The European Union Commission says it will take Britain to court over its benefits system, saying the current UK system discriminates against other EU nationals.
BRUSSELS, BELGIUM (REUTERS) - The European Commission said on Thursday (May 30) that it would take Britain to Europe's top court over its benefits rules, accusing it of denying thousands of EU citizens living in Britain the right to welfare - a claim London rejects.
The Commission says it received complaints from citizens who worked in Britain and paid taxes to theBritish government but were denied unemployment benefits when they were made redundant.
EU spokesman Jonathan Todd said as many as thousands of EU citizens may have been denied their right to welfare.
"On the basis of the figures given to us by the UK authorities, potentially, tens of thousands of EU nationals legally living in the UK have been refused access to social security benefits, to which they are entitled," Todd said.
Official figures showed London refused benefits to 28,400 EU citizens living in Britain between 2009 and 2011, Todd said, out of more than 42,000 who applied.
The European Commission said that two years of talks had failed to resolve a conflict over Britain's rules that require EU nationals to pass a special test to access a range of benefits including unemployment payments.
"We have been talking to the UK authorities for more than two years now, in order to try to find a solution, but the difference between us is fundamental. The UK authorities claim that their system is fully compliant with EU law. On the basis of the case-law of the court of Justice, we cannot agree. Therefore there is no alternative but to resolve the issue before the Court of Justice in Luxembourg," Todd said
The European Court of Justice in Luxembourg must now rule on the issue, a lengthy process but which could end in large fines for Britain if the court were to find it in breach of EU law.
The EU commission denied accusations that its decision to go to the Court of Justice was political or that dropping Britain's special test would lead to so-called benefits tourism.
Britain signed up to EU rules in 2009 allowing EU nationals living and working in the UK to receive such benefits, while British citizens living abroad can receive benefits there.
The British government, which is trying to cut its budget deficit while addressing public unease about immigration and abuse of its welfare system, says it will continue to enforce a "right to reside" test and pursue further benefit reforms.