LR v The Secretary of State for Work and Pensions (UC)

Under regulation 66(1)(c) of the Universal Credit Regulations 2013, a foreign payment is unearned income if it is analogous to a benefit listed in regulation 66(1)(b). The claimant need not be entitled to the listed United Kingdom benefit. The words concerning entitlement in regulation 66(1)(b) address the net amount of a listed benefit payable after overlapping-benefit adjustments.

Whether benefits are analogous turns on relevant similarity, particularly their nature and purpose. They need not be identical. A lifelong foreign widow’s contributory pension, subject to replacement by state pension at pension age, was analogous to a United Kingdom widow’s pension. It was therefore deductible from universal credit. A time-limited bereavement support payment was not analogous.

The claimant received universal credit and an Irish widow’s contributory pension following her husband’s death. The Secretary of State treated the Irish pension as unearned income and deducted it from universal credit under regulation 66(1)(c) of the Universal Credit Regulations 2013.

The First-tier Tribunal, Social Entitlement Chamber, dismissed her appeal on 26 February 2020 under file reference SC242/19/05749. It held that the Irish pension was analogous to a United Kingdom widow’s pension rather than to bereavement support payment.

On appeal, the Upper Tribunal considered whether regulation 66(1)(c) required the claimant to be entitled to the analogous United Kingdom benefit and whether the Irish pension was analogous to a United Kingdom widow’s pension.

1. Appeal dismissed. The First-tier Tribunal made no error of law. The Irish widow’s contributory pension was unearned income deductible from universal credit under regulation 66(1)(c) of the Universal Credit Regulations 2013.

2. Regulation 66(1)(c) catches a foreign benefit analogous to a benefit mentioned in the list in regulation 66(1)(b). It does not additionally require that the claimant be entitled to that United Kingdom benefit. Read in context, the words in regulation 66(1)(b) concerning entitlement and overlapping-benefit adjustments explain that the deductible amount is the net amount payable.

3. That construction accords with the statutory purpose. Universal credit is reduced to reflect income that meets a claimant’s basic needs. Requiring entitlement to the domestic comparator would produce anomalous results and could favour a recipient of a foreign benefit over a recipient of the materially equivalent United Kingdom benefit.

4. For statutory analogy, benefits must be similar or comparable in relevant respects, especially their nature and purpose; identity is unnecessary. The Irish pension and United Kingdom widow’s pension both provided weekly income following bereavement, had materially similar qualifying conditions, and continued broadly until state-pension provision became available. Differences between them were immaterial.

5. The award’s description as provisional did not make it time-limited. It was provisional only pending completion of a form. Bereavement support payment, by contrast, was limited to 18 months and was not an analogous comparator.

• Upper Tribunal (Administrative Appeals Chamber): dismissed the claimant’s appeal and upheld the First-tier Tribunal’s conclusion that the Irish widow’s contributory pension was deductible as unearned income.

• First-tier Tribunal (Social Entitlement Chamber): on 26 February 2020, dismissed the appeal against the Secretary of State’s decision and confirmed the deduction.

• Secretary of State for Work and Pensions: on mandatory reconsideration dated 14 May 2019, declined to revise the decision of 8 October 2018.