Four single mothers win Universal Credit legal battle as Amber Rudd vows to make system more 'compassionate'

  • Video report by ITV News Political Correspondent Libby Wiener

Four working single mothers have won a High Court challenge over the Government's controversial Universal Credit welfare scheme.

It comes as the Work and Pensions Secretary Amber Rudd announces a set of reforms to UC, making the system more "compassionate" than the one she inherited.

She confirmed she was delaying asking Parliament for permission to move three million people on to UC until next year, after a pilot of the transfer from existing benefits has been completed.

Controversial plans to apply a two-child benefit cap retrospectively to new Universal Credit claimants will also be scrapped, helping around 15,000 families.

  • High Court rules in favour of single mothers

Some of the mothers claimed they were relying on food banks. Credit: PA

The High Court ruling on Friday was related to how the payment system works, where on occasion monthly payments can vary “enormously” leaving people out of pocket.

Lord Justice Singh and Mr Justice Lewis gave their ruling following a hearing in November when they were told the women are struggling to manage their household budgets and some have fallen into debt or had to rely on food banks.

Lawyers for Danielle Johnson, Claire Woods, Erin Barrett and Katie Stewart said the problem is likely to affect “tens of thousands of people” claiming Universal Credit, which was introduced to replace means-tested benefits including income support and housing benefit.

They said the problem arises when claimants are paid by employers on a date which “clashes” with their assessment period for Universal Credit.

For example, they pointed out that if a claimant is paid early because of a weekend or bank holiday, the system counts them as having been paid twice in one month and they receive a “vastly reduced” Universal Credit payment.

The judges said they had concluded that the “Secretary of State had wrongly interpreted” the relevant regulations.

Solicitor Carla Clarke, of the Child Poverty Action Group, who brought the case on behalf of the lone mothers, said: “Today’s result should mean that in future no-one will lose out on their Universal Credit awards or face the hardship that my clients have faced simply because of when their payday happens to fall.”

A spokesman for the DWP said: “We are carefully considering the court’s judgment.”

  • How Rudd wants to make system more 'compassionate'

Ms Rudd also signalled that an end is in sight to the benefits freeze. Credit: PA

Speaking to BBC Radio 4's Today programme, Ms Rudd said: "I'm absolutely convinced that Universal Credit is a far better system than the legacy system it replaces.

"This is a really ambitious project. It’s going to impact on eight million people's lives when it is finally completed.

"It is inevitable that, as we roll it out, as we make the changes, we are learning about how to do it better.

"Maybe things that were were proposed previously weren’t effective or weren’t compassionate in the way that I want them to be.

"So I'm going to be perfectly bold about making those changes where I need to."

Other intended changes will make the system more "individual", tailoring it to claimants' needs by making payments more regular or paying rent money direct to landlords.

Ms Rudd said she also would build a "nudge" into the system to ensure that a couple's UC payment was "much more likely" to go to children's primary carer-giver – usually the woman.

  • How did the intended two-child cap work?

The roll-out of Universal Credit has been ongoing. Credit: PA

The two-child cap limits support for families through tax credits, housing benefit and UC to the first two offspring.

Subsequent children, except in special cases, are not entitled to the "child element", which is currently £2,780 a year.

Ms Rudd said it was not "reasonable"to impose the two-child cap – intended to force claimants to make decisions on whether they can afford a third child in the same way as those in work – on families which already have more than two offspring".

The Commons Work and Pensions Committee had branded the plans to retrospectively extend the cap to children born before it was brought in as "cruel".