Gargett, R (on the application of) v London Borough of Lambeth [2008] EWHC 663 (Admin)

[2008] EWHC 663 (Admin)Case No CO/7684/2007
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 8 th April 2008
Before
SIR GEORGE NEWMAN
Between
The Queen on the application ofClaimantGARGETTClaimantThe mayor & burgesses of the London borough of lambethDefendant
(Transcript of the Handed Down Judgment ofWordWave International LimitedA Merrill Communications Company190 Fleet Street, London EC4A 2AGTel No: 020 7404 1400, Fax No: 020 7831 8838Official Shorthand Writers to the Court)
Marina Sergides (instructed by Pierce Glynn) for ClaimantAndrew Lane (instructed by Judge & Priestley) for DefendantHearing Hearing date: 18 th March 2008
JudgmentSir George Newman :
[1]This application for judicial review raises a short point in connection with the purpose and scope of discretionary housing payments (“DHPs”).

The Statutory Provisions

[2]DHPs were introduced in 2001 by the Child Support, Pensions and Social Security Act 2000 (“the 2000 Act”). They replace exceptional circumstances and exceptional hardship payments formerly found in regulation 61 Housing Benefit Regulations 1987.[3]The power to make DHPs derives from section 69 of the 2000 Act which provides: “69Discretionary financial assistance with housing(1) The Secretary of State may by regulations make provision conferring a power on relevant authorities to make payments by way of financial assistance (“discretionary housing payments”) to persons who— (a) are entitled to housing benefit or council tax benefit, or to both; and (b) appear to such an authority to require some further financial assistance (in addition to the benefit or benefits to which they are entitled) in order to meet housing costs.(2) Regulations under this section may include any of the following— (a) provision prescribing the circumstances in which discretionary housing payments may be made under the regulations; (b) provision conferring (subject to any provision made by virtue of paragraph (c) or (d) of this subsection or an order under section 70) a discretion on a relevant authority— (i) as to whether or not to make discretionary housing payments in a particular case; and (ii) as to the amount of the payments and the period for or in respect of which they are made; (c) provision imposing a limit on the amount of the discretionary housing payment that may be made in any particular case; (d) provision restricting the period for or in respect of which discretionary housing payments may be made; (e) provision about the form and manner in which claims for discretionary housing payments are to be made and about the procedure to be followed by relevant authorities in dealing with and disposing of such claims; (f) provision imposing conditions on persons claiming or receiving discretionary housing payments requiring them to provide a relevant authority with such information as may be prescribed; (g) provision entitling a relevant authority that are making or have made a discretionary housing payment, in such circumstances as may be prescribed, to cancel the making of further such payments or to recover a payment already made; (h) provision requiring or authorising a relevant authority to review decisions made by the authority with respect to the making, cancellation or recovery of discretionary housing payments.(3) Regulations under this section shall be made by statutory instrument, which shall be subject to annulment in pursuance of a resolution of either House of Parliament.(4) Subsections (4) to (6) of section 189 of the [1992 c. 5.] Social Security Administration Act 1992 (supplemental and incidental powers etc.) shall apply in relation to any power to make regulations under this section as they apply in relation to the powers to make regulations that are conferred by that Act.(5) Any power to make regulations under this section shall include power to make different provision for different areas or different relevant authorities.(6) In section 176(1) of that Act (consultation with representative organisation on subordinate legislation relating to housing benefit or council tax benefit), after paragraph (a) there shall be inserted— “(aa)regulations under section 69 of the Child Support, Pensions and Social Security Act 2000;”.(7) In this section— “prescribed” means prescribed by or determined in accordance with regulations made by the Secretary of State; and “relevant authority” means an authority administering housing benefit or council tax benefit.” (a) are entitled to housing benefit or council tax benefit, or to both; and (b) appear to such an authority to require some further financial assistance (in addition to the benefit or benefits to which they are entitled) in order to meet housing costs. (a) provision prescribing the circumstances in which discretionary housing payments may be made under the regulations; (b) provision conferring (subject to any provision made by virtue of paragraph (c) or (d) of this subsection or an order under section 70) a discretion on a relevant authority— (i) as to whether or not to make discretionary housing payments in a particular case; and (ii) as to the amount of the payments and the period for or in respect of which they are made; (c) provision imposing a limit on the amount of the discretionary housing payment that may be made in any particular case; (d) provision restricting the period for or in respect of which discretionary housing payments may be made; (e) provision about the form and manner in which claims for discretionary housing payments are to be made and about the procedure to be followed by relevant authorities in dealing with and disposing of such claims; (f) provision imposing conditions on persons claiming or receiving discretionary housing payments requiring them to provide a relevant authority with such information as may be prescribed; (g) provision entitling a relevant authority that are making or have made a discretionary housing payment, in such circumstances as may be prescribed, to cancel the making of further such payments or to recover a payment already made; (h) provision requiring or authorising a relevant authority to review decisions made by the authority with respect to the making, cancellation or recovery of discretionary housing payments. “(aa)regulations under section 69 of the Child Support, Pensions and Social Security Act 2000;”.[4]In the exercise of the power to make regulations in this regard, the Secretary of State made the Discretionary Financial Assistance Regulations 2001 which, in their material part, provide as follows:- “Discretionary housing payments 2.—(1) Subject to paragraphs (2) and (3) and the following regulations, a relevant authority may make payments by way of financial assistance (“discretionary housing payments”) to persons who—(a) are entitled to housing benefit or council tax benefit or to both; and(b) appear to such an authority to require some further financial assistance (in addition to the benefit or benefits to which they are entitled) in order to meet housing costs. (2) Subject to paragraph (3) and regulations 4 and 5, a relevant authority has a discretion— (a) as to whether or not to make discretionary housing payments in a particular case; and (b) as to the amount of the payments and the period for, or in respect of which, they are made. (3) Paragraphs (1) and (2) shall not apply in respect of housing costs incurred in any period before 2nd July 2001— (a) in the case of a person entitled to council tax benefit who requires further financial assistance in order to meet his liability to pay council tax; (b) in the case of a person entitled to housing benefit who requires further financial assistance in order to meet housing costs (other than costs in respect of council tax) arising from his liability to make periodical payments in respect of the dwelling which he occupies as his home. Circumstances in which discretionary housing payments may be made 3. For the purposes of section 69(2)(a) of the Child Support, Pensions and Social Security Act 2000, the prescribed circumstance in which discretionary housing payments may be made is where a person has made a claim for a discretionary housing payment and the requirement for financial assistance does not arise as a consequence of— (a) a liability to meet any of the ineligible service charges specified in Schedule 1 to the Housing Benefit Regulations or Schedule 1 to the Housing Benefit (State Pension Credit) Regulations (ineligible service charges); (b) a liability to meet charges for water, sewerage or allied environmental services;(c) a liability to meet council tax payments in a case where the person is entitled to housing benefit but not council tax benefit;(d) a liability to make periodical payments in respect of such housing costs as are referred to in regulation 10 of the Housing Benefit Regulations in a case where the person is entitled to council tax benefit but not housing benefit;(e) a liability to meet council tax where the conditions in section 131(4) and (5) of the Social Security Contributions and Benefits Act 1992 are not satisfied and alternative maximum council tax benefit is payable;(f) a liability to meet the increase in such payment as is referred to in regulation 8(2A) of the Housing Benefit Regulations;(g) a reduction of an amount of benefit by virtue of section 46(11) of the Child Support Act 1991;(h) a reduction of a specified amount of benefit by virtue of section 2A of the Social Security Administration Act 1992;(i) a reduction in the amount of a jobseeker’s allowance payable by virtue of section 17 of the Jobseekers Act 1995;(j) the non-payability of a jobseeker’s allowance or a reduction in the amount of a jobseeker’s allowance payable, pursuant to a decision made by virtue of section 19 or 20A of the Jobseekers Act 1995;(k) the suspension of payment of an amount of benefit by virtue of section 21, 22 or 24 of the Social Security Act 1998 or section 68 of, and paragraphs 13 and 14 of Schedule 7 to, the Child Support, Pensions and Social Security Act 2000. [(l) a restriction in relation to the payment of benefit imposed pursuant to section 62 or 63 of the Child Support, Pensions and Social Security Act 2000 [or section 7, 8 or 9 of the Social Security Fraud Act 2001] (loss of benefit provisions)]. Limit on the amount of the discretionary housing payment that may be made 4. The amount of a discretionary housing payment (if calculated as a weekly sum) shall not exceed, in a case where the need for further financial assistance arises as a consequence of the liability to make— [(a) periodical payments in respect of the dwelling which a person occupies as his home, other than payments in respect of council tax, an amount equal to the amount of the aggregate of the payments specified in - (i) regulation 12(1) of the Housing Benefit Regulations less the aggregate of the amounts referred to in regulation 12(3)(b)(i) to (iii) of those Regulations, calculated on a weekly basis in accordance with regulation 80 and 81 of those Regulations; or (ii) regulation 12(1) of the Housing Benefit (State Pension Credit) Regulations less the aggregate of the amounts referred to in regulations 12(3)(b)(i) to (iii) of those Regulations, calculated on a weekly basis in accordance with regulation 61 and 62 of those Regulations; or] (b) payments in respect of council tax, an amount equal to the weekly amount of council tax liability of that person calculated on a weekly basis.” (a) are entitled to housing benefit or council tax benefit or to both; and (b) appear to such an authority to require some further financial assistance (in addition to the benefit or benefits to which they are entitled) in order to meet housing costs. (a) as to whether or not to make discretionary housing payments in a particular case; and (b) as to the amount of the payments and the period for, or in respect of which, they are made. (a) in the case of a person entitled to council tax benefit who requires further financial assistance in order to meet his liability to pay council tax; (b) in the case of a person entitled to housing benefit who requires further financial assistance in order to meet housing costs (other than costs in respect of council tax) arising from his liability to make periodical payments in respect of the dwelling which he occupies as his home. (a) a liability to meet any of the ineligible service charges specified in Schedule 1 to the Housing Benefit Regulations or Schedule 1 to the Housing Benefit (State Pension Credit) Regulations (ineligible service charges); (b) a liability to meet charges for water, sewerage or allied environmental services; (c) a liability to meet council tax payments in a case where the person is entitled to housing benefit but not council tax benefit; (d) a liability to make periodical payments in respect of such housing costs as are referred to in regulation 10 of the Housing Benefit Regulations in a case where the person is entitled to council tax benefit but not housing benefit; (e) a liability to meet council tax where the conditions in section 131(4) and (5) of the Social Security Contributions and Benefits Act 1992 are not satisfied and alternative maximum council tax benefit is payable; (f) a liability to meet the increase in such payment as is referred to in regulation 8(2A) of the Housing Benefit Regulations; (g) a reduction of an amount of benefit by virtue of section 46(11) of the Child Support Act 1991; (h) a reduction of a specified amount of benefit by virtue of section 2A of the Social Security Administration Act 1992; (i) a reduction in the amount of a jobseeker’s allowance payable by virtue of section 17 of the Jobseekers Act 1995; (j) the non-payability of a jobseeker’s allowance or a reduction in the amount of a jobseeker’s allowance payable, pursuant to a decision made by virtue of section 19 or 20A of the Jobseekers Act 1995; (k) the suspension of payment of an amount of benefit by virtue of section 21, 22 or 24 of the Social Security Act 1998 or section 68 of, and paragraphs 13 and 14 of Schedule 7 to, the Child Support, Pensions and Social Security Act 2000. [(l) a restriction in relation to the payment of benefit imposed pursuant to section 62 or 63 of the Child Support, Pensions and Social Security Act 2000 [or section 7, 8 or 9 of the Social Security Fraud Act 2001] (loss of benefit provisions)]. [(a) periodical payments in respect of the dwelling which a person occupies as his home, other than payments in respect of council tax, an amount equal to the amount of the aggregate of the payments specified in - (i) regulation 12(1) of the Housing Benefit Regulations less the aggregate of the amounts referred to in regulation 12(3)(b)(i) to (iii) of those Regulations, calculated on a weekly basis in accordance with regulation 80 and 81 of those Regulations; or (ii) regulation 12(1) of the Housing Benefit (State Pension Credit) Regulations less the aggregate of the amounts referred to in regulations 12(3)(b)(i) to (iii) of those Regulations, calculated on a weekly basis in accordance with regulation 61 and 62 of those Regulations; or] (b) payments in respect of council tax, an amount equal to the weekly amount of council tax liability of that person calculated on a weekly basis.”

Essential Facts

[5]On 27th July 2007 the claimant applied to the defendant for a DHP seeking to cover “all or a significant part of the outstanding rent arrears” in order to prevent the “serious risk of losing her home”.[6]The claim was rejected. The primary reason given for the refusal was that the claimant was already in receipt of maximum housing benefit/council tax benefit: “Your client’s request has been denied on the basis that she was in receipt of Maximum Housing/Council Tax Benefit. DHP[s] are awarded in special circumstances to make up the difference in a person[’s] rent on a week-by-week basis and only if that person demonstrates that they have vulnerability such as health, disability or family issues …. Discretionary Housing Payments are not payments of benefit, they are freestanding payments made at the Authority’s discretion and only used to alleviate the position of people experiencing severe financial difficulties, particularly where the benefit system does not meet their full liability whether it is Council Tax or Housing Benefit. In your client’s case the Authority concludes that your client was not in receipt of Housing Benefit largely for the period of her rent arrears and therefore Housing Benefit may not be awarded as in accordance with the Discretionary Financial Assistance Regulations 2001: 2(1) and (3)”.[7]The claimant’s solicitors rejected this reasoning and invited the defendant to think again in a letter dated 22nd August 2007. In particular they submitted that the claimant’s current receipt of full housing benefit did not prevent a DHP – lump sum or periodic – and past periods of non-receipt were irrelevant given that it was the claimant’s current position which was the crucial factor to consider.[8]Guidance set out in the form of the original March 2001 document was produced by the Department of Work & Pensions’ predecessor, the Department of Social Security.[9]Paragraph 1 of the Guidance states:
“Discretionary Housing Payments are not payments of benefit. They are freestanding payments made at the discretion of the local authority, subject to an annual cash limit, in cases where the local authority considers that additional help with housing costs is needed.”
[10]According to the Guidance DHPs are, in essence, payments made by a local authority at their discretion to applicants in receipt of housing benefit and/or council tax benefit who they consider need help with their “housing costs” over and above their usual housing benefit and/or council tax benefit entitlements. It should be noted:(1) they are not payments of benefit;(2) local authorities have an annual budget for such awards and payments cannot be made once this limit is reached (see paragraph 10 of the Guidance”);(3) according to the Guidance at paragraph 11, “housing costs” refers to council tax liability and eligible rent (e.g. not including ineligible service charges, charges for water, sewerage and environmental service or increases in rent due to outstanding rent arrears); and(4) DHPs cannot exceed (when calculated as a weekly sum) the “eligible rent” after taking into account the housing benefit award.

The Grounds of Challenge

[11]There are three grounds of challenge:(1) The Council fettered its discretion and misapplied the Regulations in excluding lump sum DHPs from those in receipt of full housing benefit.(2) The Council has failed to have regard to the claimant’s circumstances.(3) The Council has failed to consider its own prevention of homelessness strategy.[12]Section 69(2) of the 2000 Act lays down a framework for the regulation of DHPs.

(c) provides, as part of the framework, that there may be a:

“provision imposing a limit on the amount of the discretionary housing payment that may be made in any particular case;”
Regulation 4 sets the limit on the amount of the DHP. It provides that a DHP cannot in effect exceed “eligible rent” (in broad terms, the maximum housing benefit award for any particular week). It follows that the discretion conferred on a local authority to make a DHP is restricted by the limit set under regulation 4. Regulation 4 applies to all DHPs because all DHPs fall to be calculated by reference to the relevant periodical payments which have given rise to the need for financial assistance (see sub-paragraph 2 of regulation 2).[13]The claimant’s case is that a local authority is empowered by the regulations to make a DHP which is outside the limit set by regulation 4. Ms Sergides submits that there is power to award a lump sum even where full housing benefit is being received. She founds this argument, principally, upon the words in parenthesis in regulation 4:
“… (if calculated as a weekly sum) …”
. The argument, with respect, misses the point of the regulation. The regulation sets a means of calculation, not a circumstance of entitlement to the amount which is to be paid. The entitlement arises (as Ms Sergides in other parts of her argument submitted) if there is an entitlement to housing benefit or council tax or both and a requirement (as it appears to the authority) for some further financial assistance. But it is to be noted that a DHP is tied to an entitlement to benefit or benefits, it is “in addition to” the benefit or benefits (s.69(1) 2000 Act and regulation 2(1)(a) and (b)) and it cannot be calculated under regulation 4 unless it is being paid or has been paid in any relevant period covered by the application.[14]The fallacy of the argument for the claimant that entitlement to housing benefit, once made out, is sufficient to found payment of a DHP cannot survive the impact of regulation 4. Indeed the consequence of the submission, recognised by Ms Sergides in the course of argument, would be that an applicant, with a one off housing cost (for example, adaptation to a home) could obtain a lump sum. “Housing costs” are not defined but, without deciding the issue, I would doubt that the expression extends to such a cost, having regard to the terms of the regulations which are presently in force.[15]In the final alternative Ms Sergides submitted that even if regulation 4 does apply, the regulation only caps the amount by reference to the payments in regulation 12(1) of the Housing Benefit Regulations 2006 falling due during the period over which the arrears occurred, minus any amount referred to in regulation 12(3)(b)(i) to (iii). This argument fails for the reasons already advanced. Whilst back payments are within the discretion of a local authority, the calculation under regulation 4 is concerned with the present shortfall. DHPs are available to assist tenants and others to remain in their accommodation by enabling them to afford the periodic rent (also some backdating based on a weekly analysis) and to make up shortfalls in certain cases, for example in the case of non-dependant deductions.[16]Having regard to the conclusion that the defendant had no power to make a payment, grounds 2 and 3, although not abandoned, were not developed and do not arise.[17]This application for judicial review is dismissed.

Cited in 1 later judgment