If you are considering starting a family via surrogacy in Scotland, England or Wales, or you are thinking about acting as a surrogate, one of the main considerations may be about the financial implications. Surrogacy involves real costs and expenses, so it is natural to ask what it may cost, what a surrogate can be paid, what counts as reasonable expenses, and how those payments are treated. Two recent court rulings have reshaped the answer, both in the family courts and in the benefits system.
This blog explains what the latest case law means for surrogates and intended parents.
Paying a surrogate: reasonable expenses only
Since the Human Fertilisation and Embryology Act 2008 (the “2008 Act”) came into force in the UK, courts up and down the country, north and south of the border, have made thousands of Parental Orders transferring legal parentage from the surrogate to the intended parents. Throughout that time and via those thousands of cases, certain precedents have been set. One notable fact is that there has never been a case where a Parental Order has been refused on the basis of payments being made to a surrogate which were beyond what could be deemed to be “reasonable expenses”.
In the recent High Court decision in the English case of A & B v C & D, Mr Justice Williams considered the approach taken to this issue, amongst others.
The 2008 Act requires the court to be satisfied that the intended parents have not made any payments to the surrogate except for reasonable expenses. The rationale behind this rule is to deter the practice of commercial surrogacy, which is illegal in the UK. There is one important qualification, however. Section 54(8) of that Act provides that the court can retrospectively authorise payments which are in excess of reasonable expenses. This qualification, and the power it vests in the court to grant Orders despite a flouting of the rule against excessive payments, has enabled the courts to grant many Parental Orders which otherwise would have been prohibited, which has been a source of concern in some quarters. In all of those cases, the principles set out in three international surrogacy cases heard in the courts of England and Wales in 2008 and 2009 respectively were followed to allow them to grant the Orders sought.
The approach the courts have taken to date, therefore, was to carry out a balancing exercise between the welfare of the child and the public policy considerations against allowing commercial surrogacy, determining whether the surrogate was subjected to any exploitation, and closely examining whether the intended parents had acted in good faith.
A&B v C&D: the child’s welfare comes first
In his judgment in A & B v C & D, Mr Justice Williams addressed how the court should balance the ability, or need, to retrospectively authorise payments from intended parents to surrogates, as is permitted under s.54(8) of the 2008 Act, with the welfare of the child, and, whilst noting that no Order had ever been refused on the basis of payments made, examined the circumstances, if any, in which the court could refuse to grant a Parental Order. Could public policy objections ever outweigh the child’s welfare?
Mr Justice Williams determined that in circumstances where the welfare of the child is paramount, as mandated in the 2008 Act, “pure public policy” concerns cannot, alone, be a reason to refuse to make a Parental Order. He recognised that courts across the jurisdiction have, for the past two decades, repeatedly retrospectively authorised payments made to surrogates by the intended parents if the court has determined that the parental order would be in the child’s best interests. On that basis, public policy concerns become secondary to the welfare principle, and indeed Mr Justice Williams declared that concerns of “pure public policy” have no legitimate role in the court’s determination as to whether or not to authorise payments under s.54(8). That is to say, if the public policy concern does not relate directly to the welfare of the child, it is to be left out of consideration. Put simply, the welfare of the child comes first.
How to record surrogate expenses for the court
The judgment then goes on to set out how intended parents should categorise their payments to surrogates for the purposes of the court’s analysis of the expenses paid. It was stated that the funds paid should be categorised, in detailed table format, as follows:
- Sums or other benefits which do not fall under s.54(8) and therefore do not need to form part of the court’s analysis;
- Sums or other benefits which constitute reasonable expenses; and
- Sums or other benefits which exceed what could be considered to be reasonable.
Whilst this may place an administrative burden on the intended parents to keep accurate records and present their evidence accordingly, arguably intended parents should have been doing this anyway and it may serve as a useful tool, from the outset, for intended parents to keep track of what sums are being paid and for what, to ensure that a close watch is maintained on this often delicate issue from the outset of the surrogacy journey, and that when it comes to the court application, they are ready with all of the required details.
What the ruling means for intended parents
This judgment should reassure intended parents, and surrogates, that the welfare of the child very much remains the primary focus for the court. Indeed, it has in some ways recalibrated the consideration of public policy concerns such that they are only to be considered through the lens of the child’s welfare.
However, the judgment ought not to be read as a licence for intended parents to completely disregard the law as it relates to the payment of reasonable expenses. The court still expects intended parents to show what expenses they have paid and indeed confirmed expectations as to how these should be presented to the court in a parental order application. The court still expects the intended parents to properly consider, plan and structure their expenses payments, to be transparent about those, and above all else to ensure that the child’s welfare is safeguarded.
This case also throws the continuing issues with UK surrogacy law into sharp focus once again. UK permits only altruistic surrogacy, and yet the courts are, on an ever increasing scale, hearing cases which clearly fall under the category of commercial surrogacy. The judgment does suggest that, if lawmakers want public policy considerations around expenses, or other issues, to be given additional weight in parental order cases, law reform may be necessary.
Whilst this case was heard in the English courts, it is likely that Sheriffs across Scotland will apply the principles set out by Mr Justice Williams in cases heard north of the border.
Surrogate expenses and state benefits: PQ v Secretary of State for Work and Pensions
In other news, another landmark ruling from England in 2026 has made headlines in relation to the treatment of payments to surrogates for the purposes of state benefits.
In PQ v Secretary of State for Work and Pensions, the appellant had entered into two arrangements with two sets of intended parents to act as their surrogate. Each set of intended parents paid the surrogate a five figure sum, paid in monthly instalments during each respective pregnancy. At the same time, she was in receipt of income-related jobseeker’s allowance.
Upon learning of the receipt of those expenses, the Secretary of State for Work and Pensions decided that they had constituted income, and as such the surrogate had not been eligible to receive the benefits she had during the relevant periods. They determined therefore that she had received an overpayment of benefits which was then recoverable by the government.
At the First-tier Tribunal, the surrogate’s appeal against the Secretary of State’s decision was dismissed. On further appeal to the Upper Tribunal, the dismissal was upheld. The Upper Tribunal clarified that payments of reasonable expenses to surrogates cannot be considered or treated as ‘capital’. The regularity of the payments supported this conclusion although it was noted that that was not a determinative factor. It further stated that, whilst surrogacy in the UK is considered to be altruistic, and not commercial, the fact of the matter is that the payments are made with the intention of receiving something for those payments, i.e. a baby. As such, the payments also cannot be considered as payments received by a volunteer or “voluntary payments”, which are left out of account for the purposes of means testing benefits. It held that acting as a surrogate could not be considered as unpaid work.
What this means for surrogates and intended parents
For any surrogates who receive income-related, or means tested, state benefits, the fall out from this decision is clear: the receipt of expenses could mean that they risk having their benefits reduced, or they could face the need to repay overpayments of benefits received. Surrogates therefore have to carefully consider their financial position prior to entering into a surrogacy arrangement.
More broadly, this case is another which could give rise to calls for reform. There is anecdotal evidence that more and more intended parents are going abroad, to countries where commercial surrogacy is permitted, to find surrogates due to the shortage of surrogates in the UK. This ruling may reduce further the pool of willing surrogates, if surrogates are discouraged due to the risk that they will lose state benefits as a result, and inadvertently drive further parents seeking to build a family through surrogacy to go abroad, which may in turn lead to further concerns on legal and ethical grounds.
Getting the right legal advice
Surrogacy, both domestic and international, is a complex area of law, the stakes are high, and a surrogacy agreement is not legally binding, so good legal representation protects everyone involved. It is vital that intended parents as well as surrogates seek specialist, independent legal advice at the earliest opportunity, and further advice as the arrangement, and then the parental order process, moves forward. In deciding whether to make a parental order, the court treats the child’s welfare as its paramount consideration.
Our family lawyers have recently advised on surrogacy cases in Glasgow and Edinburgh, and can support you through every stage of the process, tailored to your circumstances, from the surrogacy agreement through to your parental order. We help all kinds of intended parents, including married couples, civil partners and same sex couples, and can advise where donor eggs or donor sperm are used, or where only one parent has a genetic link to the child. Our wider family law team supports both surrogates and intended parents across Scotland.
To arrange an initial consultation and talk through your situation call us on 0141 375 1222
About the author:
Lynsey Brown is a partner at Jones Whyte, accredited by the Law Society of Scotland as a specialist in both Family Law and Child Law. She advises clients on different Family Law matters including adoption, surrogacy, divorce and separation. Lynsey can be contacted via joneswhyte.co.uk.
Please note: This article is for general information purposes only and does not constitute legal advice. It should not be relied upon as a substitute for professional legal advice tailored to your specific circumstances. If you need advice on a legal matter, get in touch with our team.
