Upper Tribunal (Administrative Appeals Chamber)

IN THE UPPER TRIBUNAL Case No.  CP/677/2010

ADMINISTRATIVE APPEALS CHAMBER

 

Before: UPPER TRIBUNAL JUDGE WARD

 

Attendances:

For the Appellant: Mr P, the claimant’s son

For the Respondent: Mr David Blundell of Counsel

 

Decision: Though it will not assist the claimant, the appeal is allowed on technical grounds, but the decision in the result remains the same.  The decision of the First-tier Tribunal sitting at Fox Court on 5 June 2009 under reference 242/09/00230 involved the making of an error of law and is set aside.  Acting under section 12(2)(b)(ii) of the Tribunals, Courts and Enforcement Act 2007, I remake the decision in the following terms:

 

The claimant is not entitled to category A Basic State Retirement Pension.  This is because he needed to have paid Class 1, 2 or 3 National Insurance Contributions to give at least the qualifying earnings factor for any one of the years ending before his 65^th Birthday or, prior to 6 April 1975 paid at least 50 contributions in order to satisfy the first contribution condition.  The claimant has not paid any National Insurance Contributions and is therefore unable to satisfy the first contribution condition.

 

Though the claimant has been credited with contributions in respect of the period 6 April 1949 to 10 July 1949, these are insufficient to create any entitlement to a United Kingdom Category A State Retirement Pension under the Family Allowances, National Insurance and Industrial Injuries (Yugoslavia) Order 1958 SI 1958 No 1263.

 

REASONS FOR DECISION

 

1. The claimant was born on 12 July 1933.  Between 1960 and 1991 he worked as a teacher and subsequently as an interpreter/translator in territory which was formerly part of the Federal People’s Republic of Yugoslavia but which is now recognised by the United Kingdom as Kosovo.  In 1998 the claimant came to the UK.  In 2008 he claimed a retirement pension. 

 

2. He has never worked in the United Kingdom and has never paid any national insurance contributions.  Nor did he have any national insurance credits, except in respect of the period of 6 April 1949 to 10 July 1949, the period leading up to his 16^th birthday.  I will return to these below.

 

3. By a decision dated 17 September 2008 his claim was rejected on the basis that he did not satisfy the first contribution condition for retirement pension which is set out in paragraph 5(2) of Schedule 3 of the Social Security Contributions and Benefits Act 1992 (“the 1992 Act”) and which requires the actual payment of contributions. 

 

4. The claimant appealed, asserting:-

(a) that his period of working abroad should be taken into account; and

(b) that the failure to award him a retirement pension amounted to a breach of the right to peacefully enjoy his possessions under the European Convention on Human Rights. 

 

5. In the submission to the First-tier Tribunal, the DWP indicated (wrongly, as is now known) that the United Kingdom does not have any reciprocal agreements on social security matters with Kosovo. 

 

6. In its decision notice, the tribunal, rejecting the claimant’s appeal, indicated that:-

 

“The reason [the claimant] is not entitled to a state retirement pension under the UK scheme is because he has not paid any NI Contributions into the UK state scheme.  Such payments are an essential prerequisite of any entitlement arising.  Moreover, as the UK does not have a reciprocal agreement with Kosovo in respect of any state insurance contributions he paid when working there any such contributions cannot in law fall to be taken into account.  And R(P)1/06 is binding authority against Art[icle] 1 Pr[otocol] 1 of the European Convention on Human Rights having any application to his alleged right to a UK Pension as “possession” where he has no entitlement to such a pension under domestic law.”

 

The tribunal judge subsequently directed that the decision notice be incorporated into the statement of reasons. 

 

7. Permission to appeal was refused by a district tribunal judge but given by me on the basis that it might be arguable that the reciprocal social security agreement with the former Yugoslavia continued in force with Kosovo, but raising whether, even if it did, it would materially assist the claimant.

 

8. I held an oral hearing at which the claimant was represented by his son, who spoke good English and who had prepared a detailed typed submission.  An Albanian interpreter (Kosovan dialect) attended for the claimant’s benefit.  The Secretary of State was represented by Mr Blundell of Counsel.  I am grateful to all concerned for their assistance with this technical case.

 

9. Mr Blundell accepted that the submission on behalf of the Secretary of State to the First-tier Tribunal had been incorrect.  The Secretary of State now accepts that at the date of decision (17 September 2008) Kosovo was covered by the reciprocal agreement with the former Federal Peoples’ Republic of Yugoslavia.  The relevant agreement is set out in the Schedule to the Family Allowances, National Insurance and Industrial Injuries (Yugoslavia) Order 1958 SI 1958/1263 (“the Order”).  (All references in these Reasons to an Article are to an article of the relevant agreement as there set out.) In November 2008 the Foreign and Commonwealth Office had confirmed that Kosovo had formally accepted by note verbale that it would continue to be bound by existing treaties by which the former Federal People’s Republic was bound.  This included the reciprocal social security agreement. Before Kosovo was a party in its own right in this way, it was covered by the old Yugoslavia agreement in that it was recognised as a part of Serbia and Montenegro for the purposes of the application of the agreement. 

 

10. The basic rule for old age pensions is set out in Article 19.

 

“(1) Subject to the provisions of Article 21, where a person submits a claim to receive an old age pension by virtue of insurance periods and equivalent periods completed under the legislation of both Contracting Parties, his claim shall be determined in accordance with the provisions of the succeeding paragraphs of this Article. 

(2) The appropriate social security authority of each Party shall determine, in accordance with its own national legislation, whether the person satisfies the conditions for receiving a pension under that legislation, and for this purpose, shall take into account all the insurance periods and equivalent periods completed by him under the legislation of the two Parties as if they had been completed under its own national legislation. 

 

(3) Where the right to a pension is established in accordance with the provisions of paragraph (2) of this Article, the social security authority of each Party shall calculate –

 

(a) the pension which would have been due to the person under its own national legislation if all the insurance periods and equivalent periods completed by him under the legislation of both Parties had been completed under its own national legislation; and

 

(b) that part of such pension which bears the same relation to the whole as the total of all the insurance periods and equivalent periods completed by the person under its own national legislation bears to the total of all the insurance periods and equivalent periods completed by him under the legislation of both Parties.

 

The part thus calculated shall be the pension actually due to the person from the social security authority concerned.

 

(4) Where the total of all the insurance periods and equivalent periods completed by a person under the legislation of one Party is less than six months, the appropriate social security authority of the other Party shall take into account all those periods as if they had been completed under its own national legislation, not only for the purpose of determining whether the person satisfies the conditions for receiving an old age pension under that legislation but also for the purpose of determining the amount of that pension; and no old age pension shall be paid under the legislation of the former Party.

 

(5) [Not material].”

 

11. Article 1 provides a number of relevant definitions, among them:

 

“(o) “insurance period” means a period for which an insured person has paid contributions relevant to the benefit in question or has had such contributions paid in respect of him;

(p) “equivalent period” means a period for which an insured person has had contributions credited to him which are relevant to the benefit in question.”

 

12. Article 27 makes further provision about how the provisions which concern the adding together of insurance periods and equivalent periods for the purpose of establishing the rights to receive benefit are to be applied.  However, they do not have any material impact on the present case. 

 

13. Mr Blundell’s submission is that the claimant falls squarely within paragraph (4) of Article 19.  He has no “insurance periods” and the “equivalent periods” are limited to the 14 week period of credits in 1949.  Thus, the total period is less than 6 months.  The consequence is that while it may be for the “other Party” (in this case Kosovo) to take into account the 14 week period, so far as the UK’s position is concerned, the case falls squarely within the final words of Article 19 that “no old age pension shall be paid under the legislation of the former Party”.

 

14. (I add that I was told in written submissions that the Secretary of State’s position was that credits of the type awarded to the claimant in this case could not be relied upon under Article 19 even as against the “other Party”.  However at the oral hearing, counsel resiled from this position for the purposes of this case only.  In any event, it seems to me that whether it was necessary to take into account the period of such credits for such a purpose would fall to be determined as between the claimant and the Kosovan social security authorities.)

 

15. The position in this case becomes significantly more obscure because of the 14 weeks of credits referable to 1949, which was long before the claimant came to the United Kingdom.  These credits were awarded under the provisions of the Social Security (Widow’s Benefit, Retirement Pensions & Other Benefits) (Transitional) Regulations 1979 SI 1979/643 (“the 1979 Regulations”).  Regulation 7 distinguishes between a person who is a “pre – 1975 contributor” as defined and one who is not.  The claimant in this case is not.  Paragraph (5) states that:

 

 “In any case where the contributor concerned attained the age of 16 before 6 April 1975 and is not a pre-1975 contributor, a contribution as payable by a non-employed person under the former principal Act shall be credited to him - …(b) if he attains the age of 16 on or after 5 July 1948, for each contribution week from 6 April of the year in which he attained the age of 16 up to the contribution week immediately before that in which he attains that age;

 

provided that the maximum number of weeks for which contribution may be credited to any person by virtue of the provisions of this paragraph shall  be 50.”

 

The submission to the First-tier Tribunal directed it to the wrong provision but it is clear that it is the above that is the relevant one.

 

16. Paragraph (4) contains the equivalent rules for a “pre-1975 contributor”.  Paragraph (2) contains a mechanism for converting credits in respect of the period prior to 6 April 1975 into “reckonable years” for pension purposes.  However, it only applies to a pre-1975 contributor.  There is no equivalent legislative provision applying to a person such as the claimant, who is not a pre-1975 contributor.

 

17. Notwithstanding this, there was evidence before me that the contributions which had been credited in the 14 week period had been equated to 1 reckonable  year for pension purposes. 

 

18. The Secretary of State submits that although the provisions of regulation 7(2) of the 1979 Regulations apply by their terms only to a pre-1975 contributor, a similar calculation is applied as a matter of administrative concession to credits accumulated by those who are not pre-1975 contributors.  I am told that the purpose behind the concession was to remedy an apparent lacuna in the legislation which prejudiced the position of 16 year old married women who were not potentially eligible for a retirement pension under the National Insurance Act 1965.  However, narrow as this category may be, the Secretary of State has not limited the concession to people falling within that category but has extended the benefit of it to others similarly.  However, in all cases, what the person gets, whether under regulation 7(2) or as a matter of concession, is not additional credits, but a “reckonable year”.

 

19. However this odd position came about, it can only help the claimant if he can bring himself within the definition of “equivalent period” in Article 1(p) of the Order.  This refers to “a period for which an insured person has had   contributions credited to him which are relevant to the benefit in question.“  Mr Blundell submits that this refers to the actual period when contributions are credited, not to any equivalent years which may be calculated based on those credits. 

 

20. It does seem to me that this submission is well founded.  It would be stretching the language to say that a person who had been credited with say four weeks’ contributions – thus not assisting him in establishing a reckonable year for pension purposes - had not, nonetheless “[had] contributions credited to him.”  The position can be seen with equal or greater force in relation to those who had paid contributions for a short while, in relation to the definition of “insurance period”, which is in materially similar form.  I therefore conclude that the more natural meaning of the words “the period for which an insured person has had contributions credited to him” in the definition of “equivalent period” refers to the actual period in respect of which contributions are credited.  The conversion to “reckonable years” in my view comes at a later stage in the process, as part of establishing what, if anything, the contributions have entitled the person to.

 

21. I therefore conclude that the claimant is not assisted by the terms of the Order, which ought, nonetheless, to have been considered.

 

22. The claimant’s son invites me to conclude that the refusal of retirement pension to his father contravenes the European Convention of Human Rights.  In Stec v United Kingdom (2005) 41 EHRR SE18 the court held (among other things)  at [50] of its decision that:

 

 “where an individual has an assertable right under domestic law to a welfare benefit, the importance of that interest should also be reflected by holding Article 1 of Protocol 1 to be applicable”.

 

 23. Then at paragraph 53:

 

 “In particular, the Article does not create a right to acquire property.  It places no restriction on the Contracting State’s freedom to decide whether or not to have in place any form of social security scheme or to choose the type or amount of benefits to provide under any such scheme (see, mutatis mutandis,, Kopecky (GC) at [35] (d) If, however, a Contracting State has in force legislation providing for the payment as of right of a welfare benefit – whether conditional or not on the prior payment of contributions – that legislation must be regarded as generating a proprietary interest falling within the ambit of Art. 1 of Protocol  No. 1 for persons satisfying its requirements (ibid)”.  (My underlinings).

 

24. The difficulty that the claimant faces is that applying this test, he does not satisfy the requirements of UK domestic legislation for retirement pension in the first place and  has no assertable right to such a pension and thus it cannot fall within his “possessions”, protected by Article 1 Protocol 1. 

 

25. The claimant’s representative drew to my attention the case of Wessels-Bergervoet v Netherlands (2004) 38 EHRR 37. However, that case is of little assistance to me, firstly because the European Court of Human Rights in Stec made clear that it was setting a new direction for the law in this area. Thus earlier decisions, such as Wessels-Bergervoet, must be of very limited value.  In any case, on the facts of Wessels-Bergervoet, it is clear that the court was able to assume jurisdiction because the claimant in that case was in any event entitled to at least a partial AOW pension, “AOW” being the Dutch Old Age Pensions Law.  Her position was thus different from that of the present claimant, who does not qualify at all under national law.

 

26. The claimant’s son asserts that his father would face formidable difficulties in obtaining payment of his pension in Kosovo.  I cannot judge whether that is so, but even if it be so, it does not help the claimant in the present proceedings.  If he has a claim to a retirement pension in Kosovo, then no doubt he will raise such arguments as he may be advised in order to enforce it.  But nothing in the European Convention on Human Rights obliges the United Kingdom to provide the claimant with a pension merely because it is said to be hard to enforce an entitlement to one in Kosovo.

 

27. The claimant further relies on the European Social Charter.  However, this has not been ratified by the United Kingdom and for this reason, and others, cannot be relied upon against the United Kingdom in these proceedings.

 

28. It follows therefore that although the decision of the First-tier Tribunal was in error of law by not considering the terms of a relevant reciprocal agreement, the outcome would have been no different.  Consequently, while the appeal is allowed on a technical level, it does not assist the claimant.

 

 

 

Christopher Ward

Judge of the Upper Tribunal

10 February 2011