What is the Impact of the Spare Room Deduction Case on Local Authorities?

05-12-2016

By Sheldon Wood, Benefits and Revenues Advisor, CIPFA

Should authorities review their Discretionary Housing Payments (DHP) decision-making processes and budgets to ensure they identify those cases with similar situations?

The Supreme Court’s ruling on the spare room deduction case, which it heard at the end of February 2016, was published on 9 November 2016. Many commentators have awaited this ruling with interest, in expectation that it may provide a definitive ruling on the legality, or otherwise, of the bedroom tax legislation as a whole.

In fact, the Court took a narrow approach in only considering the small number of situations raised by the specific appeals before it, in the application of the bedroom tax, and did not address the wider legality of the policy.

Effect of the ruling

This ruling adds two additional exemptions to the list of exemptions to the bedroom tax:
  • Existing rule – those who need an extra room where a disabled child cannot reasonably be expected to share a bedroom.
  • New rule  - those who need an extra room where a partner cannot be expected to share a bedroom for a clearly identified medical need.
  • Existing rule – those who need an extra room for an overnight carer of an adult.
  • New rule – those who need an extra room for an overnight carer of a child, where there is a clearly identifiable medical reason.
The ruling also confirmed that there are three linked tests that can be applied in order to determine an exemption from the bedroom tax:
  • The discrimination caused should be manifestly without reasonable justification.
  • The situations involved should be easy to identify, not liable to lead to abuse of the scheme, unlikely to undergo change and not in need of regular monitoring.
  • There is a transparent medical need for an additional bedroom.

Actions for local authorities

The Depart of Work and Pensions (DWP) provided guidance to local authorities saying that the rulings did not strike down the regulations and that authorities should continue to follow them and need take no action until the DWP has considered the ruling and taken the necessary steps.

Such consideration will almost certainly involve making amendments to regulation B13 of the housing benefit regulations.

However, although the court did not strike down the regulations, it did give a ruling which now must be considered law. Authorities should therefore consider their approach to the treatment of new claims in such circumstances. They may also decide to trawl through existing claims to identify any with similar circumstances which may need to be reviewed. Authorities may wish to work with social landlords to identify potential such cases.

Authorities will need to decide whether to review such cases in light of the Supreme Court’s ruling or to ‘stay’ any review, pending the DWP introducing new regulations. Authorities should review their DHP decision-making processes and budgets to ensure they identify those cases with similar situations to those which the Supreme Court ruled should be considered for the award of a DHP to mitigate any discriminatory effects of the bedroom tax regulations.

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