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Legal challenges to charging policies

Cutbacks iStock 000013353612XSmall 146x219A disabled adult recently brought a successful High Court challenge to aspects of a county council's policy on charging for adult non-accommodation services. Jonathan Auburn looks at the implications for local authorities.

Charging for local authority social care services has in recent years become a more prominent issue. Local authorities are under tight financial pressure. The adult social care budget is usually a particular target for austerity. The issue is a sensitive one, as in increasing their charging for social care services, councils are usually reducing the income of some of the most vulnerable and resource-less members of society, whose remaining disposable income is cut to near vanishing point. In this context it is hardly surprising that challenges have emerged to the local authority charging policies themselves.

Case background

In 2013 the Department of Health updated its guidance relating to how local authorities should charge persons to who it provides non-residential care services. The purpose of the updated guidance, the Fairer Charging Policies for Home Care & Other Non-Residential Social Services, was to put in place minimum requirements to ensure that charges are reasonable.

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One of the minimum requirements put in place required local authorities to ensure that service-users retained a basic amount of protected weekly income. This basic amount was to be calculated by adding together three elements: ‘basic levels of Income Support or the Guaranteed Credit of Pension Credit’, any ‘premium or additional amount appropriate to the user, according to age, level of disability and family status but need not include the Severe Disability Premium or an amount for severe disability’ and an additional 25% buffer. Under the guidance, local authorities were required to ensure that they did not issue charges the effect of which would be to leave service-users with less than this basic amount of weekly income.

In 2014, Northamptonshire County Council (NCC) issued a new policy, which set out the approach to be taken when calculating charges for non-residential care services. The policy stated that "the calculation will consider the amount of weekly assessable income, minus the weekly allowance/disregards" but did not provide any specific detail as to how a person’s ‘weekly allowance’, or protected income, was to be calculated. It also provided a worked example, but made no mentioned of premiums (additional amounts) related to age, disability and family status.

The applicant was a 34-year-old Northamptonshire woman with Downs Syndrome. She received non-residential care services. She sought to challenge NCC’s Policy as unlawful, as well as the particular calculation of the charges made under the policy. It was uncontested that the NCC was obliged to follow the DoH’s guidance, and so to ensure that individuals retained the basic amount of protected income.

The claimant challenged NCC’s policy on the basis that it was so vague on the matter of how a service-user’s ‘weekly allowance’ was to be calculated that it produced an unacceptable risk that weekly incomes would be diminished below the basic amount of protected income. In particular, it produced the risk that premiums would not be counted in the way required by the guidance.

The claimant also challenged NCC’s particular calculation relating to her, on the ground that the Council had applied an estimated amount for a particular benefit (Support Group Premium), rather than the amount actually received.

Decision

In R (KM) v Northamptonshire CC [2015] EWHC 482 (Admin) the Court upheld all of the claimant’s grounds of challenge. There was "simply nothing in [NCC’s] published policy which gives any indication at all of how the 'personal allowance' is calculated" and that "even on the most generous interpretation, the policy is entirely unclear." Accordingly, the policy was unlawful.

The Court also found that the use of the estimate figure for a particular benefit, rather than the amount actually received had "no justification within the policy".

Accordingly, both NCC’s policy and its calculation of the amount that the claimant could be charged under that policy were unlawful.

Implications

The case has important implications both for local authorities and for individuals who charged for non-residential care services.

In terms of the impact on local authorities, the case illustrates the importance of ensuring that their charges do not diminish a service-user’s weekly income below the protected amount in the DoH’s Guidance.

Further, the case requires local authorities to ensure that their charging policies are drafted in terms specific enough to ensure that service-users’ weekly income will not be diminished below this level. Local authorities must provide detailed guidance as to how protected income is to be calculated. It is not enough simply to make reference to the DoH Guidance. Charging policies which create a risk that service users’ income will be unduly diminished will be found to be unlawful.

The case also shows that the practice of estimating what individuals receive in premium is unlawful. Local authorities are required, when calculating protected income, to add in the figure a service-user actually receives and ought to make sure that they do this.

In relation to the impact on individuals, the case shows that those who are charged for non-residential services are entitled to receive a basic amount of protected weekly income. It is unlawful for local authorities to diminish a service-user’s weekly income below this amount. The case also shows that local authorities are required to issue clear and specific policies which set out how they will calculate service-users’ protected income. If a service-user considers that a charging policy under which they are being charged is too vague to ensure that they retain their protected income, they may be able to challenge. If the policy is deemed to create an unacceptable risk that service users will be over-charged, it will be unlawful.

Jonathan Auburn is a barrister at 39 Essex Chambers specialising in adult social care. He can be contacted This email address is being protected from spambots. You need JavaScript enabled to view it..

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