British child living with her mother in the UK will not be entitled to DLA if her father is living and working in another EU State – recent ruling by Upper Tribunal.

In AH v Secretary of State for Work and Pensions [2020] UKUT 53 (AAC), the claimant and her parents are British citizens.  The parents separated in 2011 but are not divorced.  The father moved to live and work in Belgium.  In October 2013, the Claimant (the daughter) claimed Disability Living Allowance (DLA) when she was four years old.  The care component was awarded at the middle rate, but the award was later removed when the DWP became aware that the claimant’s father was living and working in Belgium.

The DWP issued a decision that in these circumstances there was no entitlement to DLA under section 72(7B) of the Social Security Contributions and Benefits Act 1992, which provides that where the EU coordination rules apply, someone will not be entitled to an award of the care component of DLA unless the UK is the competent State to pay ‘sickness benefit’ (which is how the care component of DLA is classified under EU law).

The First-tier Tribunal allowed the claimant’s appeal against the decision on the basis that DLA should continue to be paid on a provisional basis, as the evidence showed that there was a dispute as to whether Belgium was the competent State.  The Secretary of State appealed to the Upper Tribunal.

Under Regulation (EC) 883/2004 the general rule is that the place where the claimant is in gainful employment or self-employment is the competent State (Art 11(3)(a)).  But for those who are not economically active, it is normally the State of residence (Art 11(3)(e)). The Upper Tribunal held an oral hearing to consider the position where a family member has competing derived rights, from both parents but on a different basis.  Here, the UK was the competent State for the mother based on residence.  But for the father the competent State was Belgium based on him being self-employed.

The Upper Tribunal set aside the First-tier Tribunal’s decision and held that the evidence from Belgium authorities did not go so far as to show a difference of views [19].  They went on to uphold the original decision to refuse DLA to the claimant.  UTJ Jacobs said the term “insured person” in Article 1(c) was intended to be a broad one and it covered the full range of potential social security claimants [28].

The Judge accepted the claimant’s argument that the issue of which right took priority could not be determined by the priority rules in Article 32, as these only deal with sickness benefits in kind [31].  The Judge however concluded that Article 21, on the payment of cash benefits, overrode the claimant’s right to benefit based on her mother.

Article 21 provides that an “insured person and members of his family” shall be entitled to cash benefits provided by the competent institution”.  The Judge said the “obvious purpose” of Article 21 was “to ensure that all members of the family can look to one State for their sickness benefits” [26].  Giving priority to the father based on his place of work would be consistent with the need for a claimant being subject to the legislation of one State only.  The Judge said that while this approach put the focus on an ‘insured person’ as an employed or self-employed person, this was consistent with the structure of Article 11, which gives priority to the place where a person is pursuing an activity as a self-employed or employed person under Article 11(3)(a) over the place where someone is resident in Article 11(3)(e) [34].

The Upper Tribunal also rejected the argument that section 72(7B) of the SSCBA 1992 put the claimant and her mother at a substantial disadvantage compared to cases in which a family pursued all of their activities in a single State [38].  The Judge held that the claimant’s challenge to s.72(7B) was “ultimately a financial one” but this conflicted with CJEU case-law to the effect that EU law cannot guarantee to an insured person that moving to another Member State will be neutral in terms of social security [39].  The Upper Tribunal also rejected an argument based on the general principle in EU law that the interests of a child should prevail could not be used to “subvert the core structure of Regulation 883/2004” [46], which is a carefully constructed set of conflict of law provisions.

Our client is considering an appeal to the Court of Appeal.

William Ford, Partner, Osbornes Law instructed barrister Adrian Berry and Desmond Rutledge from Garden Court Chambers “This is a disappointing decision that will cause significant hardship for my client and her family. We are now actively considering an  appeal to the Court of Appeal”

For full transcript of the decision in AH v Secretary of State for Work and Pensions [2020] UKUT 53 (AAC) click here.