TMcC -v- Department for Social Development (ESA) [2014] NICom 7 (18 February 2014)

TMcC-v-Department for Social Development (ESA) [2014] NICom 7

Decision No: C11/11-12(ESA)(T)

SOCIAL SECURITY ADMINISTRATION (NORTHERN IRELAND) ACT 1992

SOCIAL SECURITY (NORTHERN IRELAND) ORDER 1998

EMPLOYMENT AND SUPPORT ALLOWANCE

Appeal to a Social Security Commissioner

on a question of law from a Tribunal's decision

dated 21 April 2011

DECISION OF THE SOCIAL SECURITY COMMISSIONER

1. The decision of the appeal tribunal dated 21 April 2011 is in error of law. The error of law identified will be explained in more detail below. Pursuant to the powers conferred on us by Article 15(8) of the Social Security (Northern Ireland) Order 1998, we set aside the decision appealed against.

2. We are unable to exercise the power conferred on us by Article 15(8)(a) of the Social Security (Northern Ireland) Order 1998 to give the decision which the appeal tribunal should have given. This is because there is evidence relevant to the issues arising in the appeal to which we have not had access. Further, there may be further findings of fact which require to be made and we do not consider it expedient to make such findings, at this stage of the proceedings. Accordingly, we refer the case to a differently constituted appeal tribunal for re-determination. In referring the case to a differently constituted appeal tribunal for re-determination, we direct that the appeal tribunal takes into account the guidance set out below.

3. It is imperative that the appellant notes that while the decision of the appeal tribunal has been set aside, the issue of his entitlement to employment and support allowance (ESA), under the decision of 4 May 2010, remains to be determined by another appeal tribunal. In accordance with the guidance set out below, the newly constituted appeal tribunal will be undertaking its own determination of the legal and factual issues which arise in the appeal.

What is this appeal about?

4. This appeal is about the sequential decision-making process in the Department pursuant to:

(i) an initial claim to and award of entitlement to ESA;

(ii) a subsequent determination that a claimant does not have limited capability for work and is no longer entitled to ESA;

(iii) an appeal against the decision at (ii) above;

(iv) the determination of that appeal.

5. The appeal is concerned with the interaction of the specific legislative provisions relating to claims to social security benefits and the discrete conditions of entitlement to ESA. As will be noted below, those provisions, as they applied at the relevant dates, sought to implement a Departmental policy intention to permit entitlement to ESA to continue pending the making and pursuing by an appellant of an appeal against a decision that he no longer has an entitlement following a determination that he does not have limited capability for work.

6. We are aware that there have been subsequent amendments to the specific legislative provisions which are considered in this appeal. Some of those amendments are considered below. It is the case, therefore, that the issue which is active and tangible in the instant case has now been dissipated by those ensuing legislative developments.

7. Finally, this appeal is linked to the appeal in C14/11-12(ESA)(T) where the issues arising are parallel.

Decision-making in the Department

8. As was noted above, the appeal is concerned with the validity of the decision-making process giving rise to the appeal before the appeal tribunal below. Accordingly, that decision-making process will be explored in greater detail below. For the moment, however, the following summary is sufficient.

9. On 1 February 2009 a decision-maker of the Department awarded the respondent an entitlement to ESA from and including 28 January 2009. Subsequently, the respondent was requested to complete a questionnaire outlining his ability to perform various activities. The respondent completed this form on 25 March 2009 and returned it to the Department where it was received on the same date. On 10 September 2009 the respondent was examined by a healthcare professional on behalf of the Department. On 23 September 2009 a decision-maker determined that the respondent did not have limited capability for work. Further the decision-maker superseded the decision dated 1 February 2009 and disallowed entitlement to ESA from and including 23 September 2009.

10. The respondent appealed against the decision dated 23 September 2009 by way of completion for Appeal Form GL24 which was received in the Department on 28 September 2009. On 1 October 2009 a decision-maker decided that the respondent should have an entitlement to ESA from and including 23 September 2009. On 25 March 2010 the respondent’s appeal against the decision dated 23 September 2009 was disallowed by an appeal tribunal. On 30 April 2010 the decision-maker determined that the respondent did not have limited capability for work. On 4 May 2010 the decision-maker superseded the decision dated 1 October 2009 and disallowed entitlement to ESA from and including 4 May 2010. That decision is not in evidence.

11. The respondent appealed against the decision dated 4 May 2010. On 28 May 2010 a decision-maker awarded an entitlement to ESA from 4 May 2010. That decision is also not in evidence but was presumably made, like the decision of 1 October 2009, on the footing that there was an appeal pending. On 21 April 2011 the appeal tribunal disallowed the appeal against the decision dated 4 May 2010.

12. On 4 August 2011 an application for leave to appeal against the decision dated 21 April 2011 was received in the Appeals Service. The application was made by Mr Toner on behalf of the Decision Making Services Unit (‘DMS’) of the Department. On 3 September 2011 leave to appeal was granted by the legally qualified panel member (LQPM). In granting leave to appeal, the LQPM identified, as a point of law:

‘Whether the Tribunal erred in law in finding that the decision maker on 1.10.09 had no power to make an award of Employment and Support Allowance from 23.9.09 when there was already an assessment phase running.’

Proceedings before the Social Security Commissioners

13. On 12 October 2011 the appeal was received in the Office of the Social Security Commissioners (OSSC). On 13 October 2011 written observations on the appeal were sought from the respondent. On 25 January 2012 the Chief Commissioner directed that under the provisions of Article 15(7) of the Social Security (Northern Ireland) Order 1998, the appeal involved a question of law of special difficulty and that it should, accordingly, be dealt with by a Tribunal consisting of three Commissioners. The Chief Commissioner also directed an oral hearing of the appeal.

14. The oral hearing took place on 29 March 2012. The appeal was heard at the same time as the appeal in C14/11-12(ESA)(T). The Department was represented by Mr Young from DMS and the respondent was represented by Mr Hatton of the Law Centre (Northern Ireland). Gratitude is extended to both representatives for their detailed and constructive observations, comments and suggestions.

15. Following the oral hearing of the appeal, the decision of the Upper Tribunal Judge in Great Britain in TW v Secretary of State for Work & Pensions (ESA) ([2012] UKUT 152 AAC, CE/1147/2011) was promulgated. The parties to the proceedings were asked to provide further written observations on the extent to which the principles in that decision were relevant to the issues arising in the present appeal. There then followed a further delay in the promulgation of this decision for which apologies are extended to the parties to the proceedings.

The relevant legislative background

Claims, decision-making and appeals

16. Section 1 of the Social Security Administration (Northern Ireland) Act 1992, as amended, provides that:

‘1(1) Except in such cases as may be prescribed, and subject to the following provisions of this section and to section 3 below, no person shall be entitled to any benefit unless, in addition to any other conditions relating to that benefit being satisfied—

(a) he makes a claim for it in the manner, and within the time, prescribed in relation to that benefit by regulations under this Part of this Act; or

(b) he is treated by virtue of such regulations as making a claim for it.’

Articles 9(1) and (2) of the Social Security (Northern Ireland) Order 1998, as amended, (hereinafter the 1998 Order) provide that:

‘9 (1) Subject to the provisions of this Chapter, it shall be for the Department—

(a) to decide any claim for a relevant benefit;

(b) to decide any claim for a social fund payment mentioned in section 134(1)(b) of the Contributions and Benefits Act; and

(2) Where at any time a claim for a relevant benefit is decided by the Department—

(a) the claim shall not be regarded as subsisting after that time; and

(b) accordingly, the claimant shall not (without making a further claim) be entitled to the benefit on the basis of circumstances not obtaining at that time.’

Articles 11(1) and (3) of the 1998 Order provide that:

‘11(1) Subject to paragraph (3) and Article 36(3), the following, namely—

(a) any decision of the Department under Article 9 or this Article, whether as originally made or as revised under Article 10; and

(b) any decision under this Chapter of an appeal tribunal or a Commissioner,

may be superseded by a decision made by the Department, either on an application made for the purpose or on the Department’s own initiative.

…

(3) Regulations may prescribe the cases and circumstances in which, and the procedure by which, a decision may be made under this Article.’

Regulation 6(2)(q) of the Social Security and Child Support (Decisions and Appeals) (Northern Ireland) Regulations 1999 (hereinafter the 1999 Regulations) provides that:

‘(q) is an employment and support allowance decision where, since the decision was made, the Department has—

(i) received medical evidence from a health care professional approved by the Department, or

(ii) made a determination that the claimant is to be treated as having limited capability for work in accordance with regulation 20, 25, 26 or 33(2) of the Employment and Support Allowance Regulations;’

Regulation 3(j) of the Social Security (Claims and Payments) (Northern Ireland) Regulations 1987, as amended, (hereinafter the Claims and Payments Regs 1987), and as it applied at the relevant date, provides that:

‘Claims not required for entitlement to benefit in certain cases

3. It shall not be a condition of entitlement to benefit that a claim be made for it in the following cases—

…

(j) in the case of an employment and support allowance where the beneficiary has made and is pursuing an appeal against the decision of the Department that he does not have limited capability for work..’

ESA

Section 1(1)-(4) of the Welfare Reform Act (Northern Ireland) 2007 (hereinafter WRA 2007) provides that:

‘1(1) An allowance, to be known as an employment and support allowance, shall be payable in accordance with the provisions of this Part.

(2) Subject to the provisions of this Part, a claimant is entitled to an employment and support allowance if he satisfies the basic conditions and either—

(a) the first and the second conditions set out in Part 1 of Schedule 1 (conditions relating to national insurance) or the third condition set out in that Part of that Schedule (condition relating to youth), or

(b) the conditions set out in Part 2 of that Schedule (conditions relating to financial position).

(3) The basic conditions are that the claimant—

(a) has limited capability for work,

(b) is at least 16 years old,

(d) is in Northern Ireland,

(e) is not entitled to income support, and

(f) is not entitled to a jobseeker's allowance (and is not a member of a couple who are entitled to a joint-claim jobseeker's allowance).

(4) For the purposes of this Part, a person has limited capability for work if—

(a) his capability for work is limited by his physical or mental condition, and

(b) the limitation is such that it is not reasonable to require him to work.’

Sections 2 and 4 of the WRA 2007 provide that:

‘Amount of contributory allowance

2—(1) In the case of a contributory allowance, the amount payable in respect of a claimant shall be calculated by—

(a) taking such amount as may be prescribed,

(b) if in his case the conditions of entitlement to the support component or the work-related activity component are satisfied, adding the amount of that component, and

(2) The conditions of entitlement to the support component are—

(a) that the assessment phase has ended,

(b) that the claimant has limited capability for work-related activity, and

(3) The conditions of entitlement to the work-related activity component are—

(a) that the assessment phase has ended,

(b) that the claimant does not have limited capability for work-related activity, and

(4) Regulations may—

(a) prescribe circumstances in which paragraph (a) of subsection (2) or (3) is not to apply;

(b) prescribe circumstances in which entitlement under subsection (2) or (3) is to be backdated;

(5) For the purposes of this Part, a person has limited capability for work-related activity if—

(a) his capability for work-related activity is limited by his physical or mental condition, and

(b) the limitation is such that it is not reasonable to require him to undertake such activity.

…

Amount of income-related allowance

4—(1) In the case of an income-related allowance, the amount payable in respect of a claimant shall be—

(a) if he has no income, the applicable amount;

(b) if he has an income, the amount by which the applicable amount exceeds his income.

(2) Subject to subsection (3), the applicable amount for the purposes of subsection (1) shall be calculated by—

(a) taking such amount, or the aggregate of such amounts, as may be prescribed, and

(b) if in the claimant's case the conditions of entitlement to the support component or the work-related activity component are satisfied, adding the amount of that component.

(3) Regulations may provide that, in prescribed cases, the applicable amount for the purposes of subsection (1) shall be nil.

(4) The conditions of entitlement to the support component are—

(a) that the assessment phase has ended,

(b) that the claimant has limited capability for work-related activity, and

(5) The conditions of entitlement to the work-related activity component are—

(a) that the assessment phase has ended,

(b) that the claimant does not have limited capability for work-related activity, and

(6) Regulations may—

(a) prescribe circumstances in which paragraph (a) of subsection (4) or (5) is not to apply;

(b) prescribe circumstances in which entitlement under subsection (4) or (5) is to be backdated;

Section 8(5) of the WRA 2007 provides that:

‘(5) Regulations may provide that, in prescribed circumstances, a person in relation to whom it falls to be determined whether he has limited capability for work, shall, if prescribed conditions are met, be treated as having limited capability for work until such time as

(a) it has been determined whether he has limited capability for work, or

(b) he falls in accordance with regulations under this section to be treated as not having limited capability for work.’

Regulations 4 and 6 of the Employment and Support Allowance Regulations (Northern Ireland) 2008 (hereinafter ESA Regs 2008) provided at the material time that:

‘The end of the assessment phase

4.—(1) Subject to paragraph (2) and regulations 5 and 6, the assessment phase in relation to a claimant ends on the last day of a period of 13 weeks beginning on the first day of the assessment phase as determined under section 24(2)(a) of the Act.

(2) If at the end of the period of 13 weeks referred to in paragraph (1), it has not yet been determined whether the claimant has limited capability for work—

(a) the claimant having been assessed in accordance with a limited capability for work assessment; or

(b) as a result of the claimant being treated as having limited capability for work in accordance with regulation 20, 25, 26, 29 or 33(2),

the assessment phase shall end when the limited capability for work determination is made.

…

The assessment phase – claimants appealing against a decision

6. Where the period for which the claimant is entitled to an employment and support allowance commences and the claimant has made and is pursuing an appeal against a decision which embodies a determination that that claimant does not have limited capability for work, the assessment phase in relation to that claimant ends when the appeal is determined by an appeal tribunal constituted under Chapter 1 of Part 2 of the 1998 Order.’

Regulation 30 of the ESA Regs 2008 provides that:

‘Conditions for treating a claimant as having limited capability for work until a determination about limited capability for work has been made

30.—(1) A claimant is, if the conditions set out in paragraph (2) are met, to be treated as having limited capability for work until such time as it is determined—

(a) whether or not the claimant has limited capability for work;

(b) whether or not the claimant is to be treated as having limited capability for work otherwise than in accordance with this regulation; or

(c) whether the claimant is to be treated as not having limited capability for work in accordance with regulation 22 or 23.

(2) The conditions are—

(a) that the claimant provides evidence of limited capability for work in accordance with the Medical Evidence Regulations; and

(b) that it has not, within the 6 months preceding the date of claim, been determined, in relation to the claimant’s entitlement to any benefit, allowance or advantage which is dependent on the claimant having limited capability for work, that the claimant does not have limited capability for work or is to be treated as not having limited capability for work in accordance with regulation 22 or 23 unless—

(i) the claimant is suffering from some specific disease or bodily or mental disablement from which the claimant was not suffering at the time of that determination,

(ii) a disease or bodily or mental disablement from which the claimant was suffering at the time of that determination has significantly worsened, or

(iii) in the case of a claimant who was treated as not having limited capability for work in accordance with regulation 22, the claimant has since provided the information requested under that regulation.

(3) Paragraph (2)(b) does not apply where a claimant has made and is pursuing an appeal against a decision that embodies a determination that the claimant does not have limited capability for work and that appeal has not yet been determined by an appeal tribunal constituted under Chapter 1 of Part 2 of the 1998 Order.’

The 2010 and 2011 amendments to the legislation relating to claims to ESA

17. The Social Security (Miscellaneous Amendments No. 4) Regulations (Northern Ireland) 2010, (hereinafter the 2010 Regs), made alterations to the Claims and Payments Regs 1987 and the ESA Regs 2008, with effect from 28 June 2010 (thus after the appeal made by the claimant with which we are concerned), as follows. A new regulation 3(j), which, it will be recalled, deals with when claims were not required for entitlement to benefit, was substituted in the Claims and Payments Regs 1987, as follows:

‘“(j) in the case of an employment and support allowance where— .

(i) the beneficiary has made and is pursuing an appeal against a decision of the Department that embodies a determination that the beneficiary does not have limited capability for work, and

(ii) that appeal relates to a decision to terminate or not to award a benefit for which a claim was made.’

18. Regulation 6 of the ESA Regs 2008 was omitted. A new regulation 147A was inserted into the ESA Regs 2008, as follows:

‘Claimants appealing a decision

147A.—(1) This regulation applies where a claimant has made and is pursuing an appeal against a decision of the Department that embodies a determination that the claimant does not have limited capability for work.

(2) Subject to paragraph (3), where this regulation applies, a determination of limited capability for work by the Department under regulation 19 shall not be made until the appeal is determined by the appeal tribunal.

(3) Paragraph (2) does not apply where either—

(a) the claimant suffers from some specific disease or bodily or mental disablement from which the claimant was not suffering when entitlement began; or

(b) a disease or bodily or mental disablement from which the claimant was suffering at that date has significantly worsened.

(4) Where this regulation applies and the Department makes a determination—

(a) in a case to which paragraph (3) applies (including where the determination is not the first such determination) that the claimant does not have or, by virtue of regulation 22 or 23, is to be treated as not having limited capability for work; or

(b) subsequent to a determination that the claimant is to be treated as having limited capability for work by virtue of a provision of these Regulations other than regulation 30, that the claimant is no longer to be so treated,

this regulation and regulation 30 apply as if that determination had not been made.

(5) Where this regulation applies and—

(a) the claimant is entitled to an employment and support allowance by virtue of being treated as having limited capability for work in accordance with regulation 30;

(b) neither of the circumstances in paragraph (3) applies, or, subsequent to the application of either of those circumstances, the claimant has been determined not to have limited capability for work; and

the claimant is to be treated as not having limited capability for work with effect from the beginning of the first day of the benefit week following the date on which the Department was notified by the appeal tribunal that the appeal is dismissed, withdrawn or struck out.

(6) Where a claimant’s appeal is successful, subject to paragraph (7), any finding of fact or other determination embodied in or necessary to the decision of the appeal tribunal or on which the appeal tribunal’s decision is based shall be conclusive for the purposes of the decision of the Department, in relation to an award made in a case to which this regulation applies, as to whether the claimant has limited capability for work or limited capability for work-related activity.

(7) Paragraph (6) does not apply where, due to a change of circumstances after entitlement to which this regulation applies began, the Department is satisfied that it is no longer appropriate to rely on such finding or determination.’

19. The new regulation 147A was itself amended by the Social Security (Miscellaneous Amendments No. 2) Regulations (Northern Ireland) 2011, (hereinafter the 2011 Regs). A new paragraph 5A, which took effect from 31 October 2011, was inserted, as follows:

‘(5A) The day specified for the purposes of paragraph (5) is the first day of the benefit week following the date on which the Department either—

(a) receives the clerk of the appeal tribunal’s notification that the appeal is dismissed, withdrawn or struck out, or

(b) discontinues action on an appeal in the circumstances to which regulation 33(9) (Decisions and Appeals) Regulations applies.’

What did the appeal tribunal decide?

20. The statement of reasons for the appeal tribunal’s decision reads as follows:

‘The appeal before the Tribunal was an appeal against a supersession decision made on 4.05.10 in respect of a decision dated 1.10.09 awarding or purporting to award the appellant Employment and Support Allowance from and including 23.09.09.

In considering the appeal the Tribunal considered whether the decision of 1.10.09 was a valid decision. The facts of the case are as set out in Section 4 of the Department submission to the Tribunal, save for the question as to whether the assertion therein was that the decision of 1.10.09 was in accordance with para 6 of the E.S.A. Regulations (N.I.) 2008 is in fact correct. That paragraph states:

“Where the period for which the claimant is entitled to an employment and support allowance commences and the claimant has made and is pursuing an appeal against a decision which embodies a determination that the claimant does not have limited capability for work, the assessment phase in relation to that claimant ends when the appeal is determination by an appeal tribunal …”

In the instant case the Appellant’s assessment phase which commenced on 28.01.09 was thus automatically extended by regulation 6 to 25.03.10, when an Appeal Tribunal upheld a decision superseding the decision of 1.02.09. That extension was not dependent on the making of a further award by the Department (as it purported to do on 1.10.09) and there does not appear to be any legislative basis for the making of a further award when there is already an assessment phase running.

It follows therefore that in the view of this Tribunal the decision of 1.10.09 was one which the decision maker had no power to make. Payments of Employment and Support Allowance were properly made to the Appellant up to 25.03.10 as the appellant’s assessment phase was extended to that date by regulation 6. Payments made after that date were unlawful as they were made on foot of an invalid decision. As the decision maker had no power to make the decision of 1.10.09, there is no right of appeal against the decision of 4.05.10.’

The submissions of the parties

21. In the appeal which was received in OSSC on 12 October 2011, Mr Toner, for DMS, submitted the following:

‘… as the conditions of regulation 30(1), (2)(a) and (3) of the Employment and Support Allowance Regulations were satisfied that the decision maker, on 1 October 2009, under the provisions of regulation 3(j) of the Claims and Payments Regulations, had the power to make an award of employment and support allowance from 23 September 2009 and that the appeal tribunal erred in law by finding that the decision of 1 October 2009 was one that the decision maker had no power to make.

Regulation 4 of the Employment and Support Allowance Regulations (NI) 2008 provides for the ending of the assessment phase whereas regulation 6, until its revocation on 28 June 2010, provided for the ending of the assessment phase where a claimant is pursuing an appeal. I submit that the tribunal erred in law by finding that the assessment period (which under regulation 4 ended with the limited capability for work assessment on 23 September 2009) was extended under regulation 6 with the pursuance of an appeal.’

22. In the case summary prepared for the oral hearing of the appeal, Mr Toner continued to submit that the decision of the appeal tribunal was in error of law on the basis of the ground cited in the original appeal. In his case summary, Mr Hatton, for the respondent, agreed with the Department that the appeal tribunal had erred in finding that the decision dated 1 October 2009 was a nullity which the Departmental decision-maker had the power to make. As a result, the appeal tribunal had erred by finding that there was no valid decision and, therefore, no valid appeal. Mr Hatton made the following additional points:

(i) He submitted that what appeared to be a literal interpretation of the legislation did seem to produce what he described as an ‘anomalous situation’.

‘A claimant who has claimed ESA and then is appealing the decision that is made pursuant to Regulation 3(j) of the Social Security (Claims and payments) Regulations 1987 can appeal the decision which is made pursuant to Regulation 3(j) of the Social Security (Claims and Payments) Regulations 1987 … continuously.’

(ii) The legislation operates so as to require a regulation 3(j) decision to be made when a claimant appeals. Regulation 3(j) was the mechanism which was put in place to ensure that a claimant continues to receive ESA while waiting for determination of an appeal. Mr Hatton submitted that he could understand the appeal tribunal’s view that this produced an ‘absurd result.’

(iii) The intention of Parliament was to ensure that while appealing a determination on capability for work, a claimant should continue to be entitled to ESA while waiting for the appeal to be determined. The legislative mechanism created by Parliament was through regulation 3(j) which removes the requirement for a claim to be made while appealing an adverse ESA determination. Parliament could have chosen alternative mechanisms and, in fact, had retained this legislative mechanism through the 2010 and 2011 amendments to the legislative provisions.

(iv) The appeal tribunal had found that the mechanism through which a claimant continues to receive ESA while appealing was under regulation 6 of the ESA Regs 2008. This reasoning was problematic, in two respects:

‘Firstly, Article 9(2) of the Social Security (NI) Order states that a claim shall not be regarded as subsisting after it has been determined by the Department and a claimant shall not be entitled to benefit on the basis of circumstances not obtaining at the time. The circumstances which exist to allow a person to continue to be entitled to ESA under the operation of Regulation 6 only exist if the person appeals and meets the other conditions under Regulation 30 so as to be treated as having limited capability for work. Article 9(2) specifically refers to making a further claim, which would seem to be the purpose of Regulation 3(j). Secondly, in making the amendments to this legislation, it was Regulation 6 that was removed and Regulation 3(j) retained which would lend support to our argument that Regulation 6 was not the intended mechanism by which entitlement continued once an appeal was lodged. In our view, therefore, the tribunal erred by finding that entitlement continued by Regulation 6 extending the assessment phase when this would appear to be contrary to the primary legislation in Article 9(2) and, using the later amendments as an aid to construction, does not appear to have been the intention of the legislators.’

(v) The appeal tribunal had found that it was impossible to have two assessment phases existing concurrently. The assessment phase is not a condition of entitlement to ESA but operates to dictate the rate of payment.

23. In addition, Mr Hatton submitted that the amendments to the relevant legislation which had taken place in 2010 and 2011 could be used as an aid to the interpretation of the legislative provisions which are relevant in the instant appeal. He restated that the fact that regulation 6 of the ESA Regs 2008 had been revoked lent weight to his submissions that the interpretation which the appeal tribunal had given to the relevant legislative provisions was incorrect.

Analysis

24. We begin by considering the sequence of decisions, determinations and appeals which were made leading to the decision which was under appeal to the appeal tribunal.

(i) The decision of 1 February 2009

25. The decision of 1 February 2009 was a decision made under Article 9(1) of the Social Security (Northern Ireland) Order 1998, as amended, on a claim to ESA made on 28 January 2009. The effect of the decision on the claim was, for the purpose of Article 9(2) of the 1998 Order, that the claim no longer subsisted after that date.

26. Under the provisions of section 24(2)(a) of the WRA 2007, the assessment phase, in relation to the respondent, was the period beginning with the first day of the period for which he was entitled to ESA, namely 28 January 2009. Under the provisions of regulation 4(1) of the ESA Regs 2008 the assessment phase would be expected to last for a period of 13 weeks from 28 January 2009. By the end of the period of 13 weeks from 28 January 2009, however, it had not been determined whether the respondent had limited capability for work in accordance with the limited capability for work assessment. Accordingly, under the provisions of regulation 4(2) the assessment phase continued and would end when the limited capability for work determination was made.

27. To be entitled to ESA, the respondent would have to satisfy, inter alia, the basic condition for limited capability for work under section 1(3)(a) of the WRA 2007. The respondent satisfied that condition because under the provisions of regulation 30(1) of the ESA Regs 2008 he was to be treated as having limited capability for work until such time as it was determined whether or not he had limited capability for work, as long as that he continued to satisfy the condition that he provided evidence of limited capability for work in accordance with the Medical Evidence Regulations, as set out in regulation 30(2)(a) of the ESA Regs 2008. It is clear that the Department accepted that the respondent satisfied the condition of providing evidence of limited capability for work. Indeed, at Tab No 1 there is a reference to the dates on which certificates which amount to such medical evidence were provided.

(i) The determination of 23 September 2009

28. On 23 September 2009 a decision-maker of the Department determined that the respondent did not have limited capability for work. That determination had no effect on the respondent’s entitlement to ESA. Entitlement was to be altered by the further decision of 23 September 2009. The determination should, however, under the provisions of regulation 4(2) of the ESA Regs 2008, ordinarily, bring to end the assessment phase in connection with the respondent. A further decision, however, and the respondent’s actions in connection with that decision, altered that position.

(ii) The decision of 23 September 2009

29. On 23 September 2009 a decision-maker superseded the decision dated 1 February 2009 and disallowed entitlement to ESA from and including 23 September 2009. The decision of 23 September 2009 was made under the provisions of Article 11 of the 1998 Order and regulation 6(2)(q) of the 1999 Regulations. Regulation 6(2)(q) permits supersession where, since the decision was made, the Department has received medical evidence from a healthcare professional approved by the Department.

(iii) The appeal of 28 September 2009

30. This was an appeal against the decision dated 23 September 2009. As was noted above, it had a consequence for what would ordinarily be the effect of the determination of 23 September 2009. The ordinary effect of that determination should have been that, under the provisions of regulation 4(2) of the ESA Regs 2008, the assessment phase in connection with the respondent should have come to an end. However, under the provisions of regulation 6 of the ESA Regs 2008 because the respondent had now made and was pursuing an appeal against a decision which embodied a determination that he did not have limited capability for work, the assessment phase in relation to the respondent would now end when the appeal was determined by an appeal tribunal constituted under Chapter 1 of Part 2 of the 1998 Order.

(v) The decision of 1 October 2009

31. The decision of 1 October 2009 was a decision that the respondent had an entitlement to ESA from and including 23 September 2009. Because the respondent had made an appeal against the decision dated 23 September 2009, the Department implemented its policy of making a ‘pending appeal’ award of entitlement to ESA. In the appeal which was received in OSSC on 12 October 2011, Mr Toner submitted that ‘…as the conditions of regulation 30(1), (2)(a) and (3) of the Employment and Support Allowance Regulations were satisfied and the decision maker, under the provisions of regulation 3(j) of the Claims and Payments Regulations, had the power to make an award of employment and support allowance on 1 October 2009.’

(vi) The decision of the appeal tribunal dated 25 March 2010

32. On 25 March 2010 an appeal tribunal disallowed the appeal against the decision dated 23 September 2009. A copy of the decision notice for the appeal tribunal’s decision was attached to the original appeal submission as Tab No 10. The appeal tribunal decided that the respondent was not entitled to ESA from and including 23 September 2009. Under the provisions of regulation 6 of the ESA Regs 2008 the assessment phase in relation to the respondent, which commenced on 28 January 2009, would now come to an end as the appeal was determined by an appeal tribunal constituted under Chapter 1 of Part 2 of the 1998 Order.

(vii) The determination dated 30 April 2010

33. On 30 April 2010 a decision-maker of the Department determined that the respondent did not have limited capability for work in accordance with the work capability assessment. That determination had no effect on the respondent’s entitlement to ESA. Entitlement was to be altered by the further decision of 4 May 2010.

(viii) The decision dated 4 May 2010

34. On 4 May 2010 a decision-maker of the Department superseded the decision dated 1 October 2009 and decided that the respondent had no entitlement to ESA from and including 4 May 2010. There is no copy of the decision dated 14 May 2010 in the file of papers which is before us. In the case summary prepared for the oral hearing of the appeal Mr Toner submitted that the supersession decision had been made on the ground that there had been a relevant change of circumstances since the decision dated 1 October 2009 had been made. The relevant change of circumstances was stated to be that the appellant no longer had limited capability for work. We will further discuss the nature of the decision to supersede below.

(ix) The appeal dated 26 May 2010

35. On 26 May 2010 an appeal against the decision dated 4 May 2010 was received in the Department.

(x) The decision dated 28 May 2010

36. The decision of 28 May 2010 was a decision that the respondent had an entitlement to ESA from and including 4 May 2010. Once again and because the respondent had made an appeal against the decision dated 4 May 2010, the Department implemented its policy of making a ‘pending appeal’ award of entitlement to ESA. Again, we will further discuss the nature of this decision below.

37. We turn now to the reasoning of the appeal tribunal in the instant case. We are of the view that the reasoning is problematic in two respects – the import of the ‘assessment’ phase and the proper application of regulation 3(j) of the Claims and Payments Regs 1987.

38. In our opinion, the appeal tribunal has misinterpreted the legislative provisions in connection with entitlement to ESA and, in so doing, placed an inappropriate emphasis on the significance of the ‘assessment phase’ in connection with entitlement to ESA. In his original appeal to the appeal tribunal, Mr Hatton had made the following submission, in connection with the ‘assessment phase’:

‘… It is useful to consider the purpose of the assessment phase. It is not a condition of entitlement to ESA that a person is in the assessment phase. The conditions of entitlement to ESA are set out in Section 1 of the 2007 Act. In an appeal such as this, the main condition in dispute is whether the person has limited capability for work. When appealing, the question of limited capability for work is addressed by the provisions of Regulation 30. The person is treated as having limited capability for work while appealing, providing they continue to supply medical evidence in accordance with Regulation 30(2)(a). Regulation 3(j) requires a decision to be made as to their entitlement when the appeal is lodged, and Regulation 30 treats the person as having limited capability for work while appealing. As a result of these two provisions, the person appealing meets the conditions of entitlement until at least the appeal is resolved.

… It is only at this stage that the assessment phase needs consideration. The assessment phase operates so as to dictate the rate of payment as the additional work- related activity component or support component can only be included in a person's claim when the assessment phase has ended. Regulation 6 operates so as to ensure that when appealing the person is entitled only to the assessment phase rate of ESA. In our view, it is immaterial if there is one or two assessment phases running and there is no need to look for express provision which would allow for a second claim during the extended assessment phase. The tribunal's findings attached too much weight to the significance of the assessment phase to the extent that it would render invalid a decision which the legislation requires to be made under Regulation 3(j). This cannot be correct when the assessment phase operates only to dictate the rate of payment and is not a condition of entitlement. Again, the fact that Regulation 6 has been removed but the assessment phase continues through the new provisions, along with the retention of Regulation 3(j), lends support to our submissions.’

39. We agree with Mr Hatton that it is not a condition of entitlement to ESA that a person is in the assessment phase. As noted by him, the conditions of entitlement to ESA are set out in section 1 of the WRA 2007. One of the principal conditions of entitlement is that a person has limited capability for work. It is inevitable, however, that following the making of a claim to ESA, it will take a period of time before a decision-maker can determine whether the claimant has limited capability for work and, accordingly, entitled to ESA. The decision- maker has to gather evidence which, invariably, includes the completion of a questionnaire by the claimant and the compilation of a report by a healthcare professional following an examination of the claimant. One possibility might have been for the legislative scheme to defer any payment of ESA pending the determination of limited capability for work and, accordingly, entitlement to ESA and back-date any payment to the date of claim where the decision-maker was satisfied that the condition of limited capability for work was satisfied for the entirety of that period.

40. Instead, regulation 30(1) of the ESA Regs 2008 permits a claimant to be treated as having limited capability for work until such time as it is determined whether or not he has limited capability for work, as long as he continues to satisfy the condition that he provides evidence of limited capability for work in accordance with the Medical Evidence Regulations, as set out in regulation 30(2)(a) of the ESA Regs 2008. The period between claim and determination of limited capability for work is the assessment phase. Regulation 4(1) of the ESA Regs 2008 provides that the assessment phase is expected to last for a period of 13 weeks. By the end of the period of 13 weeks if it has not been determined whether the respondent had limited capability for work in accordance with the limited capability for work assessment, then under the provisions of regulation 4(2) the assessment phase continues and ends when the limited capability for work determination was made. During the assessment phase - whether for up to 13 weeks under regulation 4(1) or extended under regulation 4(2) - the claimant will be paid ESA at the relevant assessment phase rate. That is the real and effective significance of the assessment phase.

41. As was noted above, the legislative provisions pertaining to entitlement to ESA pending the making of an appeal were amended in 2010 and were the subject of further amendment in 2011. In the Explanatory Memorandum to the Social Security (Miscellaneous Amendments No. 4) Regulations 2010 some guidance was given, at paragraphs 3.3 and 3.4, as to the background and purpose of ESA and the place and effect of the assessment phase:

‘3.3 Employment and Support Allowance has two phases, with different rates of benefit payable: the assessment phase rate and the high, main phase, rates. Where an Employment and Support Allowance award is disallowed following a medical assessment and the claimant appeals, where that person continues to provide medical evidence of limited capability for work, Employment and Support Allowance will continue to be paid at the assessment rate, without the need for a further claim, pending the outcome of the appeal (the “pending appeal award”).

3.4 The intention of the pending appeal award is to provide some sort of payment of benefit while an appeal tribunal considers whether or not the decision maker was correct to find that the claimant did not have limited capability for work. In itself this award is not intended to count as a period of limited capability for work in terms of qualifying for the higher main phase rates of benefit (the work-related activity component or the support component). It is the determination of limited capability for work which establishes continuing entitlement to benefit and if higher rates are payable after 13 weeks of entitlement.’

42. The emphasis is on rates of benefit payable. In our view, the ending of an assessment period in respect of a claimant does not affect further entitlement to ESA provided that the claimant continues to satisfy the conditions of entitlement to ESA. That latter rider is important because the conditions of entitlement to any social security benefit include the requirement under section 1 of the Administration Act to make a claim to it.

43. The 2010 amendments were introduced to attempt to rectify certain problematic aspects of the original ESA Regs 2008. One of these was the inconsistency and tension between the original regulation 6, regulation 3(j) of the Claims and Payments Regs 1987 and sections 2(2)(a), 2(3)(a), 4(4)(a) and 4(5)(a) of the WRA 2007. Those latter provisions imposed a condition of entitlement to either the support or work-related activity component of ESA that the assessment period had ended. The problem was the determination of the appropriate date for back-dating the support or work-related activity component where the pending appeal was successful. Part of the solution was to create a new regulation 147A to the ESA Regs 2008 and the insertion of a new regulation 3(5E) into the 1999 Regulations. The latter permitted revision of the pending appeal award where the appeal was successful and payment of the relevant higher rate support or work-related activity component. The removal of regulation 6 confirms, therefore, that it had no significance in connection with the conditions of entitlement to ESA but, rather, dictated that the rate of payment of ESA during a pending appeal award would continue to be the assessment phase rate.

44. The decision of the appeal tribunal relied, in part, on an interpretation of the relevant legislative provisions and on a conclusion that there ‘… does not appear to be any legislative basis for the making of a further award when there is already an assessment phase running.’ The appeal tribunal argued that the making of the appeal, on 28 September 2009, against the decision dated 23 September 2009 had the effect of extending the assessment phase. The appeal tribunal went on to conclude that the Department had no power, on 1 October 2009, to make a further award of entitlement to ESA during the period of an extant single assessment phase and which extended entitlement beyond the termination of that assessment phase. We are of the view that that reasoning is erroneous. It is based on a supposition that the extension of the assessment period equates to an extension of entitlement. The effect of the decision of 23 September 2009 was that the respondent had no entitlement to ESA. He could not gain any such entitlement simply by the extension of the assessment period through the making of an appeal against the decision dated 23 September 2009. Entitlement had to be by some other method.

45. The decision-making process was such that it was only on 1 October 2009 that it was decided that the appellant should have an entitlement to ESA pending the appeal made on 28 September 2009 and that the entitlement should be from 23 September 2009.

46. A further consequence of the appeal tribunal’s thinking is as follows. The appeal tribunal reasoned that the appellant remained entitled to ESA at the assessment phase rate because the making of an appeal against the decision dated 23 September 2009 had the effect of extending the assessment phase. That would last, according to the appeal tribunal, until at least 25 March 2010. The subsequent decision of the appeal tribunal, on 25 March 2010, was that the appeal against the decision dated 23 September 2009 was to be disallowed and that the appellant would have no entitlement not from 25 March 2010 but from 25 September 2009. Where would that leave the entitlement based, as the appeal tribunal reasoned, on the extension of the assessment phase to the date of the appeal tribunal hearing on 25 March 2010? Was the benefit, accordingly, overpaid?

47. We are of the view that, to the extent that the appeal tribunal’s reasoning was based on an erroneous interpretation of the significance of regulation 6 and an inappropriate emphasis on the assessment period as a condition of entitlement to ESA, its decision is in error of law.

48. That is not the end of the matter, however. We have stated that it is axiomatic that entitlement to a social security benefit is dependent on a claimant satisfying the conditions of entitlement to that benefit. As was noted above, section 1(1) of the Social Security Administration (Northern Ireland) Act 1992, as amended, imposes a condition that ‘… no person shall be entitled to any benefit unless, in addition to any other conditions relating to that benefit being satisfied … he makes a claim for it in the manner, and within the time, prescribed in relation to that benefit.’ We have to be certain, therefore, that in connection with the decision giving the respondent entitlement to ESA the ‘claim’ condition has been satisfied.

49. In this case, the decision which requires close examination is the decision dated 1 October 2009. As described above, this was a decision that the respondent had an entitlement to ESA from and including 23 September 2009. On 4 May 2010 a decision-maker of the Department superseded the decision dated 1 October 2009 and decided that the respondent had no entitlement to ESA from and including 4 May 2010. It was the decision dated 4 May 2010 which was on appeal to the appeal tribunal. Nonetheless, the appeal tribunal concluded that the decision dated 1 October 2009 was a ‘nullity’ as the Department could not make a decision awarding entitlement to ESA during the period of an extant assessment phase and which extended entitlement beyond the termination of that phase.

50. In the appeal which was received in OSSC on 12 October 2011, Mr Toner submitted that ‘…as the conditions of regulation 30(1), (2)(a) and (3) of the Employment and Support Allowance Regulations were satisfied that the decision maker, on 1 October 2009, under the provisions of regulation 3(j) of the Claims and Payments Regulations, had the power to make an award of employment and support allowance from 23 September 2009 and that the appeal tribunal erred in law by finding that the decision of 1 October 2009 was one that the decision maker had no power to make.’ That submission requires a closer examination of the provisions of regulation 3(j) of the Claims and Payments Regs 1987.

51. The requirement in section 1(1) of the Social Security Administration (Northern Ireland) Act 1992, as amended, that entitlement to a social security benefit is predicated on the requirement for the claimant to make a claim to it, in a prescribed time and manner is subject to the exception for ‘such cases as may be prescribed’. As was noted above, regulation 3(j) of the Claims and Payments Regs 1987, and as it applied at the relevant date, provided that:

‘Claims not required for entitlement to benefit in certain cases

3. It shall not be a condition of entitlement to benefit that a claim be made for it in the following cases—

…

52. This version of regulation 3(j) was inserted into the Claims and Payments Regs 1987 by regulation 13(3)(b) of the Employment and Support Allowance (Consequential Provisions) Regulations (Northern Ireland) 2008.

53. We have noted above that on the introduction of ESA it was the policy intention of the Department to permit entitlement to ESA to continue pending the making and pursuing by an appellant of an appeal against a decision that he does not have limited capability for work. That policy intention is set out in some detail in paragraph 3.4 of the Explanatory Memorandum to the Social Security (Miscellaneous Amendments No. 4) Regulations 2010, noted above. The determination that the claimant does not have limited capability for work will, inevitably, have resulted in the ending of an existing entitlement to ESA. Accordingly, for there to be a further award of ESA pending the appeal, the conditions of entitlement to ESA would have to be satisfied. The usual conditions of entitlement to any social security benefit include the making of a claim to that benefit. The legislative mechanism adopted by the Department was to obviate the requirement to make a claim by prescribing that a claim should not be required in these circumstances.

54. The important point to note, however, is that an existing entitlement to ESA will have ended and, accordingly, a new decision making a new award of entitlement would have to be made. In the instant case, the effect of the decision of 23 September 2009 was that the respondent had no entitlement to ESA from and including that date. To gain an entitlement to ESA pending the appeal against the decision dated 23 September 2009 a decision would have to be made that he had an entitlement to ESA. That decision was made on 1 October 2009. It gave a new entitlement to ESA from and including 23 September 2009.

55. We are of the view that a decision-maker should be satisfied that the conditions of entitlement to a social security benefit are met. It seems to us, however, that, in the circumstances of a case such as this, it would be relatively easy for the decision-maker to check whether the other conditions of entitlement to ESA are satisfied. There would, for example, be an existing claim to ESA where details such as age, residence and presence could be checked. Further, there may be an extant medical certificate covering part of the ‘pending appeal’ period. If so, then the advice to decision-makers, as set out in the Decision Makers’ Guide is to make the award from the ‘… last date of the award which is the subject of the appeal’ or, if not, from the date ‘… the medical evidence begins if later.’

56. It is clear to us that the enabling power in section 1(1) of the Social Security Administration (Northern Ireland) Act 1992, as amended, is sufficiently broad to allow for the making of regulations which remove the requirement for the making of a claim. Regulation 3 of the Claims and Payments Regulations 1987 has become, in our view, a repository for exclusions from the requirement to make a claim as a condition of entitlement to a social security benefit. It is arguable that each prescribed case in regulation 3 is discrete and that it is not possible to draw common themes of construction from the regulation as a whole. It seems to us that regulation 3(j) permits entitlement to ESA, without the requirement for a claim, providing the circumstances set out continue to exist and providing that such other conditions of entitlement to ESA as are applicable in the circumstances of that case, are satisfied. Applying that interpretation to the facts of the instant case, the decision-maker, on 1 October 2009 was satisfied that the relevant conditions of entitlement to ESA were satisfied in that the appellant had, at that stage, made and was pursuing an appeal against a decision of the Department that he did not have limited capability for work.

57. As was noted above, on 4 May 2010 a decision-maker of the Department superseded the decision dated 1 October 2009 and decided that the respondent had no entitlement to ESA from and including 4 May 2010. There is no copy of the decision dated 4 May 2010 in the file of papers which is before us. In the case summary prepared for the oral hearing of the appeal Mr Toner submitted that the supersession decision had been made on the ground that there had been a relevant change of circumstances since the decision dated 1 October 2009 had been made. The relevant change of circumstances was stated to be that the appellant no longer had limited capability for work.

58. We had asked for submissions on the approach taken to the issue of supersession by Judge Jupp in the case of TW v Secretary of State for Work and Pensions [2012] UKUT 154. We subsequently became aware of the decision of Judge Turnbull in CG v Secretary of State for Work and Pensions [2011] UKUT 384. Judge Jupp accepted that, in order to terminate a Departmental award of ESA based on treating a person as having limited capability for work pending an appeal, the Department would have to supersede on the basis that the claimant no longer had limited capability for work under regulation 30(1)(a) of the ESA Regulations (paragraph 16). By contrast, Judge Turnbull held that the Department was entitled to supersede on the basis that the claimant no longer satisfied the conditions for being treated as not having limited capability for work (paragraph 9). While we have not heard argument on this point, we prefer the approach of Judge Turnbull on this issue.

59. Neither judge referred to the decision of Judge Howell QC in R(IB)8/04; however, we consider that the circumstances of that case are to be distinguished from the situation where an award has been made without a claim under regulation 3(j) of the Claims and Payments Regulations 1987.

60. We do not accept Mr Toner’s submission that the Department’s decision of 4 May 2010 should have been made on the ground that the appellant no longer had limited capability for work. Rather, it would have been more properly made on the ground that the appellant no longer satisfied the conditions for being treated as having limited capability for work. This analysis addresses what Mr Hatton described as the ‘anomalous situation’ of the potential for a series of continuous appeals. Any further appeal, brought against the supersession decision, would not be an appeal from a decision that embodies a determination that the claimant does not have limited capability for work. Rather, as we indicate, it would be an appeal from a decision that the claimant can no longer be treated as having limited capability for work. Therefore, regulation 3(j) of the Claims and Payments Regulations 1987 would not have application. In our view, this has the implication for the present case that the Department’s purported decision of 28 May 2010 had no lawful basis.

Disposal

61. The decision of the appeal tribunal dated 21 April 2011 is in error of law. Pursuant to the powers conferred on us by Article 15(8) of the Social Security (Northern Ireland) Order 1998, we set aside the decision appealed against.

62. We direct that the parties to the proceedings and the newly constituted appeal tribunal take into account the following:

(i) the decision under appeal is a decision of the Department, dated 4 May 2010 in which a decision-maker of the Department superseded the decision dated 1 October 2009 and decided that the respondent had no entitlement to ESA from and including 4 May 2010;

(ii) the Department is directed to produce a copy of this decision, identifying grounds of supersession;

(iii) alternatively, the Department is directed to review and remake the decision in accordance with the guidance we have given; any appeal rights should be unaffected by this as the resulting decision is unlikely to be more advantageous to the appellant than the decision before it was revised;

(iv) the Department is directed to prepare a further submission which sets out the decision-making history relevant to this appeal, which provides details of any subsequent claims to ESA and the outcome of any such claims to the appeal tribunal to which the appeal is being referred. The appeal tribunal is directed to take any evidence of subsequent claims to ESA into account in line with the principles set out in C20/04-05(DLA);

(v) it will be for both parties to the proceedings to make submissions, and adduce evidence in support of those submissions, on all of the issues relevant to the appeal; and

(vi) it will be for the appeal tribunal to consider the submissions made by the parties to the proceedings on these issues, and any evidence adduced in support of them, and then to make its determination, in light of all that is before it.

(signed) K Mullan

Chief Commissioner

O Stockman

Commissioner

C Ward

Deputy Commissioner (NI)

18 February 2014

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	Northern Ireland - Social Security and Child Support Commissioners' Decisions
You are here: BAILII >> Databases >> Northern Ireland - Social Security and Child Support Commissioners' Decisions >> TMcC -v- Department for Social Development (ESA) [2014] NICom 7 (18 February 2014) URL: http://www.bailii.org/nie/cases/NISSCSC/2014/7.html Cite as: [2014] NICom 7

Northern Ireland - Social Security and Child Support Commissioners' Decisions