Socialist Worker

Legal win in Universal Credit childcare fight

by Sadie Robinson
Issue No. 2739

Women were forced to pay for childcare upfront

Claimants were forced into debt to pay for children (Pic: Lars Plougmann/Flickr)


A woman has won a legal challenge against the Department for Work and Pensions (DWP) over its childcare benefit rules.  

Nichola Salvato had challenged the DWP over its Universal Credit (UC) childcare payments system. 

A “proof of payment” rule means claimants have to pay for childcare costs up front, then claim money back.  

But a court last week ruled that this is unlawful and discriminatory.  

Nichola previously told Socialist Worker that she had to “borrow from friends and family, and take out loans” to cover the costs. 

Eventually she was forced to cut her working hours to reduce childcare costs —making her more dependent on benefits. 

Frustrated

“That frustrated me,” said Nichola. “The government says the aim of UC is to help people into work.”  

Mr Justice Chamberlain said in a judgement last week that the proof of payment rule “discriminates indirectly against women”. He said it has “disproportionately prejudicial effects on women” in two ways.  

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Firstly, more than 80 percent of those claiming the childcare costs element (CCE) of UC are women. Secondly, the rule “is bound to have a greater adverse effect on women because women as a group earn substantially less than men as a group”.  

“It follows that women are substantially more likely than men to be denied access to the CCE because they do not have enough money to pay childcare charges out of their own funds before being reimbursed,” he said.  

And the judge dismissed the government’s argument that it needed the rule to prevent fraud. He said it is “not obvious” why basing the system on liability to pay would be any more likely to lead to fraud or error.  

The system is eventually expected to affect 500,000 parents when UC is fully rolled out. The DWP is appealing against the judgement.


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