London Borough of Croydon v Shanahan

For an offence under section 111A(1A)(a) of the Social Security Administration Act 1992, a change of circumstances affects entitlement only where a correct computation would alter the benefit payable. Each new source or increase of income capable of altering that computation is a separate notifiable change, even where it arises from the same employment.

However, where a claimant has properly notified income that has already reduced entitlement to zero, a later income change which cannot alter that result need not be notified. Practical case-management considerations may justify removing duplicative counts, despite an error in the legal basis originally given for doing so.

The respondent was tried at Croydon Crown Court on three counts under section 111A(1A) of the Social Security Administration Act 1992. The prosecution alleged dishonest failures to notify the borough of employment income, working tax credit, and an increase in child tax credit.

At the close of the prosecution case, the judge upheld a submission of no case to answer on the two tax-credit counts. The trial continued on the employment-income count, on which the jury acquitted the respondent. The borough sought leave to appeal under section 58 of the Criminal Justice Act 2003, while stating that it did not seek a retrial.

The central issue was whether each contemporaneous income change affected entitlement where any one of them would have been sufficient to reduce housing and council tax benefit to zero.

Appeal dismissed. The court granted leave and ordered the respondent’s acquittal on counts 2 and 3. Although the judge erred in his construction of the offence, the practical result of removing those counts was justified.

1. The court followed Passmore ((2007) EWCA Crim 2053). Under section 111A(1A)(a) of the Social Security Administration Act 1992, a change affects entitlement only if the application of the benefit rules would alter the claimant’s entitlement. A mere matter capable of prompting an inquiry is insufficient.

2. On the evidence, the employment income, working tax credit and increased child tax credit each could have changed the computation of entitlement when the changes occurred. Each was therefore a distinct notifiable change. Tax credits remain income capable of affecting entitlement even if they arise because the claimant has entered employment. There was no principled distinction between such income and an independently received annuity.

3. The judge was consequently wrong to hold that the tax-credit counts disclosed no case merely because notification of employment income would ultimately have reduced entitlement to zero. At the close of the prosecution case, the evidence was that none of the changes had been notified.

4. Nevertheless, the jury might have accepted that the respondent notified the employment income. If so, entitlement would already have been extinguished and later tax credits would not have affected it. Conversely, if count 1 were proved, the additional tax-credit failures added nothing to culpability. The judge could properly confine the jury’s consideration to count 1 for case-management reasons, though the proper mechanism would have been to discharge the jury from returning verdicts on counts 2 and 3.

• Court of Appeal (Criminal Division) — in [2010] EWCA Crim 98, granted the borough leave to appeal under section 58 of the Criminal Justice Act 2003, but dismissed the appeal and ordered acquittals on counts 2 and 3.
• Croydon Crown Court — HHJ Stow QC upheld a submission of no case to answer on counts 2 and 3. The jury acquitted the respondent on count 1.