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12 Jan 2010 : Column 178WH—continued
"compatible with European Community law".
I have been through the ECJ judgment carefully-it is not riveting reading-and it would be helpful if the Minister set out why the Department thinks that the past presence test is compatible with the ruling, given that the European Commission does not think so and has indicated to the Department that it intends to introduce infringement proceedings.
On the issue of openness and transparency, I can understand why the Minister does not want to share specific correspondence, but given the information that has not been provided to the House-my hon. Friend drew attention to it-it is disappointing to see what is available on the European Commission website. There, the Commission clearly sets out that it is taking legal action against the UK for not paying benefits and that it
"addressed a Letter of Formal Notice to the UK authorities. The British authorities have two months to respond",
as my hon. Friend said. Again, the Department took the full two months, so it did not exactly act with all due speed. The Commission then sets out the benefits and the ECJ ruling. It also says that the past presence test
"goes against the European rules coordinating social security benefits and justifies the Commission's decision to start an infringement procedure."
We can get all that information from the Commission website, but when we ask Ministers to set out the discussions that they have had and the position that they have taken, we get rather less information. This is not something that I thought that I would say, or that we hear often in the House, but the European Commission is being more open and transparent than the British Government, and the Minister should rectify that.
I have asked the Minister to set out the number of claimants abroad. Just to be clear, will he tell us what estimate the Government have made of the predicted
case load and expenditure for existing claimants who move abroad, claimants who already live abroad and both sets of claimants combined? The Minister has talked about 2010-11, which is assumed to be the first full year for implementation of the ruling, but what does full implementation actually mean and why has it taken two years to reach this stage?
It is worth making one final point, which my hon. Friend and the hon. Member for Edinburgh, West (John Barrett), who speaks for the Liberal Democrats, have touched on. One reason why the issue has attracted attention and annoyed some of those living abroad is that the same European Union rules that say that British citizens who lived here all their lives, paid taxes, contributed, worked and then moved abroad should get the benefits under discussion, also say that people who come here from other European countries are entitled to other benefits. We read all the time in the papers-the stories are not made up, but are backed by parliamentary answers-about people who have come to the UK from other European countries and have not worked here or paid taxes, but who, under EU rules, can claim benefits for themselves and their children. People find that extraordinary. We hear stories about Polish workers coming to the UK who can claim child benefit for their children, when their children do not even live here, but in Poland.
The Government never seem to look for clever loopholes to avoid paying such people, who never seem to have any trouble claiming benefits. I do not suggest that they should not get those benefits-under EU rules, these things work in both directions-but it is strange that the Government have looked for every opportunity to deny money to those who have worked here, paid their taxes and gone abroad. Ministers never seem to make similar efforts with those who come to this country, and I am not saying that they should, but there is a disparity. People who come to this country never seem to have any trouble claiming money when they have not contributed. [Interruption.] It is all very well the Minister sighing, but that sort of thing enables people who are against our membership of the EU to score an easy hit. It also enables those who represent, shall we say, somewhat less democratic parties in this country to stir up all sorts of feeling against those who come here from other European countries. As everyone who has spoken has made clear, people are looking for fairness-they want people to be treated fairly.
Once the law is established following the ECJ ruling, it will be incumbent on the Government to implement it as soon as possible so that those who are lawfully entitled to benefits receive their lawful entitlement. On the basis of what I have said and what my hon. Friend so ably said in opening the debate, it is clear that the Government have not moved with due speed. At each stage, they appear to have taken the maximum time available to them and tested every deadline. That is not how the Government should behave, particularly when many of the British citizens involved are elderly and disabled, and when every month really matters.
In his response, I hope that the Minister will answer the questions raised by my hon. Friend and other hon. Members who have spoken in this debate, and that he will move to resolve the issues surrounding the past presence test and its lawfulness, or otherwise, and implement the settled law with all possible speed.
10.20 am
The Parliamentary Under-Secretary of State for Work and Pensions (Jonathan Shaw): It is a pleasure to serve under your chairmanship, Mrs. Humble. As other hon. Members have noted, you take a personal interest in matters relating to the Department for Work and Pensions.
I begin by paying tribute to the hon. Member for North Thanet (Mr. Gale), who has been pursuing this issue for a long time. He and I have had meetings and he acts in his own doughty way but always in a manner of reasonableness, as the hon. Member for Forest of Dean (Mr. Harper) said. The hon. Member for North Thanet expresses his views in a forthright way, and I appreciate the manner in which he has presented his case, not only during this debate but during our meetings in the Department.
The starting point is the judgment by the European Court of Justice in October 2007, and I want to explain what that meant. In case C-299/05, the Court decided that certain benefits belonging to Finland, Sweden and the United Kingdom should not be classified as special non-contributory benefits under European law, but should instead be classified as sickness benefits. That change in classification for the UK mainly affected disability benefits-the disability living allowance care component, attendance allowance and carer's allowance, which have been referred to.
The relevant legislation is EC regulation 1408/71, which co-ordinates social security systems in the European economic area, and provides rights for workers and people who used to work and, in certain circumstances, their family members. Not all people who are eligible to receive benefits in the UK can export them if they leave the country. For instance, someone who resides in the UK can claim DLA without having a national insurance contribution record. When they leave the country, however, the UK is no longer responsible for paying them and they are not covered by the regulation. Each member state is free to decide who is entitled to be insured under its legislation, which benefits are to be granted and under what conditions, and how those benefits are calculated. Any such decisions are, of course, subject to challenge from individuals or the European Commission.
When people are covered by the regulation and wish to export their benefit, they are no longer required to meet normal residence and presence conditions although they are still required to meet other conditions of entitlement under domestic legislation. In the UK, that includes a past presence test, whereby an individual is required to have been present in the UK for 26 of the previous 52 weeks, on each day of the award of benefit. For people wishing to export their benefit we have modified that condition so that it is applied only on a single date, on which other conditions of entitlement can be established.
The unmodified test is not new-it has always been part of the conditions of entitlement that all customers are required to meet. Unlike the state pension, for example, disability benefits are not paid because relevant national insurance contributions have been made. They are not means-tested and are paid out of general UK taxation. The purpose of the past presence test is to establish a connection with the UK that is appropriate and proportionate.
The hon. Member for North Thanet said that we have failed to comply with the Court's decision. However, since the judgment, more than 1,700 people who have
left the UK for another EEA state have been able to export their benefit. They are currently being paid while resident abroad, as long as they meet the eligibility criteria for payment. The hon. Gentleman represents a campaign group of people who previously received benefits, but who moved abroad before the date of the judgment and consequently lost them. As noted by the hon. Member for Hexham (Mr. Atkinson), who is no longer in the Chamber, when those people moved abroad they would have known that their benefits would cease, and would presumably have taken that into account when making their decision to leave the UK. Automatically to reinstate benefits to that group of people could be contrary to both domestic and European law. Apart from ensuring that customers satisfy all relevant domestic requirements, including whether they need help in looking after themselves or caring for others, they also need to satisfy European law on sickness benefits.
Jonathan Shaw: If I can make my point, I will come to the issue that the hon. Gentleman has referred to.
We know that some customers may have worked in their country of residence. Once that happens, even if they have now stopped work, they are no longer the responsibility of the UK for payment of sickness benefits, and they will need to claim sickness benefits from their new state of residence. People in the UK can receive a disability benefit, even if they have no income at all. However, under European law relating to sickness benefits, in order to be eligible for payment a person needs to be in receipt of a state pension, or a long-term benefit such as incapacity benefit, or to have paid recent national insurance contributions.
People who moved abroad before the judgment and lost their benefits-such as the constituents referred to by the hon. Member for North Thanet-have written to the Department to ask the Secretary of State to reconsider the disallowance decision, and we have looked carefully at all the available options. We can revise a decision when we have made an official error. The definition of an error specifically
"excludes any error of law which is shown to have been an error by virtue of a subsequent decision of a Commission or the court."
When we decided to disallow benefit when people moved abroad, the decision was made under relevant legislation that was appropriate prior to the decision by the European Court of Justice. People reclaiming benefits they received in the past must therefore not have worked in their state of residence, must be receiving a long-term contributory benefit such as incapacity benefit or state pension, or must have made recent national insurance contributions. They must also satisfy relevant domestic conditions of entitlement.
As I noted earlier, we consider the past presence test to be a necessary condition of entitlement to a non-contributory benefit, as it establishes a recent link to the UK. However, we recognise that people abroad who have not left the UK recently will not be able to qualify.
Jonathan Shaw: Let me make this point as it is relevant to a question raised by the hon. Gentleman.
There are exceptions to the situation that I have outlined, and they include cases when people are terminally ill. When we announced the criteria for payment of the disability living allowance care component and attendance allowance for people claiming from abroad, we made it clear that people in such circumstances would not have to satisfy the 26-weeks past presence requirement.
The hon. Gentleman referred to an e-mail that he received on 11 January and the case of people who were asked to pay back around £3,000. I cannot answer in detail about that specific issue now, but I would be happy to look into the case and consider it carefully.
We are paying benefits, including state pensions, to many thousands of expatriates abroad. Most of our expatriates in the EEA live in Spain, and over the last year Ministers and senior officials have visited Spain to meet them and their representatives. They have demonstrated a genuine interest and concern in the lives of British nationals overseas. We are aware that UK nationals may experience difficulties abroad, and we want to help where we can. Since May 2007, my Department has supplied a team of six staff based in Alicante, Malaga and Madrid to provide customer service to support UK nationals living in Spain.
Mr. Harper: The reason why I tried to intervene earlier was to ask the Minister about the Court ruling. I have two questions: first, I think that the Minister said that if the Department were to reinstate benefits from the time the relevant people moved abroad, or from when they lost them on moving abroad, it would in some way breach European or domestic law. I am not quite certain which aspect of law would be breached.
Secondly, what is the Government's view of the ECJ ruling? Did it change European law or simply set out what European law had been all the time?
Jonathan Shaw: I shall answer those points in my speech.
As I was saying before the hon. Gentleman intervened, we are providing staff. We have a presence, and are working with the Spanish authorities. That is in contrast to the characterisation the hon. Gentleman attempted to give of our interest in British people living overseas. The team on the ground offers up-to-date and accurate information on entitlements; it liaises with the Spanish authorities to resolve the most complex cases; and it also works closely and improves co-operation with the Spanish benefits agency-the National Institute of Social Security. The team is approached on occasion by customers who are priority cases in difficult welfare and health care situations, and who need quick intervention. Recent cases have included dealing with terminally ill customers requiring medical cost advice, and giving support to vulnerable customers when benefits have not been claimed.
People who cannot receive a benefit from the UK may be able to receive a benefit or service from their new state of residence. If they are integrated in their new community and satisfy relevant conditions they may be able to receive benefit and assistance from social services, just like people who come to the UK. In fact, we know that people can and do receive help. For
example, there are messages on various websites. One person who left the UK in 2004 recounts that she had three strokes and has
"received excellent treatment in France".
"I received a letter telling me I am considered 80 per cent. or more disabled and will receive an allowance which will pay for a home help. My husband will also get an allowance for helping me in the house with washing, dressing etc."
She goes on to say that although she is happy with the help she gets in France she feels bitter that she cannot get help from the UK, as she and her husband paid into the system all their working lives.
I am pleased that lady is receiving the help she requires. As Minister for disabled people I strongly support the provision of services for disabled people, but the imposition of conditions such as the past presence test is compatible with regulation 1408/71. If the hon. Member for Forest of Dean wishes, I shall send him details of the regulation. Conditions of entitlement under domestic legislation must be taken into consideration.
The European Commission has indeed written to us to start infringement proceedings, as hon. Members have noted today, on the basis that it considers the past presence test to be an unlawful residence test. We have replied explaining our position in detail and in particular ensuring that the Commission understands how we treat workers. We have not yet received a response.
Members have asked why we do not agree with the Commission. The UK is not alone among member states in disagreeing from time to time with the European Commission in this and other policy areas. I am sure that hon. Members present have disagreed with it, and have called on the UK Government to argue their case. Of course, that is what we do when we disagree. However, we have never published such correspondence with the European Commission. It is important that we can have frank and robust exchanges with the Commission, and to publish them would undermine our opportunity to engage in them. That is not true just of the present case; it is the general custom and practice.
Mr. Harper: I think the Minister was guilty of slightly mischaracterising what I and my hon. Friend the Member for North Thanet said. I did not ask why the Government disagree with the European Commission. I asked the Minister to set out in detail why the Government think that the past presence test is compatible with the ECJ rule. I have no problem with the Minister disagreeing with the Commission-I frequently do so-so I do not want to leave him with the idea that I am complaining about that. I just want to know why the Government think that what they are doing is compatible with the ECJ ruling. The point that I made about the Commission was that it was apparently being more transparent about its discussion with the British Government than the Government were being.
Jonathan Shaw: I am grateful for that clarification of the hon. Gentleman's position.
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