The claimants were three single parents and each of their youngest children, and the adults were all in receipt of housing benefit.
MG lived in a flat with her four sons, and was unable to work due to both her illiteracy and obligation to care for her youngest child of 12 months. The effect of the ‘benefit cap’ (Welfare Reform Act 2012) was to reduce her total income from benefits by £176.75 per week.
NS lived in a flat with her three daughters, having left her matrimonial home following sexual abuse and domestic violence from her former husband. The effect of the cap was to reduce her total income from benefits by £54.50 per week, although if she was still living with her husband, he would have been eligible for working tax credit and the cap would not have applied. NS was also yet to find a job, with her ability to work being restricted by her need to care for her youngest child, as well as her limited English.
SG lived in a flat with three of her children, with an additional child in foster care nearby, and two other children living with their father in Belgium. After recently leaving her job, SG had been subject to a 39-week grace period before the application of the cap. However, following impending increases in her rent, and the possibility of two of her other children returning from Belgium to her care, SG faced the possibility of having to look after two extra children without any additional funds. As a result of her Jewish faith, it was also important for her to live in the area that she resided in, which was close to the Jewish school that her children attended, near to her child’s foster home, within range of various kosher food outlets and within distance of the family’s support network of family and friends. The effect of the cap was to reduce her total income from benefits by £85.40 per week.
The grounds of challenge, contended by the six claimants in relation to the imposition of the ‘benefit cap’, were threefold. Firstly, they contended that the cap was discriminatory, thus contrary to Article 14 taken together with Article 8 and/or Article 1 of Protocol 1 (A1P1). Secondly, they argued that the cap had breached the claimants’ rights under Article 8, or the defendant’s obligations under the United Nations Conventions on the Rights of the Child (UNCRC) which required that the best interests of children were a primary consideration ‘in all actions concerning children’. And thirdly, they argued that the Secretary of State had acted irrationally and unreasonably when introducing the ‘benefit cap’.
In relation to the first challenge, this Court found that Article 8 added nothing to the argument based on A1P1 as the test of justification would be the same. Specifically here, the claimants argued that the ‘benefit cap’ discriminated against women and large families, contrary to Article 14 of the European Convention of Human Rights (ECHR).
With regards to the cap’s treatment of ‘large families’, the claimants observed that this could constitute ‘indirect discrimination’ as to race and religion, on the basis that certain ethnic minorities and religious groups tend to have larger families. This Court however expressed doubt that such a ‘generalised assertion’ could be treated as a personal characteristic amounting to an ‘other status’ within Article 14, given the lack of statistical evidence to support it.
However, in relation to women, the Court conceded that the ‘benefit cap’ had a negative impact, due to the adverse effect that it has on lone parents (and the disproportionately high number of female lone parents who are female). This finding was corroborated by the Equality Impact Assessment that accompanied the Bill, which estimated that 60% of benefit claimants would be single women, and most of whom would have children. Further, as Mr Wise submitted, the cap also impacted unfairly upon domestic violence victims, who statistically were more likely to be female (and fall within the category of ‘some other status’, for the purposes of Article 14). One particular area of difficulty for this group of people was the Housing Benefit Regulations 2006, which ensure that housing benefits paid temporarily on two homes where a claimant is fleeing domestic abuse; these benefits would be caught by the cap.
In relation to these allegations of discrimination, the critical issue, nonetheless, was ‘justification’. As Lord Justice Elias observed, ‘[w]hat must be justified is the difference in treatment; the policy must pursue a legitimate aim and there must be a reasonable relationship of proportionality between the means employed and the aim sought to be realised’. However, given that the case concerned ‘State benefits’, the margin of appreciation given here to the State was very broad, with the relevant test being whether, in view of the discriminatory effects, the measure was ‘manifestly without reasonable foundation’ [Stec v United Kingdom]. The claimants contended that the justification for the cap was ‘inherently weak’ given the adverse effect of the policy, whilst criticising its ‘arbitrary and unjust’ nature. This related particularly to the ‘dramatic and unjustified differential’ to which it was anticipated that the cap will give rise, because ‘if someone is in work and receiving the average wage that is only a proportion of his income. He will in addition be entitled to a range of benefits, and in particular child benefit and housing benefit, which are payable to those in work and out of work alike’. Further, the claimants questioned whether the aims of the scheme were feasible at all, especially in relation to the ‘assumed savings’ of the scheme, its frivolous attempts to incentivise work and the unreasonable expectation it placed upon beneficiaries to move house. However, in finding that the scheme was not ‘manifestly without reasonable foundation’, the Court accepted the following submissions of the Secretary of State. The Secretary of State had explained that the short term benefits of the cap would be achieved, whilst stressing that, in order to facilitate positive and meaningful welfare changes, beneficiaries may have to be forced to take difficult decisions. The Secretary of State also stated that help was still available for beneficiaries in the short term through ‘discretionary housing payments’ (DHPs), as well as temporary local authority accommodation if households were to become homeless. If the aforementioned ‘differential’ was to be eliminated by removing benefits which can be claimed by those at work from the cap, this would produce ‘an anaemic scheme which fails to give effect to Parliament’s objectives’. This imbalance, however, whilst ‘inevitable in an administrative scheme of this nature’ by being a ‘bright line’ rule, was not however reflective of the wider effect of the policy. Finally, as the Court stressed, the distribution of State funds is ‘par excellence a political question’. It was therefore beyond the ambit of the judiciary to deliberate upon whether or not the objectives can be achieved.
The second challenge concerned the claimants’ submission that the Secretary of State had failed to accord sufficient weight to the interests of children. Despite Article 3(1) of the United Nations Convention on the Rights of the Child placing emphasis upon the ‘best interests of the child’ being ‘a primary consideration’, as opposed to ‘the primary consideration’, the claimants nonetheless submitted that the Secretary of State had erred in failing adequately to approach the ‘proportionality assessment’ which weighed the ‘best interests of the children’ against ‘other considerations’ adequately. Furthermore, the claimants and the Child Poverty Action Group contended that in including ‘child benefits’ and ‘child tax credits’ within the scope of the cap, severe repercussions would be experienced by large families in particular; whilst both the Office of the Children’s Commissioner and the Impact Assessment accompanying the Bill foresaw severe ramifications for children in general. Notwithstanding these criticisms, the Court could not detect any failure by the Secretary of State sufficiently to appreciate the impact of this policy on children. Whilst in certain circumstances children would be adversely affected by the cap, it was importantly unapparent that their interests or concerns were treated as anything less than ‘a primary consideration’. Whilst it was clear that countervailing considerations had trumped the concerns of children in certain instances, this did not detract from the broader picture that the cap had been deployed as a means of facilitating a more positive welfare culture that will be more beneficial to families (inclusive of children) in the long-run and more financially sustainable. As the Parliamentary Joint Committee on Human Rights commented, the aim of the cap to incentivise work and diminish dependency is ‘potentially human-rights enhancing’.
The final submission by the claimants challenged the decision of the Secretary of State on the grounds of irrationality and unreasonableness. The claimants believed that the Secretary of State was not sufficiently informed of the ramifications of imposing the cap on families fleeing domestic violence and those living in temporary accommodation. However, as the court found, it was clear that the Secretary of State was knowledgeable of the problems within these areas, illustrated by the consultation groups that were set up to deal with these issues and attempts to structure the scheme so as to manage these particular areas. The claimants’ argument here was indicative of a belief that the Secretary of State should have given more weight to these features; however the requisite weight to be applied was a matter for the Secretary of State, and importantly there was no challenge to the merits of the decision itself. And further, the claimants’ suggestion that the imposition of the cap as a means of incentivising work was irrational within the context of ‘income support’ and the protection it gives to parents of young children was again rejected by the Court. This was a mere change of policy that was otherwise lawful, but also Governmental decisions on how to allocate public funds remain outside the parameters of the court’s jurisdiction.
Therefore the Court dismissed these applications.