Single mum will fight DWP in the High Court in a landmark Universal Credit case

A single mum has won permission to fight a landmark case against Universal Credit in the High Court.

Nichola Salvato could help up to half a million parents who pay for childcare on the six-in-one benefit after a top judge allowed her to bring a judicial review.

The 48-year-old benefits advisor from Brighton launched her case after she was hurled into debt by the way Universal Credit collides with childcare.

Parents can claim up to 85% of the cost of childcare, to a cap of £646 per month, for each child under 16. But they must pay up-front and claim the costs back later, which leaves parents facing four-figure bills.

The Department for Work and Pensions (DWP) says the policy is to prevent fraud.

But Nichola’s legal claim, backed by charities Save the Children and Gingerbread, alleges the childcare rule is unlawful, discrimination and breaches the European Convention on Human Rights.

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Now the High Court has granted her permission to fight a judicial review over the childcare rule. A hearing in the High Court is expected later this year.

Nichola said: "I am so relieved that the court has allowed me to take my case further.

"The DWP will have to face up to its illogical system which forces working parents, especially single mothers, into financially precarious situations and even forces them out of work altogether.

“All I wanted to do was to work and provide for my child."

Ms Salvato was stung when she moved from Citizens’ Advice to a full-time job with a housing association last September. She was forced to cut her hours and borrowed £2,000 from payday lenders and family to cope with childcare costs.

She needs the childcare cash to pay for after-school clubs for daughter Sofia, 11. But Nichola couldn’t get a DWP advance payment, because she had earned more than £2,600 in six months.

Nichola, who has a degree and expertise on the benefits system, told us: “If I can’t figure my way out of this then how is anyone else going to?"

Her lawyer Carolin Ott, of Leigh Day, added: "We are very pleased that the court has granted our client permission for a judicial review of the DWP systems which forced her out of full-time work and into debt.

"This was the very opposite of what the government said Universal Credit was intended to achieve for people, especially women, who want to go out to work and provide for their families."

Charities and campaigners welcomed the chance to finally have their day in court.

Becca Lyon of Save the Children said: "This case offers a glimmer of hope to families who have been pushed into debt and hardship by upfront childcare costs.

"It just isn’t right that working parents are being forced to take out loans or turn down better paid jobs because they can’t find the money for childcare."

Liz Bayram, chief executive of the Professional Association for Childcare and Early Years, said the current policy puts vulnerable families in an "impossible position".

She added: "Parents like Nichola have to take out loans of up to £1,000 to secure a place.

"Or they are forced to use less childcare, reduce their working hours or stop working altogether – the opposite of what Universal Credit aims to achieve."

Victoria Benson, chief executive of single parents' charity Gingerbread, added: "Sadly, Nichola's experiences with Universal Credit and the upfront costs of childcare are not uncommon.

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"Many hard-working single parents are forced into desperate financial circumstances due to the unfairness of the current welfare system."

Around 50,000 households including 42,000 single parents were claiming childcare costs under UC last August. But the number is rising all the time as more people join UC, and is expected to eventually reach as high as 500,000.

Nichola's legal action says the childcare policy “disproportionately adversely affects women” and “disadvantages parents who lack the funds to pay the upfront costs of childcare.”

Branding the policy “irrational” under the law it adds: “It stands in stark contrast to the way in which other components of Universal Credit are paid.”

A DWP spokesman said: "We cannot comment on an ongoing case.”

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