UK Benefit Claimants Set to Receive Compensation Of £5,000 After Legal Battle with DWP

A major legal case has led to thousands of benefit claimants in the UK receiving compensation. The Department for Work and Pensions (DWP) is facing legal action after many individuals lost out on essential disability payments when they moved from older benefits to Universal Credit. A new compensation scheme is now in place, but many details are still unclear.

Why Are Benefit Claimants Receiving Compensation?

The issue began when people receiving legacy benefits, including Severe Disability Premium (SDP) and Enhanced Disability Premium (EDP), were transferred to Universal Credit before September 2019. This change resulted in them losing up to £180 per month, significantly impacting their financial stability.

After legal action, the High Court ruled in 2019 that the government had failed to protect these individuals, leading to financial hardship. As a result, thousands of claimants are now eligible for compensation.

How Much Compensation Will Claimants Receive?

The legal case, led by the law firm Leigh Day, has already secured compensation payments between £200 and £3,000 for more than 275 individuals. However, it is estimated that up to 13,000 people could be eligible for larger payouts, with some claimants receiving over £5,000 in compensation.

Universal Credit and Its Impact on Benefits

Universal Credit was introduced to replace various legacy benefits, but the transition process has been problematic. Those affected by the loss of SDP and EDP struggled financially, and many were unaware of their entitlement to compensation.

To address this, the SDP Gateway was introduced in 2019. This system was designed to prevent new claimants from facing similar financial losses when moving to Universal Credit. However, those who already lost money before 2019 were not compensated until legal action was taken.

Legal Action and the Compensation Scheme

Leigh Day took up the case on behalf of two individuals who suffered financial hardship due to the transition. The case set a legal precedent, leading to the introduction of a broader compensation scheme.

According to Ryan Bradshaw, a lawyer at Leigh Day, the loss of benefits caused severe financial and emotional distress to many vulnerable people. The new compensation scheme aims to restore lost income and provide financial relief to those affected.

Key Details About the Compensation Case

• 275 claimants have already received compensation ranging from £200 to £3,000.
• Up to 13,000 people could be eligible for payments exceeding £5,000.
• Many lost Severe Disability Premium (SDP) and Enhanced Disability Premium (EDP) when moved to Universal Credit before September 2019.
• The SDP Gateway, introduced in 2019, now protects claimants from similar financial losses.
• The compensation scheme acknowledges both financial losses and emotional distress.
• The Work and Pensions Secretary, Liz Kendall, has not yet announced how all eligible claimants can apply for compensation.

How This Affects Claimants

One of the claimants, Philippa, a 39-year-old from Chesterfield, suffers from fibromyalgia, a chronic autoimmune condition causing widespread pain and fatigue. She struggled to afford basic necessities after losing her disability benefits.

She described the stress of waiting for government support, saying:
“Receiving benefits can create a sense of insecurity. Each day, you anticipate the arrival of the small brown envelope.”

After receiving compensation, her quality of life has improved, as she can now afford healthier food and essential items.

What Happens Next?

The DWP has acknowledged the court ruling and confirmed that the compensation process is ongoing. However, no clear guidelines have been provided on how thousands of affected claimants can apply for compensation.

Many campaigners and legal experts are urging the government to speed up the process and provide full clarity to ensure all eligible individuals receive their rightful compensation.

Conclusion

This case is a significant victory for benefit claimants who suffered financial losses due to the transition to Universal Credit. While some have already received compensation, thousands are still waiting for their payments. The government must now act quickly to ensure that all eligible claimants receive fair compensation and prevent similar issues in the future.

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