The King (on the application of MS Helen Timson) v The Secretary of State for Work and Pensions
| Jurisdiction | England & Wales |
| Judge | Lord Justice Edis,Lord Justice Warby,Lord Justice Phillips |
| Judgment Date | 09 June 2023 |
| Neutral Citation | [2023] EWCA Civ 656 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: CA-2022-002107 |
[2023] EWCA Civ 656
Lord Justice Phillips
Lord Justice Edis
and
Lord Justice Warby
Case No: CA-2022-002107
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
KING'S BENCH DIVISION
ADMINISTRATIVE COURT
Mr Justice Cavanagh
[2023] EWHC 2392 (Admin)
Royal Courts of Justice
Strand, London, WC2A 2LL
Clive Sheldon KC, Katherine Apps KC, and Gethin Thomas (instructed by Government Legal Department) for the Appellant
Jenni Richards KC, and Tom Royston (instructed by Bindmans LLP) for the Respondent
Jason Coppel KC (instructed by DWF) for the Interested Party
Hearing dates: 25 and 26 April 2023
Approved Judgment
This judgment was handed down remotely at 10.30am on 9 th June 2023 by circulation to the parties or their representatives by e-mail and by release to the National Archives.
The principal issue in this appeal is whether Cavanagh J was right to hold that the Secretary of State for Work and Pensions had issued unlawful guidance which allowed decision makers to make an order for a third-party deduction (always called a “TPD”) from Ms. Helen Timson's benefits without first giving her an opportunity to make representations. The deduction was made under the exercise of a power by the Secretary of State which arises under Regulation 35 of and Schedule 9 to the Social Security (Claims and Payments) Regulations 1987 (“the Regulations”). Paragraphs 6(1) (fuel costs) and 7(2) (water charges) of Schedule 9 to the Regulations permit deductions for the utility supplies to which they relate.
This is a short point in the context of a complex system. The answer appears to me to be obvious: yes, he was right. It is important that the court should not be drawn into deciding issues which are not necessary to this decision. I think that this occurred to some extent before the judge, and that submissions of the parties have, to some extent, invited this court to take the same course. In my judgment this should be resisted.
The key provisions
Paragraph 6(1) of the Regulations, as now in force, says:-
(1) Subject to sub-paragraphs (6) and (6A) and paragraph 8, where a beneficiary who has been awarded the specified benefit or his partner is in debt for any fuel item to an amount not less than the rate of personal allowance for a single claimant aged not less than 25 and continues to require the fuel in respect of which the debt arose (“the relevant fuel”), the Secretary of State, if in its opinion it would be in the interests of the family to do so, may determine that the amount of the award of the specified benefit (“the amount deductible”) calculated in accordance with the following paragraphs shall be paid to the person or body to whom payment is due in accordance with paragraph 2(3).
Paragraph 7(2) of the Regulations, as now in force, says:-
(2) Where a beneficiary or his partner is liable, whether directly or indirectly, for water charges and is in debt for those charges, the Secretary of State may determine, subject to paragraph 8, that a weekly amount of the specified benefit shall be paid either to a water undertaker to whom that debt is owed, or to the person or body authorised to collect water charges for that undertaker, but only if the Secretary of State is satisfied that the beneficiary or his partner has failed to budget for those charges, and that it would be in the interests of the family to make the determination.
The effect of both provisions is that the Secretary of State can only make such deductions if in “its” opinion it would be in the interests of the family to do so. The wording which has that effect differs slightly between the provisions, but it is common ground that they have the same meaning.
Income-Related Employment and Support Allowance (“ESA”) is a “specified benefit” for the purposes of paragraphs 6 and 7 of the Regulations. Ms. Timson receives this benefit, as well as other benefits which are not specified benefits.
At paragraph 1, the Regulations define “family” as follows:-
“family” in the case of a claimant who is not a member of a family means that claimant and for the purposes of state pension credit “a family” comprises the claimant, his partner, any additional partner to whom section 12(1)(c) of the 2002 Act applies and any person who has not attained the age of 19, is treated as a child for the purposes of section 142 of the Contributions and Benefits Act and lives with the claimant or the claimant's partner;
The challenge
The claimant in this case is Ms. Helen Timson, now the Respondent to this appeal by the Secretary of State. She is a “beneficiary” for the purpose of the Regulations. Beneficiaries are usually called “claimants” in the documentation, and it would be artificial to use any other word when referring to claimants in general. Where, therefore, I need to refer to Ms. Timson I shall do so by name and will avoid describing her as “the claimant” in order to avoid confusion.
Ms. Timson lives on her own, and is, therefore, the “family” for the purposes of the Regulations. She suffers from mental and physical disabilities, and is dependent upon means-tested benefits. In the past, she fell into arrears with her utility providers, Severn Trent Water and E.ON. She was subject to TPDs between September 2019 and July 2021 for her water charges, and March 2021 and July 2021 for fuel costs. Neither deduction was made with her consent. Both TPDs were stopped in July 2021 in a supersession of earlier decisions. Following this, she made arrangements with both providers to pay a sum towards ongoing usage and a token sum towards arrears.
By these proceedings, Ms. Timson sought to challenge the way in which the TPD scheme is implemented in the Decision Makers Guide and in an Overview Document issued by the Secretary of State. Where I refer to “the Guidance” I refer to these documents taken together. The judge held that these documents amount to directions to the officials to whom the operation of the scheme is delegated. The challenge failed except in the single respect which is now the subject of this appeal. It is not necessary for the purposes of this judgment to rehearse the arguments or to summarise the parts of the comprehensive and clear judgment which relate to failed challenges. It will be necessary to return to them briefly at the end of this judgment when dealing with the Secretary of State's appeal against the costs order made by the judge. The judge awarded Ms. Timson her costs notwithstanding the failure of a significant part of her case.
Neither is it necessary to summarise the whole of the complex scheme of which the Regulations are a part. It is only necessary to refer to those aspects of it which are relevant to the contention that there is a legal obligation on the Secretary of State to give a claimant an opportunity to make representations before making a TPD.
This legal obligation is said to arise from three different sources:-
i) The duty of fairness.
ii) The true construction of the Regulations.
iii) The duty of the Secretary of State to determine reasonably what enquiries should be made prior to imposing a TPD. It is said that it is unreasonable to determine that an enquiry to ascertain the views of a claimant was not required. This has been referred to as the Tameside duty, based on the decision of the House of Lords in Secretary of State for Education v Tameside MBC [1977] AC 1014.
There is a Respondent's Notice which seeks to support the judge's decision on rather broader grounds than those which commended themselves to him. It does not seek to appeal against his rejection of other challenges. The Respondent's Notice invites the court to consider not only whether there was a duty to allow an opportunity to make representations, but also how the Secretary of State should decide issues which might be raised in representations.
The TPD scheme
The Overview Document begins by setting out what it describes as “the Background”, as follows:-
2. Benefit customers are normally expected to meet their household expenses from their income in the same way that people in work do. The TPD scheme was designed to provide last-resort protection for a vulnerable minority of people on income-related benefits who have failed to budget and run up arrears of essential household outgoings and where other methods of payment have been tried without success.
3. Deductions should be considered where there is no other suitable course of action available to allow for clearance of the arrears. In helping our customers with debt management the scheme also aims to promote financial responsibility.
The “last-resort protection” described here is further explained in a subsequent passage:-
5. The primary purpose of the scheme is therefore to protect the welfare of customers by shielding customers and their families from the consequences of getting into debt with essential household costs or to ensure compliance with a social obligation.
6. It is not intended to be a debt collection option for creditors except in very limited circumstances.
7. Paying a prescribed amount to the creditor removes the risk of the severe hardship likely to be caused by, for example, eviction or the disconnection of a fuel supply. TPD are normally made where it is in the interests of the family…..
The decision of the judge
At paragraphs [164]–[194] of his judgment, the judge examined the evidence before him on the subject of the “interests of the family”. He did not consider the possibility of eviction, as mentioned in the Overview Document, presumably because that is not a possible outcome in modern times.
He noted that...
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