Information Note on the Court’s case-law No. 113
November 2008
Carson and Others v. the United Kingdom - 42184/05
Judgment 4.11.2008 [Section IV]
Article 14
Discrimination
Absence of right to index-linking for pensioners resident in overseas countries which had no reciprocal arrangements with the United Kingdom: no violation
[This case was referred to the Grand Chamber on 6 April 2009]
Facts: This case concerned allegedly discriminatory rules governing the entitlement to index-linking of the State pension. Under the rules, pensions were only index-linked if the recipient was ordinarily resident in the United Kingdom or in a country having a reciprocal agreement with the United Kingdom on the uprating of pensions. Those resident elsewhere continued to receive the basic State pension, but this was frozen at the rate payable on the date they left the United Kingdom. The 13 applicants had spent most of their working lives in the United Kingdom, paying National Insurance contributions in full, before emigrating or returning to South Africa, Australia or Canada, none of which had a reciprocal agreement with the United Kingdom on pension uprating. Their pensions were accordingly frozen at the rate payable on the date of their departure. Considering this to be an unjustified difference in treatment, the first applicant sought judicial review of the decision not to index-link her pension. However, her application was dismissed in 2002 and ultimately on appeal before the House of Lords in 2005, inter alia, on the grounds that she was not in an analogous, or relevantly similar, situation to a pensioner resident in the United Kingdom or in a country where up-rating was available through a reciprocal agreement.
Law: (a) Scope: In the circumstances of the applicants' case, which involved the different application of the same pensions legislation to persons depending on their residence and presence abroad, ordinary residence, like domicile and nationality, was to be seen as an aspect of personal status falling within the scope of Article 14.
(b) Analogous situation: As to whether the applicants were in a relevantly similar position to pensioners entitled to index-linking, the Court noted that since the purpose of a Contracting State's social-security and pensions system was to provide a minimum standard of living for those resident within its territory, those residing outside that territory were not in a relevantly analogous situation. The Court was also hesitant to find an analogy between pensioners living in countries where uprating was available through a reciprocal agreement and those where it was not, as National Insurance contributions were only one part of the United Kingdom's complex system of taxation and the National Insurance Fund was just one of a number of sources of revenue used to pay for the United Kingdom's social security and national health systems. The applicants' payment of National Insurance contributions during their working lives in the United Kingdom was not therefore any more significant than the fact that they might have paid income tax or other taxes while domiciled there. Nor was it easy to compare the respective positions of residents in different States owing to differences in social-security provision, taxation, rates of inflation, interest and currency exchange.
(c) Justification: Any difference in treatment had, in any event, been objectively and reasonably justified. While there was some force in the applicants' argument that an elderly person's decision to move abroad might be driven by a number of factors, including the desire to be close to family members, place of residence was nonetheless a matter of choice. In that context, the same high level of protection against differences of treatment was not needed as with differences based on an inherent characteristic, such as gender or racial or ethnic origin. Moreover, the respondent State had taken steps through a series of leaflets to inform United Kingdom residents moving abroad about the absence of index-linking for pensions in certain countries. The pattern of reciprocal agreements was the result of history and perceptions in each country as to the perceived costs and benefits of such arrangements. They represented whatever the Contracting State had from time to time been able to negotiate without placing itself at an undue economic disadvantage and applied to provide reciprocity of social security cover across the board, not just in relation to pension uprating. Accordingly, the respondent State had not exceeded its very wide margin of appreciation to decide on matters of macro-economic policy by entering into such arrangements with certain countries but not others.
Conclusion: no violation (six votes to one).
© Council of Europe/European Court of Human Rights
This summary by the Registry does not bind the Court.
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