The Department for Work and Pensions (DWP) has provided an update for individuals claiming disability benefits who may be entitled to substantial compensation. These payments are being issued to those who previously received certain disability benefits like Employment and Support Allowance but lost disability premiums when transitioning to Universal Credit before January 2019.
Affected individuals saw a reduction in their payments, particularly in severe disability premium (SDP) and enhanced disability premium (EDP). Legal firm Leigh Day challenged this income loss in court, highlighting that some experienced a monthly payment decrease of up to £180.
The DWP has acknowledged the need to compensate for the income loss, with estimates from Leigh Day suggesting potential compensation exceeding £5,000 per person. However, approximately 13,000 cases are still pending processing and clearance by the DWP.
In a recent annual report, the DWP noted challenges in identifying and rectifying underpayments for individuals no longer actively claiming ESA due to data restrictions. The DWP aims to resolve the outstanding cases by September, affecting an estimated 57,000 individuals and totaling an expected repayment cost of £452 million.
Following a High Court challenge by Leigh Day, 275 claimants secured settlements ranging from £200 to £3,000 in damages. A DWP spokesperson emphasized the commitment to promptly address owed arrears and prevent similar errors in the future.
Leigh Day solicitor Ryan Bradshaw expressed satisfaction in settling the claim for affected clients but highlighted the thousands more impacted by the income loss and stress resulting from the transition to Universal Credit before January 2019.
The DWP is in the final stages of transitioning all individuals on legacy benefits to Universal Credit, replacing benefits such as Housing Benefit, Income-related Employment and Support Allowance, Income-based Jobseeker’s Allowance, Child Tax Credit, Working Tax Credit, and Income Support.