A disabled woman left in “great distress” by an “immoral” Department for Work and Pensions (DWP) scheme – which allows it to take money from her benefits to pay off utility debts – is asking the high court to declare the practice unlawful.
Helen Timson even had to cancel a cancer scan because she could not afford the taxi fare, thanks to the deductions.
On other occasions, she has not been able to pay her rent.
The long-standing scheme allows DWP to take up to five per cent of someone’s means-tested benefits to pay off a utility bill.
But the scheme does not have to seek the claimant’s permission to make the deductions, and it seems they are often not told about the payments before they begin.
This means claimants are typically not given the opportunity to challenge the payments or discuss the financial problems they might cause with DWP before they begin.
Critics say the scheme lacks the necessary checks and balances.
Timson, from Leicester, believes the DWP deductions scheme means she is treated worse than those with utility debts who are not benefit claimants.
If she was not a benefit claimant, a court would have to decide whether she was liable for the debt and how much she should repay.
But the deductions scheme provides her and many other claimants with less legal protection and often results in them paying higher deductions than an “economically identically situated non benefit claimant”.
Timson first had to ask DWP to stop making deductions for her water, electricity and gas debts in December 2014, because they were making it difficult for her to pay her rent.
But the department said the only way it would do so was if she secured permission from her creditors to stop the deductions.
On this occasion, she said, she had been charged too much because of a faulty electric meter.
Even when the electricity company knew the meter was faulty, it continued to take the same amount through the deductions scheme, even after she had changed supplier and no longer owed them anything.
She said: “It was a substantial amount of money: £80.80 a month. I made repeated phone calls about this, but it carried on for about two years.”
Now she is again being faced with deductions from her employment and support allowance, this time amounting to more than £20 a week, to pay off fuel and water debts.
Even without the deductions, her total income is below the level which the benefit system says is an appropriate minimum level for someone in her circumstances.
Instead of the automatic DWP deductions, she wants to obtain professional money advice, and be allowed to make her own decisions about what spending to prioritise.
She also hopes to seek support from charities that help people repay utility debts.
She said: “I feel extremely upset about the behaviour of the DWP and how this scheme allows utility companies to treat me like a second-class citizen.
“I have been extremely stressed and upset, especially when I have phoned begging for these payments to be stopped, and I have just been dismissed.
“This scheme has made me feel like I have no voice and am powerless.”
She said the deductions scheme was “immoral”.
She said: “It is sold as helping benefit claimants, but in fact it helps the utility companies to get their pound of flesh.
“This scheme allows utility companies to prioritise and help themselves to money for their arrears before we can use our own money to pay rent or buy food.
“Can you imagine the uproar if banks allowed utility companies to help themselves from people’s accounts? Or if employers allowed utility companies to help themselves from people’s wages? So why is it OK for it to happen to benefit claimants?”
She believes there will be thousands of disabled and non-disabled claimants who are being put under financial pressure due to the scheme.
In papers submitted to the court, they say that Timson “feels very strongly that she should be allowed to manage her own resources, and has been caused great distress by [Coffey’s] unilateral control of those resources”.
They say that she “strongly considers that her approach is likely to be significantly psychologically preferable for her, is likely to give her greater economic flexibility to manage critical spending, and is likely to be better value in the sense that it will probably lead to her paying less of her modest income to service debt”.
They are arguing that the DWP deductions scheme is a breach of three articles of the European Convention on Human Rights: on discrimination, the right to a fair trial, and the right to “peaceful enjoyment of possessions”.
Timson has told the court that, even if she successfully appealed a deduction at a benefits tribunal, it would not be able to “eradicate the experience of having had to live month to month on that inadequate income”.
They believe the case raises important points of principle and is likely to be relevant to many other claimants.
Timson’s solicitor, Emma Varley, from Bindmans, said: “Our client has demonstrated incredible bravery in challenging the DWP’s third party deductions scheme, under which payments are made from her benefit to private utility companies without her consent, and as a result of which she has sometimes been left unable to pay her rent.
“We hope that her judicial review challenge will lead to a changed system, whereby our client, and many others, will be afforded more autonomy to decide how their money is spent.”
But it is not the first time that Timson has had to complain about unfair treatment by DWP.
Two years ago, the Independent Case Examiner upheld five complaints she had made against DWP after it incorrectly calculated an ESA overpayment three times, provided conflicting information about the overpayment, delayed providing her with information she had requested about her case, and failed to respond properly to her complaints.
A DWP spokesperson said: “Customers can contact the DWP if they believe a deduction from their benefit should not be made, while safeguards are in place to ensure deductions are manageable and to prevent hardship.
“It is not appropriate for us to comment on current legal proceedings.”
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