Decision Making and Contracts

October 7th, 2013

In R (T) v Sheffield City Council [2013] EWHC 2953 (QB) 4 mothers challenged by judicial review the decision of the Council to stop paying subsidies to 20 nurseries.  They did so on 5 grounds: (1) failure to consult fairly; (2) breach of the PSED; (3) breach of the best value duty; (4) breach of duties imposed by the Childcare Act 2006 (“CA 2006”); and (5) irrationality.  All the challenges failed.

As regards flawed consultation, Turner J observed (para 30) that whether consultation is undertaken at a formative stage “is bound to be fact sensitive” and that “the important point” is that “when the process starts the ultimate decision should still be fully capable of being moulded and influenced by the response”.  At paras 32 and 35 he stated:-

“32. It is also important to put the issue of consultation into context. There will be many cases in which it will not be possible precisely to time the beginning (or even the end) of the consultation process. For example, it is by no means unusual for particular proposals to have been preceded by earlier different but related proposals upon which there has already been some level of pertinent consultation. The existence of the prior period of consultation does not, of course, obviate the need to consult further but it may have an important influence on the timing, content and duration of the process of consultation which follows.

“35. The time reasonably to be allowed for a response to a consultation process is, again, a highly fact sensitive issue. Once more, context is important. Where, as here, the issue upon which consultation is to take place is one in which interested parties have already been recently engaged the time reasonably required for any formal consultation period may well be shorter than in circumstances where the proposal is without precursors.

As regards the PSED, under Section 149 of the Equality Act 2010, Turner J said (para 53):-

“Of course, a mere generic, background level of concern is not of itself sufficient to comply with the requirements of the Act but it is not insignificant that those responsible for taking the decision in this case were not approaching their responsibilities from a position of ignorance about the social and demographic context in which they were operating. Further, Cabinet members were engaged in the process of assessing and developing proposals as part of a continuous process and the records of meetings are snapshots only of the route which they are following.

As regards the best value duty under Section 3 of the Local Government Act 1999, and Guidance issued by the Secretary of State, Turner J concluded (para 67):-

There is no substance in the complaint that the defendant impermissibly distorted the outcome of its decision making process in a way calculated to preserve funding for itself as opposed to the nurseries. In any event the Guidance, thankfully, does not require a formulaic “pound for pound” approach. …”

As regards CA 2006, Turner J said:-

“70. Section 1 of the 2006 Act is described as a “general duty” and cannot be approached in the context of the position of an individual or individuals. It is necessary to look at the population of those affected as a whole. In this case, it was perfectly open to the defendant to conclude that the decision to prioritise intervention over subsidy would have the overall effect of improving the well-being of young children and to reduce inequalities in the well-being of young children in the Sheffield area. It is not for the court to substitute its own views for that of the democratically elected local authority.”

“71. Much the same can be said of section 3(2). I do not see how it can be contended that redistributing resources away from nursery subsidies and towards individual cases of need cannot, at least arguably, result in a better integrated provision of early childhood services and a maximisation of the benefit to be derived by young children and their parents. Whether it actually does or not is a matter upon which the defendant is in a far better position than this court to judge.

72.Within the factual parameters of this case it is difficult to see how section 3(3) could be any more than peripherally relevant if at all. This sub-section too applies to all those children and parents affected by the actions of the decision maker and cannot be applied to a limited class in isolation. The withdrawal of funding from twenty nurseries does not on the face of it constitute a general failure to identify parents or prospective parents who would otherwise be unlikely to take advantage of early childhood services. There is simply no evidence in support of this contention and it is misconceived as a matter of law.

73. The duty under section 6 is more obviously pertinent to the issues arising in this case but it is subject to the constraints of reasonable practicability. This issue was clearly and directly considered by the defendant. The requirements of section 6 are also set out in the overarching EIA. There is simply no legitimate basis in this case upon which this court can substitute its own view as to what is or is not reasonably practicable for that reached by the defendant.”

As regards irrationality, Turner J said:-

“77. I am in no doubt that the claimants genuinely believe that the defendant’s decision was irrational in the sense that they consider that the balance of argument was firmly weighted in favour of the retention of the grants, at least for some further period, and they cannot understand why this did not happen. It is not, however, for this court to attempt to re-balance the arguments and form its own conclusion on their respective merits.”

Turner J’s conclusion was as follows:-

78. The twenty nurseries affected by this decision which provide valuable facilities to the families which they serve are to be commended on the contribution they have made and continue to make to their local communities. I hope that, despite the termination of the subsidies, they are all able to survive and flourish but I must recognise that some may not. In an ideal world, it would not be necessary to make hard choices about the distribution of funds between competing but thoroughly meritorious causes but, particularly in the present economic climate, sacrifices even of highly socially desirable initiatives are sometimes unavoidable. Councils are democratically elected to make decisions and some of these are bound to be contentious and unpopular. Ultimately, however, the decision in this case, controversial as it undoubtedly was, complied with the standards imposed by public law and must remain undisturbed.

Comments are closed.