R (Motherhood Plan) v HM Treasury

The claim challenged the Self-Employment Income Support Scheme (SEISS) on the grounds that its use of average trading profits (ATP) over three tax years unlawfully discriminated against self-employed women who had taken maternity-related leave, in breach of Article 14 read with Article 1 of Protocol 1 of the European Convention on Human Rights, and that the Chancellor breached the Public Sector Equality Duty (PSED) in s149 Equality Act 2010. The court held that the ATP method was a neutral, uniform measure based on historic HMRC data and did not amount to indirect discrimination or to unlawful Thlimmenos-type discrimination.

Even if discrimination had existed, the court found the measure justified: the choice of ATP was rationally connected to the Scheme's purpose, and the design was reasonably founded given the need for rapid delivery, simplicity, fraud mitigation, avoidance of perverse effects and public value for money (the measure was not manifestly without reasonable foundation). The Chancellor had properly considered equality issues and the PSED was not breached.

This judicial review arose after HM Treasury established the Self-Employment Income Support Scheme by direction under the Coronavirus Act 2020 to provide grants to self-employed people whose businesses were adversely affected by the pandemic. The Scheme calculated payments by reference to average trading profits for the three full tax years 2016/17–2018/19, subject to eligibility conditions in the Schedule to the Treasury Direction. The first claimant is a charity campaigning for mothers' employment rights and the second claimant is a self-employed woman who had taken maternity leave during the relevant tax years and received a reduced SEISS award as a result.

Relief sought: declarations and quashing of the Scheme on grounds of (i) unlawful discrimination under Article 14 read with Article 1 of Protocol 1 (both conventional indirect discrimination and Thlimmenos-type discrimination) and (ii) breach of the PSED (s149 Equality Act 2010).

Issues framed by the court: (i) whether the ATP approach constituted unlawful discrimination against women who took maternity-related leave within the relevant tax years; (ii) if discrimination was established, whether it was justified (whether the Scheme was manifestly without reasonable foundation); and (iii) whether the Chancellor complied with the PSED.

Reasoning and material findings: the court accepted that the Scheme fell within the ambit of Article 1, Protocol 1 and that recent maternity leave was a protected "other status" for Article 14. However, the ATP calculation was a uniform rule applied to all claimants and did not impose a pre-condition or hidden barrier of the kind that gives rise to conventional indirect discrimination. The Thlimmenos argument failed because the claimed "uniqueness" of past maternity did not, in the court's view, justify present differential treatment by the Scheme; the disadvantage alleged derived from historic lower earnings rather than from the Scheme itself. On justification, the court applied the manifestly without reasonable foundation test and accepted contemporaneous and witness evidence that speed, reliance on verified HMRC data, fraud mitigation, simplicity, avoidance of perverse outcomes and cost considerations made ATP a reasonable basis for the Scheme. The court also held that equality considerations, and the specific position of mothers who had taken maternity leave, had been considered in ministerial submissions and that the PSED had not been breached. The application for judicial review was dismissed.

This application for judicial review is dismissed. The court found no unlawful indirect discrimination or Thlimmenos-type discrimination arising from the use of average trading profits to calculate SEISS awards; alternatively any difference was justified because the Scheme was not manifestly without reasonable foundation given the objectives of rapid delivery, reliance on existing HMRC data, fraud mitigation, avoidance of perverse effects and value for money. The Chancellor complied with the Public Sector Equality Duty.