Iain Duncan Smith attacks 'enormous' cost of plan to end residency test for anyone arriving to claim benefits
Minister draws up battleplan with 17 other countries to 'end this nonsense'

PUBLISHED: 08:51, 13 September 2012
UPDATED: 09:24, 13 September 2012

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At least 17 countries have vowed to contest demands by the European Commission for an end to the residence test when deciding who can claim benefits

European demands that Britain scrap rules aimed at curbing benefit tourism could cost the taxpayer £155m a year, Iain Duncan Smith has warned.

The Work and Pensions Secretary is in talks with other countries about how to block the move by the European Commission to end the Habitual Residence Test.

It would mean the government having to pay benefits to anyone who arrives in the UK, without having to prove that they have been working or are eligible to live here

Mr Duncan Smith insists the rule is ‘vital’ to stop benefit tourists coming to Britain with the aim of claiming state handouts.

He is challenging the EU’s power to interfere in the policy area and has enlisted the support of other European countries including Germany, Sweden and Finland to end the 'nonsense' idea of allowing open borders rules to give access to state help.

Mr Duncan Smith told MPs: ‘The European Commission wants to end the habitual residence test. As a result, we would have to pay benefits to EU migrants as and when they arrive and they would not have to prove that they have been here, are working and have a residence.

‘I believe that that is fundamentally wrong, as do the Government. The habitual residence test is vital to protect our benefits system and to stop such benefit tourism.

‘I also do not believe that the EU has any rights in that area, and we are working with other countries that feel much the same.
I want to put it on the record that the costs of the proposal could be enormous Iain Duncan Smith

‘I want to put it on the record that the costs of the proposal could be enormous. If we did not have the British residency test, it is estimated that right now the cost would be something in the order of £155 million, although that could change.’

Officials at the Department for Work and Pensions fear the European Commission is ‘chipping away’ at the Habitual Residence Test and the way it allows Britain to protect its benefits.

The ministry's budget is under pressure because Chancellor George Osborne has said he wants to find an additional £10bn in cuts from the welfare bill, something Mr Duncan Smith has resisted.

Figures suggest the majority of migrants who come to Britain do so to work, not claim benefits.

The fear is that removing the test will encourage more people to move from other countries in the EU.

The UK government organised a conference of 17 EU member states including Germany, Netherlands, Sweden, Denmark and Finland who all expressed their concern at the Commission’s proposal.

‘We are working with them on a set of agreed principles that we will present to the EU, which I hope will end this nonsense,’ Mr Duncan Smith added.

He stressed that he wanted to support people who ‘through no fault of their own, fall out of work and we want to do that for our own citizens’.

‘We also accept that for those who have been here for a period of time - hence the habitual residence test - because it is important to support those who are genuinely resident in the UK and delivering something for the UK economy.

‘However, it is not right for us to end up with a system—other countries agree on this—in which someone can literally arrive here and, only days after, decide that they are not working and, therefore, they are eligible for benefits. That would be quite wrong for the British taxpayer.’

Tory MP Marcus Jones said people in his constituency would be “horrified” and the Commission’s proposal while Gareth Johnson said the residence the test is ‘vital in preventing abuse of our welfare state’.

The number of foreign nationals claiming an out of work benefit within 6 months of registering for a national insurance number has fallen since 2002-03. In 2010-11, 6.6 per cent of people were claiming a key out-of-work benefit within 6 months of receiving an NI number.

http://www.dailymail.co.uk/news/article-2202191/Iain-Duncan-Smith-EU-Britain-open-doors-benefit-tourists-cost-taxpayer-155m-year.html