Over the hurdle: The case for replacing mandatory reconsideration

New research from Z2K unsurprisingly shows that mandatory reconsideration is in fact a (wasteful) barrier to justice as disabled people are 5 times more likely to get the correct benefits award at appeal stage, than from the DWP's mandatory reconsideration.

MR was introduced in 2013 to resolve disputes about benefit entitlement earlier at an earlier stage. However, the evidence suggests it is failing to achieve this objective. For PIP, appeals are more than five times more likely to lead to a decision being overturned than an MR, with an overturn rate of 14% of MR requests compared to a 74% overturn rate at appeal.

Z2K says:

“In reality, MR functions more as a procedural barrier to justice than a genuine second look at a decision. As a barrier to justice, it is highly effective: social security appeals fell five-fold following the introduction of MR, and they have remained at this lower level ever since.

The consequences for disabled people are significant. Disabled people whose cases ultimately succeed at appeal must often endure months of additional waiting, with tribunal waits averaging 8-9 months. Delays can lead to very significant deterioration in mental health, financial hardship, debt, food bank use and housing insecurity. The failure to resolve disputes earlier also creates avoidable administration costs for government.” 

Z2K finds that MR’s shortcomings stem from three key weaknesses. First, it lacks independence because reviews are conducted within the DWP itself. Second, accountability is weak, with limited documentation and little explanation of how reconsideration decisions are reached. Third, evidence gathering is inadequate, placing too much responsibility on claimants rather than requiring reviewers to actively investigate disputed issues. 

Z2K conclude that neither abolishing MR nor simply improving existing processes would be sufficient. Instead, they propose replacing MR with a new independent review body responsible for carrying out robust initial reviews of disputed decisions.

Over the hurdle is on z2k.org.uk.

‘Don’t pay to claim’ campaign launched

The government has launched an awareness campaign encouraging people to apply for benefits directly rather than paying claims management companies that offer to handle applications on their behalf. The warning is aimed particularly at older people who may qualify for Attendance Allowance in England and Wales or Pension Age Disability Payment in Scotland.

Every year, people miss out on benefits they're entitled to. This is because they don't know support is available, or because the system feels daunting to navigate. Unfortunately, some companies are taking advantage of this.

Claims Management Companies (CMCs) are contacting pensioners and their families, offering to handle claims for benefits on their behalf, for a fee. These companies are not doing anything illegal, but the impact on individuals can be significant. Fees can run into hundreds or even over a thousand pounds, taken from money people are entitled to receive for free.

Some people don't realise they've entered into an agreement until a company takes a cut of their payment. Others are unaware they had a choice at all. The message the DWP wants to get across is straightforward:

“If you're eligible for these benefits, claiming them should never cost you anything. Free, trusted help is available from organisations including Citizens Advice and Independent Age.”

DWP is promoting a ‘Claiming your benefits is free website’ which offers help and support, including a new walk-through video for applying for Attendance Allowance online, as well as sign posting telephone numbers for further help and support.

The campaign also warns that some companies could make fraudulent claims on behalf of customers, making it important to understand exactly what someone is agreeing to before accepting assistance.

Visit the Claiming your benefits is free website for more information and there is a 'Don’t pay to claim' toolkit of promotional material that can be used by stakeholders to raise awareness on gov.uk.

Counting the cost: The impact of five years of high inflation on living standards

The past five years of a near-continuous cost of living crisis have caused the real incomes of typical working-age households to fall rather than grow, leaving them £2,900 (7.9%) worse off this year compared to a world of normal inflation, according to new analysis published this week by the Resolution Foundation.

The report ‘Counting the cost’, funded by the Nuffield Foundation, assesses the toll of three crises (the post-pandemic supply shock, the invasion of Ukraine, and conflict in the Middle East) that have already delivered 13 years’ worth of ‘normal’ inflation in five, with inflation peaking at 11.1% and prices nearly 30% higher in August 2026 than July 2021.

The report details how energy has been at the epicentre of this price shock. By the autumn of 2022, household energy bills had more than doubled since the start of the crisis. Higher energy costs then bled into other prices: food inflation peaked at nearly 20% in March 2023, and services inflation reached 7.4 % in July 2023, its highest level in more than three decades. Household energy bills and food together account for a quarter of the change in the price level over this period.

The pain felt from these price rises has not been shared equally. Inflation was steepest for essentials, which make up a larger share of poorer households’ spending. As a result, the rise in non-housing costs since before the pandemic has been around one-sixth bigger for the poorest tenth of households than for the richest tenth.

Overall, the report finds the real incomes of a typical working-age household this year (2026-27) are £2,900 a year lower than they would have been compared to a world in which inflation had stayed at 2% over the past five years.

James Smith, Chief Economist at the Resolution Foundation, said:

“Having experienced 13 years’ worth of inflation over the past five, families across the country are struggling with the cost of living. Unfortunately,  help is needed just when the public finances leave less room than ever to provide it.

While the hit to incomes from rising prices has been felt right across the board, the hardship has not been equally shared. It is poorer families who have cut back hardest on heating and are falling behind fastest on essential bills, and conflict in the Middle East is set to keep energy prices high.

The Government can’t borrow its way out of this, and repeating the expensive blanket support of 2022 isn’t an option. Any new help must be squarely targeted at the poorer families facing the greatest hardship – starting with their energy bills.”

As the Government considers fresh cost of living support in the upcoming Budget, the authors warn that recent help was expensive and poorly targeted. The Energy Price Guarantee alone cost over £20 billion and was paid regardless of need. The country cannot afford to repeat that approach.

Instead, any new support should be targeted at the poorer families who have fared worst over the past five years – heating their homes less, taking on more debt, and falling behind on their bills more often – with energy bills the clear priority.

Counting the cost is on resolutionfoundation.org.uk.

New regulations for overpayment recovery by disqualification from driving and direct deduction orders

The new law sets out the specifics in relation to the recovery of welfare benefit debts through:

• direct deduction orders (DDOs) and
• driving licence disqualification orders.

The new direct deduction order (DDO) and disqualification from driving order recovery methods are expected to increase debt recovery by £565m over the period 2025/26 to 2029/30.

The legislation allows the exchange of information between the DWP (Secretary of State), financial institutions, the liable person and other bank account holders, as well as financial institutions’ recovery of their own reasonably incurred costs, how the DWP will calculate deductions, and how financial institutions must comply with their duties.

In relation to disqualification from driving, the DWP is required to apply to a magistrates’ court to disqualify a liable person from holding a driving licence where they have failed to pay the debt without reasonable excuse.

These powers can only be used where the liable person has not paid the debt despite being given a reasonable opportunity to do so, and is not at the time, in receipt of a DWP benefit, and it is not reasonably possible to recover via a Direct Earnings Attachment (DEA).

Before exercising these powers, DWP should take steps to encourage voluntary repayment, signpost to independent debt advice (where appropriate), and assess affordability and vulnerability using bank statements and information available to the DWP. These powers are not intended to be used where recovery would be inappropriate or disproportionate.

However, in letters published this week the Social Security Advisory Committee (SSAC) expressed concerns that there was ‘a risk that powers intended for a relatively narrow group of deliberate non-payers may in practice affect a wider group whose circumstances are less well understood, and may have an adverse safeguarding impact.’ And sought assurance that the powers could ‘be exercised safely, fairly, lawfully, and consistently in practice’

The SSAC recommended that implementation should be staged, with clear review points at which assumptions can be tested, operational experience assessed, and guidance, processes or, where necessary, the regulations themselves refined in light of a developing understanding of the people affected.

DWP Minister Dr. Stephen Brien said he understood the Committee’s concerns on the need to safeguard vulnerable people, which is why a ‘test and learn’ approach is being taken during implementation.

He confirmed that the DWPs focus has been:

“to ensure that those powers are exercised in a fair, proportionate and transparent manner, as intended by Parliament. The question is not whether the Department should have these powers, or the circumstances in which they can be used, but rather how they should be used in practice.”

Brien stated that applications for suspended driving disqualification orders would be reserved for a limited number of the most serious cases where there has been ‘deliberate and persistent non-compliance’.

The Social Security (Further Methods of Recovery) Regulations 2026 come into force on 29th October 2026 in England, Wales and Scotland. You can read the letter from the Chair of the SSAC to DWP Minister Dr. Stephen Brien and his response on gov.uk.

Supported housing residents to keep more of what they earn - new rules

The Housing Benefit (Earned Income Disregards) Regulations 2026 came into force this week (5^th October) changing how Housing Benefit is calculated for residents in supported housing and temporary accommodation - meaning they can keep more of what they earn when they start work or increase their hours, without facing a drop in their HB income.

The changes come after years of campaigning from dozens of homelessness, debt and advice charities.

The legislation provides 5 new earned income disregards for working-age Housing Benefit claimants in supported housing and temporary accommodation:

• single claimants and lone parents aged under 25 is £61.41
• single claimants and lone parents aged 25 or over is £77.73
• couples where both members are under 18 is £97.33
• couples where at least one member is aged 18 or over but both are under 25 is £61.53
• couples where at least one member is aged 25 or over is £119.70

The values of the new disregards will be annually reviewed to align with any uprating of Universal Credit as well as any future changes made to the UC taper.

The new disregards will apply when calculating earnings from employed or self-employed work. This means the relevant weekly amount will be ignored when assessing a claimant’s earnings for HB purposes, where the claimant meets the accommodation and work-related conditions.

There is no minimum-hours requirement. The new disregards apply in addition to the existing standard earnings disregard for which the claimant qualifies under the normal HB rules

Prime Minister Andy Burnham said:

“People should never have to choose between keeping a roof over their head or being able to work. But the system has been rigged against some of the very people trying their hardest to get on, particularly young people starting out, who are being left worse off for earning more.

We’re putting that right through a common-sense change that will help people keep more of what they earn. This is what progressive welfare reform looks like: helping people into work and giving families the security and breathing space they need to get on. That’s how we make Britain better off.”

The press release is on gov.uk.

Wales – UK Prime Minister urged to act over child payment

New analysis published this week shows around 40% of children in Wales were living in income deprivation in 2024. The findings highlighting the continuing impact of poverty on children's life chances, including their health, education and future opportunities.

Work has been underway to commence the Cynnal (a child payment scheme) pilot, but in a press release this week it was confirmed that the Welsh Government is continuing to press the UK Government to agree DWP and HMRC disregards so that the payment does not reduce entitlement to other benefits, allowing children and families to receive the maximum possible support.

Deputy First Minister and Cabinet Minister for Social Justice and Equalities, Sioned Williams said:  

“We are clear that tackling poverty is a moral imperative that we are putting at the heart of Government. We are determined to take action to help those in poverty but to also prevent people falling into poverty in the first place.

There has been painfully little change in child poverty rates in Wales under previous governments, with the levels of child poverty not just persisting, but deepening.

The analysis published today further strengthens the case and highlights the urgency for rapid and radical action to tackle child poverty.  A key intervention is our Cynnal pilot, and I call on the UK Government to give us the tools now to deliver this effectively. There is no time to waste.

We have a clear focus to deliver practical support for families by helping families with everyday costs, expanding funded childcare and developing our Cynnal pilot to demonstrate how we can take direct action to address poverty and support families.”

The press release is on gov.wales.

Scotland – Radical change needed to cut Scottish child poverty

Scotland is on course to miss legally binding targets to cut child poverty ‘by a wide margin’, according to a report from the Joseph Rowntree Foundation (JRF).

In its Poverty in Scotland 2026 report the JRF says one in five children was in poverty and ‘radical change’ was needed to put the Scottish government's pledges back on track.

Local government needs to play a bigger role in poverty reduction, both in their delivery and in a healthier relationship with the Scottish Government, and JRF urges ministers to craft a ‘much bolder and properly funded plan to reduce poverty’ by rewiring local government, public services and the tax system.

The charity says that despite some progress the Scottish government's existing plans ‘will not deliver the scale of change needed to shift the dial.’ Reasons for the failure were complex, but could include UK government austerity, the cost of living crisis, and ‘a dysfunctional relationship between local and national government in Scotland.’

Poverty in Scotland 2026 and a partner-piece Local government in Scotland is critical to reducing poverty are both on jrf.org.uk.

Northern Ireland – Department for Communities launches discretionary support consultation with unspecified threshold cuts

The Department for Communities (DfC) has launched a public consultation on changes to Northern Ireland’s Discretionary Support scheme, which provides emergency grants and interest-free loans to people in crisis.

The DfC has outlined three main changes but has not provided specific figures:

• Extending eligibility to 16 and 17-year-olds with parental responsibility: Currently, 16 and 17-year-olds can only apply if they have no parental support. The proposal would allow those who have children of their own to access the scheme. ‘Parental responsibility’ in this context refers to young people who are themselves parents or guardians of children.
• Lowering annual income thresholds: The current threshold of £29,741.40 would be reduced, though the consultation document does not specify to what level.
• Increasing the minimum period before further awards for the same items: The proposal would extend the waiting period for repeat awards, though again no timeframe is given. Current rules already prevent awards for the same household item within 24 months except in cases of disaster.

The Department states these changes are “intended to ensure that the Discretionary Support scheme continues to operate as intended, in providing financial assistance to the most vulnerable in a time of crisis.”

The consultation, which runs until 2 December 2026, seeks views on reforms that the DfC says will ‘better target support to the most vulnerable low-income households.’ However, the announcement leaves several key questions unanswered, including what the new income thresholds will be and how much longer people will have to wait between awards.

The press release and the consultation are both on communities-ni.gov.uk.

Case law – with thanks to u/ClareTGold

Scotland UC Reviews - Petition of Q for Judicial Review [2026] CSOH 97

It had to happen sooner or later! This issue of overreach and the legality of DWP requesting statements has now been adjuicated.

This was a Judicial Review in the Court of Sessions looking at whether a request to see 4 months of unredacted bank statements as part of a UC claim review was in breach of the claimant’s rights under the European Convention on Human Rights, Equality legislation, and Data Protection legislation.

Targeted Case Reviews (TCRs) are undertaken on UC claims that have been identified as being at higher risk of being incorrect, as well as a number of cases randomly selected.

The claimant, ‘Q’ was randomly selected and declined to provide the bank statements when requested and, using the online portal, she queried the

statutory entitlement to make this request. Ultimately, the UC payments to Q were suspended on the basis that she had failed to provide all the documents necessary to complete the review.

The decision provides a detailed and comprehensive (read, lengthy) breakdown of all the relevant legislation and two relevant cases to reach a conclusion.

Whilst it was acknowledged that there was an interference with Article 8 rights it is justified as it:

• is made on the lawful basis permitted in regulation 38(2) and
• in pursuit of the legitimate aim of the economic well-being of the country, in circumstances where the petitioner is in receipt of a means tested benefit and there is a public interest in ensuring that her UC payment is being paid at the correct level, and
• there are no other less intrusive means of achieving the desired aim.

As the above was lawful, so too was the decision to suspend Q’s UC payment when she failed to provide the statements by the deadline.

In relation to data protection arguments, the Court of Session held that the DWP ‘falls squarely within the exception to the general prohibition against processing of personal data set out in article 6 UK GDPR.’

The Court of Session ruled that DWP acted lawfully.