Back ground to the Sickness - DLA, AA and CA - benefits controversy.

The Disability Living Allowance (care component), Attendance Allowance, Carer’s Allowance – Indicated below as ‘sickness benefits’

1. This account concerns the ‘exportability’ of ‘sickness benefits’ from the UK to the wider EU.

2. Social Security benefits, including sickness benefits and pensions etc., are matters for the EU Member States and the affiliated States, and where the granting of these benefits is mostly a sovereign matter. However, in accordance with the EC Treaty, and EU Council Regulations 1408/71, as amended, which sets out certain overriding principles, not least so as to protect citizen’s rights when moving within those States. New Social Security Coordinating Regulations 883/2004, which grant even more enhanced rights of free movement in this field, will supersede these regulations when they enter into force on 1 May 2010, although many of the principles enshrined in the current regulations will still apply.

3. In 1992, following an application by the UK to the EU Parliament and Council, the above benefits, which were then classified as sickness benefits and exportable under Community law, were re-classified as special non-contributory benefits and as such the UK was no longer required to permit their export. This took effect as of 1 June 1992. However, the amending regulations which brought that about, also provided that where such benefit had been awarded prior to that date, then recipients were granted the right to continue to export any of those benefits to another State within the EEA, including Switzerland, as from 1 June 2004.

4. In the Late 1990’s the British Expats Association (Spain), in liaison with another resident organisation there, raised dialogue with the EU Commission when they contended that the said benefits were indeed ‘sickness’ benefits and in the meantime there was increasing supportive case law from the ECJ culminating with a ruling by that court on 8^th March 2001 when the Austrian ‘care’ allowance was ruled to be a sickness benefit.

5. Without getting into the legalities upon which the EU is founded, the EU Commission were constrained to act, until an opportunity arose in April 2005 after they had proposed amendments to Regulations 1408/71, which would have led to the re-classification of those benefits as sickness benefits, and therefore exportable from the UK.

6. The UK and two other States appealed against that proposal and the Parliament and Council upheld their submissions. The Commission was then able to open the infringement procedure, so as to bring the matter before the ECJ for their ruling. The Commission entered a single plea, to the effect that classifying the ‘care’element of DLA and the other two benefits to be other than sickness benefits, was an error at law.

7. The Advocate General delivered his opinion on 5^th May 2007, when he upheld the plea by the Commission. The matter was then sent to the ECJ for a full hearing This case was finally decided by that court on 18 October 2007, when the ECJ also held in favour of the Commission, when ruling that the ‘care’ element of DLA, AA and CA were sickness benefits and that the earlier classification had been an error at law.

8. The Spanish Association. for Expatriates then wrote several letters to the Commission, commencing with their first in November 2007 when seeking clarification as to the proper effects of that ruling. On 17^th May 2008 they again wrote to the Commission setting out that the UK was dragging its feet over re-instatement of the said benefits and requested they open the infringement procedure. They received a reply on 17^th June 2008 to the affect that the Commission considered that, in their opinion, the UK were going to comply with the Court’s ruling and that infringement could not be justified at that time. (!)

9. There then followed further procrastination by our Government and in the meantime the Association caused a petition to be sent to the EU Parliament, which finally led to the Commission commencing the infringement proceedings in September 2009, following our Government’s response to that petition through the Joint International Office

10. We also saw the involvement of others with numerous complaints being sent to the Commission and Members of Parliament at Westminster.

11. On 5^th January 2009 the Spanish Association again wrote to the Commission, requesting the opening of the infringement procedure, as the UK were still failing to comply with the ECJ’s ruling

12. We then saw supportive case law being handed down from the Upper Chamber of the newly created ‘Independent Tribunal Service’, when in respect of a case then under appeal, on 5 May 2009, the Judge took the reinstatement of the ‘care’ component element of DLA back to 13 December 2001, being the day immediately following the date it had been withdrawn after the appellant had relocate to Germany. In this and a later case from which we can draw proper reference the appellants also secured accrued arrears.

13. Since then the UK Government has offered various spurious reasons for refusing reinstatement to all this who lost their benefit before the Court’s ruling. The latest excuse being their newly invented ‘past presence criterion’ of 26 weeks residence in the UK in the previous 52 weeks.

[This criterion does not coordinate with Community or the following two case laws.

1. of the ECJ of 28 June 2001. - Gervais Larsy v Institut National d'Assurances Sociales pour Travailleurs Indépendants (INASTI). - Reference for a preliminary ruling: Cour du travail de Mons - Belgium. - Regulations (EEC) Nos 1408/71 and 1248/92 - Retirement pensions - Anti-overlapping rules - Unenforceability pursuant to a judgment of the Court of Justice - Limitation of effects - Serious breach of Community law. - Case C-118/00

2. The case of 18 April 2002. - Johann Franz Duchon v Pensionsversicherungsanstalt der Angestellten. - Reference for a preliminary ruling: Oberster Gerichtshof - Austria. - Social security for migrant workers - Article 48 and Article 51 of the EC Treaty (now, after amendment, Article 39 and Article 42 EC) - Article 9a and 94 of Regulation (EEC) No 1408/71 - Accident at work occurring in another Member State before the entry into force of the regulation in the worker's home State - Incapacity for work. - Case C-290/00.]

14. The former case addresses a ‘serious breach of Community law’, when being misapplied by a Member State, including the right to damages. The latter case refers to the backdating of a benefit to include a time when the circumstances which gave rise to a claim for benefit arose even before a State joined the EU.

15. This case law was forwarded to the Spanish Expats Association on 26 January 2010 when in their letter, the Commission also advised that its members should pursue their appeals through the domestic legal procedures. Indeed, all those so affected in Spain, were so advised by their Association from the outset.

16. Currently there are test (Lead) cases pending before the 1^st Tier of the Sutton Appeals Tribunal Service and listed for hearing in central London on the 3rd and 4th March 2010. However, decisions are not expected to be released until the earliest April 2010 ! But don’t hold your breath.

Further Matters.

Roger Gale MP (North Thanet) has shown an active interest in this matter, since the end of 2008, including questions in the House. On 14^th October 2009 Mr. David R. Burrage, the legal adviser to the Spanish Expats Association also had a meeting with him. Mr. Gale eventually secured a debate at Westminster Hall on 12 January 2010, when he was also supported by other members.

Roger Gale M.P. was introduced to this saga in late 2008 following complaints by his constituent Mrs. Hamilton, whose husband had been similarly affected in this matter. Mrs. Hamilton also started up a campaign in France, including a petition to Downing Street.

During the debate Mr. Gale appealed emotionally to his audience. The above legal history was not paraded as above. It must be acknowledged that Mr. Gale’s voice was initially alone in the House. Perhaps no other MP was as motivated as Mr. Gale to take up the cause of expats.

Jonathan Shaw, Minister for the Disabled, responded on behalf of our Government, but he did not present any sound counter argument and only displayed our government’s unwillingness to comply with Community law, stating that our government disagreed with the EU Commission?

The debate raised consciousness but that is all.

A complete up-date in this matter, including an analysis of the debate, has been prepared by Mr. Burrage [click here to view], for guidance to those who are affected by this matter and others who would seek to represent them.

A further matter which has caused some confusion, is where the ‘mobility component element of DLA was severed from the care element and currently remains non-exportable. This came about as the ‘mobility’ element was not the subject of challenge by the Commission, when bringing their infringement, as they had no supporting case law upon which to rely. Also whilst the severing of the two component elements has been the subject of concern by the Judge hearing the two recent cases in the Upper Chamber of the Tribunals Service. Mr. Burrage advises that even though the judge has sent that matter back to the ECJ for a preliminary ruling, this may take up to two years before we have some resolution. However, in the shorter term we must await the publication of Annex X of the new coordinating regulations, to be published in the Official Journal, to see whether this particular benefit is to be included as non-exportable.

ECJ - European Court of Justice, otherwise known as the Court of Justice, whose function is the guardian of the Parliament, the Council and the rights of all citizens who come within the meaning of the EU’s legislation.

European Union – An economic and political association currently comprising 27 Member States.

EEA – European Economic area, which embraces the 3 affiliated States , namely Norway, Iceland and Lichtenstein, with Switzerland having its own separate identity.

The Council of the European Union - Council of Ministers (27, one from each State)

The European Commission is the executive ‘cabinet’ of the EU.

The EU Parliament.

Independent Tribunal Service – A judicial body set up in accordance with the Tribunals, Courts and Enforcement Act 2007 and which comes under our Ministry of Justice, replacing the old Social Security Tribunal system.

Attached is a long, but full legal exposition of all this written by the Legal Advisor to the Spanish Expatriates Association. The above is a much condensed resumé of that document: