Whittaker v R & C Commissioners
| Jurisdiction | England & Wales |
| Judgment Date | 27 March 2006 |
| Date | 27 March 2006 |
| Court | Special Commissioners (UK) |
special commissioners decision
Michael Tildesley OBE
The Appellant appeared in person
John Cormack, HM Inspector of Taxes for the Respondents
National Insurance - Married Woman's Election to pay Reduced Rate Contributions - Appellant's evidence that she made no election unconvincing - Respondents' evidence overwhelming despite the fact that original certificate of election had been destroyed in accordance with its Records Management Policy - Appeal Dismissed
1. The Appellant was appealing against the decision of the Respondents dated 13 April 2005 which stated that
From 1 July 1968 to 5 April 1975 the Appellant was not liable to pay National Insurance contributions, and from 6 April 1975 to 6 February 2005 the Appellant was liable to pay married woman's reduced rate contributions.
2. The issue in dispute was whether the Appellant made an election to pay married woman's reduced rate National Insurance contributions from 1 July 1968.
3. The Appellant asserted that she did not make the election in July 1968. She relied on the fact that the Respondents were unable to produce the document making the election signed by her.
4. The Respondents accepted that the original election document was destroyed under their "Records Management Policy" which has ministerial approval. The Respondents, however, submitted that the evidence of official records, the refunds accepted by and the Certificate of Election held by the Appellant overwhelmingly demonstrated that the Appellant freely elected to pay reduced rate contributions on 1 July 1968.
5. The outcome of the Appeal will depend upon whether the Appellant can satisfy me on the balance of probabilities that she did not elect to pay reduced rate contributions on 1 July 1968.
6. National Insurance was introduced in the United Kingdom in 1948. Under regulation 2 of the National Insurance (Married Women) Regulations 1948, married women were given a special status. A married woman who was an employed person was liable to pay Class 1 National Insurance contributions unless she elected not to pay. Under regulation 2(3)(a) a certificate was issued to a married woman who elected not to pay Class 1 contributions. She was required to give this certificate to her employer immediately.
7. A married woman's election not to pay contributions was made on a form (CF9). The married woman making the election would sign the CF9 which included a declaration that she had read, or explained to her the contents of leaflet NI1. The leaflet clearly set out the consequences of making the election and also confirmed that the woman could cancel her election at any time.
8. A married woman who made an election not to pay National Insurance contributions would not receive the same benefits as a married woman who paid class 1 National Insurance contributions. Thus a married woman who made the election was covered for industrial benefit, redundancy and maternity payments but she was not entitled to receive any contributory benefit, such as unemployment or a retirement pension in her own right.
9. The Social Security Pensions Act 1975 introduced a policy of equal benefits for men and women in return for equal contributions. The Act abolished a married woman's right not to pay contributions from 6 April 1977. However, regulation 102 of the Social Security (Contributions) Regulations 1979 allowed a married woman to carry forward her election to pay a reduced rate National Insurance contribution.
10. The Respondents conducted advertising campaigns in the mid 1970's to alert married women of the changes in the legislation regarding the married woman's National Insurance contributions. The campaign advised married women about their options regarding National Insurance contributions, including retaining the right to continue paying reduced rate contributions where an election was made prior to the legislation coming into force.
11. I heard evidence from the Appellant and Mrs Nadine Newham for the Respondents. Mrs Newham gave evidence about the National Insurance general procedures for dealing with married women who elected to pay reduced rate contributions and for refunds of contributions.
12. The Respondents provided me with a bundle of documents.
13. The Appellant has been a hard working person all her adult life, having worked almost continuously since 1959 and at one stage in her career, holding down at the same time four different jobs. The Appellant was convinced that she had been paying full National Insurance contributions and that she was entitled to a retirement pension in her own right. The Appellant at the time of the hearing was still working part-time.
14. The Appellant married Mr James Whittaker on 4 December 1965.
15. The Appellant entered the National Insurance scheme on 7 February 1960. She paid weekly class 1 National Insurance contributions up and until the contribution year 1968/69 when the Respondents' records revealed that she paid just four class 1 contributions.
16. Around May 1968 the Appellant gained employment with Bemore Press Limited as a printer and book-binder. Whilst in this employment the Respondents asserted that the Appellant elected to pay the married woman's National Insurance contribution rate. The Appellant's permanent record of National Insurance (RF1) was endorsed with "MW1/NP 1/7/68" which meant "Married Woman in Class 1 employment Not Paying". A certified copy of the Appellant's RF1 was produced to me at the hearing. Each individual's RF1 was contained in a ledger which was kept under secure conditions in the Respondents' offices at Newcastle.
17. According to Mrs Newham the entry on the RF1 would have been generated by the completion of a form CF9 by the Appellant. The CF9 evidenced the Appellant's election not to pay class 1 National Insurance contributions because of her married woman's status. The CF9 incorporated a declaration by the signatory that she had read or explained to her the contents of leaflet NI1 which set out clearly the consequences of not paying class 1 National Insurance contributions on future benefit claims and pension entitlement.
18. The details of a married woman's election would be transferred to a machine card by the local social security office, which would then send the card to the National Insurance office in Newcastle. The machine card would have on it the married woman's full name, her national insurance number and date of birth. The RF1 for the married woman would then be updated with the details on the machine card. The National Insurance office returned the machine card to the local social security office which would note on the married woman's CF9 the recording of the married woman's election on the RF 1. Mrs Newham confirmed that the entries on the machine card and the RF1 would have been the subject of rigorous independent checks by supervisory staff.
19. The machine card and the CF9 would have been retained by the local social security office for six years and then destroyed. The destruction was authorised under the Respondents' "Record Management policy" which had Ministerial approval. This policy was made in response to the requirements of the Public Records Act 1958 and 1967 which urged all government departments to review stringently the cost effectiveness of their arrangements for document storage. The Respondents considered that there was no need to retain indefinitely the CF9 and the machine card because the RF1 contained a permanent record of the individual's history of National Insurance contributions. The RF1 was kept under secure and safe conditions. The Respondents were not, therefore, in a position to produce the originating documents for the entry on the Appellant's RF1 relating to her purported married woman's election on 1 July 1968 not to pay class1 National Insurance contributions. According to the Respondents the documents including the CF9 would have been destroyed after six years in accordance with their "Record Management policy".
20. The Appellant stated in evidence that she had not signed any Government form to pay no class I National Insurance contribution because of her status as a married woman. The Appellant had every reason to pay the class 1 contribution because she was earning good money.
21. The Respondents in their letter to the Appellant dated 22 March 2005 set out some of the reasons why married women elected not to pay class 1 contributions:
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(2) There was a marked difference in the rate of contribution that was paid by a married woman. In 1975 the weekly class 1 contribution for a woman was 62 pence; a weekly exempt contribution for a married woman was four pence.
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(3) If a married woman was in low paid work, it was financially attractive to her not to pay the class 1 contribution.
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(4) It was possible in some cases that payment of class 1 contributions would not necessarily give the married woman a retirement pension. This was because of an additional condition known as the "married woman's half test" which had to be satisfied before a pension could be paid. The half test required the married woman to make class 1 contributions in at least half the number of weeks between the date of her marriage and the year preceding her 60th birthday,
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(5) A married woman may qualify for a retirement pension because of her husband's contributions. In these circumstances the married woman would be entitled to a pension equal in value to 60 per cent of her husband's entitlement.
22. The Appellant's RFI had the following entries apart from her married...
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Slater
...bodies in respect of married women's elections. These included Gutteridge v R & C CommrsSCD(2006) Sp C 534, Whittaker v R & C CommrsSCD(2006) Sp C 528 and SpraggsTAX[2011] TC 01193 (in all of which decisions the issue for determination was whether or not an election had in fact been made); ......
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Eastwood
...lapsed. [13] We were also referred to the following case authorities: Gutteridge v R & C Commrs (2006) Sp C 534 Whittaker v R & C Commrs (2006) Sp C 528 Evidence seen and heard [14] We were provided with a witness statement from Lesley Crawford an officer of HMRC dated 16 July 2019 and we h......
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Bennett
...bodies in respect of married women's elections. These included Gutteridge v R & C CommrsSCD(2006) Sp C 534, Whittaker v R & C CommrsSCD(2006) Sp C 528 and SpraggsTAX[2011] TC 01193 (in all of which decisions the issue for determination was whether or not an election had in fact been made) a......
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Harwood
...pay reduced rate contributions by completing form CF9A. Authorities [45] We were referred to these decisions: Whittaker v R & C Commrs (2006) Sp C 528 Gutteridge v R & C Commrs (2006) Sp C 534 Evidence seen [46] We saw copies of Mrs Harwood's RF1 for the period from 1951 to 1975, including ......