Michaela Simkova v Secretary of State for Work and Pensions

Universal Credit is a single, composite benefit. Regulation 883/2004 does not permit a court to disaggregate one of its components into a separate family benefit unless domestic law has already made that component a distinct, separately claimable entitlement. The Regulation coordinates national social-security systems; it does not harmonise them or dictate their structure. The CJEU decisions concerning severable components involved benefits already separated under national legislation. Generalised composite benefit schemes therefore remain outside the Regulation where they do not correspond to a listed social-security risk. A reference under Article 158 of the Withdrawal Agreement is unnecessary where the legal position is sufficiently clear.

The appellant, a Slovakian national resident in England, claimed a child element of Universal Credit for her son, who lived and attended school in Slovakia. The First-tier Tribunal allowed her appeal against revision of the award. The Upper Tribunal allowed the Secretary of State’s appeal, holding that the child element was not a legally separate entitlement under Regulation 883/2004. The appellant appealed to the Court of Appeal and sought a reference to the CJEU under Article 158 of the Withdrawal Agreement. The central issue was whether the child element could be severed from Universal Credit and treated as an exportable family benefit.

Lord Justice Green gave the leading judgment, with which Lady Justice Elisabeth Laing and Lord Justice Lewison agreed. The appeal was dismissed and no reference was made to the CJEU.

1. Nature of the Regulation. Regulation 883/2004 establishes coordination, not harmonisation. It preserves Member States’ freedom to organise and configure their social-security systems. Its purpose is to facilitate free movement and prevent overlapping application of national systems, not to require a particular domestic benefit structure.
2. No general severance doctrine. The Regulation contains no implied principle allowing a component of a single, blended and means-tested benefit to be converted into a separate legally enforceable benefit. The references to severed or severable benefits in the CJEU authorities concerned components already made distinct and separately claimable under national law.
3. Authorities. Hoeckx remained good law: a general social benefit outside the listed branches was not a social-security benefit for the purposes of the coordination regime. Commission v European Parliament and Council and Bartlett, Gonzalez Ramos and Taylor concerned the mobility component of Disability Living Allowance, whose components were already clearly separated by domestic legislation. They did not establish a novel doctrine applicable to Universal Credit. The observations relied on from the Advocate General’s Opinion in CG addressed a different issue and did not support severance.
4. Family-benefit provisions. The exportability rule in Article 67 and the definition of family member in Article 1(i)(3) could not assist unless the child element first qualified as a separate family benefit within the Regulation. They did not themselves sever the child element from Universal Credit.
5. Reference and disposition. The legislative scheme and CJEU jurisprudence made the answer sufficiently clear. Article 158 of the Withdrawal Agreement therefore did not require a reference. The appeal was dismissed.

• Court of Appeal (Civil Division): dismissed the appeal and declined to make a reference to the CJEU.
• Upper Tribunal: allowed the Secretary of State’s appeal from the First-tier Tribunal decision in [2023] UKUT 44 (AAC).
• First-tier Tribunal: allowed the appellant’s appeal on 17 February 2020.