Factual and Procedural Background
The appeal concerns a decision of a tribunal sitting at Stockport dated 17 October 2008, which was found to contain an error of law and was set aside. The claimant, a Polish national born in 1969, had lived in Sweden for many years before moving to the United Kingdom in late 2007. She faced domestic violence issues in Sweden and initially stayed with her sister in London before moving to the Manchester area, where she eventually secured a tenancy for a one-bedroom housing association flat commencing 26 May 2008. The claimant received a Swedish invalidity pension since 1993 but did not work or seek work in the UK due to disabilities including epilepsy and depression. She applied for housing benefit and council tax benefit on 28 May 2008 but was refused on the grounds that she lacked the right to reside, primarily due to insufficient resources and lack of comprehensive sickness insurance.
The claimant appealed the refusal, but the First-tier Tribunal dismissed her appeal, confirming that housing benefit and council tax benefit are forms of social assistance and that the claimant would be an unreasonable burden on the public purse. The claimant sought permission to appeal the decision on the insurance issue, which was granted. The Secretary of State was joined as a party and conceded that the claimant had sufficient health insurance, but both the Secretary of State and the local authority maintained that the claimant lacked the right to reside due to insufficient resources. The Upper Tribunal conducted an oral hearing on 8 June 2010, although the claimant did not attend and was likely residing in Sweden at that time.
Legal Issues Presented
- Whether the provisions of Regulation (EEC) No. 1408/71 concerning National Health Service care confer comprehensive sickness insurance cover on an EU citizen in the host Member State.
- When and how the test of 'sufficient resources' is to be applied for the purposes of the right of residence for more than three months under Article 7 of Directive 2004/38/EC.
Arguments of the Parties
Appellant's Arguments
- The claimant argued that she should be treated as self-sufficient based on the income she brought from Sweden, specifically her invalidity pension.
- Her representative contended that the standard sickness cover in the form of an E111 certificate should satisfy the comprehensive sickness insurance requirement.
- It was also argued that relying on the decision in Grzelczyk v Centre Public d'Aide Sociale d'Ottignies-Louvain-la-Neuve, the claimant was entitled to the benefits claimed.
Respondent's Arguments (Secretary of State and Local Authority)
- The Secretary of State conceded that the claimant had sufficient health insurance by virtue of rights under Council Regulation (EEC) No 1408/71 and Regulation (EEC) No 574/72, with entitlement to healthcare costs recoverable from Sweden.
- Both the Secretary of State and local authority argued that the claimant lacked sufficient resources to avoid becoming a burden on the UK social assistance system, and therefore did not have the right to reside.
- The Secretary of State distinguished the present case from the Court of Appeal decision in W(China) and X(China) v Secretary of State for the Home Department on the basis of the right of recovery from Sweden.
Table of Precedents Cited
| Precedent |
Rule or Principle Cited For |
Application by the Court |
| Grzelczyk v Centre Public d'Aide Sociale d'Ottignies-Louvain-la-Neuve [2002] 1 CMLR 19 |
Interpretation of self-sufficiency and entitlement to social assistance under EU law; protection against discrimination on grounds of nationality. |
The court considered the claimant’s reliance on this precedent for entitlement to benefits despite insufficient resources at a later stage, noting its possible application beyond students but expressing some difficulty with its application. |
| W(China) and X(China) v Secretary of State for the Home Department [2006] EWCA Civ 1494 |
Requirement of comprehensive sickness insurance to prevent burden on host Member State’s public finances. |
The Secretary of State distinguished this case on the basis that the claimant had a right of recovery for healthcare costs from Sweden, which was not present in W(China) and X(China). |
| Commission v Kingdom of Belgium [2006] ECR I-2647 (C-408/03) |
Justification of restrictions on right to reside when conditions are not met; assessment of sufficiency of resources and accommodation provided by third parties. |
The court applied principles from this case to consider the claimant’s resources including accommodation provided by third parties and the legitimacy of restricting residence rights when conditions are unmet. |
| Abdirahman and Ullusow v Secretary of State for Work and Pensions [2007] EWCA Civ 657 |
Scope of Article 12 of the EC Treaty regarding discrimination and rights of residence. |
The court distinguished this case from the claimant’s situation, noting that Abdirahman and Ullusow had no right of residence, whereas the claimant’s case involved the application of Article 12. |
| AG and others (Germany) v Secretary of State for the Home Department [2007] UKAIT 75 |
Burden of proof regarding entitlement in immigration and social security law. |
Referenced to emphasize that the claimant bears the burden of establishing entitlement to benefits and rights of residence. |
Court's Reasoning and Analysis
The court identified and corrected an error of law in the original tribunal decision, particularly concerning the assessment of comprehensive sickness insurance and sufficiency of resources. It accepted the Secretary of State's concession that the claimant had comprehensive sickness insurance by virtue of exported Swedish invalidity benefits under Regulation 1408/71 and Regulation 574/72, which entitled her to healthcare costs recoverable from Sweden.
Regarding sufficiency of resources, the court analysed Directive 2004/38/EC and related provisions, including Articles 7, 8, 14, and recitals, to determine the conditions for right of residence beyond three months. It rejected the claimant’s argument that sufficiency of resources should be assessed only at the time of claim, considering the possibility that prior self-sufficiency might afford protection against loss of rights except if the claimant became an unreasonable burden.
The court examined the claimant’s income from her Swedish pension against UK income support thresholds and housing costs, concluding that she did not possess sufficient resources to avoid becoming a burden on the UK social assistance system. The temporary nature of accommodation provided by third parties and the claimant's inability to secure permanent housing without assistance further undermined her claim to self-sufficiency.
The court also addressed the legislative and policy context, including the intention behind the Directive’s provisions to balance free movement rights with protection of host Member States’ social assistance systems. It found the claimant’s indefinite need for housing and council tax benefits, combined with her incapacity to work and short residence period, established that she would be an unreasonable burden.
The court noted the claimant’s failure to maintain contact and provide further evidence, necessitating a decision based on the existing record. It also clarified that the assessment of self-sufficiency and entitlement to benefits necessarily involves decision-makers beyond the Secretary of State for the Home Department, including the Department for Work and Pensions and tribunals.
Holding and Implications
The appeal is ALLOWED in the sense that the original tribunal decision was set aside due to errors of law. However, the court REMAKES THE DECISION to dismiss the claimant’s appeal on the substantive merits.
The claimant is not entitled to housing benefit or council tax benefit because she lacks the right to reside, having failed to demonstrate sufficient resources to avoid becoming a burden on the UK social assistance system, despite having comprehensive sickness insurance. Alternatively, even if she had sufficient resources initially, she would have become an unreasonable burden due to the indefinite nature of her claim and incapacity to work.
This decision directly affects the parties by confirming the claimant’s ineligibility for the benefits claimed. No new precedent is established beyond the application and interpretation of existing EU and domestic law provisions in this context.