REUTERS | Neil Hall

Local government quarterly digest (August – October 2014)

This is the latest in our series of quarterly local government update blogs, which will enable readers to catch up on the most important cases, issues or developments in local government from August to October 2014. For those who are seeking the latest on education law, we will shortly be publishing a regular digest focusing solely on that topic.

Please feel free to submit a comment below or send us an Ask query if you have any views on the cases, issues, or legal developments covered or if you think we have missed something that should be brought to the attention of local government practitioners.

In this post we look at:

  • Cases of interest to local authorities.
  • Various legislative and other developments of interest to local authority lawyers.


High Court holds that planning committee chairman’s instruction on how to vote was not predetermination  (IM Properties Development Ltd v Lichfield District Council)

The High Court has held that an e-mail from the chairman of a local authority planning committee to members of his political party (which told the recipients to vote in favour of a proposal to modify a local plan strategy, or abstain from the vote), fell within section 25(2) of the Localism Act 2011 (LA 2011) and therefore did not amount to predetermination. The section provides that a decision-maker when making a decision is not to be taken to have had, or to have appeared to have had, a closed mind (to any extent) just because he has previously done anything that directly or indirectly indicated what view he took, or would, or might take, in relation to a particular matter.

The case provides  useful guidance for local authorities on the extent of the word “anything” in the context of section 25. However, it is important to note that what was key was the actual content and tone of the chairman’s e-mail. The court considered that the view expressed was not “so strident” that any recipients would feel that they did not have discretion as to how they would vote and therefore the e-mail was covered by section 25(2). A key issue for a local authority when deciding if there has been predetermination will be to assess the substantive impact of a statement or e-mail rather than pointing to a principle established in previous case law.

Council in breach of contract by freezing care home rates (High Court) (Abbeyfield Newcastle Upon Tyne Society Limited v Newcastle City Council)

In a case that illustrates the difficulties for local authorities of balancing their budgets with the costs of meeting their statutory responsibilities, the High Court has held that the council was in breach of contract by freezing care home rates. It rejected the council’s argument that by continuing to provide a service to residents and receiving payment, the claimant care home provider had accepted the price by conduct.

Local authority entitled to suspend former teacher acting as union representative (Davies v London Borough of Haringey)

This decision, which provides useful clarification for local authorities of the purpose of the School Staffing England Regulations 2009 and the Education (Modification of Enactments Relating to Employment) (England) Order 2003, confirmed that a local authority was entitled to suspend a teacher who had been working as a union representative on secondment from a school for the previous 14 years. The court rejected the claimant’s argument that the school’s disciplinary policy should apply and only the governing body of the school was entitled to suspend her. The case also confirmed that even where the 2009 Regulations apply, the governing body’s powers to discipline an employee working at its school are not exclusive.

Challenge to local authority’s closure of care home fails (Karia v Leicester City Council)

The High Court has held that, in taking a decision to close several care homes, a local authority did not breach its duties under section 149 of the Equality Act 2010 (the public sector equality duty (PSED)) or Article 8 of the European Convention on Human Rights (ECHR) (right to respect for private and family life). The case is a good example of a local authority taking a difficult decision with its responsibilities under the PSED very firmly in mind, and provides a useful summary of the hurdles that a claimant must overcome to successfully challenge a public body under public law, breach of the PSED and breach of Article 8.

Court of Protection issues judgment on streamlined process for dealing with deprivation of liberty cases (Re X and others (Deprivation of Liberty) (Number 2))

On 16 October 2014, the Court of Protection issued a judgment supplementing the court’s preliminary ruling of 7 August 2014 ([2014] EWCOP 25). Both decisions contain the President of the Court of Protection Rules’ Committee answers to 25 questions which he formulated at an earlier hearing in order to devise a standardised, streamlined process for dealing with deprivation of liberty cases in a timely and fair way following the decision of the Supreme Court in P v Cheshire West and Cheshire Council [2014] UKSC 19 (see Legal update, People without capacity cared for in domestic settings were deprived of their liberty (Supreme Court)).

The questions and answers, as well as the unanswered questions, especially those dealing with urgent authorisations, should now be considered by the Court of Protection Rules Committee including what changes will be required to the Court of Protection Rules 2007. The President has made it clear that the Committee will have to consider how best to craft a process which meets the requirements of the law, and also has regard to the realities of the legal aid regime and the exposure of a litigation friend to a costs risk.

Supreme Court holds that council tax reduction scheme unlawful (R (Moseley) v London Borough of Haringey)

On 29 October 2014, the Supreme Court held that the council’s consultation exercise relating to the introduction of its council tax reduction scheme was unlawful. The council’s consultation documents failed to refer to any other options that had been considered for addressing the shortfall in funding caused by the government’s scrapping of council tax benefit, and suggested the only option for the council was to require people who were exempt from council tax under the council tax benefit scheme to pay approximately 20% of their council tax.

Although a duty to consult does not invariably require information about options that have been rejected, the court considered that, in this case, it was difficult to see how ordinary members of the public could express an informed view on the proposed scheme, so as to participate in a meaningful way in the decision-making process, unless they had an idea of how the council’s loss of income might otherwise be replaced or absorbed. The council’s consultation document had presented the proposed reduction in council tax support as if it was the inevitable consequence of the government’s funding cuts, thereby disguising the choice made by the council. It misleadingly implied there was no possible alternative to that choice so that in reality there was no consultation on the fundamental basis of the scheme.

Court holds that estate not liable for care home fees under Mental Capacity Act 2005 (Aster Healthcare Ltd v Shafi (The Estate of))

On 24 October 2014, the Court of Appeal upheld the High Court’s ruling that the estate of a deceased man who had been placed in a residential care home at a time when he lacked mental capacity was not liable to pay the care home’s fees. Instead the court found that the council, which was not a party to the proceedings, was at least arguably liable under the National Assistance Act 1948 (NAA 1948) for S’s care home fees, despite the fact that the individual  had sufficient capital to pay the fees. This was because the council had a duty under section 21 of the NAA 1948 to arrange residential accommodation for S and no-one had been appointed as his deputy or to act on his behalf.

The case demonstrates the importance for local authorities and care providers of ensuring that, in relation to individuals who can self-fund but who lack capacity, they identify an appropriate person to make arrangements directly with the care provider, or under a section 26(3A) arrangement with the authority and provider. A care provider cannot rely on section 7 of the Mental Capacity Act 2005 to recoup its costs unless it is clear that it provided those services with the intention that the incapacitated person, and not the local authority, would pay for them.


Government publishes its response to public sector exit payments

On 28 October 2014, the government published its response to a consultation launched in July 2014 on proposals for recovering exit payments from individuals earning over £100,000 who leave the public sector and then return to work for the same organisation or another organisation within the same sub-sector of public sector organisations within 12 months. The government has indicated its intention to implement its proposals in regulations made under the Small Business, Enterprise and Employment Bill, which it intends to bring into force no later than April 2016.

Final statutory guidance and regulations published on the Care Act 2014

On 23 October 2014, the Department of Health (DH) published its final statutory guidance on the implementation of Part 1 of the Care Act 2014. Part 1 of the Act covers various issues including the duties on local authorities to meet needs for care and support, assessing the needs and eligibility criteria of individuals and direct payments, personal budgets and deferred payment agreements. In addition, the DH has published two sets of regulations under Part 1 of the CA 2014. These are final affirmative regulations which will be laid before Parliament and come into force on 1 April 2015 and a number of final negative regulations, which will also come into force on 1 April 2015 unless Parliament passes a resolution annulling the regulations.

Local government audit

On 22 October 2014, the Local Audit (Auditor Panel Independence) Regulations 2014 were made under the Local Audit and Accountability Act 2014, which requires local authorities to appoint local auditors and auditor panels (who will advise on the local authority’s selection and appointment of auditors) when it comes into force. The regulations amend the definition of an independent member of a local authority auditor panel, to avoid conflicts of interest when auditor panellists are deliberating.

On 19 September 2014, the National Audit Office (NAO) published a consultation inviting views on the draft Code of Audit Practice for the audit of local public bodies and whether the proposed code addresses the auditor’s statutory duties in connection with the audit of annual accounts. The code, which will take effect from 1 April 2015, prescribes the framework within which local auditors are to carry out their statutory responsibilities for the audit of local public bodies under the Local Audit and Accountability Act 2014.

The Local Government Association has set up an independent public audit agency, Public Sector Audit Appointments (PSAA), to take on public sector auditing responsibilities when the Audit Commission closes in 2015.  PSAA, which is a wholly-owned subsidiary of the Improvement and Development Agency, will manage contracts with private sector audit firms for the external audit of local authorities, police and NHS bodies, until at least 2017.

Public Spaces Protection Orders Regulations in force

On 20 October 2014, the Anti-social Behaviour, Crime and Policing Act 2014 (Publication of Public Spaces Protection Orders) Regulations 2014 came into force. The regulations make provision for how a Public Spaces Protection Order (PSPO) that is made, extended, varied or discharged is to be published. Part 4 of the 2014 Act allows local authorities to make a PSPO covering unreasonable or persistent activities carried on in public places that have, or are likely to have, a detrimental effect on the quality of life of local people, provided that certain conditions are met.

Revised code on local government transparency

On 3 October 2014, the government published a revised Local Government Transparency Code, which sets out the minimum data that local authorities should be publishing, the frequency with which it should be published and how it should be published.  The revised code now includes several additional datasets to the list of information that must be published including information on how an authority tackles fraud, delivers waste services and uses parking revenues. According to the updated FAQs that have also been published, the government expects Part 2 of the code to become mandatory by 7 November 2014.

Transfer of health responsibilities to local authorities and public health

On 29 September 2014, the DH published a factsheet that explains some of the finance issues related to the transfer of responsibility for children’s public health commissioning from the NHS to local authorities, which is intended to take place on 1 October 2015. The finance factsheet deals with issues raised by the transfer to local authorities of responsibility for planning and paying for public health services for 0 to 5 year olds, including its funding implications for 2015-16.

Public Health England has published a spend and outcomes tool for local authorities. The tool, which is an interactive spreadsheet that gives local authorities an overview of spend and outcomes across key areas of business, is designed to help local authorities understand health outcomes and expenditure.

Code of Recommended Practice on Local Authority Publicity in Wales

On 18 August 2014, the Welsh Government published the Code of Recommended Practice on Local Authority Publicity in Wales. The code, which revises and replaces the 2001 version of the code, provides guidance on the content, style, distribution and cost of local authority publicity in Wales. It also highlights factors that local authorities should consider when making decisions on publicising issues that are controversial but that are not dealt with by the section 2 of the Local Government Act 1986 prohibition on publishing political material. Specific guidance is now included in the revised code on the production of council newspapers and the broadcasting of council meetings.

Pre-election purdah to commence on 30 March 2015

With the 2015 general election fixed for 7 May 2015, the UK Parliament website has published an election timetable. This confirms that Parliament will be dissolved on 30 March 2015, on which date the period of pre-election purdah will commence. Local government departments should take into account that, from this date, decisions should not be taken or policies announced if they may be significant in their effects and politically contentious.

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