough, to rent.
Chris – this judgment does not apply to direct payments of UC rent component to private landlords. That was already done with pre-notification to the tenant claimant, so lawful.
Absolutely none of this has anything to do with the Renters’ Rights Bill.
You appear to be having a bit of a random froth in response to a case which has precisely nothing to do with what you are talking about.
Random Froth – loved it