As an EU national's family member the "public funds" rules would not apply to him,but that is purely for immigration purposes. If someone with a "public funds" restriction applies for public funds beenfits then technically this is an immigration law offence. Of course if DWP is doing its job properly they won't get the beenfit and it's unlikely they would be penalised by IND for the attempt, but it might go against them if they were trying to get leave extended.
However he is still subject to the totally separate benefit rules that we all know and love, especially the right to reside ones. I suspect that the HO is thinking exclusively about the first set of rules and have very little reason to know about the second, since EU nationals and their families are generally of almost no concern to them.
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