The Department for Work and Pensions (DWP) has introduced the Successful Legacy Appeals Compensation Scheme for individuals who experienced financial detriment after transitioning from legacy benefits to Universal Credit due to an erroneous decision.
Background of the Scheme
This initiative follows a 2020 Court of Appeal ruling involving claimants who successfully contested the cessation of their existing benefits but were unable to revert to them after having claimed Universal Credit. Under Universal Credit regulations, once a claim is made, previous legacy benefits cease and typically cannot be reinstated. According to new GOV.UK guidance published on Thursday, compensation may be available to those who received less under Universal Credit than they did from their prior benefits.
Covered Legacy Benefits
The compensation scheme applies to claimants in Scotland, England, and Wales. Legacy benefits covered include:
- Housing Benefit
- Child Tax Credit
- Working Tax Credit
- Income-related Employment and Support Allowance (ESA)
- Income-based Jobseeker's Allowance (JSA)
- Income Support
Eligibility Criteria
You may qualify for compensation if all the following conditions are met:
- You have evidence of receiving one or more means-tested legacy benefits listed above.
- A decision was made to terminate one of your legacy benefits, ending your entitlement.
- As a result of that decision, you successfully claimed Universal Credit within one month of your legacy benefit ending.
- The amount of Universal Credit you were entitled to was less than what you received from your legacy benefit before the move.
- You challenged the decision that stopped your benefit and won, meaning you should have continued receiving your legacy benefit instead of claiming Universal Credit when you did.
The DWP emphasizes that only individuals meeting all these conditions will be eligible for compensation.
Payment Details
Payments will be calculated based on the claimant's highest monthly financial loss multiplied by 12. The DWP states that the lump sum is designed to reflect compensation similar to what a court might have awarded for the financial loss incurred due to the inability to return to previous benefits.
How to Apply
Eligible individuals can apply by completing a form available on GOV.UK or by sending a letter containing the same information required on the form. Applications can also be made over the phone for those unable to complete the paperwork themselves.
Processing Timeline
The Department aims to issue decisions within six weeks of receiving an application. The scheme is intended to ensure affected individuals do not need to seek further compensation through the courts or a tribunal.
Legal Context
The compensation scheme follows the Court of Appeal case TD, AD and R v Secretary of State for Work and Pensions [2020] EWCA Civ 618, which found that some claimants suffered financial loss after being forced to move to Universal Credit due to incorrect decisions on their legacy benefits.
Full details about the compensation scheme and how to claim can be found on GOV.UK.
