Upper Tribunal (Administrative Appeals Chamber)

 

DECISION OF THE UPPER TRIBUNAL

ADMINISTRATIVE APPEALS CHAMBER

 

The claimant's appeal to the Upper Tribunal is disallowed. The decision of the Leicester First-tier Tribunal dated 8 September 2009 involved no errors on a point of law and is therefore not set aside (Tribunals, Courts and Enforcement Act 2007, section 12(2)(a)).

 

 

REASONS FOR DECISION

 

1. The essential facts of this case are very simple, but it raises difficult issues of statutory interpretation. The claimant was born on 28 April 1980. She has fragile X syndrome and was diagnosed with learning difficulties from early in her life. She has never been able to work. She was awarded severe disablement allowance (SDA) under section 68 of the Social Security Contributions and Benefits Act 1992 from April 1996, presumably from her 16th birthday, the earliest date from which there could be entitlement. On 6 April 2001, section 65 of the Welfare Reform and Pensions Act 1999 came into force, revoking sections 68 and 69 of the 1992 Act, thus abolishing SDA. However, the claimant (being over the age of 20 on 6 April 2001) fell within the terms of article 4(a) of the Welfare Reform and Pensions Act 1999 (Commencement No 9, and Transitional and Savings Provisions) Order 2000, under which her entitlement to SDA was to continue as if those sections of the 1992 Act continued in force. On 13 October 2008 the claimant's mother, as her appointee, made a claim for incapacity benefit from 8 July 2008. At that time the claimant was also in receipt of disability living allowance and income support on the grounds of incapacity. Since she had never paid any national insurance contributions, she could only qualify for incapacity benefit through the route under section 30A(2A) of the 1992 Act, inserted by section 65 of the 1999 Act, which has the side-note "Incapacity benefit: persons incapacitated in youth". The claim was disallowed on 22 October 2008 on the ground that a condition of being under the age of 20 at the start of a period for which incapacity benefit had been claimed was not met. The appeal against that disallowance was dismissed by the tribunal of 8 September 2009.

 

2. The claimant's appointee now appeals against the tribunal's decision with the permission of a salaried First-tier Tribunal judge. In essence, the contention for the claimant is that the crucial condition is properly to be interpreted as referring to actual incapacity for work, instead of to the first day of a period of incapacity for work as defined for incapacity benefit purposes, so as to avoid unjustified discrimination against people in the claimant's age group.

 

3. There was an oral hearing of the appeal on 3 December 2010. The claimant's appointee was represented by Andrew Millar, a senior welfare rights officer for Leicester City Council. The Secretary of State was represented by Leo Scoon of DWP/DH Legal Services. I am grateful to both representatives for well-focused submissions. After the hearing I gave the parties time to comment on some documents forming part of the Parliamentary and other background to the 1999 Act and later invited further submissions on provisions not previously highlighted and on a comparison with the position under the employment and support allowance (ESA). Sadly, Mr Millar, who had been fighting the claimant’s case with characteristic tenacity, died before the two most recent rounds of submissions. The claimant is now represented by Darren Moore of the same organisation. I apologise for the length of time taken up by my many requests for further submissions, in an attempt to ensure that every avenue has been explored in this particularly difficult case.

 

The statutory framework

4. It is necessary to set out the relevant legislation in some detail. I make some preliminary interpretative comments at relevant points in this section.

 

Severe disability allowance and the introduction of incapacity benefit

5. I do not know whether the claimant's entitlement to SDA arose under section 68(2), on the basis of presently being incapable of work and having been incapable of work for a period of not less than 196 consecutive days beginning before reaching 20, or under section 68(3), on the basis of presently being incapable of work and disabled (as defined in subsection (6) and regulations) and having been both incapable of work and disabled for a period of not less than 196 consecutive days. It would no doubt have been the former, as the easier to satisfy at the age of 16, but it does not matter. In either case it was a continuing condition of entitlement that the claimant was incapable of work. However, importantly, section 68 did not use the concept of a period of incapacity for work as such. The continuing condition was simply in terms of being incapable of work and the past condition was in terms of having been incapable of work for a period of a sufficient number of consecutive days beginning no later than a claimant’s 20th birthday.

 

6. The Social Security (Severe Disablement Allowance) Regulations 1984 do use the distinct concept of a period of incapacity for work for some purposes (taking over from a "period of interruption of employment" on the introduction of incapacity benefit from 13 April 1995). For instance, it is referred to in regulation 6 on linking rules over a period of non-entitlement and in the provisions on the transition from non-contributory invalidity pension. Regulation 2(3) provides:

 

"(3) In determining whether a day falls within a period of incapacity for work, the provisions of section 30C of the Contributions and Benefits Act (incapacity benefit: days and periods of incapacity for work) and of any regulations made under section 30C(3) and (4) shall have effect for the purposes of severe disablement benefit as they have effect for the purposes of incapacity benefit."

 

The relevant parts of section 30C and the regulations made under section 30C(3) are set out below. I come back in discussion to the effect of regulation 2(3).

 

7. Article 4 of the Commencement No 9 Order is as follows:

 

"4. Notwithstanding the commencement of the provisions referred to in article 2(3)(d), (f) and (g) and 6(b) (`severe disablement allowance provisions'), the provisions referred to in paragraphs 26 and 27 of Schedule 8 and Part IV of Schedule 13 shall continue to have effect, in the period of incapacity for work beginning before 6th April 2001 which would have continued, whether or not by virtue of section 30C or 68(10) or (10A) of the Contributions and Benefits Act or regulations made thereunder, on or after that date but for the commencement of the severe disablement allowance provisions, as if those provisions had not been commenced--

 (a) in relation to a person, to whom paragraph (b) does not apply, who is entitled to severe disablement allowance under section 68 or 69 of the Contributions and Benefits Act on any day of incapacity for work in that period of incapacity for work; or

 (b) until the beginning of 6th April 2002, in relation to a person who--

 (i) was under the age of 20 years on 6th April 2001, and

(ii) is entitled to severe disablement allowance under section 68(1) of the Contributions and Benefits Act on any day of incapacity for work."

 

8. The provisions whose commencement is to be ignored under article 4 are section 65 of the 1999 Act and, by reference, paragraph 26 of Schedule 8 and Part IV of Schedule 13, in particular revoking sections 68 and 69 of the 1992 Act. The provisions that continue to have effect include sections 68 and 69. It is notable that article 4 does use the concept of a period of incapacity for work. However, in my judgment there is no need to explore any problems of interpretation because there is no dispute that the claimant has continued to be entitled to SDA throughout the period from 6 April 2001 and it is not part of the conditions of entitlement to incapacity benefit that a claimant is not entitled to SDA.

 

9. Some existing recipients of SDA in April 2001 were given an automatic entitlement to incapacity benefit from 6 April 2002 on the transition, but the claimant did not fall into that group by reason of her age. The provision is regulation 19 of the Social Security (Invalidity Benefit) Regulations 1994, as amended, headed `Persons formerly entitled to severe disablement allowance':

 

"19.--(1) Where a person was below the age of 20 years on 6th April 2001 and was entitled to, or receiving, severe disablement allowance by virtue of section 68(1) of the Contributions and Benefits Act on or immediately before 5th April 2002, he shall, if he continues to be incapable of work in accordance with Part XIIA of the Contributions and Benefits Act, be--

 (a) entitled to the long-term incapacity benefit from 6th April 2002; and

 (b) treated as having acquired entitlement under section 30A(1)(b) and (2A) of the Contributions and Benefits Act; and

 (c) treated as if section 30DD of the Contributions and Benefits Act does not apply in his case.

 

 (2) Where a person was below the age of 20 years on 6th April 2001 and was entitled to, or receiving, severe disablement allowance by virtue of section 68(1) of the Contributions and Benefits Act and to whom section 30C(1) to (4) or section 68(10) or (10A), or regulations made under section 30C(4)(b), of that Act applied on or immediately after 5th April 2002, he shall be--

 (a) entitled to the long-term incapacity benefit from the relevant day; and

 (b) treated as having acquired entitlement under section 30A(1)(b) and (2A) of the Contributions and Benefits Act; and

 (c) treated as if section 30DD of the Contributions and Benefits Act does not apply in his case."

 

10. Regulation 19 ties in with article 4(b) of the Commencement No 9 Order. The ordinary case is of a person who was under 20 on 6 April 2001 who was, if then entitled to SDA, only allowed by article 4(b) of the Order to retain that entitlement until 5 April 2002. From 6 April 2002 the entitlement to long-term incapacity benefit under regulation 19(1) would take over, if the claimant continued to be incapable of work. Since it is an overall condition of regulation 19 that the claimant be under 20 immediately before 6 April 2001 and then in receipt of SDA, its operation is restricted to those then aged 16 to 19. By way of comparison, the weekly rate of SDA, including the highest rate age addition to which the claimant here would have been entitled, from 6 April 2001 was £56.80. The weekly rate of long-term incapacity benefit was £69.75, plus the higher age –related addition of £14.65.

 

11. Since the claimant here was aged 20 on 6 April 2001, she was not able to benefit from regulation 19. Although Mr Millar has severely criticised whatever was the thinking behind restricting the automatic entitlement to incapacity benefit to those aged 16 to 19 as at 6 April 2001, I can see no way in which the very specific terms of regulation 19 could be interpreted so as to cover someone above the age of 19 at that date.

 

Incapacity benefit in youth

12. The issue then is whether the claimant could on the claim received on 13 October 2008 satisfy the special conditions for those incapacitated in youth, in place of the ordinary incapacity benefit contribution conditions in section 30A(1) of the Contributions and Benefits Act. Satisfaction of the contribution conditions qualified a person for short-term incapacity benefit (weekly rate in April 2001, £52.60, rising to £62.20 after 196 days). After 364 days of entitlement to short-term incapacity benefit, entitlement to long-term incapacity benefit would take over in ordinary cases.

 

13. The special conditions, all of which have to be satisfied, are in section 30A(2A) of the Contributions and Benefits Act, inserted by section 64 of the 1999 Act with effect from 6 April 2001:

 

"(2A) The conditions mentioned in subsection (1)(b) above are that--

 (a) he is aged 16 or over on the relevant day;

 (b) he is under the age of 20 or, in prescribed cases, 25 on a day which forms part of the period of incapacity for work;

 (c) he was incapable of work throughout a period of 196 consecutive days immediately preceding the relevant day, or an earlier day in the period of incapacity for work on which he was aged 16 or over;

 (d) on the relevant day he satisfies the prescribed conditions as to residence in Great Britain, or as to presence there; and

 (e) he is not, on that day, a person who is receiving full-time education."

 

14. The "relevant day" is, under section 30A(1), any day of incapacity for work which forms part of a period of incapacity for work. In effect, it means in subsection (2A) any day of potential entitlement to incapacity benefit. "Period of incapacity for work" is defined in section 30C(1):

 

"(1) For the purposes of any provisions of this Act relating to incapacity benefit, subject to the following provisions and save as otherwise expressly provided--

 (a) a day of incapacity for work means a day on which a person is incapable of work;

 (b) a period of incapacity for work means a period of 4 or more consecutive days, each of which is a day of incapacity for work; and

 (c) any two such periods not separated by a period of more than 8 weeks shall be treated as one period of incapacity for work."

 

15. Section 30C(3) authorises the making of regulations to provide that days are or are not to be treated as days of incapacity for work for the purposes of any provision of the Act relating to incapacity benefit. Among the provisions made in the Social Security (Incapacity Benefit) Regulations 1994 is regulation 4(1)(a) and (aa):

 

"(1) For the purposes of incapacity benefit a day shall not be treated as a day of incapacity for work if it is--

 (a) a day in respect of which a person--

 (i) has made no claim for incapacity benefit;

(ii) has made a claim for incapacity benefit but not within the prescribed time and good cause for the delay is not shown; or

(iii) has made a claim for incapacity benefit but not within the prescribed time and, whether or not the person has shown good cause for the delay, he is not entitled to benefit as a result of section 1(2) of the [Social Security Administration Act 1992] (which provides for a 12 month limit on claims for incapacity benefit);

(aa) a day which is, for the purposes of section 30A(2A)(c) of the Contributions and Benefits Act (period of 196 consecutive days preceding the relevant day), not part of any consecutive days of incapacity;

 (b) [absence from Great Britain or imprisonment]; or

 (c) [payment of training allowance]."

 

Paragraph (aa) was inserted by an amendment with effect from 6 April 2001. The rest of regulation 4(1) had been in place from 13 April 1995.

 

16. If SDA and incapacity benefit would otherwise both be payable, regulation 4 of the Social Security (Overlapping Benefits) Regulations 1979 would operate, since both benefits fall within Parts II and III of the Contributions and Benefits Act. There would have to be an adjustment under regulation 4(5) to the amount of SDA payable, since SDA is a non-contributory benefit and incapacity benefit is a contributory benefit. The amount of incapacity benefit would be deducted from the amount of SDA and only any balance remaining of the SDA would be payable.

 

17. A further potentially relevant provision, although not referred to in submissions, is regulation 10 of the Social Security and Child Support (Decisions and Appeals) Regulations 1999, as in force from 27 July 2008:

 

"10.—(1) This regulation applies to a determination whether a person—

(a)           is capable or incapable of work;

(b)           is to be treated as capable or incapable of work;

(c)           has or does not have limited capability for work; or

(d)           is to be treated as having or not having limited capability for work.

 (2) A determination (including a determination made following a change of circumstances) as set out in paragraph (1) which is embodied in or necessary to a decision under Chapter II of Part I of the [Social Security Act 1998] or on which such a decision is based shall be conclusive for the purposes of any further decision."

 

Similar (but not identical) provision was in place immediately before 27 July 2008 in relation to determinations as to whether a person was or was to be treated as capable or incapable of work and had previously been made in regulation 19 of the Social Security (Incapacity for Work) (General) Regulations 1995.

 

Employment and support allowance in youth

18. I have concluded that it is at least instructive to look at the legislation concerning employment and support allowance (ESA), in operation from 27 October 2008 under the Welfare Reform Act 2007. My directions for the parties to comment on my preliminary views of the effects of that legislation and the possibilities of the claimant here now surrendering her entitlement to SDA and income support to claim ESA were the cause of the most recent delay in the process of reaching a decision. The Secretary of State submitted that the ESA provisions were irrelevant and Mr Moore for the claimant disclaimed any interest in surrendering the claimant’s current entitlement to SDA. Mr Moore’s view may well be the most practical and in any event the possibility of a claim for ESA in youth seems now to have been overtaken by the implementation of section 53 of the Welfare Reform Act 2012 from 1 May 2012. Nevertheless, I do not accept much of the Secretary of State’s interpretation of the ESA legislation in the submission dated 24 January 2012. I think it important to explain why.

 

19. Paragraph 4 of Schedule 1 to the Welfare Reform Act 2007, in operation for new claims from 27 October 2008 (only a few days after the date of the decision under appeal in the present case), provides for the national insurance condition for contribution-based ESA to be satisfied by those disabled in youth on substantially the same conditions as in section 30A(2A) of the Social Security Contributions and Benefits Act 1992. The fundamental age test in paragraph 4(1)(a) is that the claimant was under 20 (or in exceptional cases not relevant to the present case 25) when the “relevant period of limited capability for work”, ie the period including the week for which entitlement is in issue, began. Section 24(1) of the 2007 Act requires the meaning of “period of limited capability for work” to be prescribed by regulations. In regulation 2(1) of the Employment and Support Allowance Regulations 2008 (the ESA Regulations) as originally enacted the definition was simply “a period throughout which a person has, or is treated as having, limited capability for work”, with provision in regulation 145 for the linking of such periods that would otherwise have been separate. There was, however, as originally enacted, no equivalent to regulation 4(1)(a) of the Social Security (Incapacity Benefit) Regulations 1994 excluding any day for which no in-time claim for ESA had been made from counting as part of a period of limited capability for work or an equivalent to regulation 4(1)(aa). There therefore appears to have been no obstacle to that period, for the purposes of the age test and possibly more generally, starting before the date of claim, perhaps many years before, providing that it could be shown that the claimant did actually have limited capability for work for all of that period.

 

20. The legislation contains a rule about what limited capability for work means and how it is to be determined whether a person’s capability is limited or not (sections 1(4) and 8 of the 2007 Act and regulation 19 of the ESA Regulations). There must be an assessment in accordance with the points-scoring test under Schedule 2 to the Regulations and with various deeming provisions. In the submission of 24 January 2012 the Secretary of State’s representative argued that no-one could have or be treated as having limited capacity for work for any day before 27 October 2008. I cannot see how that follows as a matter of principle, in the absence of any specific legislative provision pointing to that result. No doubt there could not be an assessment under regulation 19 until that regulation was in force, but in the nature of the system the assessment will be made in relation to a period prior to the date that the assessment is carried out. When there was no exclusion of days for which an in-time claim had not been made, why should the relevant period not go back before 27 October 2008? I cannot believe that it was intended that on a claim made on 27 October 2008 a claimant under 20 who had had limited capability for work from birth would be excluded from entitlement on the ground that the 196 days condition under paragraph 4(1)(d) could not be satisfied until 196 days had elapsed following 27 October 2008.

 

21. With effect from 29 June 2010 the definition of “period of limited capability for work” in regulation 2(1) of the ESA Regulations was amended by regulation 9 of the Social Security (Miscellaneous Amendments) (No 3) Regulations 2010 (SI 2010/840), which also added a new paragraph (5). The definition now reads:

 

“`period of limited capability for work’ means except in paragraph (5), a period throughout which a person has, or is treated as having, limited capability for work, and does not include a period which is outside the prescribed time for claiming as specified in regulation 19 of the Social Security (Claims and Payments) Regulations 1987;”

 

Regulation 2(5) provides:

 

“(5) For the purposes of paragraph 4 of Schedule 1 to the [2007] Act (condition relating to youth) `period of limited capability for work’ means a period throughout which a person has, or is treated as having, limited capability for work.”

 

22. Those provisions operate clearly enough in relation to identifying the relevant benefit year (ie the benefit year in which the period of limited capability for work begins) for the purposes of the application of the ordinary contribution tests. However, the exception in regulation 2(5) seems expressly to envisage the treatment of days falling before those covered by an in-time claim as part of the period of limited capability for work for the purposes of satisfying the age test in ESA in youth. The explanatory note at the end of the 2010 Regulations stated that the amendment to the definition was to “clarify the period for which entitlement to an employment and support allowance can be considered” (my underlining). The Explanatory Memorandum laid before Parliament stated in paragraph 8.1 that there had been no substantive change in policy. The amendment in regulation 9 appears to have been covered in paragraph 7.13:

 

“Establishing the benefit year and the contribution years when a claim is made late

7.13 An amendment is made to clarify that the contribution conditions for Employment and Support Allowance are determined on the basis of the period of the claim made within the time limit allowed for claiming that benefit. Entitlement to Employment and Support Allowance is therefore linked to contributions paid as the result of recent work. This has been the policy since the contribution conditions for Incapacity Benefit were amended in 2001. A further consequential amendment protects the position of young people claiming under special provisions who need to have limited capability for work for six months before entitlement can commence.”

 

23. I do not need to consider how far the actual terms of the legislation on the identification of the relevant benefit week could have been said to be in accord with that policy before 29 June 2010. In the submission of 24 January 2012 the representative of the Secretary of State argued that the effect of the exception in regulation 2(5) is limited to the condition of 196 consecutive days of limited capability for work prior to some day in the relevant period of limited capability for work (paragraph 4(1)(d)(ii) of Schedule 1 to the 2007 Act), in part by reference to the intention shown in the Explanatory Memorandum and what was said to be the understanding of how the age test worked. However, that cannot stand with the actual words of the legislation. Regulation 2(5) of the ESA Regulations is expressly made to apply for the purposes of paragraph 4 of Schedule 1 to the 1997 Act, ie the whole of paragraph 4, including paragraph 4(1)(a). For that purpose, days for which no in-time claim for ESA has been made cannot be excluded from a “period of limited capability for work”, which for the reasons given in paragraphs 19 and 20 above would start from the date (however far in the past) on which the claimant is first determined to have had limited capability for work on the application of the ESA assessment.

 

General

24. I shall have to return in detail to the proper interpretation of the incapacity benefit in youth provisions, as the primary focus of the appeal before me. But to sum up the general position on the age test, we start with SDA (down to 5 April 2001 for new claims), where it is undisputed that a claimant qualified if she became incapable of work before the age of 20, whenever the claim was made, and end with ESA in youth from 27 October 2008 onwards where, whether by mistake or poor drafting or whatever, the same qualification applies with the substitution of the test of having limited capability for work. What remains to be decided is what rule properly applies to incapacity benefit in youth in the intervening period. It would at the least be odd if, without any apparent change in policy there was a different result for that period than from 27 October 2008.

 

The decision of the First-tier Tribunal

25. In disallowing the claimant's appeal, the tribunal of 8 September 2009 accepted the argument put forward on behalf of the Secretary of State, which was primarily that the age test in section 30A(2A)(b) had to be satisfied at the date of the claim for incapacity benefit. The claimant clearly failed that test, even if she had qualified (which she did not) for the use of the higher age of 25. A secondary submission was that the amendment to section 30A to insert subsection (2A) did not have retrospective effect, so that the claimant would have had to be under the age of 20 on 6 April 2001.

 

26. Mr Millar's argument for the claimant at that stage was, first, that, since under regulation 9 of and Part I of Schedule 1 to the Social Security (Claims and Payments) Regulations 1987, the Secretary of State had the power to treat a claim for SDA as, alternatively or in addition, a claim for incapacity benefit, the original claim for SDA should be regarded as also a claim for incapacity benefit for the purposes of regulation 4 of the Incapacity Benefit Regulations. He further submitted that the claim for incapacity benefit in October 2008 could then be treated as a late application for supersession on the change of circumstances constituted by the April 2001 amendments. A strained interpretation could be justified by the principle against construing legislation in a way that had a discriminatory effect (relying on the speech of Lord Hoffmann in R v Secretary of State for the Home Department, ex parte Simms [2000] 2 AC 115). Here, Mr Millar argued, the claimant was discriminated against purely on the ground of her age, being too old to be given automatic entitlement to long-term incapacity benefit and apparently too old to make a new claim under the "incapacitated in youth" provisions despite clearly coming within that description.

 

The appeal to the Upper Tribunal

27. Permission to appeal was very properly given by the judge who had constituted the tribunal of 8 September 2009. Given the large number of submissions made at different stages through the appeal I shall not attempt to detail all the twists and turns. Instead, after briefly dealing with Mr Millar’s arguments as made to the First-tier Tribunal and initially to me, I shall set out my view of the proper interpretation of the legislation on incapacity benefit in youth, referring to the parties’ submissions only as and when necessary.

 

Discussion

28. Mr Millar’s first argument to the First-tier Tribunal simply does not work. Once the claim for SDA had been adjudicated on, by the award of benefit, it was not in my judgment capable of being treated in the alternative or in addition as a claim for incapacity benefit, so that no question of the exercise by the Secretary of State of the power under the Claims and Payments Regulations arose. Nor was the decision awarding SDA capable of supersession for relevant change of circumstances in the form of the April 2001 amendments to the legislation. In so far as those amendments concerned SDA they did not justify any alteration to the existing award, as the claimant fell into a category whose continuing entitlement was not affected. In so far as those amendments introduced provisions about incapacity benefit, they could not be relevant to the SDA decision, being concerned with a different benefit. I shall come back to the submissions about discriminatory effect as I work through the relevant provisions.

 

Relevant explanatory material on the transition to incapacity benefit for youth

29. Paragraph 3 of Chapter One of the White Paper A new contract for welfare: SUPPORT FOR DISABLED PEOPLE (Cm 4103, October 1998) described two deficiencies of the then current SDA system, intended as a non-means-tested benefit for people disabled from childhood: that it failed to meet their needs, as 70% of recipients had to top up their income through income support, and that resources were not concentrated on that group, as just over two-thirds of new SDA awards were made to people aged over 20. Then paragraphs 4 and 6 were as follows:

 

“4 We believe that the time is right to modernise Severe Disablement Allowance, to direct more help to those for whom it was intended, bringing them into mainstream provision for incapacity. We therefore propose that those who were disabled at birth or in youth and who claim benefit before the age of 20 will in future be eligible for a new higher rate of benefit. By the age of 20, those who wish to try work should have been able to discover whether or not this is a realistic option for them.

 

 6 All those young people aged 16 to 19 who are on Severe Disablement Allowance at the point of change will transfer to the new higher rate of benefit after one year. This will put them on the same footing as 16 to 19-year-olds who make a new claim for Incapacity Benefit at the time the change is introduced. Those aged 20 and over who currently receive Severe Disablement Allowance will continue to get it, but from the point of change, no new claims will be accepted. Those who would have claimed Severe Disablement Allowance will continue to have access to income-related benefits and Disability Living Allowance.”

 

30. The Explanatory Notes issued with the Welfare Reform and Pensions Bill in session 1998-99 said that the clause amending section 30A of the Social Security Contributions and Benefits Act 1992 would allow a new category of people to claim incapacity benefit: those aged between 16 and 19 who would currently claim and receive SDA. The notes about the clause abolishing SDA recorded the intention to protect existing recipients aged over 20 at the date of change and continued:

 

“The Government intends to make regulations that will automatically transfer those entitled to SDA, who are under the age of 20 at the time the changes are introduced, on to long-term Incapacity Benefit a year later. This will give this group of people access to long-term IB under the new entitlement conditions introduced by clause 53 in this Bill.”

 

However, the description of the effect of what is now section 30A(2A)(b) was that the claimant had to have become incapable of work before the age of 20.

 

31. A very helpful House of Commons Library paper on the Bill produced before the Second Reading (Research Paper 99/19) described the proposals and some reactions to them. At page 76 it described the effect of what is now section 30A(2A)(b) in the same way, but stated:

 

“The group who will lose entitlement with these reforms are those age 20 or over who do not satisfy the contribution conditions for Incapacity Benefit and who do not satisfy the age conditions for having the contribution conditions waived. The Government estimates that about 16,000 people who would previously have been able to claim Severe Disablement Allowance will be affected although about 70% of these will qualify for Income Support.”

 

On pages 77 and 78 the paper recorded that among the points made by the Disability Alliance was that the fact that the increased rate of benefit would only be available to those under 20 would result in a two-tier system, with those aged over 20 at the time of the changes being paid less than younger disabled people and that they and other disability organisations would be arguing for the proposed incapacity benefit rate to be paid to all SDA recipients.

 

32. Mr Millar had referred at the oral hearing to some statements by the Minister, Mr Hugh Bayley, in the Standing Committee of the House of Commons (of which he supplied copies from the internet and therefore without Hansard date, volume and column references). He pointed to statements of the purpose of substantially increasing the benefit available to people severely disabled before the age of 20, or 25 in certain circumstances, or “disabled early in life”. In particular, he relied on this statement about existing SDA recipients:

 

“For existing cases, we intend to transfer automatically those entitled to severe disablement allowance, who are under the age of 20 at present or at the time when the changes are introduced, to long-term incapacity benefit one year later. However, SDA is currently claimed by many older people who have become disabled later in life. Unlike young disabled people, many will have had the opportunity to have worked and to have made choices about future financial provision. The abolition of SDA does not, of course, mean that in future people who become disabled later in life will be denied access to social security benefits … .”

 

33. I must also mention a statement on behalf of the Secretary of State dated 9 December 2008 (although I do not know the context in which it was made) attached to the Secretary of State’s submission dated 13 January 2011 in response to a direction asking for comments on the material summarised above:

 

“This is a statement on behalf of the Secretary of State with regard to the age condition for people incapacitated in youth.

 

The reforms ensure that resources are concentrated on those with the greatest needs. This is why we are giving a significantly higher level of benefit to people who become incapacitated before they reach the age of 20. By this time many young people will have had the opportunity to work and build up a contribution record. Even those who stay on at school to do A-levels will have had the opportunity to build up a contribution record by that age. So we believe that age 20 is a reasonable cut-off in most situations.

 

However, we recognise that some people leave school to take up other forms of education or training and then subsequently become incapacitated. We are committed to encouraging and widening access to educational and vocational courses and we recognised that the age 20 cut-off could disadvantage certain disabled young people who wished to continue their education. Therefore, we have increased the age cut-off for students in education or training to 25. By that age, most young people who undertake education/training courses will have had the opportunity to complete their course and to work and build up a contribution record to enable them to qualify for Incapacity Benefit in the normal way.”

 

34. Mr Millar naturally pointed in his submissions to the elements in those various statements suggesting the intention to distinguish between those disabled early in life and those disabled later in life, with the cut-off being at age 20 (or sometimes 25), and for those in the former group to be favoured by access to the new increased amount of benefit in the form of incapacity benefit. He pointed to the use of a dividing line in terms of age of onset of disability rather than of date of claiming (or at any rate of claiming incapacity benefit, rather than SDA). In addition, if it were to be accepted that the legislative history showed an intention to exclude anyone who had already reached the age of 20 by the date of change (including existing SDA recipients) from entitlement to incapacity benefit without satisfying the ordinary contribution conditions, he submitted that the history contained no explanation of or justification for excluding not only those over 20 on 6 April 2001 who had become disabled after reaching that age, but also those over that age who had been disabled early in life, with all the disadvantages in building up a contribution record that had been clearly identified. The Secretary of State naturally pointed to what it was said were clear statements of intention that only existing recipients of SDA who were under 20 on the date of change (6 April 2011) were to be transferred automatically to long-term incapacity benefit after a year, with the necessary implication (expressly stated in places) that those claiming incapacity benefit after reaching  20, whether they had a retained entitlement to SDA or not, could not qualify for incapacity benefit without satisfying the ordinary contribution conditions.

 

35. In truth, in my judgment Mr Millar was not able to establish anything more than some unwarranted assumptions and confusions, plus maybe some of the weasel words of politicians that have become so familiar in so many contexts.

 

36. The first unwarranted assumption, I think, was that if a claimant continued to receive SDA she would thereby not qualify for incapacity benefit. The issue would not previously have arisen in practice because a person who met the conditions of entitlement to SDA would not have chosen to claim only that benefit instead of the higher amounts in incapacity benefit if she had also met the conditions of entitlement, including the contribution conditions, for incapacity benefit. However, there was no rule in the legislation on incapacity benefit excluding entitlement when SDA was in payment, nor was any rule to that effect introduced as part of the transition to incapacity benefit in youth. Thus there was nothing to prevent an award of incapacity benefit being made, if a claimant satisfied the conditions of entitlement, including from 6 April 2001 the exemption from the ordinary contribution conditions, although she remained in receipt of SDA. The amount paid would then be adjusted under the Social Security (Overlapping Benefits) Regulations 1979, with the result under regulation 4(5)(a) that the amount of incapacity benefit would be deducted from the amount of SDA, in practice extinguishing its payability (see paragraph 16 above). The unwarranted assumption perhaps led to a failure always to spell out the intention to exclude entitlement to incapacity benefit in youth for new claimants over 20, although that was expressly stated in the White Paper. Other statements were not strictly inconsistent with that position, but tended not to emphasis the negative side of the new entitlement for the under-20s, picked up in the House of Commons Library Research Paper.

 

37. The second unwarranted assumption was that anyone who was awarded SDA after the age of 20 (and by definition had claimed SDA after the age of 20) must have become disabled “later in life”, not prior to reaching 20. No doubt that would have been so in most cases, but as the law stood prior to 6 April 2001, if a person, for whatever reason, delayed making a claim for SDA until after reaching 20 there could be entitlement from the date or deemed date of claim if it was established that the claimant had been incapable of work for a continuous period starting before she reached that age. More important, there was a further confusion, to put it at the kindest, when carrying the issue forward into the incapacity benefit in youth provisions, where the position was quite different. There had, prior to 6 April 2001 been no point in a person, however disabled, claiming incapacity benefit when she knew that she did not satisfy the contribution conditions. Yet the advantage of being exempted from the contribution conditions was to be withheld from those who had not claimed incapacity benefit before reaching the age of 20 as if that were a proxy for not having become long-term incapable of work prior to that age. The White Paper and the Explanatory Note to the Bill had in my view made clear the intention to limit entitlement under those new provisions to those who not only became incapable of work on a long-term basis before the age of 20 but also claimed incapacity benefit before that age. Subsequent statements were not strictly inconsistent with that, but tended to be made (and here is where the weasel words might come in) in terms of what was being done for those disabled early in life, without spelling out the limitation on who was to be allowed to claim on the new basis with the unpalatable consequence of the two-tier system identified by the Disability Alliance.

 

38. Two particular relevant things are clear, though. First, the legislative history, although clear on the intention to limit incapacity benefit in youth to claims made prior to the age of 20, did not descend into the nuts and bolts of how that result was to be achieved in the legislation. Nor would the words of the amendments to the primary legislation in the 1999 Act give any real clue about that. It therefore remains to be worked out in the following section whether the legislation did in fact achieve the intended result. That has to be a relatively technical process of interpretation in which I gain no assistance from the legislative history. Second, I agree with Mr Millar that the legislative history contains no specific explanation of or justification for excluding from the benefit of the new provisions that sub-category of people disabled or long-term incapable of work from early in life who were over the age of 20 on the date of change.

 

The interpretation of the incapacity benefit in youth provisions

39. If one looks only at the Social Security Contributions and Benefits Act 1992 as amended by the Welfare Reform and Pensions Act 1999, there would be no doubt that the claimant satisfied section 30A(2A)(b), as well as the other conditions, on the claim of 22 October 2008. All of the days in the period of entitlement to SDA prior to the claimant's 20th birthday were days of incapacity for work forming part of a period of incapacity for work within the terms of section 30C taken on its own. All that a period of incapacity for work means under section 30C(1)(b) is that it is a period made up of at least four consecutive days which are days of incapacity for work, with the possibility of linking periods under paragraph (c). Then all that a day of incapacity for work means under paragraph (a) is that it is a day on which a person is incapable of work. It was a continuing condition of entitlement to SDA that the claimant be incapable of work and, by virtue of regulation 10 of the Decisions and Appeals Regulations, the determination of incapacity was conclusive for the purposes of any other decision relating to another social security benefit. The obstacle in the way of the claimant's entitlement to incapacity benefit the section 30A(2A) conditions seems therefore to be in regulation 4(1)(a) of the Social Security (Incapacity Benefit) Regulations 1994, providing that for the purposes of incapacity benefit a day for which no in-time claim for incapacity benefit has been made is not to be treated as a day of incapacity for work and therefore cannot form part of a period of incapacity for work.

 

40. I interpose at this point that I find myself unable to accept the reasoning of Upper Tribunal Judge Bano in decision CIB/489/2008, relied on by the Secretary of State. The circumstances there were on all fours with those of the present case. The First-tier Tribunal had decided in the claimant’s favour on the basis that she had satisfied section 30A(2A)(b) by virtue of her incapacity for work beginning before subsection (2A) came into force. Judge Bano accepted the submission for the Secretary of State that that involved impermissibly giving section 30A(2A) a retrospective effect and said in paragraph 6 of the decision:

 

“As the submission pointed out, the phrase `a period of incapacity for work’ in section 30A(1) of the Contributions and Benefits Act must refer to such a period after the relevant provisions of the Welfare Reform and Pensions Act 1999 came into force, since no such period could have existed prior to that date. I accept that `the period of incapacity for work’ in section 30A(2A) must refer to the same period of incapacity for work, and that accordingly no relevant period of incapacity for work could exist prior to the coming into force of the amending provisions of the 1999 Act. I can see no reason why it should have been intended that claimants whose entitlement to SDA was preserved should also be entitled to [incapacity benefit in youth], and I therefore do not accept that section 30A(2A) should be construed to [apply] to claimants who satisfied the qualifying conditions before the provision came into force.”

 

41. There are in my judgment two fatal flaws in the submission accepted by Judge Bano. First, the phrase `a period of incapacity for work’ had been in section 30A(1) since the whole section was inserted in the Social Security Contributions and Benefits Act 1992 with effect from 13 April 1995 on the introduction of incapacity benefit, so that there was no reason to link its applicability to the amendments made by the 1999 Act. Second, even if the concept of a period of incapacity for work had only come into legislative existence on 6 April 2001, I do not see how treating days before that date as part of a period of incapacity for work in relation to a claim made on or after that date involves any impermissible retrospective effect. Legal effect is given to the new provisions only from the date they come into effect, but taking into account events that have occurred before that date. Bennion on Statutory Interpretation (5^th ed, 2008) says at page 318 that:

 

“An application is not retrospective where … the enactment is applied after its commencement to a state of affairs subsisting at that time, even though the state of affairs came into existence before its commencement.”

 

As Staughton LJ said in Secretary of State for Social Security v Tunnicliffe [1991] 2 All ER 712, at 723, it “is well-established that the presumption against retrospective legislation does not necessarily apply to an enactment merely because `a part of the requisites for its action is drawn from time antecedent to its passing’” Taking into account also the factors mentioned in paragraph 20 above, I can see no unfair retrospective effect.

 

42. However, regulation 4(1) of the Social Security (Incapacity Benefit) Regulations 1994, as in operation from 13 April 1995 onwards, would appear to provide the complete answer to why the claimant in the present case could not benefit from section 30A(2A). The 1997 Act must be taken as enacted in the context of the existence of that provision although it was not referred to in any of its provisions or, so far as I know, in any of the explanatory material or Parliamentary debates. The claim made on 13 October 2008 was for incapacity benefit. It sought entitlement from 8 July 2008, three months before the date of signature of the form, three months being the period within which an in-time claim for any day had to be made (Social Security (Claims and Payments) Regulations 1987, regulation 19(1) and Schedule 4, paragraph 2). No claim for incapacity benefit had previously been made. Thus, in substance no day prior to 8 July 2008 could be a day of incapacity for work under regulation 4(1)(a). For the reasons given in paragraph 28 above, the claim for SDA made from the claimant’s 16th birthday cannot be treated as a claim for incapacity benefit.

 

43. At one point I considered that it might be relevant that all the days from the claimant’s 16th birthday onwards were days on which she was accepted as incapable of work, which determination was made conclusive for the purposes of all benefits by regulation 10 of the Decisions and Appeals Regulations and its predecessors. I thought that there might be a conflict between an actual and conclusive determination of incapacity for work and a deeming under regulation 4(1). However, I am now clear that there is no conflict because different concepts are involved. The claimant must be accepted as incapable of work for every day between her 16th birthday and 13 October 2008 and beyond. However, the test in section 30A(2A) of the Contributions and Benefits Act, by reference to section 30C(1), is in terms of days of incapacity for work. A day on which a claimant is actually incapable of work is not necessarily a day of incapacity for work under section 30C(1)(a), because section 30C(3) allows regulations to provide for days not to be treated as days of incapacity for work, ie to be treated as not being days of incapacity for work. That is what regulation 4(1) does. The deeming of a day for which a claim for incapacity benefit has not been made not to be a day of incapacity for work is not inconsistent with a determination that the claimant is actually incapable of work on that day.

 

44. At one point I also thought that regulation 2(3) of the Social Security (Severe Disablement Allowance) Regulations 1984, as amended with effect from 13 April 1995 (paragraph 6 above), might be relevant and directed submissions about its relevance and effect. Regulation 2(3) provided that any regulations made under section 30C(3) of the Contributions and Benefits Act, like regulation 4(1) of the Social Security (Incapacity Benefit) Regulations 1994, were to apply when determining whether a day fell within a period of incapacity for work for the purposes of SDA. As explained in paragraphs 5 and 6 above, the concepts of a period of incapacity for work or of a day of incapacity for work did not form part of the basic conditions of entitlement to SDA. But for limited purposes for which it was relevant, the question arises of how regulation 4(1) was then to have effect. It could not possibly have had effect to exclude a day from being a day of incapacity for work, and so being capable of forming part of a period of incapacity for work for SDA purposes, simply because a claimant had not made a claim for incapacity benefit. That would have excluded all SDA recipients, who almost by definition would not have claimed incapacity benefit. For the purposes of SDA regulation 4(1)(a) would only make any rational sense if it applied to days for which there had not been an in-time claim for SDA.

 

45. The further question that I then posed in a direction was whether regulation 4(1)(a) had therefore to be treated for all purposes as having been impliedly amended so as to apply, in relation to a period for which there has been entitlement to SDA, only to days for which there has not been an in-time claim for incapacity benefit or SDA. I agree with the representative of the Secretary of State in the submission of 2 August 2011 that regulation 2(3) did not amend regulation 4(1) either expressly or impliedly, but merely required it to have effect, with the necessary adjustment mentioned above, for SDA purposes. Therefore, when regulation 4(1) is being applied for the purposes of incapacity benefit there is no warrant for doing anything other than applying the words of the relevant part of it as enacted. In his reply of 18 October 2011 Mr Moore for the claimant argued for the outcome, to avoid unfairness, that a day on which a claimant was entitled to SDA, by definition having been determined following a claim to be incapable of work for that day, should be regarded as not falling within regulation 4(1)(a). I have already explained in paragraph 43 above why the conclusive determination of incapacity for work for a day does not prevent a conclusion that the day is not a day of incapacity for work for the purposes of section 30C(1) of the Contributions and Benefits Act. The interpretation of regulation 4(1)(a) is not entirely easy. As Mr Scoon pointed out at the oral hearing, seeking to meet the force of the arguments then being put forward by Mr Moore, section 8(2)(b) of the Social Security Act 1998 provides that once a claim for a benefit is decided by the Secretary of State the claim shall not be regarded as subsisting after that time. For the purposes of regulation 4(1)(a), the period following an award of incapacity benefit for an indefinite period must be regarded as made up of days in respect of which the claim for incapacity benefit leading to the award was made. However, I cannot see how that necessary adjustment could allow days within the period of an award of SDA to be treated in the same way. The claim for SDA which could have been treated as also or in the alternative a claim for incapacity benefit, but which was not so treated, was not for that reason to be regarded as a claim for incapacity benefit.

 

46. Accordingly, my conclusion is that on ordinary principles of interpretation the incapacity benefit in youth legislation has the effect contended for on behalf of the Secretary of State of requiring not only that a claimant became incapable of work before reaching the age of 20 but also that a claim for incapacity benefit was made before reaching that age. The mechanism by which that result was achieved was not through any direct statement in that new legislation, but through the deeming in secondary legislation of days prior to a claim not to be days of incapacity for work and therefore not capable of forming part of a period of incapacity for work for the purposes of section 30A(2A)(b) of the Contributions and Benefits Act.

 

Discrimination and the Human Rights Act 1998

47. It therefore becomes necessary to consider the arguments on discrimination. As noted above, Mr Millar relied in the main on the speech of Lord Hoffmann in the Simms case. But what Lord Hoffmann said in the House of Lords in that case was that fundamental rights could not be overridden by general or ambiguous words. Here I have found the words of the relevant legislation, although technical and difficult, unambiguous. Accordingly, the discrimination argument for the claimant is better framed in terms of the Human Rights Act 1998. Mr Scoon seemed to regard it in that way by putting forward at the oral hearing submissions as to the justification for the legal position and Mr Millar was also able to cover possible justification arguments. However, there is a difficulty in that neither party has set out their position on the human rights arguments with any completeness. Especially in view of the very long time that has elapsed since the oral hearing and because I consider that I can fairly construct at least the basis of the arguments that could be made on either side, I am not going to delay a final decision by asking for yet more submissions. A complicating factor is the recent emergence of two decisions of the superior courts which could be thought to endorse inconsistent approaches to the issue of justification: Burnip v Birmingham City Council and Secretary of State for Work and Pensions and other cases [2012] EWCA Civ 629, 15 May 2012, and Humphreys v Commissioners for Her Majesty’s Revenue and Customs [2012] UKSC 18, 16 May 2012. I contemplated issuing this decision in draft and giving the parties the opportunity to comment. However, as I have concluded that on either approach justification has been made out, I have not followed that course.

 

48. I can deal with some issues rather shortly. I have no doubt that entitlement to incapacity benefit is a possession for the purposes of Article 1 of Protocol 1 to the European Convention on Human Rights, so that Article 14 on discrimination when read with that article is engaged in relation to the conditions for access to that benefit. Discrimination on the ground of age is potentially discrimination on the ground of “other status” under Article 14 (the challenge in the case of Reynolds to the payment of a lower jobseeker’s allowance to a claimant under 25 than to a claimant over that age was not rejected by the House of Lords on that ground: R (on the application of Carson) v Secretary of State for Work and Pensions [2005] UKSC 37, [2006] 1 AC 173).

 

49. Then I consider that there was a difference of treatment in the present case that calls for consideration of the issue of justification. That can be put in two ways. The first is that the claimant was treated differently from persons in an analogous situation. She could claim that as a recipient of SDA from the age of 16 she was in an analogous situation so far as having established that she had become disabled or long-term incapable of work from early in life was concerned to persons in the same circumstances but still under the age of 20 on 6 April 2001. That would point to an argument that the claimant was discriminated against contrary to Article 14 in her exclusion from the automatic transfer to incapacity benefit under regulation 19 of the Social Security (Invalidity Benefit) Regulations 1984, which was not how her case has been made. In relation to the rejection of her claim made in 2008 the analogy would I think have to be different, between persons who had become disabled or long-term incapable of work before the age of 20 and had made a post-6 April 2001 claim for incapacity benefit before reaching that age and persons in the same circumstances except that the post-6 April 2001 claim was made after reaching that age. That would point to an argument either that the condition of entitlement in section 30A(2A)(b) of the Contributions and Benefits Act was discriminatory contrary to Article 14 in linking entitlement to age at the beginning of the relevant period of incapacity for work, rather than the age of onset of disability or incapacity, or that regulation 4(1)(a) of the Social Security (Invalidity Benefit) Regulations 1984 was discriminatory in its application in these circumstances in excluding days of entitlement to SDA from a period of incapacity for work.

 

50. The second way of putting things would be that there had been a failure to treat differently persons whose situations are significantly different (Thlimmenos v Greece (2001) 31 EHRR 15 and AM (Somalia) v Entry Clearance Officer [2009] EWCA 634), in the application to the claimant of the rule that she could not be entitled to incapacity benefit with the exemption from the contribution conditions under the incapacity benefit in youth provisions because her claim was made after she reached the age of 20, when her situation of having become disabled or long-term incapable of work and been accepted as such for benefit purposes before that age, when making a claim for incapacity benefit would have been pointless, was significantly different from that of claimants who only became disabled/incapable and so able to make a realistic claim for incapacity benefit later in life, after reaching 20. That would also point to an argument that there was discrimination in one of the ways just mentioned.

 

51. It seems to me that the second way of putting things probably accords more closely with the circumstances of the present case, and in particular the factor that the claimant was not made worse off than she had been previously through her retention of entitlement to SDA. That therefore leads to the questions whether the claimant’s situation was significantly different from other persons treated in the same way and whether there was objective and reasonable justification for the failure to treat the claimant differently, ie was a legitimate aim being pursued and, if so, was there a reasonable relationship of proportionality between the means employed and the aims to be pursued (Stec v United Kingdom (2006) 43 EHRR 47). Essentially the same issue of justification would arise however the potential discrimination is properly to be formulated. Without finally deciding the question, I proceed on the basis that there was a significant difference between the claimant’s situation and that of others treated in the same way for the purposes of Thlimmenos. The decisive issue is then that of justification.

 

52. In both Burnip and Humphreys there was express reliance on the explanation given by the European Court of Human Rights in paragraph 52 of Stec after stating at the end of paragraph 51 that a state enjoyed a margin of appreciation in assessing whether and to what extent differences in otherwise similar situations justify a different treatment:

 

“The scope of this margin will vary according to the circumstances, the subject-matter and the background. As a general rule, very weighty reasons would have to be put forward before the Court could regard a difference in treatment based exclusively on the ground of sex as compatible with the Convention. On the other hand, a wide margin is usually allowed to the State under the Convention when it comes to general measures of economic or social strategy. Because of their direct knowledge of their society and its needs, the national authorities are in principle better placed than the international judge to appreciate what is in the public interest on social or economic grounds, and the Court will generally respect the legislature's policy choice unless it is `manifestly without reasonable foundation’."

 

In both cases there was also an acknowledgement that that test had been applied by the House of Lords in R (RJM) v Secretary of State for Work and Pensions [2008] UKHL 63, [2009] 1 AC 311, which concerned the denial of income support disability premium to rough sleepers.

 

53. In Burnip, having rejected the submission that difference of treatment on the ground of disability required very weighty reasons for justification, Henderson J went on to express the conclusion (agreed with by the other members of the Court of Appeal) that justification had not been shown in terms that the “single bedroom rule” in housing benefit was not a fair or proportionate response to the discrimination that had been established. By contrast, in Humphreys, Lady Hale (with whom the other members of the Supreme Court agreed) at [19] stated that even in cases of sex discrimination the normally strict test for justification gives way to the “manifestly without reasonable foundation” test in the context of state benefits. At [20] she said that the real object of the complaint in Humphreys, about the “no-splitting” rule in child tax credit for parents to count as responsible for a child, was the discrimination between majority and minority shared carers and that, if that was regarded as a status, justification would turn on the “manifestly without reasonable foundation” test. She had also noted at [18] Lord Neuberger’s observation in RJM, at [56], that this was "an area where the court should be very slow to substitute its view for that of the executive, especially as the discrimination is not on one of the express, or primary grounds". However, at [22] Lady Hale also said that the justifications put forward for the rule in question required careful scrutiny and, after detailed consideration of the submissions and relevant factors, put her conclusion that the indirect sex discrimination in that case was justified in terms that the “no-splitting” rule was a reasonable rule for the state to adopt.

 

54. The question I must ask in the present case under the authority of Humphreys is therefore whether the failure to treat the claimant differently from other claimants who did not claim incapacity benefit until they were over 20, or the treating of her differently from other claimants who had become disabled or long-term incapable of work before the age of 20, was manifestly without reasonable foundation. I deal very briefly with the alternative question that could be relevant if it was intended in Burnip to endorse the approach of asking only whether there was a fair and proportionate response to a legitimate aim.

 

55. An important element of the claimant’s circumstances is that, by virtue of Article 4 of the Commencement No 9 Order (paragraphs 7 and 8 above), she retained her entitlement to SDA after 6 April 2001. That entitlement would continue so long as she remained incapable of work or there was some further legislation. It was still in place, with the amount having been up-rated annually like other benefits, at the time of the 2008 claim. Not all of those who did not gain any advantage from the introduction of the incapacity benefit in youth conditions in 2001 would necessarily be in the same position. One could envisage a person who through ignorance or some other reason had never claimed SDA before 6 April 2001, although an award would have been made if a claim had been made. If aged over 20 on 6 April 2001, such a person would neither have been able to take advantage of the incapacity benefit in youth conditions nor have been able to claim SDA, which had been abolished for new claimants. However, that was not the situation of the claimant here and it is her situation that I must consider. A further part of the context is the existence of other benefits, such as DLA to provide towards the extra costs incurred as a result of disability and income support to provide a minimum subsistence income, with special provisions for additional amounts for the disabled. The claimant here, as recorded on the claim form for incapacity benefit, was in receipt of both benefits in 2008. From April 2008 the weekly rate of SDA with the highest age addition was £81.45. The weekly rate of long-term incapacity benefit (available after a year on short-term incapacity benefit at a rate lower than SDA) was £84.50, plus £17.75 as the higher age-related addition. However, the claimant’s weekly applicable amount for income support purposes (without knowing her exact domestic circumstances) would have been made up of at least £60.50 as the personal allowance for a person over 25 and £25.85 for the disability premium. As she was apparently not entitled to the highest rate of the care component of DLA she would not have been entitled to the enhanced disability premium and, as she seems to have been living with her parents, would not have been entitled to the severe disability premium either. Other SDA recipients might well have been entitled to those additional premiums.

 

56. Another important factor is that there cannot in general be a complaint against the introduction of some new benefit or more generous conditions for an existing benefit for only a limited category out of all those who might potentially have been covered. Nor could there in general be a complaint against a state for excluding persons already entitled to some other benefit from the advantage of the new provisions. Such matters would fall plainly within the margin of appreciation allowed to states in matters of economic or social strategy. However, the grounds for drawing the line between those who gain an advantage and those who do not can come under scrutiny under Article 14 of the Convention and differences of treatment or failures to treat differently may require specific justification.

 

57. I think that three legitimate aims of the 2001 changes can be identified in broad terms. (1) To concentrate the new more generous amounts of benefit, which might be sufficient to avoid the need for means-tested top-up, on claimants who had become disabled early in life and thereby been disadvantaged through their inability to build up any record of actual contributions through work. (2) To remove the advantage of having a non-contributory and non-means-tested benefit from claimants who were incapable of work but had not suffered that disadvantage early in life. (3) To manage the transition from SDA to access to incapacity benefit through the incapacity benefit in youth provisions fairly and without undue administrative difficulty.

 

58. The second aim was fairly and reasonably implemented by the abolition of SDA for new claimants and the restriction of the incapacity benefit in youth provisions to those who claimed in time for periods before their 20th birthday. The provision in regulation 19 of the Social Security (Invalidity Benefit) Regulations 1994 for automatic entitlement to incapacity benefit for anyone in receipt of SDA who was under 20 on 6 April 2001 does not undermine that conclusion. Such persons could have become entitled to incapacity benefit on making a claim, so that the provision was simply to avoid the cost and inconvenience, both administrative and on the part of claimants, of making and dealing with a new claim.

 

59. Evaluation of the first and third aims is more complex. This is not a simple case of payment of a benefit being restricted to claimants under or over some set age. There is nothing to prevent payment of incapacity benefit to a claimant of any age below pensionable age, without the contribution condition having to have been satisfied, providing that the period of claim began before the age of 20. That condition, so far as people who become disabled or long-term incapable of work after 6 April 2001 are concerned, could fairly be regarded as reflecting the aim of concentrating assistance on those disabled early in life. Once the new conditions had been introduced, even though they were to some extent technical and obscure, they were part of the relatively well-known structure of incapacity benefit. Someone who became incapable of work could be expected to make a claim for incapacity benefit, no separate claim specifically for incapacity benefit in youth being necessary, and would then be exempted from the contribution condition if under 20 at the beginning of the period of in-time claim. Given the legitimate interest in having the question of whether a person is incapable of work at any date determined not too long afterwards, because of the difficulties of gathering and evaluating evidence relating to a distant date, the use of such a rule rather than a rule directly making the test when actual incapacity for work began could no doubt be justified. But those who had become incapable of work before 6 April 2001 (or earlier than three months before that date), like the claimant here, were effectively barred completely from qualification without satisfying the contribution condition, because there would have been no point in their putting in a claim for incapacity benefit at the time of becoming incapable. Is there justification for the resulting failure to treat the claimant differently from others who had not claimed incapacity benefit before 6 April 2001?

 

60. There is not a direct link to the first aim taken on its own. The claimant and others in her circumstances fell plainly within the group identified as deserving more generous treatment and there was no problem of determining incapacity for work as at long-distant dates when such incapacity had already been accepted for SDA purposes. Their exclusion produced the two-tier system mentioned in paragraph 31 above and also the oddity of what I have identified as the difference in outcome for incapacity benefit purposes as compared with the previous and subsequent regimes of SDA and ESA . However, in my judgment the third aim must be considered alongside the first. Although the first aim was put to the fore for presentational purposes and there may sometimes have been unwarranted assumptions and confusions in the form of the presentation of policy, aim (3) was still a necessary part of the changes and publicly acknowledged as such, albeit in the background and without discussion of the mechanisms involved. There were obviously a number of choices available, including allowing new claims from anyone who had already shown incapacity for work through entitlement to SDA from a date before the 20^th birthday. That is the choice that it is submitted for the claimant would be the only fair one, giving proper weight to aim (1) of the changes. It is true that none of the documentary evidence before me contains any structured reasons for the rejection of that choice in favour of what the legislation actually provided. It cannot though be said, in my judgment, that what was actually provided was manifestly without reasonable foundation. Taking into account in particular the factors mentioned in paragraphs 55 and 56 above, although criticisms could be made in terms of lack of generosity or perhaps some muddled thinking, the outcome was well within the margin of appreciation to be allowed to the government.

 

61. For essentially the same reasons, if the test to be applied is primarily whether there was a fair and proportionate response to a legitimate aim, as perhaps suggested by Burnip, I am satisfied that there was such a fair and proportionate response once the legitimate aims are properly identified as including not just (1) and (2) in paragraph 57 above, but also aim (3). What the legislation provided was within the range of different fair and proportionate responses possible.

 

Conclusion

62. Accordingly, there is no inconsistency with Convention rights that requires the legislative provisions in question to be interpreted in any different way from that set out above or requires any provision to be disregarded. On the interpretation set out above, the First-tier Tribunal reached the only decision open to it in law and the claimant’s appeal must be disallowed.

 

 

 

 

(Signed) J Mesher

  Judge of the Upper Tribunal

 

Date:  6 August 2012