‘Sorry, we don’t accept housing benefit’ will be a familiar refrain to anyone who is looking for a home in the private rented sector and who also claims benefits. Until recently, at least, ‘no housing benefit’ policies could be seen emblazoned unashamedly in letting agents’ windows and in property advertisements. The shorthand for such policies – ‘no DSS’ – is, in itself, a sign of how deep-rooted they are: the Department of Social Security was abolished in 2001.
In a recent case in the County Court at York, however, the judge declared one such policy to be unlawful. Does this spell the end for DSS discrimination?
What is DSS discrimination?
DSS discrimination is the practice whereby landlords and letting agents reject an application from a potential tenant simply because they are in receipt of benefits. Sometimes, the agent or landlord publicly advertises it as a fixed policy; on other occasions, the applicant only discovers it when they make an enquiry and are rebuffed on the grounds that they receive benefits. Either way, DSS discrimination occurs when an application is not considered on its individual merits but is refused just because the applicant receives benefits.
The challenge to DSS discrimination
In recent years, a number of cases have been brought challenging the lawfulness of ‘no DSS’ policies. The argument made by claimants is that such policies are unlawfully indirectly discriminatory against women and disabled people, contrary to the Equality Act (EA) 2010.
Pursuant to EA 2010 s19(2), a provision, criterion, or practice is indirectly discriminatory if:
(a)A applies, or would apply, it to persons with whom B does not share the characteristic,
(b)it puts, or would put, persons with whom B shares the characteristic at a particular disadvantage when compared with persons with whom B does not share it,
(c)it puts, or would put, B at that disadvantage, and
(d)A cannot show it to be a proportionate means of achieving a legitimate aim.
There is no dispute that ‘no DSS’ policies are of apparently neutral application. However, research by Shelter has shown that women and disabled people are significantly more likely than men and non-disabled people to claim housing benefit. For example, figures from 2018 showed that 53 per cent of women renting privately in single-adult (including single-parent) households claimed housing benefit compared with 34 per cent of men in the same position.1Shelter looked at the number of housing benefit claims by gender, household type and housing type from the Department for Work and Pensions’ (DWP’s) Stat-Xplore analysis tool for March 2018. These figures come directly from the DWP’s administrative database and are therefore an exact count of the numbers of claims administered. They were then examined in conjunction with other official data on the size and make-up of the population taken from the English Housing Survey, the 2011 Census and the Office for National Statistics.
Meanwhile, according to data collected between 2017 and 2019, 45 per cent of disabled people renting privately claimed housing benefit compared with 15 per cent of non-disabled tenants.2Shelter looked at data taken from the Understanding Society survey. This is the UK Household Longitudinal Study based at the Institute for Social and Economic Research at the University of Essex. It is the largest available official survey that collects detailed information relating to the claiming of benefits.
This indicates that ‘no DSS’ policies put women and disabled people ‘at a particular disadvantage’ compared with men and non-disabled people.
While it is open to a defendant to show that a policy is, despite its disparate impact, a proportionate means of achieving a legitimate aim, Shelter is not aware of any factors which would justify this practice.
‘Jane’ was a single mother of two children. She was disabled due to attention deficit hyperactivity disorder, anxiety and depression. She had to leave her rented home because the landlord wanted the property back for a family member to live in. In October 2018, she saw an advert for a suitable property to rent and contacted the letting agent to express her interest. However, she was told that it did not ‘accept housing benefit’ and, when she pressed it further, that it had had a ‘policy for many years not to accept housing benefit tenants’.
Jane brought proceedings in the county court seeking damages and a declaration that the agent’s policy was unlawful. Several months into the litigation, and after it had abandoned the policy, the agent indicated that it would agree to pay damages and to a declaration being made, and an application by consent was duly made to the court.
The case was heard by District Judge Mark, who, having considered the statement of reasons agreed between the parties, granted a declaration that:
The defendant’s former policy of rejecting tenancy applications because the applicant is in receipt of housing benefit was unlawfully indirectly discriminatory on the grounds of sex and disability contrary to sections 19 and 29 of the Equality Act 2010.
What next for DSS discrimination?
While this decision does not have the force of precedent, and relates specifically to one defendant’s policy, it is nevertheless an important step forward in the campaign against DSS discrimination. It is the first time that a ‘no DSS’ policy has been declared unlawful by a court and the strongest indication so far that such practices contravene the EA 2010. It certainly stands as a warning to landlords and letting agents that they risk legal action if they continue to operate blanket bans against applicants in receipt of benefits.