The Department for Work and Pensions (DWP) has said it is ‘carefully considering’ a court ruling that will mean landlords must wait for longer before being allowed to deduct money from tenants’ Universal Credit (UC) payments to reduce rent arrears.

The High Court case took place last month and its judge ruled that the DWP had acted unlawfully by making deductions from tenant Nathan Roberts’ UC payments to his landlord without first consulting him.

The DWP made the deductions from Roberts’ UC in March 2024 following an application by his landlord.

At the time, he was engaged in a dispute about his liability for rent, and a date for him to move out of the property had been agreed.

But Roberts continued to challenge the lawfulness of the eight-year-old policy and won the case, which highlighted how the DWP system was one sided because it relied almost wholly on a landlord’s version of events and rent arrears.

Reform

The judgement is expected to initiate reform of the system by Labour, which would significantly impact thousands of landlords with UC tenants relating to ongoing rent payments and towards rent arears.

So far, it has also been estimated, payments have totalled some £480 million, the i paper has revealed via a freedom of information request.

It is not known yet whether the Government will decide to reimburse the millions of tenants involved.

Emma Varley (pictured), associate at the legal firm Bindmans, which led the case, told the paper: “The impact of the court’s decision is that the DWP, as a matter of procedural fairness, must now ask UC claimants what they think about the proposed deduction before it is made.

“That presents a significant change in the way that the DWP will have to process these deductions going forward.”