Two EU nationals refused universal credit on the basis that their limited leave to remain in the UK was not a qualifying right of residence begin their test case in the Court of Appeal this week. Appeal judges will hear the claimants’ arguments in the case of R (Fratila and Tanase) v Secretary of State for Work and Pensions which highlight the relationship between the EU Settlement Scheme and the UK benefit system. Under the settlement scheme, applicants who have been resident in the UK for less than five years are entitled to pre-settled status. Those who have five years of continuous residence are eligible for settled status.
The claimants in Fratila are challenging the Social Security (Income-related Benefits) (Updating and Amendment) (EU exit) Regulations 2019 which mean that individuals with pre-settled status do not meet the residence requirements for accessing social welfare benefits including Universal Credit. By contrast, individuals with settled status are able to access social welfare benefits as though they were British citizens. The Claimants’, who are supported in the test case by the Child Poverty Action Group, argues that this amounts to discrimination on the grounds on nationality and is contrary to EU Law.
In April of this year, the High Court dismissed the Claimants’ claim. Mr Justice Swift firstly found that one of the claimants, Miss Fratila, lacked standing to bring her claim as she had since been awarded settled status (after previously having been awarded pre-settled status). The judge then found, in relation to Mr Tanase’s claim, that there had been indirect discrimination on the basis of nationality. His reasoning centred on the fact that there was no indivisible connection between nationality and a right to reside in the United Kingdom: although those with such a right to reside were more likely to be British nationals, foreign nationals could also obtain that right to reside.
This finding is significant because indirect discrimination can be justified (and is thus permissible), whereas direct discrimination cannot. Here, Mr Justice Swift accepted the Secretary of State’s submission that the residence requirement was aimed at protecting the social security system and found that the discrimination in this case was justified and, therefore, dismissed the claimants’ case.
The claimants will challenge Swift’s finding as to Fratila’s lack of standing to bring her claim. They will also argue against the finding that the discrimination in this case was indirect discrimination and therefore justifiable; and separately, whether it was justified.
Statistics released in June of this year show that of the nearly 3.5 million EUSS applications submitted since the scheme was launched on 30 March 2019, 41% (1.4 million) resulted in an individual being granted pre-settled status. These figures highlight the number of people who could be affected if the Claimants’ appeal is successful and the law is changed.
The appeal hearing is due to conclude today.