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 aimed at those who were receiving specific disability benefits like Employment and Support Allowance but lost out on disability premiums when they transitioned to Universal Credit before January 2019.
Following a legal challenge by Leigh Day, it was revealed that some recipients experienced a reduction of up to £180 per month due to the loss of severe disability premium (SDP) and enhanced disability premium (EDP). The DWP has acknowledged the income loss and agreed to compensate those affected, with potential compensation estimated at over £5,000 per person. However, approximately 13,000 cases are still pending resolution.
In its recent annual report, the DWP highlighted challenges in identifying and rectifying underpayments for individuals no longer actively claiming ESA due to data limitations. The department aims to conclude the outstanding cases by September, with an estimated 57,000 individuals impacted by the issue and an anticipated total repayment cost of £452 million.
Leigh Day successfully secured settlements for 275 claimants through a High Court case, with compensation ranging from £200 to £3,000 in damages. A DWP spokesperson emphasized the commitment to swiftly address owed arrears and rectify errors, stressing the importance of preventing such incidents in the future.
The ongoing transition of individuals from legacy benefits to Universal Credit by the DWP has been a focal point. Legacy benefits like Housing Benefit, Income-related Employment and Support Allowance, Income-based Jobseeker’s Allowance, Child Tax Credit, Working Tax Credit, and Income Support are gradually being replaced by Universal Credit.