Austerity and Public Law

Michael Adler: Benefit Sanctions and the Rule of Law

Editors’ note: The blog is running a new series titled ‘Austerity and Public Law’. The theme explores the implications or impact of the austerity measures in the UK or any European or Commonwealth government have had on public law or the enjoyment of public law rights. We welcome further submissions of 1,000 words or less, though longer pieces may be considered if the subject matter warrants it.

In this blog, I wish to draw attention to the enormous growth in the severity, the scope and the incidence of benefit sanctions in the UK since the turn of the century, and to assess the compatibility of the current sanctions regime with the ‘rule of law’. Few people have written as clearly on the ‘rule of law’ as Tom Bingham and I use his analysis as my starting point (The Rule of Law (London: Allen Lane, 2010). According to Tom Bingham, the ‘rule of law’ comprises eight principles. These are set out in Table 1 below:

Table 1: The eight principles of the Rule of Law

1. The law must be accessible and, so far as possible, intelligible, clear and predictable.
2. Questions of legal right and liability should ordinarily be resolved by application of the law and not of discretion.
3. The laws of the land should apply equally to all, save to the extent that objective differences justify differentiation.
4. Ministers and public officials at all levels must exercise the powers conferred on them in good faith, fairly for the purpose for which the powers were conferred, without exceeding the limits of such powers and not unreasonably.
5. The law must offer adequate protection of fundamental human rights.
6. Means must be provided for resolving, without prohibitive cost or inordinate delay, bona fide civil disputes which the parties themselves are unable to resolve.
7. Adjudicative procedures provided by the state should be fair.
8. The rule of law requires compliance by the state with its obligations in international law as in national law.

Since few readers will have any personal experience of sanctions and most will probably only be dimly aware of their existence, I will start with an account of recent changes in the sanctions regime.

THE INCREASING SCOPE AND SEVERITY OF BENEFIT SANCTIONS

Benefit sanctions are now very much wider in scope (in that they are applied to more misdemeanours), greater in severity (in that they apply for longer periods) and more extensive in application (in that they apply to more people) than was formerly the case.

The main changes in the scope and severity of benefit sanctions since the 1980s are summarised in Table 2 below 

Table 2: Benefit Sanctions Then and Now.

THE INCREASING INCIDENCE OF BENEFIT SANCTIONS

In 2001, about 300,000 sanctions and disallowances were imposed by the Department for Work and Pensions (DWP) on Job Seeker’s Allowance (JSA) claimants. This figure remained fairly static for the next five years but started to rise quite sharply in 2006, exceeded 1 million in 2013 and surpassed the number of fines imposed in the criminal courts. The number of sanctions fell to just over 700,000 in 2014, mainly because of the decline in unemployment and the corresponding reduction in the JSA caseload, which fell by about 30 per cent. However, this is more than twice the number imposed in 2001. Sanctions were first imposed on Employment and Support Allowance (ESA) claimants in 2010 and 36,808 ESA sanctions were imposed in 2014.

CHARACTERISTICS OF BENEFIT SANCTIONS

Unlike court fines, benefit sanctions are not preceded by legal proceedings. There are established reconsideration and appeal procedures but, since there are no time limits, reconsideration can take a long time and sanctions are implemented without waiting for claimants’ cases to be considered. The number of appeals to an independent tribunal increased by more than 600 per cent over the period but Mandatory Reconsideration (MR), which was introduced in 2013, was designed to choke this off and appears to have done so. The number of appeals in the three month period October-December 2012 fell from 130,606 to 28,142 in the same period two years later, i.e. in 2014.

Until October 2013, when MR was introduced, claimants could either ask for the DWP’s decision to impose a sanction to be reviewed, in which case, this would be undertaken by a different decision maker, or they could appeal directly to a tribunal. Now they mustfirst make an informal request for reconsideration (there is no form). The claimant is then telephoned by the original decision-maker and given a verbal ‘explanation’ or, on request, a written statement of reasons (WSOR), and may be given an opportunity to provide further information relevant to the decision. If the claimant accepts this explanation, the matter ends there. However, if the claimant disputes anything, the initial decision-maker will consider what they have to say, including any new evidence they present. The initial decision-maker may change his/her decision at this point but, if not, and the claimant insists, the initial decision maker (not the claimant) will request a formal Mandatory Reconsideration (MR), which is undertaken by a new, remotely-located Dispute Resolution Team (DRT), and only if they are turned down at this stage can the claimant appeal to a tribunal. Claimants who wish to appeal must submit an application to HM Courts and Tribunals Service within one month of the date on which they were given the result of Mandatory Reconsideration. It is hardly surprising that the numbers of reviews and appeals have plummeted.

Thus, the combination of internal review and external appeal procedures does not provide an acceptable level of procedural protection. Those who receive benefit sanctions are, because they were on benefit and have had their benefit stopped, among the poorest people in society and the sanctions themselves are extremely severe since they can deprive claimants of all their income for periods ranging from four weeks to three years. If the courts were to impose fines set at the level of the offender’s disposable income, and go on doing this for lengthy periods, there would be an outcry. Sanctions for a non-criminal offence that are set at 100 per cent of the alleged offender’s income and applied repeatedly are, clearly, totally lacking in proportionality.

Vulnerable claimants are most likely to be sanctioned and, despite the availability of hardship payments, many of those who are sanctioned experience enormous hardship. Anecdotal evidence suggests that many of them end up becoming homeless, using food banks and resorting to crime. It is hard to see how these shortcomings could be rectified and it follows that benefit sanctions, as they have developed in the UK, are incompatible with justice.

THE RULE OF LAW AND BENEFIT SANCTIONS

We now come to the question of whether benefit sanctions are compatible with the rule of law. My conclusion is that they are not. The consistency of benefit sanctions with Bingham’s eight principles is discussed below.

1. Clarity of the law: Although the Decision Makers’ Guide provides guidance for DWP staff who make decisions about benefits and pensions and helps them make decisions that are accurate and consistent, claimants have not been provided with any comparable account of the law which sets out when sanctions can be imposed and how they can be challenged. However, since October 2013, new jobseekers have been required to sign a ‘Jobseekers’ Agreement’, which sets out what they need to do in order to receive state support, and they will have to renew this on a regular basis. They also have to provide evidence to prove they have met the requirements in their Jobseekers’ Agreement or a Jobseekers’ Direction, which specifies exactly what they are required to do, and those who fail to do so ‘without good reason’ risk losing their benefits. Although this is undoubtedly a step in the right direction, there must be very real doubts about whether the first principle is satisfied.
2. Determination of rights by law: The phrase ‘good reason’ is not defined in the legislation and depends on the circumstances of the case. Most disputes involve the exercise of discretion and are handled internally while independent adjudication is only used in the very small number of cases that are appealed to a tribunal. Whether this is sufficient to satisfy the second principle is an open question.
3. Equality of application: Since the sanctions regime applies to everyone in receipt of benefits, the third principle appears to be satisfied.
4. Reasonable exercise of discretion: There is an accumulating body of evidence that sanctions are often applied unreasonably and for trivial misdemeanours. In addition, the absence of comprehensive quality assurance procedures and the failure to hold individual members of staff who have acted unfairly or unreasonably to account for their decisions, even where these overturned as a result of review or appeal, raise serious doubts about whether the fourth principle is satisfied.
5. Respect for fundamental rights: The attenuated arrangements for challenging the imposition of sanctions, which can leave people without any income, indicate that the right to a fair trial, guaranteed under Article 6 of the ECHR, is inadequately protected. This suggests that the fifth principle is probably not satisfied.
6. Access to justice: Cost is not an issue since there are no financial barriers to challenging the DWP’s decision to impose a sanction but delay is, mainly because there are no time limits for the DWP to reconsider its decision. As a result, a claimant who wishes to challenge the imposition of a sanction may have to endure a long period without any income. Under MR, so many obstacles have been put in the way of getting to an independent Tribunal that Tribunal appeals have virtually disappeared; the right of appeal has become effectively purely theoretical. This indicates that the sixth principle is also probably not satisfied.
7. Fair adjudication: The adjudicative procedures provided by the state in tribunals that hear appeals are undoubtedly fair. However, the MR process which is now the last recourse for almost all claimants is clearly unfair as it is so one-sided. Moreover, the difficulties experienced by claimants raise doubts about the fairness of the whole set of procedures for challenging the imposition of sanctions. Thus, the seventh principle is also probably not satisfied.
8. Compliance with international law: Article 13 of the European Social Charter permits benefit sanctions but only if they do not deprive the person concerned of his/her means of subsistence. The situation in the UK is currently under review but, on this ground alone, the eighth principle is also probably not satisfied.

The number of counts on which the current sanctions regime in the UK fails to satisfy the rule of law principles proposed by Lord Bingham indicate that there are serious questions about its legality ‒ in addition to its efficacy and humanity.

WHERE DO WE GO FROM HERE?

The most significant reform, which would undoubtedly make the sanctions regime more consistent with the rule of law, would involve giving claimants an opportunity to attend a hearing before a sanction is imposed (as is the case in in the USA) and continuing to pay benefit until the hearing has taken place. Another significant reform would involve abolition of the Mandatory Reconsideration procedure. Claimants who wished to challenge the imposition of a sanction would appeal directly to a tribunal. Cases could be reconsidered by the DWP before the hearing but, if the claimant’s case was not met in full, the appeal would then be heard by the tribunal. A further reform would involve reducing the severity of the sanctions that are imposed. In addition, some serious thought also needs to be given to reducing the scope of conditionality so that fewer sanctions are imposed in the first place. Unfortunately, given its commitment to conditionality and sanctions, it is most unlikely that any of these reforms will be accepted by the UK Government.

Minor reforms, such as issuing written statements of what claimants can expect from staff as well as what staff expect from claimants that would explain what the consequences for each party of failing to meet the expectations of the other are, and giving claimants a right to seek a review of these statements and to appeal against them to a tribunal, would help to make the administration of benefits fairer and more humane, as would strengthening the provision of hardship payments for those who are sanctioned: However, the prospect of minor reforms such as these being supported by the UK Government is, to say the least, unlikely.

In a recent Report, the House of Commons Work and Pensions Committee (2015) reiterated its previous call for a comprehensive, independent review of sanctions and for a serious attempt to resolve the conflicting demands on claimants made by DWP staff to enable them to take a common-sense view on good reasons for non-compliance. The Committee concluded that there was no evidence to support the longer sanction periods introduced in October 2012 and recommended the piloting of pre-sanction written warnings and non-financial sanctions. Sadly, these recommendations seem to have fallen on deaf ears and to date there has been no response from the DWP to the Report.

Michael Adler is the Emeritus Professor of Socio-Legal Studies and Leverhulme Emeritus Fellow in the School of Social and Political Science at the University of Edinburgh.   He thanks David Webster and Colm O’Cinneide for helpful feedback. This blog is based on a paper presented at the Annual Conference of the Law Society of Scotland, held at the Edinburgh International Conference Centre on 2^nd October 2015. The full version of the paper can be read on the UK Administrative Justice Institute blog, which can be accessed at: http://ukaji.org/2015/10/14/benefit-sanctions-and-the-rule-of-law/

(Suggested citation: M. Adler, ‘Benefit Sanctions and the Rule of Law’ U.K. Const. L. Blog (23rd Oct 2015) (available at http://ukconstitutionallaw.org/)

UK Constitutional Law Association