The Queen on the Application of Moore & Anor v Secretary of State for Work and Pensions

The Universal Credit Regulations 2013 treat Statutory Maternity Pay as earned income (regulation 55) and Maternity Allowance as unearned income (regulation 66). The claimants argued this difference amounted to unlawful discrimination contrary to the European Convention on Human Rights (Article 14 read with Article 8 and/or Article 1 of Protocol 1), was irrational at common law (Wednesbury), and breached the public sector equality duty (section 149 Equality Act 2010).

The court held that Article 8 and Article 1 of Protocol 1 were engaged but that the true question was whether there was a legitimate and rational justification for treating Statutory Maternity Pay as earned income while treating Maternity Allowance as unearned. Contemporaneous departmental material and witness evidence showed the treatment derived from operational and policy choices: Statutory Maternity Pay is paid by employers through PAYE and reported via HMRC's Real Time Information system, making it operationally sensible to treat it as earned income for Universal Credit calculations to align information flows and reduce error and fraud risks; Maternity Allowance is paid separately by Jobcentre Plus. Those reasons were sufficient to justify the differential treatment. The common law Wednesbury challenge likewise failed. The claim based on a breach of the public sector equality duty was out of time and not properly arguable.

Background and parties: The first claimant (Taylor Moore) received Maternity Allowance rather than Statutory Maternity Pay because she lacked the necessary continuity of employment. She claimed Universal Credit; her award was reduced pound-for-pound by the amount of Maternity Allowance. Had she received Statutory Maternity Pay instead, less would have been deducted and she would have been financially better off. The claimants sought judicial review of the Universal Credit Regulations 2013 provisions that (a) define earned and unearned income (Part 6) and (b) specify the amounts to be deducted (regulation 22), arguing discrimination under the ECHR, irrationality at common law and breach of section 149 Equality Act 2010.

Nature of relief sought: Declarations/relief by way of judicial review that regulation 66 (classifying Maternity Allowance as unearned income) and regulation 55 (treating Statutory Maternity Pay as earned income) were unlawful.

Issues framed:

• Whether the differential treatment engaged Article 14 taken with Article 8 or Article 1 of Protocol 1 and, if so, whether it was justified.
• Whether the decision was Wednesbury irrational.
• Whether the decision-making leading to the Regulations complied with the public sector equality duty (section 149 Equality Act 2010).

Court’s reasoning and conclusion: The court accepted Universal Credit deductions for benefits fall within the ambit of Article 1 of Protocol 1 and that payment of Maternity Allowance is a means of supporting family life falling within Article 8. The court analysed whether there was a sufficient justification for distinguishing Statutory Maternity Pay from Maternity Allowance rather than treating the claim as a classic Article 14 discrimination claim based on an "other status" that coincided with the measure. Contemporaneous written ministerial submissions and a witness statement explained the policy and operational rationale: Statutory Maternity Pay is employer-paid and reported via PAYE/RTI while Maternity Allowance is paid by the Secretary of State; treating SMP as earned income aligned data sources, reduced the risk of mis-reporting and fraud, and avoided burdensome manual checks. Given the social and economic policy context, the Secretary of State’s reasons were within the margin of appreciation and not manifestly without reasonable foundation. The common law rationality challenge failed for the same reasons. The equality duty challenge was time-barred: the duty is a process obligation and any claim alleging breach should have been brought within the usual time-limits; the court refused permission on that ground.

The claim is dismissed. The court refused relief on the human rights and common law grounds because the differential treatment of Statutory Maternity Pay and Maternity Allowance was justified on legitimate operational and policy grounds (PAYE/RTI reporting, alignment of information, avoidance of fraud/error and administrative burden). The public sector equality duty challenge was refused as out of time and not properly arguable.