Migration – Social Security – Benefit ‘Magnet’ – Right to Reside – Healthcare – United Kingdom
Demagnetization of social security and healthcare for migrants to the UK
Neville Harris*
Abstract
Over the past two decades, starting with the social security ‘habitual residence’ test,UK governments have maintained a consistent policy of restricting the access of migrants to welfare benefits and public healthcare. It has represented a response toincreased levels of inward migration flow, including anticipated increases arising from enlarged European Union (EU) membership, and the supposed ‘magnetic pull’ of UK welfare and healthcare systems to migrants. Adjustment to the benefit rules affecting EU migrants, which at timeshascome very close to crossing lines of legality under EU law, has lately featured prominently in the UK’s proposals to the EU over the terms of its Union membership. The article focuses on the policy changes and legal developments, including case law, across the areas of social assistance benefits, state retirement pensions and healthcare and assesses their impact, seeking to analyse the changing position of residence as an issue in entitlement and its implications.
1. Introduction
Restrictions to migrants’entitlement to welfare benefits have been pursued by the United Kingdom (UK) governments throughout the past two decades. They intensified under the Coalition government (2010-15), whichsought to ‘protect the integrity of the UK benefits system and discourage benefit tourism’,[1]although its reforms were also consistent with the general policy aim of reducing public expenditure. Recently they were central to the negotiations between the UK and other Member States over the terms of the UK’s EU membership. There has also been an attempt to discourage entry to the UK for the purpose of receiving medical treatment.Reduced support for migrants can be perceived to represent a further shift, in the UK context, towards a national integration model. This rests on the idea that those migrating to a different state must become socially and economically established within it in order to make a legitimate claim on its public resources. This can be contrasted with a residence model, which connotes rights hinging on location alone – and thus the idea, in the EU context, that lawful residence in a state to which there is freedom of movement is sufficient.[2]
Social security and healthcare are the two largest areas of public expenditure in the UK. Millions of citizens depend on welfare benefits or the National Health Service (NHS). Around half of the UK population will, at any one point in time, be in receipt of at least one welfare benefit;[3] and it has been calculated that, in England, within any 36 hour period, there are one million people receiving care from the NHS.[4]Medical and welfare provision are areas of state activity that continue to represent the most substantial pillars of the post-Beveridge welfare state in the UK, delivering public benefits available as of right, albeit – particularly in the case of social security benefits – on a conditional basis. A broadly universalist vision of social protection for all on the basis of need has long predominated and continues to do so notwithstanding a growing policy emphasis on restrictive targeting and public costs containment, manifesting in cutbacks which appear almost inconsistent with the notion of an institutional model of a welfare system.[5]
It is probably still true to say, as Bradshaw argued some twenty years ago, that the UK’s welfare state is a ‘robust institution, firmly embedded in the social and cultural life of the country’.[6] However, there is an apparent ambivalence in public attitudes towards it. Preservation of the NHS has huge public support. In a recent survey almost 90% of adults favoured or strongly favoured continued government support for the NHS as ‘a national health system that is tax funded, free at the point of use, and providing comprehensive health care for all citizens’.[7] Not surprisingly, therefore, all the major political parties have recently expressed a commitment to maintain or increase NHS expenditure. Public spending on the NHS has been protected over the past five years. That is not, however, true of social security expenditure; indeed, there have been significant cutbacks and a ‘benefit cap’ has been introduced setting a maximum limit on a citizen’s overall entitlement from the welfare system.[8] Such restrictions seem to have attracted popular approval. There is evidence that popular attitudes are ‘generally moving in line with the current direction of government policy… There is less enthusiasm about public spending on all types of benefits and an increasing belief that the welfare system encourages dependence’.[9] The Conservative Government elected in May 2015 plans, by 2017-18,to make cuts of £12bn in annual welfare spending,[10] which currently stands at nearly £200 bn.[11]
The influence of popular opinion on the direction of public policy is particularly reflected in the shaping of the welfare rights of migrants and visitors to the UK. Popular concern about high immigration levels – the levels are among the highest, per head of population, within the EU[12] – have had a marked influence, reinforced by suggestions that the availability of ‘generous’ benefits in the UK has been a factor.[13] For example, further time limits on migrants’ benefits, announced in July 2014, were ‘addressing the magnetic pull of Britain’s benefits system’.[14]According to opinion poll data, nearly two-thirds of UK citizens believe migrants receive an unfair share of welfare benefits.[15]Some of the national media have reinforced this view.[16]There has developed a kind of policy blindness to the true picture – that the objective evidence of welfare ‘magnetism’ is not at all strong, especially where skilled persons are concerned.[17] Indeed, the UK Government has quietly acknowledged the absence of proof: ‘None of the evidence we received was able to point to specific research or analysis on the importance of access to social security benefits in the decision to migrate’.[18]
Official UK social security statistics do not currently show recipients’ nationality and thus migrant status.[19]Estimates have, however, been published, based on new individual national insurance identification numbers (NINos) issued. In 2013, 31% of new NINoswere issued to other EU nationals, 32% to persons from Asia and the Middle East and 24% to African immigrants.[20]However, other independent analysis indicates that the proportion of EU origin is far higher and that these migrants’ influx gave rise to two-thirds of the overall net increase of 565,000 in the migrant population between 2011 and 2014.[21]Department for Work and Pensions (DWP)figures show that in the year to December 2015,three-quarters of the 828,000 new adult non-UK NI registrations involved EU nationals.[22] As regards the supposed propensity of migrants to draw welfare benefits, the DWP has calculated from the NINo and other data that, in 2013, among those of working age, 6.7% of non-UK nationals and 16.4% of UK nationals,were, initially at least, claiming a DWP-administered working-age benefit.[23]The data suggest that a considerably greater proportion of migrants are supporting themselves through work than via social security, a finding consistent with evidence that it is work rather than possible benefit entitlement that mainly motivates EU nationals to move to the UK.[24]
In the UK, healthcare provision is not regarded as a facet of social security but an entirely separate area of provision. This field has also seen growing social and political pressures on government to reduce access for non-UK citizens. As discussed further below, the UK has obligations[25] to provide free health services to non-resident European Economic Area (EEA) nationals and some others (such as where it has reciprocal arrangements with the relevant country). On the other hand, the issue of ‘health tourism’has acquired a raised media and political profile. Public disquiet is said to centre in particular on the increased pressure on health services and resultant delays in or shortages of provision for UK citizens. The Chief Executive of the Patients’ Association, an interest group for NHS patients, has referred to ‘longstanding public concern that the current rules regulating access to NHS services [by non-UK citizens] are both too generous… and poorly applied’.[26]Government-commissioned research, published in autumn 2013, indicated that the annual gross cost of NHS provision in England to overseas visitors and temporary migrants was approximately £2 billion, of which between £100 million to £300 million was attributable to ‘health tourism’,[27] namely visiting ‘with the deliberate intent to obtain healthcare to which [the person] is not entitled’.[28] Meanwhile, a press investigation, drawing on data obtained from 100 NHS health bodies (health trusts), has calculated that unpaid bills from foreign patients with liability to pay for treatment totalled £62.8m between 2010-15; officials were reportedly ‘aware of the risk of the NHS being a magnet for the seriously ill from overseas because it will not turn down anyone who needs urgent treatment’.[29]
The law surrounding these policy areasin the UK is particularly complex. This article attempts to analyse the trends within, and the impactof, the evolving legal framework, which has particularly important implications for freedom of movement and equality in the EU context.
2. The organisation of social security by the state in the UK
It would in fact be more accurate to refer to social security system in Great Britain rather than the UK, because Northern Ireland has its own separate administrative and legislative framework for this field of provision.[30] However, constitutional changes will also make the notion of a wholly British welfare system questionable in the future, since the Scottish Government and Parliament are being granted autonomy over a range of social security matters in furtherance of a commitment given by the UK government (supported by main opposition parties) prior to the Scottish independence referendum in September 2014.[31]The proposed areas to be devolved were set out in November 2014 by the cross-party Smith Commission[32]and are now set out in Part 3 of the Scotland Act 2016. However, the main welfare benefits for older people (state pensions and state pension credit) will be ‘reserved’, and therefore remain under national (UK) government control, as will most of the main social assistance benefits,[33] although the Scottish Government will have power to provide various additional (discretionary) payments.[34]
Social security in the UK is currently undergoing its most radical reforms since Beveridge. Particularly significant is the phased introduction of ‘universal credit’ (UC). As shown in Part III of the table below, UC will replacevarious means-tested benefits and (in-work) tax credits (the latter comprise a state supplement to workers on relatively low wages).[35]Also, responsibility for social security administration will largely rest with the DWP alone rather than being spread across the DWP, Her Majesty’s Revenue and Customs (which has administered tax credits and child benefit) and local authorities (responsible for housing benefits and local council tax relief).Both reforms are underpinned by a policy aim of creating a simpler system.[36]Even when UC has been fully introducedthe basic division between contributory (national insurance) and non-contributory (either means-tested or non-means tested) benefitswill continue, although there has been a decline over recent decades in the extent of contributory entitlement, leaving aside retirement pension.It is not possible here to survey in detail the full range of benefits and credits[37]and their historical background.[38]However, table 1 provides a breakdown of the main benefits.
Table 1: Main UK welfare benefits and tax creditsName of benefit / Brief description / EU classification[39]
I Contributory benefits
Contribution-based Employment and Support Allowance (ESA) / Working age incapacity/sickness benefit available for up to 365 days of limited work capability. / Social security benefit (SSB)[40]
Contribution-based Jobseeker’s Allowance (JSA) / Unemployment benefit.Maximum entitlement period of 6 months. / SSB
Bereavement payment and allowance / Lump sum and weekly payments for survivors. / SSB
State Retirement Pension / Old age pension. / SSB
Maternity, paternity or adoption pay / Short-term earnings-replacement paid via employer. There is also maternity allowance. / SSB
Statutory Sick Pay / 28 weeks of employer-paid sickness benefit / SSB
II Non-contributory and (mostly) non-means-tested benefits
Child Benefit / For those with young dependants. / SSB
Disability Living Allowance (DLA) and Personal Independence Payment (PIP) / Weekly disability allowance. Can be claimed by under-65s. DLAis being replaced by PIP. DLA and PIP have care/daily living (CC) and mobility components (MC). / SSB (for CC)[41]or special non-contributory benefit (SNCB)[42] (for MC)[43]
Attendance allowance / For disabled people claiming when aged 65 or over. / SSB
Winter fuel payment / Annual fuel payment for older people. / SSB
III Income-related benefits and tax credits
Universal credit (UC) / Monthly benefit for jobseekers, non-working sick/ disabled people and low paid. / Social assistance (SA)[44]*Income support / Weekly basic benefit for people unable to work due to sickness, disability or caring. / SA[45]
*Income-based JSA / Weekly benefit for the unemployed people with capacity for work and no entitlement to contribution-based JSA. / SA
*Housing Benefit / Assistance towards rent. / SA[46]
*Income-related ESA / For working age personswith limited work capability due to ill health/disability and no entitlement to contributory ESA. / SA[47]
*Working Tax Credit / Credited to persons in low paid work of sufficient hours per week. / SA[48]
*Child Tax Credit / Basic credit for children’s parent/carer on means-tested benefit or in low paid work. / SSB
State Pension Credit / Like income support, but for those of (female) pensionable age. / SNCB
The Social Fund / Funeral or maternity grants and cold weather payments. / SA
* = benefits being replaced by UC
Set against the legislative and administrative framework described above, the analysis next focuses on the three areas selected for coverage in this themed issue: contributory old age pensions; non-contributory (social assistance) benefits; and health care.
3. State retirement pension
For the most part, state retirement pension in the UK is not residence based.[49] Changes to the pension are due to take place in April 2016, under the Pensions Act 2014, as discussed below. At present, and for all those already receiving a pension before April 2016, the pension could fall within one of three categories – A, B or D.[50] Categories A and B are the main categories and are contribution-based. Category D is a non-contributory pension for people aged over 80 and the only one covered by a residence test.[51]Category A pension is based on the claimant’s own national insurance (NI)contributions record, whereas Category B is derived from a spouse’s or civil partner’s (or late spouse’s or civil partner’s)[52] contributions. Work in other countries can count towards satisfaction of the contribution conditions in the UK, in the case of EEA nationals, by virtue of the EU co-ordination rules.[53] For work in non-EEA states, however, satisfaction of contribution conditions will depend on the existence of reciprocal or other agreements between the UK and the relevant state. UK state pension entitlement is exportable, although the rate will be frozen and not uprated beyond that at the departure date from the UK unless the claimant has moved to another EEA state or one with a reciprocal agreement with the UK.
The Pensions Act 2014 changes will establish a new single-tier state pension.[54]There will be no equivalent to the category B pension, since it is believed that the need for this ‘derived entitlement’ will all but disappear. This view is premised in part on increased participation by women in the workplace (contributing to their own pension entitlement), the equalisation of the pension ages for men and women (the age is also being increased from 65 to 66 in 2020), and the reduced number of years of contributions needed for entitlement in one’s own right (making it easier for women who took time out for childcare reasonsto qualify for full pension). Currently around 90% of people reaching pension age qualify in their own right.[55] However, underlying the ending of derived entitlement is also a concern about non-UK nationals securing entitlement to a UK benefit, since therehas reportedly been an increasing incidence of retirement pension claims where a UK national has emigrated and then has married or entered into a civil partnership with a foreign national.[56]
In summary, therefore, regarding state retirement pensions, residence has policy relevance in the UK but is of limited significance in relation to questions of entitlement to the main forms of the pension.
4. Migrant access to social assistance benefits
UK adjustments to migrant entitlement to social assistance benefits have been made in response to case law and specific EU legislative developments (including the Citizenship Directive[57]), in three distinct policy phases: (1) the introduction of the ‘habitual residence test’ in 1994; (2) the response to EU enlargement and the introduction of a ‘right to reside’ test, post-2004; and (3) the introduction of major restrictions, particularly for jobseekers, under the Conservative-led Coalition government 2010-15.There have long been separate restrictions for people seeking asylum, who have been excluded from entitlement to all the main welfare benefits[58] and have had to rely on a distinct (and not generous) system of ‘asylum support’.[59]People who have applied for but been refused asylum are similarly excludedand will only be given a payment card for food, clothing and toiletries.[60]