High Court rules on Universal Credit transitional protection payments

3 mins read

Thursday 27 January 2022

Tags: benefits, universal credit, high court, transitional protection payments, tax credits, severe disability premium, disabled child element

Universal Credit transitional protection payments to a severely disabled parent should be higher if payments for their disabled child were also cut, the High Court has found.

The new judgement, AB and F v Secretary of State for Work and Pensions, finds it unlawful not to compensate a severely disabled parent for cuts made to the disabled child element when moving from tax credits to Universal Credit.

What are transitional protection payments?

Some disabled adults receiving legacy benefits (such as Income Support) receive an extra amount in their award called the severe disability premium.

As a result of previous court decisions, the Department for Work and Pensions (DWP) has been forced to treat severely disabled adults who receive a severe disability premium as a protected group.

The DWP is obliged to make “transitional payments” to these adults for the loss of the severe disability premium when moving from the legacy benefit to Universal Credit.

But this new court judgement has found that it isn’t lawful to limit that compensation only to the amount of the severe disability premium. If the severely disabled person has a disabled child, the transitional payment should cover not just the loss of the severe disability premium itself, but also any cuts to the disabled child element in their reward.

What is the disabled child element?

The disabled child element is an extra amount paid as part of your tax credit award for each child in your family who is on Disability Living Allowance (DLA) or Personal Independence Payment (PIP). The equivalent payment under Universal Credit is known as the disabled child addition.

If your child is on the highest rate care component of DLA (or PIP equivalent) you get the same amount for that child under both tax credits and Universal Credit. However, if your child is on any other rate of DLA or PIP, the amount paid under Universal Credit is £157 per month lower than you get under tax credits. This is one of the reasons many families with disabled children are worse off when they move onto Universal Credit.

And it is this loss that the DWP must now also compensate disabled adults receiving the severe disability premium.

Will all parents be compensated if payments for their disabled child were cut when they moved onto Universal Credit?

Unfortunately not. In this case, the court was specifically looking at the rights of severely disabled adults. The judgement is only likely to help you if you are a severely disabled parent who not only saw cuts to payments for a disabled child, but also lost the severe disability premium for yourself.

What happens now?

Unless the DWP decides to appeal this decision, it’s likely to lead to higher transitional payments for those disabled parents who have not only lost the severe disability premium, but who were also hit by a lower disabled child addition for their child.

This decision is good news for those severely disabled parents. But it’s thought unlikely to lead to the DWP extending transitional protection to all those other parents who have seen cuts to payments for disabled children when moving onto Universal Credit.

What are we doing?

Contact will continue to campaign for a change in the rules to protect the incomes of all parents who face lower payments for a disabled child under Universal Credit.

Read more about Universal Credit and other benefits and tax credits you may be eligible for.