Pre-settled – still unsettled?

Fratila and CG

In Fratila and another v SSWP [2021] UKSC 53 (1 December 2021), the Supreme Court allowed the government’s appeal against the judgment of the Court of Appeal ([2020] EWCA Civ 1741).

The Court of Appeal considered unlawful the rule which amended the right to reside test to provide that a person with limited leave to remain under Appendix EU of the Immigration Rules (‘pre-settled status’) so that this was not a sufficient right to reside to satisfy the test. The court held that such a rule was prohibited by Article 18 of the Treaty on the Functioning of the European Union (TFEU), the primary provision within European Union (EU) law prohibiting discrimination against EU citizens based on nationality.

The Supreme Court’s decision, reversing the Court of Appeal, followed the decision of the Court of Justice of the European Union (CJEU) in C-709/20 CG v Department for Communities, by which it was bound. The CJEU dealt with the same point as had the Court of Appeal. While the court arrived at the same conclusion as the Court of Appeal with regard to accepting that an EU citizen who was resident under national law was within the scope of EU law, its analysis beyond that point was markedly different.

• The court held that actually the discrimination fell to be considered under Article 24 of Directive 2004/38 (‘the Directive’) rather than Article 18 of the TFEU.
• The court then reasoned that Article 24 of the Directive does not preclude legislation which excludes from social assistance economically inactive EU citizens who do not have sufficient resources and to whom that state has granted a temporary right of residence, such as pre-settled status. An EU citizen resident in the UK on the sole basis of pre-settled status does not reside in the UK ‘on the basis of’ the Directive and therefore cannot rely on the equal treatment guarantee in Article 24(1) of the Directive.

That was sufficient to dispose of any complaint of discrimination.

However, the court’s decision then takes a different turn: relying on its ruling that an EU citizen resident under national law was within the scope of EU law, the court observed that they could rely on the fundamental rights guaranteed in the EU Charter of Fundamental Rights (the ‘Charter’) with which member states are obliged to comply. Thus, member states must ensure that the EU citizen’s rights under Article 1 (human dignity), Article 7 (respect for private and family life) and Article 24(2) (rights of the child) of the Charter are protected. The court went on to hold that, in such a case, the DWP decision maker (‘the national authorities empowered to grant social assistance’) would be required to check whether refusing benefit to someone with pre-settled status would ‘expose that citizen, and the children for which he or she is responsible, to an actual and current risk of violation of their fundamental rights, as enshrined in Articles 1, 7 and 24’. In a case where the citizen did not have sufficient resources to provide for her/his own and any children’s needs, and that would mean the claimant would not be able to ‘live with his or her children in dignified conditions’, then benefit should not be refused. The decision maker could ‘take into account all means of assistance provided for by national law, from which the citizen concerned and her children are actually entitled to benefit.’

The Supreme Court’s decision in Fratila does not deal with this second part of the reasoning of the CJEU. The ruling in CG is, however, binding on decision makers.

Awaiting the decision in Fratila?

Many cases were stayed at the First-tier Tribunal or stockpiled by the DWP to await the judgment in Fratila. Some further discussion of what should now happen with those cases is available on the CPAG website.1

What now?

Fratila and CG establish that the challenge, based on Article 18 of the TFEU, to the rule which excludes pre-settled status from being a qualifying right to reside has failed. Below, we consider whether there remain any other arguments which could be relied upon by a claimant with pre-settled status and no other right to reside to obtain universal credit (UC).

Three very important caveats must be made:

• These are arguments – there is no guarantee that they will ultimately be accepted by First-tier Tribunals or upheld in the Upper Tribunal or the courts. As such, if a claimant can do anything to establish a qualifying right to reside (eg, getting part-time work), s/he would be well advised to do so.
• It is likely that getting a final answer to any of these arguments will take some time (even if the First-tier Tribunal allows an appeal on any of the bases discussed below, the Secretary of State would almost certainly appeal further). That means they are not a quick route to establishing entitlement even for a claimant in a desperate situation.
• All of the arguments depend upon the claimant being able to establish that s/he is, or at least is at risk of, destitution if UC is not paid. Claimants who have significant other means of support (eg, living with working parents/regular and substantial child maintenance being paid/housed by social services) may well fail on the facts.

Can claimants now rely on CG?

From 1 January 2021, the Charter of Fundamental Rights is not part of ‘retained EU law’ (section 5(4) of the European Union (Withdrawal) Act 2018). The CJEU based its reasoning for why benefit could not be refused if it would breach fundamental rights on that instrument. This raises the question of whether claimants can still argue they should get UC if not to award it would lead to their living in undignified conditions or not be in the best interests of their children.

The argument that claimants can continue to rely on CG could be made as follows.

• The Withdrawal Agreement has effect in UK law (section 7A of the European Union (Withdrawal) Act 2018).
• A person with pre-settled status is within the scope of the Withdrawal Agreement, even if not exercising a right of residence under that agreement (by analogy with the reasoning of the CJEU concerning people with pre-settled status being within the scope of the TFEU).
• Article 4(3) of the agreement states it is to be interpreted and applied with the methods and general principles of EU law. Those include (by Article 2(a)(i)) the Charter of Fundamental Rights. They also include the ‘general principles of the Union’s law’ (and respect for human dignity is such a general principle – see paragraph 70 of C-377/98 Kingdom of Netherlands v EU Parliament and Council which refers to that as a general principle of European Community law before the Charter was in force).
• Just as, when the TFEU still applied, a person with pre-settled status claiming UC
  could say s/he was within the scope of EU law and therefore could not be refused UC if to do so would breach her/his fundamental rights, now a person can make the same argument but relying on the Withdrawal Agreement and the fact it preserves the Charter rights.

What needs to be shown to rely on CG?

If the argument that claimants with pre-settled status can continue to rely on Charter rights (or their equivalent as general principles of EU law) under the Withdrawal Agreement succeeds, the next question is what a claimant would need to show to establish s/he could not be refused UC.

An initial question is: what is meant by the court’s instruction that decision makers can take account of ‘all means of assistance provided for by national law, from which the citizen concerned and her children are actually entitled to benefit’ when deciding whether fundamental rights would be breached? Firstly, this does not include charitable donations etc, but only means of assistance provided for by law. Secondly, the claimant must be actually entitled to benefit from the assistance. Arguably that might exclude support which there is no legal right to receive (such as the discretionary provision under section 17 of the Children Act 1989 and section 1 of the Localism Act 2011). Certainly, a strong argument could be made that it excludes support which the claimant does not actually have in place.

The next question is by what standard one is to judge whether denial of UC would lead to a breach of fundamental rights where the claimant was unable to live in dignified conditions. The court here did not link its ruling to Article 4 of the Charter (protection from cruel treatment). In cases where it has done this, then the standard applied is expressed in the formulation that a breach will be found where ‘the indifference of the authorities of a member state would result in a person wholly dependent on state support finding himself, irrespective of his wishes and his personal choices, in a situation of extreme material poverty that does not allow him to meet his most basic needs, such as, inter alia, food, personal hygiene and a place to live, and that undermines his physical or mental health or puts him in a state of degradation incompatible with human dignity’ (C-297/17 Ibrahim, C- 233/18 Haqbin). The fact that the court in CG does a dignity analysis without saying an Article 4 breach would be needed, arguably suggests the standard to be established is less strict than in cases such as that.Claimants whose situation meets that test or is likely to without support (ie, not able to meet their own basic needs or those of their children, even for a short period – see paragraph 47 of Haqbin), therefore, have a strong argument that their facts are sufficient to qualify for UC.

Human Rights Act discrimination?

Claimants may have a further argument. People with pre-settled status are the only group with limited leave to remain who could be shut out of benefit altogether in this way. People with other forms of limited leave to remain are not excluded from benefit because that is an insufficient right to reside to satisfy that test. Instead, they typically have a condition that the bearer of the leave has ‘no recourse to public funds’ and are thus defined as persons subject to immigration control and excluded from benefit under section 115(9) of the Immigration and Asylum Act 1999. However, the Home Office policy2 is that the no recourse to funds restriction should be lifted where not to do so would cause destitution. That places a destitute person with pre-settled status in an arguably worse position than a similar person with another form of limited leave who has a potential route onto benefit. Arguably, that is unlawful discrimination under the Human Rights Act 1998.