Samuels v Birmingham City Council

When deciding whether accommodation was affordable for the purpose of intentional homelessness, a housing authority must take account of all the applicant’s income, including non-housing benefits. It must compare that income with objectively assessed reasonable living expenses and housing costs.

The authority must consider the needs of the whole household and its duty to safeguard and promote children’s welfare. Applicable benefit levels are a material and, absent better objective guidance, useful starting point for assessing reasonable living expenses. The question is whether the household can meet its reasonable needs while retaining the accommodation indefinitely, not whether budgeting flexibility could somehow bridge a rent shortfall.

The appellant and her four children lost their assured shorthold tenancy after rent arrears accrued. The respondent council decided that she had become intentionally homeless because the accommodation had been affordable and its loss resulted from her deliberate failure to pay the rent.

The County Court dismissed her statutory appeal. The Court of Appeal subsequently dismissed her further appeal in [2015] EWCA Civ 1051; [2016] PTSR 558. It held that affordability required consideration of income and expenses as a whole and that benefits income had no special status.

The issue before the Supreme Court was whether the council had used the correct approach to affordability under Part VII of the Housing Act 1996 and article 2 of the Homelessness (Suitability of Accommodation) Order 1996.

1. Appeal allowed unanimously; review decision quashed. Lord Carnwath delivered the judgment, with which Lady Hale, Lady Black, Lord Lloyd-Jones and Lord Kitchin agreed.

2. Article 2 of the Homelessness (Suitability of Accommodation) Order 1996 required the council to take account of all sources of income, including all social security benefits. Nothing in the Order required or justified excluding non-housing benefits. The statutory comparison nevertheless had to include the applicant’s reasonable living expenses. Reasonableness required an objective assessment and could not depend simply upon the reviewing officer’s subjective view. Affordability also had to be assessed on the basis that the accommodation would remain available indefinitely: R (Aweys) v Birmingham City Council [2009] UKHL 36.

3. Paragraph 17.40 of the applicable statutory guidance recommended treating accommodation as unaffordable where residual income fell below the relevant income-support level. It was unnecessary to decide whether “income support” included benefits paid for children. The absence of a specific reference to children’s benefits did not make their levels irrelevant. Benefit levels were not generally designed to provide a surplus above a family’s subsistence needs. They were therefore material when assessing reasonable living expenses for all household members.

4. The assessment also had to reflect the household’s circumstances and composition and the duty under section 11(2) of the Children Act 2004 to safeguard and promote children’s welfare. In the absence of another source of objective guidance, the relevant benefits tariff was at least a good starting point for assessing reasonable living expenses.

5. The reviewing officer had asked whether the appellant’s household income possessed enough “flexibility” to bridge the shortfall between housing benefit and rent. That was the wrong question. The proper inquiry was what reasonable non-rent living expenses were required by the appellant and her children. Her submitted expenses were below the amount regarded as appropriate through welfare benefits, and no objective standard justified treating them as unreasonable.

6. The finding of affordability was therefore legally flawed. Although no further relief was sought, the court indicated that it was difficult to see how the finding of intentional homelessness could properly be upheld upon reconsideration.

1. United Kingdom Supreme Court: Allowed the appeal unanimously and quashed the council’s review decision: [2019] UKSC 28.
2. Court of Appeal: Dismissed the appellant’s further appeal on 27 October 2015: [2015] EWCA Civ 1051; [2016] PTSR 558.
3. County Court: HH Judge Worster dismissed the statutory appeal on 10 June 2014.
4. Birmingham City Council: A reviewing officer confirmed on 11 December 2013 that the appellant was intentionally homeless because her former accommodation had been affordable.