It lives! A self-sufficiency based right to claim benefits

Jun 2

Upper Tribunal win for Child Poverty Action Group client WV v SSWP (UC) [2023] UKUT 112 (AAC)

A what, now?

Before Brexit, EU nationals had the right of free movement in the UK, but typically could only access certain subsistence benefits if they could show they had a ‘right to reside’ in the UK, which usually meant being in work, or being the family member of someone who was (or by relying on permanent residence, but that required them to show they had been exercising a right to reside continuously for five years). There are other routes to having a ‘right to reside’ under EU law, but one of them had little-to-no purchase in the UK – by showing you were ‘self-sufficient’. Any attempt to rely upon this would generally fail at both of the two hurdles – self-sufficiency and comprehensive sickness insurance (CSI).

To rely on the self-sufficiency provision, an EU national would have to have CSI, and UK courts, time and again, found that being eligible for NHS treatment did not discharge this requirement (while often giving little indication as to how someone could meet this requirement in the UK – possible routes included private health insurance, though different policies might not be sufficiently comprehensive). On the issue of self-sufficiency itself, the requirement not to become an unreasonable burden on the social assistance system of the UK, the standard approach was that any claim for benefits negated any claim of being self-sufficient. The theoretical right evaporated the moment it was needed.

Why are the old rules relevant now?

After Brexit, EU nationals who were resident in the UK before the transition period ended (on 31 December 2020) and their family members were entitled to apply for a residence status under the EU Settlement Scheme. (Although the deadline of 30 June 2021 has long passed, people are entitled to make late applications if they had a good reason for missing it). Those resident for less than five years can get pre-settled status. This is a right to reside, but the UK government issued regulations discounting it for the purposes of establishing eligibility for benefits (and the CJEU basically said: fine). In short, people with PSS are still expected to show another right to reside, under the old rules. This has a detrimental impact upon people who should not work (such as: children), and people whose capacity for work is limited (such as disabled people, lone parents and carers).

Who were the claimants in this case?

This case, WV v SSWP (UC) [2023] UKUT 112 (AAC) concerned the right to reside of an EU national with PSS, who had been resident in the UK since 2017, as a full time carer for his severely disabled British wife. His wife had been on ‘legacy benefits’ (the benefits that preceded Universal Credit), and he had been entitled to claim Carers Allowance. When they moved to another area with a different local authority, they were required to move to Universal Credit. The question arose as to whether they could claim as a couple. The DWP found that they could not, asserting that the claimant did not have a right to reside.

Since the dates at issue he had acquired settled status, meaning from that moment on he was entitled to claim UC on the same basis as UK nationals.

Why is self-sufficiency suddenly an option on the table?

Because of last year’s CJEU case of C-247/20 VI v HMRC, in which the Court of Justice of the EU took it upon itself (in spite of the question not being explicitly put to it) to deem that eligibility for NHS treatment should constitute comprehensive sickness insurance – only sixteen years too late to help very many people…

As a result, in this case, what had been an insuperable hurdle was dealt with in a sentence:

‘It is accepted that C meets the further requirement for asserting self-sufficiency, to have comprehensive sickness insurance cover, in the light of the decision in C247/20 VI v HMRC’.

What still had to be thrashed out, however, was whether the EU national’s reliance upon his British wife’s social security benefits could be deemed to make him self-sufficient, so that he would have a right to reside and could be included in his wife’s Universal Credit award. If so, the Upper Tribunal further had to decide whether including him in the UC award would then obviate the claim to self-sufficiency, by making him an unreasonable burden.

Did the social security benefits count as relevant resources?

Yes. The claimant was entitled to rely on his wife’s resources, made up of income-related employment and support allowance (she was in the support group), housing benefit, personal independence payment (higher rate for both mobility and daily living), and child tax credit, to establish self-sufficiency. This position was not changed by the fact that these resources came ultimately from the public purse. Carefully running through a series of CJEU cases, UT Judge Ward concluded that:

‘conditions as to the origin of sums provided to another by way of resources have been consistently rejected as disproportionate by the CJEU.’ [§50]

While some elements of the claimant’s wife’s benefits were social assistance, the proportion of the household income that was social assistance actually decreased once the claimant had joined her. They had been able to claim ESA at the couple rate, but lost the severe disability premium, and the claimant received Carers Allowance. Overall, the amount of ESA went down, and the Carers Allowance was deemed not to be social assistance – a point conceded by the Secretary of State. Judge Ward noted that it was not open to the government to claim that the amount received did not constitute sufficient resources, since it was the amount that ‘in the eyes of the State’ was sufficient to meet the needs of a couple in their circumstances.

Do EU nationals need to show they have sufficient resources for British family members?

No. The question arose because the requirement under Directive 2004/38, Art.7(1)(b) is for the person asserting the right to “have sufficient resources for themselves and their family members not to become a burden on the social assistance system of the host Member State during their period of residence”. Judge Ward found however, that ‘on no view’ could the Directive be said to apply to the claimant’s wife as she was not a family member who had ‘accompanied or joined’ the claimant in moving to or residing in a Member State other than her own. The claimant just needed to demonstrate resources that were sufficient for himself.

**So, he had been self-sufficient up the point of claim – what about afterwards?**

Having established prior self-sufficiency, it was then necessary to determine whether a joint award for Universal Credit would, in the future, create an unreasonable burden on the social assistance system. Re-enter, stage left, Case C-140/12 Brey – a case in which the CJEU had created quite a substantial duty of assessing individual circumstances, but which had since shuffled off-stage in the UK (because it was so unlikely anyone would ever be able to establish an initial right to reside in the UK based on the self-sufficiency provisions).

To establish whether the claim posed a reasonable burden, the UT looked at the extra costs created by including the claimant in the UC award, and the period of the claim during which they needed to rely upon the self-sufficiency right to reside – a period that ended as soon as the claimant received EUSS settled status.

There was some dispute about the best way to calculate what the ‘extra’ social assistance would be; CPAG argued that it was only an extra £55.65 per month because had the claimant’s wife been living on her own, her UC would be higher than it actually was. The UT judge instead agreed with SSWP that he had to look at the difference between the figure actually received with the couple living together, and the amount that would be awarded at a couple rate. This difference amounted to £347 per month. Judge Ward noted that he read the assessment in Brey as relating only to social assistance, but added (in a rare judicial acknowledgement of the financial value of care being provided) that even if he were wrong on that, he would:

‘place little weight on the receipt of carer’s allowance, given that it is paid in acknowledgment of at least 35 hours of caring weekly, which at least in part might otherwise have had to be provided to J at public expense’ [§64].

The next question was that of duration of the ‘burden’ at issue. The Secretary of State suggested that by pointing to the future establishment of settled status the claimant might be seeking to ‘negate’ the EU law concept of an unreasonable burden. The UT judge disagreed; the fact of the claimant’s acquisition of settled status was relevant, ‘precisely in order to decide whether the burden is, or is not, unreasonable’. It was therefore a closed period at issue, of 23 months.

**Would these claims collectively give rise to an unreasonable burden?**

No. Having put a figure on the financial burden posed by the individual claimant, the judge then had to reach a decision on whether such claims overall could create an unreasonable burden on the public purse. He found that the ‘cohort who meet all the conditions described is likely to be a small one’, with the households whose social assistance incomes actually initially decreased when shifting to couple rates primarily being ‘cases where there is disability’. Moreover, the cohort would be time-limited by the completion of the transition from legacy benefits to Universal Credit.

What does this mean?

As noted in the judgment, the circumstances are fairly confined in terms of people relying directly on the outcome, but this could be significant result for a group of otherwise vulnerable households – where an EU national cares for a disabled British spouse, and where they were formerly on legacy benefits (and where they are eligible for settled status and where the amount of social assistance stayed the same or decreased when they joined the household).

But this case may also open up other, analogous ways of arguing self-sufficiency – avenues that have hitherto seemed hopeless. This could be important for establishing closed periods of a right to reside in themselves, but also could help plug right to reside gaps to enable people to rely on having acquired ‘permanent residence’. (PR no longer means very much in immigration terms, but does create a relatively unconditional right to reside for the purposes of claiming benefits, in cases where settled status has yet to be recognised).

So, a provision of EU law that has mostly lain dormant in the UK has been re-animated – in part because the EUSS meant that acquisition of settled status rendered any reliance upon self-sufficiency more likely to be proportionate. All it took, it seems, to make this bit of EU law effective, was for the UK to leave the EU…

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