The appellant, a single mother residing in Haringey, challenged the fairness and lawfulness of the consultation by the respondent, the London Borough of Haringey ("Haringey"), in respect of its proposed Council Tax Reduction Scheme ("CTRS"). The (rolled up) judicial review application was rejected by the Administrative Court on 7 February 2013 and the subsequent appeal of the Administrative Court's decision was heard, and refused, by the Court of Appeal, two weeks later on 22 February 2013.
The appellant was a recipient of Council Tax Benefit ("CTB"). CTB granted relief to certain persons from their annual council tax obligations; the sum of the relief was reimbursed to local authorities by the government, amounting to the council tax they would otherwise have received. The Local Government Finance Act 2012 ("the 2012 Act", amending the 1992 Act) enacted reforms to this system, and transferred responsibility for making and operating arrangements for council tax relief to local authorities, which they would do under a CTRS. This was accompanied by a reduction in the level of reimbursement the government would provide to local authorities for CTB by approximately 10%. Local authorities faced a potential shortfall in CTB receipts, therefore, and their CTRS' were to represent their solution to this.
The 2012 Act required local authorities to consult on its CTRS proposal as part of its preparation of the scheme, and before "making" and implementing it.
Haringey's consultation ran from August – November 2012. Its CTRS proposal intended to meet the shortfall by reducing the relief to all CTB claimants, save CTB claimant pensioners. A covering letter sent by Haringey to its residents regarding the consultation stated that the CTRS and the central CTB funding shortfall "meant", necessarily, that the CTB claimed by any non-pensioner in Haringey would be reduced. The final proposal was approved in January 2013.
Haringey's consultation documents, as provided to its constituents, did not inform them that there were alternatives to its proposal (which have been adopted by other local authorities). Haringey could, for example, have: reduced expenditure on other services; raised council tax; or applied its deployable reserves of capital, to absorb the shortfall. It did not, therefore, necessarily have to resort to reducing CTB to all non-pensioner claimants. Documents produced by Haringey and its benefits services prior to the beginning of the consultation indicated that they were aware of these alternatives but the blanket reduction of CBT represented what it considered to be the most appropriate solution.
In considering whether the consultation had been fair, the Supreme Court noted that the consultation documents had not "reasonably dispelled the impression…that the shortfall had inevitably to be met by a reduction of [CTB]". The Supreme Court cited R v North and East Devon Health Authority ex p Coughlan, and its judgment that a consultation must "let those who have a potential interest in the subject matter know in clear terms what the proposal is and exactly why it is under positive consideration, telling [consultees] enough…to enable them to make an intelligent response". The Supreme Court considered also that a consulting body is permitted to indicate its preferred options but,
"even when the subject of the requisite consultation is limited to the preferred option, fairness may nevertheless require passing reference to be made to arguable yet discarded alternative options".
Whilst it agreed that the subject of the consultation was Haringey's preferred scheme "and not any other discarded scheme", the Supreme Court approved the dissenting view by Pitchford LJ in the earlier Court of Appeal judgment that,
"consulting about a proposal does inevitably involve inviting and considering views about possible alternatives".
Lord Reed added that a statutory provision in respect of a prescribed consultation could stipulate otherwise, and that a duty to consult did not invariably require the provision of information regarding alternative options; the question would remain whether, in each specific context, such information was necessary for consultees to "express meaningful views on the proposal". He agreed, however, that this was not the case here and that consultees needed to be provided with an idea of how the loss of CTB income might otherwise be borne by Haringey so as to participate meaningfully.
The Supreme Court took the view that it would not have been onerous for Haringey to do this, and cited the CTRS proposed by Birmingham City Council which ultimately adopted what Haringey proposed but which put alternative options to its constituents. Birmingham's consultation and presentation was, therefore, fair.
The Supreme Court disagreed with the Court of Appeal's view that the absence of references to the other options was mitigated by the options being reasonably obvious to those consulted. It added also that its reasons for not pursuing those alternatives were neither clear nor obvious, and that the "accomplished fact" presented to consultees in the consultation literature would further have "disguised" this. Lord Reed added that the consultation had "misleadingly implied that there were no possible alternatives…[and]…therefore, there was no consultation on the fundamental basis of the scheme".
The consultation was, in the Supreme Court's view, unfair and unlawful. The Supreme Court did not, however, order Haringey to undertake a fresh consultation given its apparent determination to pursue the course it had proposed (which was not, in itself, unlawful) and which the Supreme Court could not, realistically, alter.
  EWHC 252 (Admin)
 (R. (on the application of M) v Haringey LBC  EWCA Civ 116)
  QB 213
 Citing R(Royal Brompton and Harefield NHS Foundation Trust) v Joint Committee of Primary Care Trusts  EWCA Civ 472 and Nichol v Gateshead Metropolitan Borough Council (1988) 87 LGR 435