MINISTERS could be forced to change the rules on Universal Credit for hundreds of thousands of self-employed Brits, it emerged today.
Mum-of-two Charmaine Parkin has won the right to take her fight to the High Court over the unfair minimum income floor.
The 34-year-old actress was forced to turn to foodbanks to feed her little ones, 11-year-old Arthur and eight-year-old Esme.
She argued that she’d be better off giving work up altogether thanks to Universal Credit.
Today her lawyers revealed they have been given permission to take forward a judicial review of the Government’s decision to apply a minimum income floor for Universal Credit.
It means that if she earns less than £788.26 a month (for 25 hours a week at the minimum wage), then she is still treated as if she had got that much, and her benefits changed accordingly.
It doesn’t apply for the first year someone sets up a business, to get them on their feet, but then will kick in afterwards.
Charmaine’s lawyers will say she will have been around £400 a month better off if she’d quit her career and moved onto the equivalent of jobseekers’ allowance.
They say the rules are “unjustified discrimination” and “irrational”.
She said today: “I am delighted that the court has granted permission for my judicial review. I am determined to hold the government accountable for its flawed universal credit system which is causing misery to so many.
“It cannot be right that a system designed to help support people in work has resulted in some people being better off if they give up their work.”
The Office Budget Responsibility estimated that more than 400,000 could lose out by an average of around £3,000 as a result of the income floor – which will save the Government £1.3billion by 2023.
700,000 self-employed people could be claiming UC by 2022.
Policy in Practice has estimated that self employed households could lose £4,128 per year less on Universal Credit than on tax credits, they said in a report last year.
What is the minimum income floor on Universal Credit?
- If you’ve been self-employed for more than a year, you’ll be treated as if you are earning a certain amount, but it’s different for every person
- It assumes that workers earn at least that every month, even if they don’t
- But if they don’t their benefits don’t increase in line with that
- The Office for Budget Responsibility, estimates that more than 400,000 claimaints will experience losses as a result of the floor
Tom Short, solicitor from law firm Leigh Day, added today: “Our client is one of the many self-employed people suffering from the application of the minimum income floor.
“The effect is particularly harsh on those who work in areas such as the entertainment industry and farming where fluctuations in income are common.
“Our client’s situation shows just how illogical and inconsistent the universal credit system is and we look forward to putting her arguments to the court.”
A DWP spokesperson said of the case last year: “We are unable to comment on an ongoing legal case.
“Universal Credit strikes the balance between supporting entrepreneurship and being fair to the taxpayer by helping self-employed people during the first year while they establish their business.”
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