Secretary of State for Work & Pensions v Yates

For a person abroad, disqualification from increases under an up-rating order is generally assessed by reference to status immediately before the order’s appointed date and operates for the order’s whole period. The ordinary week-by-week approach is displaced. Under regulation 5(3)(aa) of the Social Security (Persons Abroad) Regulations 1975, a woman who first becomes entitled to a Category B pension on marriage may be assessed by reference to her spouse’s position for current and earlier orders. That provision does not require a fresh assessment when she later becomes a widow while remaining entitled to the same category of pension at a different rate. Ambiguous drafting should be confined to the provision’s purpose and read consistently with the statutory scheme.

Mrs Yates, resident in Canada, became entitled to a Category B retirement pension on marrying Mr Yates, whose pension had been frozen because he lived abroad. After his death in May 2002, the Secretary of State maintained her pension at frozen rates. An appeal tribunal rejected her challenge, but Mr Commissioner Mesher held that, from the date of death, regulation 5(3)(c) permitted payment by reference to more recent rates.

The Secretary of State appealed to the Court of Appeal. Mrs Yates died before the Commissioner’s decision, and her step-son continued the proceedings. The appeal concerned whether status under regulation 5(3) was fixed at the appointed date for the relevant up-rating order or had to be reconsidered on the spouse’s death. A separate Article 14 issue was not determined.

Appeal allowed. The Court of Appeal held that Mrs Yates’s status under the Persons Abroad Regulations remained fixed by reference to the relevant appointed date and remitted the matter to the Upper Tribunal.

1. The general policy in section 113 of the Social Security Contributions and Benefits Act 1992 was to exclude persons absent from Great Britain from benefits, subject to regulatory exceptions. Regulation 5(3) therefore had to be read as a scheme governing each up-rating order for its whole period. The ordinary week-by-week approach was displaced.
2. The introductory words of regulation 5(3) made the appointed date the normal reference point. Regulation 5(3)(aa) addressed the specific case of a woman first becoming entitled to a Category B pension on marriage. It enabled her status under the current and earlier up-rating orders to be established by reference to her husband’s position.
3. That special mechanism did not require a fresh assessment when Mrs Yates’s husband died. She remained entitled to the same category of pension, although the rate changed under section 48A(4) and section 44(4) of the 1992 Act. Her status had already been fixed under regulation 5(3)(aa), so regulation 5(3)(c) was irrelevant. The Commissioner therefore erred in redetermining her position in May 2002.
4. Carnwath LJ expressed doubt, obiter, about the Commissioner’s separate interpretation of regulation 5(3)(c). He suggested that an established disqualification might continue from year to year while the pension remained within a relevant subparagraph, but expressed no concluded view because the point had not been argued by the Secretary of State.

The Court of Appeal was not deciding the Article 14 issue and considered itself bound by R (Carson) v Secretary of State for Work and Pensions [2005] UKHL 37; [2006] 1 AC 173. The matter was remitted to the Upper Tribunal for review in light of the final Strasbourg decision. Lord Justice Rix and Lord Clarke MR agreed.

1. Court of Appeal (Civil Division): In [2009] EWCA Civ 479, the appeal was allowed and the matter was remitted to the Upper Tribunal.
2. Social Security Commissioner: Mr Commissioner Mesher, on 1 July 2008, held that Mrs Yates’s pension was to be calculated by reference to rates current after her husband’s death.
3. Appeal tribunal: The appeal tribunal rejected Mrs Yates’s appeal on 19 April 2006.