A landmark legal settlement could see up to 13,000 benefit claimants in the UK receive compensation after being financially disadvantaged when moved to Universal Credit. The Department for Work and Pensions (DWP) has agreed to pay thousands of pounds to claimants affected by the loss of disability-related benefits, following a long-running legal battle.
The case, which centres on severe disability premiums (SDP) and enhanced disability premiums (EDP), highlights ongoing concerns about Universal Credit’s impact on vulnerable people. As the government begins issuing compensation payments, thousands more may still be entitled to financial redress.
Thousands of Claimants Unfairly Affected by Universal Credit Transition
The legal battle dates back to 2019, when the High Court ruled that the DWP had unlawfully cut payments for claimants with disabilities who were transferred from legacy benefits to Universal Credit. The primary issue was that these individuals lost vital additional payments, with no transitional protections in place at the time.
The loss of SDP and EDP left many struggling financially, as some claimants saw their incomes drop by up to £180 per month. While the government later introduced an SDP gateway to protect future claimants, those moved onto Universal Credit before September 2019 had already suffered substantial losses.
Following years of legal action, the DWP has now settled claims from 275 affected individuals, awarding them payments ranging from £200 to £3,000. In addition, a compensation scheme has been established, with affected claimants expected to receive more than £5,000 each.
However, legal representatives argue that thousands more should also receive compensation. Ryan Bradshaw, the solicitor representing the claimants, said: “I am glad to have settled this claim on behalf of my clients. However, there are thousands of others who have been similarly affected who have not been in a position to bring a claim like this.”
Financial and Emotional Toll on Disabled Claimants
For many affected by this case, the loss of benefits had far-reaching consequences beyond financial hardship. The removal of disability-related support payments forced some claimants to cut back on essentials, worsening both their health and quality of life.
Philippa, 39, from Chesterfield, suffers from fibromyalgia, a chronic autoimmune condition that causes severe pain and fatigue. When her benefits were reduced, she struggled to afford basic necessities, including nutritious food tailored to her medical needs. “When you’re on benefits, you don’t feel secure. Every day you wait for the little brown envelope,” she said, referring to official DWP letters about changes to her payments.
Her case is just one example of the stress experienced by thousands in similar situations. According to Mr Bradshaw, the emotional distress caused by these benefit reductions should not be overlooked. “They too will have suffered unnecessary stress. A suitable scheme, compensating all the people who have endured discrimination at the hands of the DWP, ought to be urgently put in place. The mistakes made here should never be repeated.”
Will the DWP Extend Compensation to All Affected Claimants?
Although the DWP has begun compensating affected individuals, there is still uncertainty over whether all eligible claimants will be included in the scheme. The government has not yet confirmed whether it will proactively identify and compensate the estimated 13,000 people affected by these unlawful benefit reductions.
A DWP spokesperson acknowledged the ruling, stating: “Following this ruling, the department has begun the process of compensating affected claimants.” However, this does not guarantee that those who have not yet come forward will receive the same level of redress.
Campaigners and legal experts argue that the government should take full responsibility and ensure that all those impacted receive appropriate financial compensation. Without proactive measures, many claimants who suffered due to these cuts may remain unaware of their entitlement.
What Happens Next?
The resolution of this legal case marks a significant victory for benefit claimants who fought for justice. However, questions remain about the DWP’s handling of Universal Credit transitions and whether similar mistakes will happen again in future welfare reforms.
As pressure mounts on the government, disability rights groups and legal experts are calling for a transparent and inclusive compensation scheme. Many believe that failing to act comprehensively would mean that thousands of vulnerable individuals continue to suffer the financial consequences of past policy failures.
For now, those who believe they may be eligible for compensation are advised to seek legal guidance or contact the DWP for further information. With potential payments exceeding £5,000, many claimants could soon receive much-needed financial relief after years of uncertainty.
