High Court rejects claim that council tax reduction scheme was discriminatory

A High Court judge has rejected claims that a London borough’s council tax reduction scheme was discriminatory on the grounds of age or disability.

However, Mr Justice Blake did find that there was insufficient evidence that due regard was had to an equality impact assessment (EIA) by those at Havering Council who took the decision to implement the scheme.

The claimant in Logan, R (on the application of) v London Borough of Havering [2015] EWHC 3193 (Admin) (06 November 2015) was a 55-year-old disabled man who suffered from a multiplicity of health problems. He was in receipt of Disability Living Allowance at the highest rates available for care and mobility having regard to the extent of his needs.

In 2014/15 Havering had promoted a council tax reduction scheme where people with the claimant’s level of income and disability received a reduction in council tax liability of 100%.

In 2014 the council’s Cabinet decided to replace the 100% reduction for those eligible for support because of their lack of resources with an 85% reduction.

This would require everyone otherwise eligible for support to pay 15% of their council tax liability subject to any further reduction pursuant to a discretion under s. 13A(1)(c) of the Local Government Finance Act 1992.

Following a consultation, a report was prepared for the Cabinet setting out the case for the proposals. An EIA was attached to the report.

The Cabinet decided on 21 January 2015 to recommend that the full council at Havering should take the decision to adopt the revised scheme. The full council approved the recommendation on 28 January.

The claimant was given permission to challenge the decision on two grounds:

1. There had been a failure by the full council to have due regard to the Public Sector Equality Duty pursuant to s. 149 of the Equality Act 2010.

2. There had been discrimination on the basis of disability and/or age contrary to Article 14 of the European Convention on Human Rights taken together with the right to enjoyment of possessions afforded under Article One of Protocol One of the Convention and indirect discrimination on the basis of disability contrary to the Equality Act.

The summary grounds filed in response by the council, amongst other things, the issue of delay, prejudice to good administration and the contention that the proceedings were academic in light of the 100% support given to the claimant and that a new scheme would have to be place in January 2016.

The claimant then abandoned any claim for relief other than for a declaration. The case was heard on 16-17 September.

Mr Justice Blake reached the following conclusions:

(i) The claimant's contentions with respect to discrimination on the grounds of age and/or disability failed both under Article 14 ECHR and under the Equality Act.

(ii) The EIA was not defective as contended.

(iii) There was insufficient evidence to support the conclusion that due regard was had to the EIA by those who took the decision. The EIA produced by council officers had been seen by the Cabinet, but had not been produced directly to the full council as part of their papers for the decision on the scheme.

(iv) There was sufficient vindication of the public interest and the claimant's rights in this litigation for conclusion (iii) to be stated in a declaratory judgment and no other formal relief was needed.

Mr Justice Blake refused permission to appeal.

In relation to the issue of discrimination, the judge said:

  • He had some doubts whether eligibility for council tax support was a possession for the purpose of A1P1 of the ECHR and accordingly whether any difference of treatment fell within the scope of Article 14 taken with other substantive Articles of the Convention.
  • The discretion afforded to billing authorities to promote a scheme reducing council tax support was limited to people of working age. He did not accept that the prohibition on discrimination meant that there was an implicit requirement that the billing authority must always exercise its discretion to treat certain classes who were subject to the discretionary scheme, in the same way as those who were statutorily excluded from it.
  • There was no direct or necessary corollary between age and disability and liability to pay council tax: some disabled people below retirement age were able to and do work and had resources to pay some or all of their council tax liability.
  • Whilst he recognised that the 2015 scheme had greater impact on disabled people under retirement age than others of a similar age, because more members of that class were likely to be unable to access employment that would result in earnings exceeding the applicable amount, he did not accept that there had been indirect discrimination on such grounds by the application of a single blanket rule to those whose situations were significantly different. “The fact that the scheme impacts on disabled people is expressly taken into account in the various disregards to income made and the premiums awarded in ascertaining the applicable amount. The different situation of the able bodied and disabled with respect to access to the labour market has thus already been acknowledged in calculating the 85% scheme.”
  • There was a material contrast with the case of Burnip v Birmingham City Council [2012] EWCA Civ 629; [2012] LGR 954 where housing benefit was reduced for people who occupied premises with more rooms than the regulations assessed they needed. “I do not read the Burnip decision as stating that it is always discriminatory to expect the disabled poor to meet ordinary living expenses out of benefits that are provided because they are disabled. Council tax liability is a general charge on living expenses in the same way as any other item of expenditure that the able bodied and disabled poor both have to make out of their subsistence budgets.”
  • Once it was recognised that different rules had been established for the disabled in calculating the applicable amount, he did not see why it constituted either a difference in treatment or an unlawful failure to treat people differently who are situated differently, to expect that a modest percentage of council tax support would be absorbed in the subsistence budgets of the poor generally, even if the benefits forming that budget were provided because of eligibility through the disability gateway.
  • In the light of his conclusions and with the existence of a discretionary scheme to address exceptional hardship he considered that any indirect difference in treatment on the grounds of age or disability was justified; “in particular maintaining the distinction in the statutory scheme of people above and below retirement age is justified”.

On the issue of due regard being given to the EIA, Mr Justice Blake said there must be conscientious consideration of the impact of the proposals on relevant groups, whether by diligent reading of the EIA or some other evidence based assessment.

He said: “In my judgment, the EIA was adequate to enable members who read it to have due regard to the PSED [public sector equality duty], but there was insufficient evidence to indicate that the decision makers had accessed the EIA attached to the officers' report or had understood the importance of reading it in order to discharge their statutory obligation.

“It is not sufficient to assume that they could have done so and therefore would have done so. The procedure whereby the 2015 scheme was adopted was accordingly defective even though I have concluded that the scheme itself was not unlawful by reason of discrimination.”

Responding to the ruling, Cllr Roger Ramsey, Leader of Havering Council, said: “We put a lot of thought into the council tax reduction scheme before it was implemented to ensure that it wasn’t discriminatory in any way, and I’m glad the court has found in our favour.”

Having lost on the PSED count, Havering has agreed to pay 25% of the claimant’s costs. It also said that it had put in place processes to ensure that the issues raised did not happen again.

Clive Sheldon QC, Ronnie Dennis and Zoe Gannon of 11KBW appeared for Havering Council, instructed by Stephen Doye of OneSource. 

Karon Monaghan QC of Matrix Chambers and David Lawson of Serjeants' Inn appeared for the claimant, instructed by John Ford & Co.