R (MA) v Secretary of State for Work and Pensions

The Court of Appeal dismissed the challenges to the Housing Benefit (Amendment) Regulations 2012 (as amended by the 2013 Regulations). The central legal issues were (i) whether the "bedroom criteria" in Regulation B13 of the Housing Benefit Regulations 2006, which reduces eligible rent where a claimant is deemed to under-occupy, unlawfully discriminated against disabled people contrary to Article 14 in conjunction with Article 1 of Protocol 1 (A1P1), and (ii) whether the Secretary of State breached the public sector equality duty (PSED) under section 149 of the Equality Act 2010 in implementing the policy.

The court accepted that Regulation B13, read in isolation, discriminated against some disabled persons with disability-related needs for additional bedrooms. However, it examined the scheme as a whole, including the expressly exempted categories in B13 and the availability of Discretionary Housing Payments (DHPs) under the Discretionary Financial Assistance Regulations 2001. Applying the applicable margin of appreciation in a benefits context (the "manifestly without reasonable foundation" standard), the court held that the Secretary of State had an objective and reasonable justification for structuring assistance through the regulations supplemented by DHPs and had given due regard to equality obligations in the policy process.

This was an appeal from the Divisional Court (Laws LJ and Cranston J) which had rejected challenges brought by five social housing claimants. The claimants contended that the 2012 Regulations (as amended by the 2013 Regulations), which apply a percentage reduction to housing benefit where tenants are deemed to have more bedrooms than they need under Regulation B13 of the Housing Benefit Regulations 2006, discriminated against disabled people and were adopted in breach of the statutory public sector equality duty.

Background and parties:

• The measures reduced the eligible rent by 14% for one excess bedroom and 25% for two or more excess bedrooms, based on prescribed bedroom criteria (Regulation B13).
• Claimants were disabled tenants occupying or living in adapted accommodation who said they objectively needed additional bedrooms for disability-related reasons.
• The Secretary of State relied on exclusion of certain categories in B13 and on DHPs to mitigate hard cases; the Government increased DHP funding and issued guidance.

Procedural posture: The Divisional Court dismissed both the Article 14/A1P1 and PSED challenges on 30 July 2013; the claimants appealed to the Court of Appeal.

Issues framed:

• Does the bedroom criteria discriminate against disabled persons for the purposes of Article 14 taken with A1P1, and if so, is it objectively and reasonably justified?
• Did the Secretary of State comply with the PSED (section 149 EA 2010) when introducing the scheme?

Court’s reasoning and resolution:

• The court accepted that, in substance, the bedroom criteria discriminated against some disabled persons who have disability-related needs for extra bedrooms, but the relevant inquiry is whether the scheme as a whole (the Regulations together with the DHP scheme and the specifically exempted categories) could be justified.
• On justification, the court applied the benefits-context standard described in Stec and Humphreys — a wide margin permitted to socio-economic policymaking: the justification must not be "manifestly without reasonable foundation." The court reviewed the detailed policy development, financial constraints, Parliamentary scrutiny (affirmative resolution) and the Government's reasons for choosing a DHP-based mitigation rather than broad statutory exemptions. It concluded that the Secretary of State’s combination of targeted exemptions, DHP funding (increased and to be kept under review), and local discretion provided an objective and reasonable justification for the differential treatment.
• As to the PSED, the court found that the Secretary of State had given focused, substantive consideration to the impact on disabled persons at each stage of policy development, considered alternatives, and took steps (including increasing DHP resources and guidance) so the PSED was satisfied; any remaining complaints related to merits of the policy rather than the adequacy of consideration.

Subsidiary findings: The court distinguished the narrower category of very few, easily identifiable cases (addressed in part by amendments after Burnip) from the broader category of disability-related need for extra rooms, treating the latter as harder to define and more administratively burdensome to accommodate by statutory exemption.

Appeal dismissed. The court held that although the bedroom criteria discriminate against certain disabled persons, the discrimination is justified in light of the legitimate aims of the policy, the Government's chosen means (Regulation B13 supplemented by targeted exemptions and DHPs), and the margin of appreciation in socio-economic measures; and the Secretary of State complied with the public sector equality duty by adequately considering disability impacts and mitigation measures in the decision-making process.

Appeal from the Divisional Court (Queen's Bench Division) of Laws LJ and Cranston J, which dismissed the claimants' Article 14/A1P1 and PSED challenges on 30 July 2013. The Court of Appeal heard argument and dismissed the appeal on 21 February 2014.