[Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback]
	England and Wales Court of Appeal (Civil Division) Decisions
You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Hockenjos v Secretary Of State For Social Security [2001] EWCA Civ 624 (2 May 2001) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2001/624.html Cite as: [2001] 2 CMLR 51, [2001] ICR 966, [2001] EWCA Civ 624

[New search] [Printable RTF version] [Help]

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE SOCIAL SECURITY COMMISSIONERS
MR COMMISSIONER M.J. GOODMAN

		Royal Courts of Justice Strand, London, WC2A 2LL Wednesday 2nd May 2001

LORD JUSTICE ALDOUS:

1. The claimant is the father of two daughters born in 1982 and 1990. He separated from his wife and a joint residence order was made on 6th October 1997 with the result that the children resided with the mother and the father for different but roughly equal parts of the week.
2. On 16th December 1997 the claimant claimed jobseeker's allowance including an additional amount in respect of his children. The adjudication officer, in a decision dated 7th January 1998, decided that the claimant was entitled to income-based jobseeker's allowance, but that the amount payable should not include any additional amount in respect of the children. The reason being that he was not in receipt of child benefit which was being paid to the mother and was therefore not to be treated as responsible for them.
3. The claimant appealed. The decision of the adjudication officer was upheld by the Social Security Appeal Tribunal. He appealed again. His appeal was heard and dismissed by Mr Commissioner Goodman in a written decision dated 2nd May 2000.
4. Before coming to the submissions of the parties, it is necessary to set out the legislative background. Jobseeker's allowance superseded unemployment benefit and in part income support. It was introduced by the Jobseekers Act 1995. The purpose of that Act is apparent from its long title which describes it as:

"An Act to provide for a jobseeker's allowance and to make other provision to promote the employment of the unemployed and the assistance of persons without a settled way of life."

5. Part I of the Act is concerned with "The Jobseeker's Allowance"; Part II with "Back to Work Scheme" and Part III with grants in connection with the provision of resettlement places for persons without a settled way of life. Part I of the Act consists of the first 25 sections. The relevant sections are as follows:

"1.(1) An allowance, to be known as a jobseeker's allowance, shall be payable in accordance with the provisions of that Act.

(2) Subject to the provisions of this Act, a claimant is entitled to a jobseeker's allowance if he –

(a) is available for employment;

(b) has entered into a jobseeker's agreement which remains in force;

(c) is actively seeking employment;

(d) satisfies either –

(i) the conditions set out in section 2; or

(ii) the conditions set out in section 3;

(e) is not engaged in remunerative work;

(f) is capable of work;

(g) is not receiving relevant education;

(h) is under pensionable age; and

(i) is in Great Britain.

(3) A jobseeker's allowance is payable in respect of a week.

(4) In this Act –

"a contribution-based jobseeker's allowance" means a jobseeker's allowance entitlement to which is based on the claimant's satisfying conditions which include those set out in section 2; and

"an income-based jobseeker's allowance" means a jobseeker's allowance entitlement to which is based on the claimant's satisfying conditions which include those set out in section 3."

6. Section 2 sets out the conditions that have to be satisfied before contribution-based jobseeker's allowance becomes payable. In essence the claimant must have paid class 1 contributions and not be entitled to income support.
7. Section 3 is as follows:

"3.(1) The conditions referred to in section 1(2)(d)(ii) are that the claimant –

(a) has an income which does not exceed the applicable amount (determined in accordance with regulations under section 4) or has no income;

(b) is not entitled to income support;

(c) is not a member of a family one of whose members is entitled to income support;

(d) is not a member of a family one of whose members is entitled to an income-based jobseeker's allowance;

(e) is not a member of a married or unmarried couple the other member of which is engaged in remunerative work; and

(f) is a person –

(i) who has reached the age of 18; or

(ii) in respect of whom a direction under section 16 is in force; or

(iii) who has, in prescribed circumstances to be taken into account for a prescribed period, reached the age of 16 but not the age of 18.

(2) Regulations may provide for one or both of the following conditions to be included in the income-based conditions, in the case of a person to whom subsection (i)(f)(ii) or (iii) applies –

(a) a condition that the claimant must register for employment;

(b) a condition that the claimant must register for training.

….."

8. Section 4 sets out the basis for calculating the amount payable by way of contribution or income-based jobseeker's allowance or both with the detail to be provided by regulations.
9. Section 5 provides for the duration of contribution-based jobseeker's allowance. Sections 6 to 12, 14 and 16 to 25 are concerned with conditions relevant to the entitlement of jobseeker's allowance whether it be contribution or income-based.
10. The relevant regulations are the Jobseeker's Allowance Regulations 1996. Regulation 82 states that "Regulations 83 to 87 apply in the case of an income-based jobseeker's allowance". Regulation 83(b) provides for an additional applicable amount for a claimant "… in respect of any child or young person who is a member of his family …". The definition of "family" in section 35(1) of the 1995 Act includes "… a person who is not a member of a married or unmarried couple and a member of the same household for whom that person is responsible and who is a child …". Regulation 77 sets out the circumstances in which a person is to be treated as responsible or not responsible for another. The relevant part is in this form:

"77(1) Subject to the following provisions of this regulation, a person is to be treated for the purposes of the Act as responsible for a child or young person for whom he is receiving child benefit.

…"

Regulation 77 is therefore the final link between entitlement to the additional applicable amount in regulation 83(b) and to child benefit.

11. Child benefit is dealt with in the Social Security Contribution and Benefits Act 1992. Section 141 provides that a person who is responsible for more than one child shall be entitled to child benefit. The meaning of "person responsible for a child" is contained in section 143.

"143(1).- For the purposes of this Part of this Act a person shall be treated as responsible for a child in any week if –

(a) he has the child living with him in that week; or

(b) he is contributing to the cost of providing for the child at a weekly rate which is not less than the weekly rate of child benefit ` payable in respect of the child for that week.

….."

12. Exclusions and priority are dealt with in section 144. The relevant subsection reads as follows:

"144 (3) Where, apart from this subsection, two or more persons would be entitled to child benefit in respect of the same child for the same week, one of them only shall be entitled; and the question which of them is entitled shall be determined in accordance with Schedule 10 to this Act."

13. Schedule 10 provides, so far as material:

"Priority between persons entitled to child benefit

Person with prior award

(1).-(1) Subject to subparagraph (2) below as between a person claiming child benefit in respect of a child for any week and a person to whom child benefit in respect of a child for that week has already been awarded when the claim is made, the latter shall be in entitled.

(2) Subparagraph (1) above shall not confer any priority where the week to which the claim relates is later than the third week following that in which the claim is made.

….

Husband and wife

(3) Subject to paragraphs 1 and 2 above, as between a husband and wife residing together the wife shall be entitled.

Parents

(4) .- (1) Subject to paragraphs 1 to 3 above, as between a person who is and one who is not a parent of the child the parent shall be entitled.

(2) Subject as aforesaid, as between two persons residing together who are parents of the child but not husband and wife, the mother shall be entitled.

Other cases

(5) As between persons not falling within paragraphs 1 to 4 above, such one of them shall be entitled as they may jointly elect or, in default of election, as the Secretary of State may in his discretion determine.

….."

14. Before the Commissioner the claimant contended that the statutory provisions for calculating the amount of income-based jobseeker's allowance favoured mothers over fathers having regard to the way it was linked to child benefit. It followed, he submitted, that the provisions contravened EC Directive 79/7/EEC. He also alleged that regulation 77 of the 1996 Regulations was ultra vires in that it frustrated and negated the purpose of the 1995 Act. On this appeal the submission that the regulation was ultra vires was not pursued, nor was an argument, raised in the notice of appeal, based upon the Human Rights Act 1998. Thus Mr Drabble QC, who appeared for the claimant, concentrated his submissions upon the Directive and its effect. The relevant parts of that Directive read as follows:

"Article 1

The purpose of this Directive is the progressive implementation, in the field of social security and other elements of social protection provided for in Article 3, of the principle of equal treatment for men and women in matters of social security, hereinafter referred to as "the principle of equal treatment".

Article 2

This Directive shall apply to the working population - including self-employed persons, workers and self-employed persons whose activity is interrupted by illness, accident or involuntary unemployment and persons seeking employment – and to retired or invalided workers and self-employed persons.

Article 3

1. This Directive shall apply to:

(a) statutory schemes which provide protection against the following risks:

- sickness,

- invalidity,

- old age,

- accidents at work and occupational diseases,

- unemployment;

(b) social assistance, in so far as it is intended to supplement or replace the schemes referred to in (a).

…

Article 4

1. The principle of equal treatment means that there shall be no discrimination whatsoever on ground of sex either directly, or indirectly by reference in particular to marital or family status, in particular as concerns:

- the scope of the schemes and the conditions of access thereto,

- the obligation to contribute and the calculation of contributions,

-the calculation of benefits including increases due in respect of a spouse and for dependants and the conditions governing the duration and retention of entitlements to benefit.

2. The principle of equal treatment shall be without prejudice to the provisions relating to the protection of women on the grounds of maternity."

15. The Directive does not apply to child benefit because it does not provide protection against any of the risks enumerated in Article 3. The main issue before this Court is whether Article 3 of the Directive applies to income-based jobseeker's allowance and turns on the question of whether the statutory scheme for that allowance provides protection against the risk of unemployment. There is also a dispute between the parties as to whether the way the additional amount of income-based jobseeker's allowance is awarded is prohibited by Article 4 of the Directive as being discriminatory.
16. Mr Commissioner Goodman, relying upon Jackson v Chief Adjudication Officer [1993] QB 367, concluded that income-based jobseeker's allowance did not fall within Article 3 of the Directive. I shall come later to the reasoning of the European Court of Justice in that case. It is sufficient at this stage of my judgment to note that in Jackson one of the claimants was a divorced mother with two children who was unemployed and had been in receipt of income support. She took up part-time employment, but the Income Support (General Regulations) 1987 did not permit child-minding expenses to be deducted from her earnings when calculating her income. That resulted in the amount of her income support being reduced. The European Court of Justice held that the benefit in question, income support, could not be regarded as providing protection against the risk of unemployment and therefore the 1987 regulations did not fall within the scope of the Directive. Basing himself upon that decision, Mr Commissioner Goodman held in paragraph 31 of his decision:

"31. Looking at all these legislative provisions, I come to the conclusion that Income-based Jobseeker's Allowance is in many respects similar to Income Support, the main difference being that there is greater emphasis than there was for Income Support on a claimant's being available for employment and actively seeking employment, e.g. the provisions for a Jobseeker's Agreement. Nevertheless, the basic characteristics of Income-based Jobseeker's Allowance are in my view similar or analogous to Income Support. Consequently, in my judgment the reasoning propounded by the European Court (see paragraphs 23 and 24 above) applies equally here. The amount of Income-based Jobseeker's Allowance is not related to loss of earnings but is simply a fixed sum as an "applicable amount" and is not available at all if capital is above a certain limit. The fact that a person may be seeking employment and a member of the member of the working population does not in any way differentiate him financially, so far as Income-based Jobseeker's Allowance is concerned from the situation of a person who is not in that category. I therefore conclude that the reasoning in the Jackson v Cresswell case is equally applicable to Income-based Jobseeker's Allowance. I say nothing about Contribution-based Jobseeker's Allowance, as it is not relevant to this case.

32. Consequently, I hold that EEC Directive 79/7/EEC does not apply to the present appeal. Income-based Jobseeker's Allowance does not come within Article 3(1)(a) of the Directive …."

17. Mr Drabble criticised that conclusion. He submitted that it did not follow from a conclusion that income-based jobseeker's allowance was in many respects similar to income support that the reasoning in Jackson applied. The crucial question was whether that allowance, considered in the context of the 1995 Act, came within Article 3.
18. Shortly after the decision of Mr Commissioner Goodman, a similar issue came before Mr Commissioner David Williams (CJSA 1920/1999). In that case the claimant had become pregnant and it was argued that she had suffered discrimination in the way that jobseeker's allowance operated. Mr Commissioner David Williams concluded that Mr Commissioner Goodman had been wrong to treat jobseeker's allowance as being based on two statutory schemes. The 1995 Act did in his view establish one statutory scheme. It was, he said, introduced by one Act with one set of regulations. It was, as section 1 said, "An allowance, to be known as a jobseeker's allowance". Section 1(2) set out nine conditions of entitlement with one of them being an alternative namely contribution-based and the other income-based. He continued:

"The rest of the Act is in unitary form, as are Jobseeker's Allowance Regulations 1996 – that is, the legislation is drafted as a single scheme, although parts of it do not apply in all cases. I can see no basis whatsoever for arguing that this is two separate benefits or two separate statutory schemes. It may be for administrative convenience the authorities treat income-based jobseeker's allowance and contribution-based jobseeker's allowance as separate allowances, but that is irrelevant. The legislation makes it clear that there is only one jobseeker's allowance. It may be that as a matter of history the jobseeker's allowance replaced the unemployment benefit and part of income support with a single allowance. That is a matter purely of history and also irrelevant. There are no relevant savings provisions in the 1995 Act or in subordinate legislation which keep that dual origin alive. On the contrary the whole thrust of the provisions was to merge the two previous forms of benefit into one. If that was done for British internal purposes, I cannot see how it can be argued that the opposite still applies for European Community purposes."

19. Mr Commissioner David Williams went on to note that it was not in dispute that unemployment benefit was replaced by contribution-based jobseeker's allowance and that that allowance was within the scope of Article 3 of the Directive. Viewed as a whole, jobseeker's allowance was a hybrid, part contributory and part means tested and was directly and effectively linked to the risk of unemployment. He therefore held that income-based jobseeker's allowance, like contribution-based jobseeker's allowance, did provide protection against the risk of unemployment.
20. Mr Drabble relied upon the decision of Mr Commissioner David Williams. Mr Nicholas Paines QC, counsel for the Secretary of State, supported the decision under appeal.
21. There was a measure of agreement as to the construction of the Directive, but we were referred to Kenneth Scrivener and Carol Cole v Centre Public d'Aide Sociale de Chastre case-122/84, R v Secretary of State for Social Security ex parte John Henry Taylor case C-382/98 and Atkins v Wrekin District Council case C-228/94 as guidance as to the approach that was necessary. For my part the principles can be obtained from the following paragraphs in the judgment of the European Court of Justice in Jackson.

"13. In order to answer the questions concerning the scope of Directive (79/7/EEC) it should be noticed first that, according to the first and second recitals in its preamble, the object of the Directive is the progressive implementation of the principle of equal treatment of men and women in matters of social security.

14. According to the wording of Article 3(1) the Directive applies to statutory schemes which provide protection against the risks of sickness, invalidity, old age, accidents at work and occupational diseases or unemployment, and to social assistance in so far as it is intended to supplement or replace those schemes.

15. As the Court has previously held, a benefit, if it is to fall within the scope of Directive (79/7/EEC), must constitute the whole or part of the statutory scheme providing protection against one of the specified risks or a form of social assistance having the same objective: Drake v Chief Adjudication Officer (Case 150/85) [1987] QB 166, 176, para. 21, and Reg. v Secretary of State for Social Security, Ex parte Smithson (Case C243/90) [1992] 1 CMLR 1061, 1074 – 1075, para. 12.

16. The court stated that, although the mode of payment is not decisive as regards the identification of the benefit as one which falls within the scope of Directive (79/7/EEC), nevertheless in order to fall within the scope of the Directive the benefit must be directly and effectively linked to the protection provided against one of the risks specified in Article 3(1): ex parte Smithson p. 1075, para. 14.

17. However, article 3(1)(a) of Directive (79/7/EEC) does not refer to a statutory scheme which on, certain conditions, provides persons with means below a legally defined limit with a special benefit designed to enable them to meet their needs.

18. That finding is not affected by the circumstance that the recipient of the benefit is in fact in one of the situations covered by article 3(1) of the Directive.

19. Indeed, in Ex parte Smithson the court held with regard to a housing benefit that the fact that some of the risks listed in article 3(1) of Directive (79/7/EEC) were taken into account in order to grant a higher benefit was not sufficient to bring that benefit as such within the scope of the Directive.

20. Consequently, exclusion from the scope of Directive (79/7/EEC) is justified a fortiori where, as in the cases at issue in the main proceedings, the law sets the amount of the theoretical needs of the persons concerned, used to determine the benefit in question, independently of any consideration relating to the existence of any of the risks listed in article 3(1) of the Directive."

22. Adopting the words of paragraph 16 of that judgment the issue is: Is income-based jobseeker's allowance directly and effectively linked with to the protection provided against risk of unemployment?
23. Mr Paines accepted on behalf of the Secretary of State that contribution-based jobseeker's allowance fell within the Directive. However he submitted that income-based jobseeker's allowance did not. He drew attention to the long title to the 1995 Act which he submitted indicated that the Act had more than one purpose, namely to make provision for a jobseeker's allowance and to promote both the employment of the unemployed and assistance to persons without a settled way of life. He submitted that contribution-based jobseeker's allowance was the successor to unemployment benefit, while income-based jobseeker's allowance largely replaced income support which did not fall within the Directive. Income-based jobseeker's allowance was a means tested benefit with entitlement being independent of contributions made. It was based entirely upon needs and resources. It was financed from taxation and the conditions of entitlement largely mirrored those of income support. He submitted that the applicability or otherwise of the Directive could not depend on how the national statute book was organised. For example, many social security benefits were now provided for in the Social Security Contributions and Benefits Act 1992, which had consolidated earlier legislation. That could not mean that one or all of them fell within the Directive. Each had to be looked at individually. It therefore was not right to reason that income-based jobseeker's allowance must fall within the Directive because it was included in the same statute as contribution-based jobseeker's allowance.
24. I accept that the fact that contribution-based jobseeker's allowance and income-based jobseeker's allowance are provided for in one statute cannot be determinative as to whether either, both or neither are a statutory scheme which is directly and effectively linked to a protection provided in Article 3 of the Directive. Thus the fact that contribution-based jobseeker's allowance falls within the directive does not mean that income-based jobseeker's allowance does also. But it does not follow that the concession that contribution-based jobseeker's allowance has no relevance. The statutory scheme for jobseeker's allowance contained in the 1995 Act and the Regulations must be considered to decide the issue in this case.
25. As I have said Mr Paines drew attention to the fact that income-based jobseeker's allowance was a means tested benefit. To illustrate that he drew to our attention that the recipients could be employed for up to 16 hours per week. From that he sought to draw the conclusion that the allowance was not provided as a protection against the risk of unemployment. He submitted that basically income-based jobseeker's allowance had not changed from income support.
26. Mr Drabble accepted that income-based jobseeker's allowance was a means tested benefit which had incorporated into it elements of income support. Put broadly his submission was that Mr Commissioner David Williams was right to hold that there was, in the 1995 Act, but one statutory scheme which provided protection against the risk of unemployment. It was aimed at the unemployed and was designed to provide income to meet the consequences of the risk of unemployment. I believe he is right.
27. The long title of the 1995 Act states that it is "An Act to provide for a jobseeker's allowance and to make other provisions to promote employment of the unemployed …". Part II of the Act is concerned with "Back-to-work scheme" and is clearly the "other provision to promote the employment of the unemployed." Thus Part I provides for a jobseeker's allowance which, because of the use of the word "other", is considered to be a provision to promote the employment of the unemployed. That is confirmed by the terms of the sections in Part I.
28. Section 1 states – "An allowance, to be known as a jobseeker's allowance, shall be payable in accordance with the provisions of this Act." It is therefore one allowance known by one name.
29. Subsection (2) of section 1 sets out nine conditions of entitlement to the allowance, known as jobseeker's allowance. Five of those conditions had to be complied with to obtain income support. However all of them apply to applicants for jobseeker's allowance with section 1(2)(d) containing an alternative available to a person who had made class 1 contributions. However it is not a true alternative as the following example provided by Mr Drabble demonstrates.

"A man becomes unemployed after a period of employment. He has paid his contributions. For the immediate period after he loses his job, he will be entitled to jobseeker's allowance based on his contribution record. If his income remains below his applicable amount, he will be entitled in addition to income-based jobseeker's allowance. If he remains unemployed for a long time, he will exhaust his entitlement to contribution-based allowance and will become entirely dependent on income-based jobseeker's allowance."

30. The stance adopted by the Secretary of State to that example means that discrimination, within the common conditions as applied to the contributory part of the allowance, would be contrary to the Directive because those conditions were part of a statutory scheme providing protection against the risk of unemployment. But the same discrimination within the same conditions as applied to an amount payable under section 3 of the Act would not be contrary to the Directive because the conditions were not part of a statutory scheme providing protection against the risk of unemployment. Further, whilst payments were made based upon contributions, the scheme fell within the Directive, but once such entitlement was exhausted then there was nothing within it.
31. There is in my view one statutory scheme for a jobseeker's allowance as the long title, section 1 and the other sections of the Act make clear. The stance adopted by the Secretary of State is both contrary to the intention expressed in the Act and leads to an absurd result as is demonstrated by the example set out above. True anybody who is unemployed and is prepared to look for work is entitled to jobseeker's allowance and, in that sense, it is a general allowance directed to the protection against the risk of unemployment. However it is payable to the unemployed as defined in the statutory provisions. The fact that it is means-tested is irrelevant as is the fact that it incorporates many of the features of income support. Such features have been incorporated into a comprehensive statutory code which does provide protection against the risk of unemployment. In my view there is the necessary direct and effective link.

Discrimination

32. Mr Paines submitted that even if income-based jobseeker's allowance fell within Article 3 of the Directive, there could not in this case be discrimination within Article 4. As he pointed out this case was only concerned with the additional amount which regulation 83(b) enabled an applicant to obtain in respect of a member of a family, with regulation 77 linking responsibility to child benefit. Thus the entitlement to the additional amount is governed by section 143 of the Social Security Contributions and Benefits Act 1992, with Schedule 10 of that Act deciding conflicts of priority.
33. Mr Paines submitted that there could be nothing discriminatory in the priority rules of Schedule 10 even it be assumed that more women than men would be entitled to child benefit. After 3 weeks from a claim, the Secretary of State had to decide, in the absence of the factors, who should receive the child benefit and it could not be suggested that he would discriminate against men. He submitted that there was no reason to suppose that decisions by the Secretary of State showed an imbalance in favour of women. Even if there was an imbalance, that would reflect the facts of the cases decided by the Secretary of State. Both child benefit and the additional amount of the jobseeker's allowance were based on responsibility for a child and therefore there was nothing discriminatory in linking the two.
34. Mr Drabble pointed out that as yet there had been no consideration by a commissioner as to whether there had been discrimination. He submitted that discrimination was probable and that if he was right upon the main issue, the case should be remitted back to a commissioner for him to decide the matter after considering evidence.
35. Questions of law on discrimination are best decided against the background of the facts. In this case it is arguable that it is discriminatory to link entitlement to the additional amount of jobseeker's allowance to the entitlement to child benefit. Child benefit is a payment made to the person responsible for the child. It is not means-tested and it could be that more women than men are entitled to receive it. The additional amount of jobseeker's allowance is a means-tested subsistence benefit. The very difference between the two payments could show that it was not logical to link the two together. For example it could be thought right by the Secretary of State, and in fact be right, that the child benefit should remain with the mother who provides accommodation, food and clothes for the child even though the child spends say two weeks in total with the father during the summer holiday. But the reasoning for that decision would appear not to apply to the question of whether the additional amount of jobseeker's allowance should be paid for those two weeks when the child was staying with the father.
36. It may be that men are at a disadvantage when claiming for a dependent after separation. It is also possible that women are more likely than men to be the recipients of child benefit. That no doubt will, to a large extent, reflect the respective degrees of responsibility. But it seems to me to be arguable that the linking of the entitlement to the additional amount of jobseeker's allowance to the entitlement to child benefit puts men at a disability to women both practically and theoretically.
37. For my part I would not wish to express any concluded view as to the arguments advanced by Mr Drabble and by Mr Paines as to the discriminatory effect of linking entitlement to the additional amount of jobseeker's allowance to child benefit. It appears to me best that the facts be found, in so far as they are available, and then, to consider the submissions of the parties on the law against that background.
38. Having regard to the conclusion that I have reached on the main issue, I would allow the appeal. I would also remit the case back to a commissioner to consider the issue of discrimination.

LORD JUSTICE TUCKEY:

39. I agree.

LORD JUSTICE KAY:

40. I also agree.

Order: Appeal allowed with costs; case remitted to the Social Security Commissioner; detailed assessment, permission to appeal to the House of Lords refused.

(Order does not form part of approved Judgment)