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Grayling being quizzed on benefits for non-EU nationals UK will fight EU benefit battle 'every inch of the way'
(about 3 hours later)
Employment Minister Chris Grayling is being questioned by MPs about the UK's dispute with Brussels over welfare entitlements for non-EU nationals. Employment Minister Chris Grayling has said the UK will fight a legal battle over welfare entitlements for non EU-nationals "every inch of the way".
The UK is suing over rules it says may allow citizens from European countries outside the EU to receive benefits without working or paying taxes. The UK is taking legal action against Brussels over rules it says may allow citizens from European countries outside the EU to get benefits without working or paying taxes in the UK.
The government has a wider disagreement with the EU over eligibility criteria for benefits for EU citizens in the UK. Mr Grayling told MPs vital principles were at stake over the issue.
The European Commission says a feared rise in "benefit tourism" is unfounded. And he suggested the UK would have a "big problem" if it lost the case.
Mr Grayling is facing questions from the Commons European Scrutiny Committee, chaired by Conservative MP Bill Cash, which examines EU legislation. Appearing before the Commons European Scrutiny Committee, which examines EU legislation, Mr Grayling defended the recent decision to take the issue of who can claim certain benefits in the UK to the European Court of Justice.
The focus of the hearing is a dispute over whether the UK is obliged to pay benefits in certain circumstances to nationals from Norway, Iceland and Liechtenstein as a result of agreements between the EU and the European Economic Area countries. Precedent
The UK argues it has an opt-out, under existing treaties, from rules introduced last year to "co-ordinate social security systems" between the EU and EEA. The UK argues it has an opt-out, under existing treaties, from rules introduced last year to "co-ordinate social security systems" between the European Union and European Economic Area countries - Norway, Iceland and Liechtenstein.
'Clear message' The UK says it would be obliged to pay benefits in certain circumstances to citizens from those countries living in the UK, including some who are not working.
The UK says it is within its right to stop "non-active" migrants from outside the EU receiving benefits and has taken the case to the European Court of Justice (ECJ) arguing that an EU decision in July was legally unsound and therefore invalid. Mr Grayling said the UK was not picking a fight with the countries concerned which were "long-standing trading partners" and admitted there was not an "immediate pressure of people turning up at the door and saying give us access to benefits".
Ministers say nation states should remain in control of determining their own social security arrangements and the European Scrutiny Committee has previously expressed concerns the new rules could "extend" welfare entitlements to some people who are not working due to sickness, disability, or caring responsibilities. But he said the EU was likely to negotiate economic and political agreements with other countries bordering the EU, such as Ukraine, in the future.
The European Commission says the UK signed the association agreements with existing EEA members which means they are legally obliged to meet the cost of certain benefits - such as pensions - for those working in the UK and paying tax. While the UK had "no intention" of allowing these agreements to contain binding welfare provisions, he feared the UK's ability to exempt itself from such arrangements could be "swept away" unless the legal position was clarified now.
But it says that it only applies to non-EU nationals who are legally entitled to live and work in the UK and that the UK remains in "total control" of who enters the UK and is allowed to work here. "This was not the battleground," he told MPs.
The EU and UK are already at loggerheads over the wider issue of criteria for EU-wide benefits with Brussels saying the UK is contravening EU law by making it easier for UK citizens to obtain certain benefits than nationals of other EU states. "The number of people involved is tiny. This is all about principle. The problem for us is if they turn into a precedent for the future."
Ministers fear taxpayers could be forced into handing out more than £2bn to non-UK citizens - including so-called "benefits tourists" who are not looking for work - if the UK has to comply. 'Poker game'
But Brussels says it has no seen any "concrete evidence" of this and UK must explain how it is going to bring its legislation into line with EU law by the end of the year or face being referred to the ECJ. Ministers say nation states should remain in control of determining their own social security arrangements and are particularly concerned that the proposals could "extend" welfare entitlements to some people who are not working due to sickness, disability, or caring responsibilities.
The UK believes its legal position is sound although Mr Grayling acknowledged that it had initially threatened legal action in the hope the European Commission would back down - in what he characterised as a "poker game".
The European Commission says the UK is legally obliged to meet the cost of certain limited benefits - such as pensions - as a result of signing EEA agreements. But it says it only applies to non-EU nationals legally entitled to live and work in the UK and the UK remains in "total control" of who is allowed to work in the country.
The EU and UK are already at loggerheads over the much wider issue of criteria for EU-wide benefits.
Brussels says the UK is contravening EU law by making it easier for UK citizens to obtain certain benefits than nationals of other EU states but ministers fear taxpayers could have to pay large sums to non-UK citizens - including so-called "benefits tourists" not looking for work - if the UK has to comply.
Mr Grayling said this was the "most immediate and present danger" to the UK and suggested other countries were also worried about the potential ramifications.
"What we are trying to achieve is a clear set of rules which set out when you can or cannot claim benefits in a country which is not your country of origin or residence."
'Right to reside''Right to reside'
At the moment, the UK grants entitlements such as child benefit, child tax credit, state pension credit, jobseekers' allowance and employment and support allowance to those with a "right to reside". Brussels says it has not seen any "concrete evidence" that EU nationals will come to Britain specifically to claim benefits and says the UK must explain how it is going to bring its legislation into line with EU law by the end of the year or face being referred to the ECJ.
The Commission says there are already EU-wide "habitual residence" rules which are strict enough and the UK is imposing an additional test, which indirectly discriminates against non-UK EU nationals. At the moment, the UK grants entitlements such as child benefit, child tax credit, state pension credit, jobseeker's allowance and employment and support allowance to those with a "right to reside".
Factors taken into account when determining "habitual residence" include how long someone has been in the country, how integrated they are within their community, whether they rent or own property and whether their children go to school locally. The commission says there are already EU-wide "habitual residence" rules - focused on length of stay and community ties - which are strict enough and the UK is imposing an additional test, which indirectly discriminates against non-UK EU nationals.
The UK says there is no "statutory definition" of habitual residence and common sense must be used in interpreting the rules as well as relevant legal precedents. While UK nationals can easily prove their "right to reside" based on their UK citizenship, the commission says other EU nationals have their applications heard on a case-by-case basis, which breaches rules giving all citizens equal rights within a single EU labour market.
While UK nationals can easily prove their "right to reside" based on their UK citizenship, the Commission says other EU nationals have their applications heard on a case-by-case basis, which breaches rules giving all citizens equal rights within a single EU labour market.
The European Commission said it was prompted to act by the "huge number" of complaints from EU citizens living in the UK refused access to benefits and its legal arguments are "sound".