By Liz Davis
Liz is a campaign volunteer with GMLC and hopes to assist the law centre with their continuing fight for free access to justice. She is a future trainee solicitor with Irwin Mitchell Solicitors.
At GMLC we fight for everyone’s right to a secure home and we fight for a supportive social security system, where people are in receipt of the benefits they deserve.
The recent Supreme Court judgment, Samuels v Birmingham City Council, is a great step forward in acknowledging the purpose of state benefits: as a means not just for people to scrape by, but to meet their needs. When the Appellant, Ms Samuels, was unable to cover her rent with her housing benefit, she was declared intentionally homeless on the basis that she could have used her other benefits. By unanimously allowing the appeal against this, the Supreme Court affirmed that non-housing benefits are not designed to create a surplus that can be used to account for insufficient housing benefits.
There is an important principle at stake: subsistence benefits are calculated to be able to cover basic needs. By deciding that people should dip into these other benefits to pay for rent not covered by housing benefits, wasn’t the local authority insisting that it is acceptable to be forced to live below this basic standard?
Ms Samuels lived with her four children in private rented accommodation in Birmingham. In July 2011, she served with Notice by her landlord, having fallen into rent arrears. Ms Samuels made a homelessness application to the local authority under Part VII of the Housing Act 1996, Birmingham City Council decided that they did not owe a full homelessness duty to Ms Samuels and her children on the basis that she had made herself intentionally homeless. The Council found that her private rented accommodation was affordable and reasonable for her to occupy and that Ms Samuels had lost this accommodation as a result of her own deliberateact in failing to pay rent.
The rent was £700 per month, £151.49 more than Ms Samuels received in housing benefit. Regulations state that, when deciding if a person is intentionally homeless, the local authority must take into account the financial resources available to that person, the costs of the accommodation and the person’s other reasonable living expenses. The Guidance to local authorities“recommends” authorities to regard accommodation as unaffordable if the applicant’s residual income would be less than the level of income support. In Ms Samuel’s case, the local authority took the view that “it is a matter of normal household budgeting that you would manage your household finances in such a way to ensure that you were able to meet your rental obligation”. In other words, that Ms Samuels could, and should, have made up the shortfall in her rent by holding back money she received for her own essential living costs (income support) and the benefits she received for her children (Child Tax Credit and Child Benefit). Her failure to do so meant that she had made herself intentionally homeless.
Defining “reasonable living expenses”
Freedom of Information Act requests from Shelter revealed that only 17 of 246 responding local authorities provided training to their staff on affordability assessments and 43 of 105 local authorities relied on guidance or policy that was not designed for assessing affordability for the purpose of homelessness decisions.
The key issue to be decided by the Supreme Court whether it was acceptable for a local authority to expect an applicant to use benefits set at levels to meet their subsistence needs to pay rent, where rent was not met by Housing Benefit.
The Supreme Court concluded that the assessment of reasonable living expenses cannot purely depend on the subjective decision of a housing officer, with little to no training. The Court suggested that where someone’s living expenses were reasonable and yet to be able to afford their full rent they would be left with less than the amount considered necessary to meet their own and their children’s needs it would be very difficult for a local authority to decided that the rent for the property was in fact affordable for them. Lord Carnwath states: “the question was not whether, faced with that shortfall, she could somehow manage her finances to bridge the gap; but what were her reasonable living expenses (other than rent), that being determined having regard to both her needs and those of the children, including the promotion of her welfare.” The Court quashed the decision of the local authority that Ms Samuels had made herself intentionally homeless by failing to pay rent.
The fact that Ms Samuels had to fight to establish that she had not made herself intentionally homeless by failing to pay her rent at the expense of her family’s essential living needs and the welfare of her children, is a depressing example of the extent to which the state now expects people to do without and survive with less than enough.
This result, and the fact that the Supreme Court were prepared to step in to expose the reality of Ms Samuels’ position and to confirm that her poverty and homelessness was of no fault of her own making, gives hope to many thousands of people living in similar circumstances and all those who fight with them. The Court has decided that subsistence benefits are not flexible and cannot be used to cover the shortcomings of other benefits. Rather these subsistence benefits are the bare minimum and should be applied to meet the needs of those receiving them.
Currently we don’t know how this ruling will be interpreted for people trying to make ends meet under the Universal Credit regime, where deductions for past debts are prioritised above rent payments, not by the individual receiving the benefit but by the DWP themselves. Will local authorities seek to argue that this is a failure in budgeting and the tenant’s fault?
Neither do we know how local authorities will treat income from disability benefits. Will they accept that this money is set at a rate just enough to meet additional disability costs and as such is not available to put towards the rent? Or will they suggest (as they often do) that disability benefits can and should be put towards rent payments, leaving disability needs unmet?
Outside of housing law, this finding that subsistence benefits are a bare minimum leads to wider questions of the current benefits regime. If subsistence benefits are a bare minimum, does this mean current sanctions of universal credit are a breach of human rights? If it is accepted that people can go below the bare minimum in law, it this presuming that we can just rely on food banks?
This is a positive finding, highlighting the reality of those who receive benefits and struggle to get by on a daily basis. We encourage the government to acknowledge this finding and apply it to a wider review of the current welfare state.