English Court of Appeal finds DWP policy on Universal Credit advance payments to persons without NI number is flawed

About this case:

• Citation:
  [2023] EWCA Civ 566
• Judgment:
  External link
• Court:
  England and Wales High Court
• Judge:
  Lord Justice Nugee

The two connected appeals were raised on behalf of claimants Ngoc Bui and Idowu Onakoya, neither of whom had a NI number when they applied for Universal Credit and sought judicial review of the DWP policy. The Upper Tribunal dismissed their applications on the basis that the Secretary of State’s position was justified by public policy.

The appeal was heard by Lord Justice Underhill, Lord Justice Nugee, and Lord Justice Edis. Richard Drabble KC appeared for both appellants and Edward Brown KC for the respondent.

Likely to be satisfied

Due to the requirement for persons claiming Universal Credit to possess a NI number, the DWP treats claims for UC by a person without one as including an application for one to be allocated. In these cases, the Secretary of State takes the view that no advance payments of UC can be made until the end of the verification process for the claimant’s entitlement to a NI number.

In the case of both appellants, there was a significant delay in processing their UC claims due to administrative errors, although both were later paid what they were entitled to, in each case amounting to around two months compared to the average gap of five weeks. While they ultimately suffered no loss, it was considered that their cases formed a convenient vehicle to examine certain questions of law.

It was considered by the Upper Tribunal that there were sound reasons of public policy for Parliament to impose a verification process before awarding or paying public funds. While the effect of the process was that a payment was not possible until a NI number had been allocated, Sections 1(1) to (1B) of the Social Security Administration Act 1992 did not in terms require the allocation of a NI number as a precondition of entitlement to benefit.

Three grounds of appeal were advanced to the UT’s decision. The first of these was that the UT was wrong to conclude that was not possible to make an advance payment to claimants without a NI number. Even before verification, it was possible for the Secretary of State to take the view that it was likely that the claimant would turn out to be entitled to UC and hence it was likely that the conditions of entitlement were satisfied, per regulation 5(1)(b) of the Payments on Account Regulations.

Not always impossible

In an opinion with which the other two judges agreed, Lord Nugee observed: “As a matter of the ordinary use of language there seems to me to be considerable force in Mr Drabble’s submission. Reg 5 is expressly dealing with a case where a claim has been made but not yet determined. Ex hypothesi therefore in a reg 5 case, it will not be known at the date of the application for an advance payment whether the claimant will fact turn out to be entitled, and the criterion for payment in reg 5(1)(b) is therefore not that the claimant will be entitled but the lower one of it appearing to the Secretary of State that it is likely that they will be entitled.”

He continued: “Section 5 SSAA 1992 and reg 5 of the Payment on Account Regulations would seem to supply the necessary statutory power to make a payment on account even to a person who in the event turns out not to have been entitled after all. The risk of paying someone who is not in fact entitled is a risk that is inherent in a scheme which permits payments to claimants before their claims have been determined.”

On the point that it was impossible to know the outcome of the verification process in advance, Lord Nugee said: “I do not think we can properly say that in every case where a claimant applies for UC and does not have a NINo, it necessarily follows that the Secretary of State will be unable to determine whether it is likely that the claimant will satisfy the requirements of s. 1(1B)(b) so as to be entitled to benefit. It does not seem self-evident that this will always be impossible; nor do I think that the evidence expressly deals with this question.”

He concluded: “The scheme of the provisions contemplates that in a case where a claimant’s claim has not yet been determined and the claimant is in need the Secretary of State will consider whether it appears likely that the conditions of entitlement are met; and it seems to me that this is just as much so in a case where the claimant does not have a NINo as in the case when they do. In my judgment therefore the Secretary of State’s practice in never considering whether this is likely in a case where the claimant does not have a NINo is flawed. Quite what this might entail in practice is not something that we can resolve on this appeal.”

The appeal was therefore allowed to this extent, with two other grounds of appeal were rejected by the Court of Appeal. Counsel were invited to address the court on the appropriate form of relief.