Care home fees and the public sector equality duty

The Administrative Court has found that Devon County Council failed to meet its public sector equality duty when setting care home fees for 2012/2013.

This fees decision had been notified to providers in a decision letter of 3 April 2012 and was challenged by South West Care Homes Limited (which owns and operates care and nursing homes in Devon). The operator complained that the fees in question would provide an effective nil rate of return on capital and some of the homes would therefore no longer be financially viable.

The case in question was R (South West Care Homes Limited and Others) v. Devon County Council and The Equality and Human Rights Commission as Intervener [2012] EWHC 2967 (Admin) and was handed down by HH Judge Milwyn Harman QC on 7 November 2012.

There were the following three grounds of challenge:

• Failure by the Council to comply with the public sector equality duty in section 149 of the Equality Act 2010[1] in failure to have due regard to the need to eliminate discrimination and/ to advance equality of opportunity amongst elderly and disabled persons. An equality impact assessment (EIA) carried out by the Council to inform the decision was argued to be flawed;
• Failure by the Council to consult lawfully and failing to provide consultees with sufficient information to enable a proper understanding of the proposal and to make meaningful representations in relation to it;
• Irrationality in the light of logical calculation flaws and/or the unreasonableness of the conclusion.

Whilst the Council survived 2 and 3, as mentioned ground 1 was grounded. The preceding financial year had also seen a challenge to the Council by the same Claimant following the Authority’s April 2011 decision that for the second year running there should be no increase in fees. However, although Singh J had then found that the Council had unlawfully failed to consult adequately, there had been no argument advanced as to breach of the equality duty (see [2012] EWHC 1867 (Admin)).

In the instant case, the Judge gave some extensive consideration to the nature and scope of the domestic public sector equality duty as well as relevant international jurisprudence. He considered that the function in question for the purposes of section 149 of the 2010 Act was the responsibility under section 21 of the National Assistance Act 1948 to provide accommodation to adults who by reason of age, illness, disability or any other circumstances are in need of care and attention not otherwise available. And he indicated that by section 47 of the National Health Service and Community Care Act 1990 the Council must carry out an assessment of the care needs of such persons.

In the course of considering the nature and scope of the section 149 duty to the situation before him, the Judge noted (from R (Baker) v. Secretary of State for the Environment [2008] EWCA (Civ) 141) that "the promotion of equality of opportunity is concerned with issues of substantive equality and requires a more penetrating consideration than merely asking whether there has been a breach of the principle of non-discrimination...". He also distilled the following four ‘key points’ from the January 2012 Equalities and Human Rights Commission (EHRC) Guidance: Meeting the equality duty in policy and decision-making:

1. Regard must be had to the purpose of the policy in question, the context in which it will operate and what results are intended.
2. Understanding the impact on different groups is a key step in identifying whether a policy might unlawfully discriminate and modern public services should be shaped by evidence-based policy-making.
3. Analysing equality information will involve asking what steps can be taken to mitigate any negative impacts on people with particular characteristics.
4. Choosing a course of action may involve making changes.

He also noted the famous (and now probably canonic) principles set out by Atkins LJ in R (Brown) v. Work and Pensions Secretary [2008] EWHC 3158 (Admin):

1. Decision makers in public authorities whose decisions might affect persons with a disability must be aware of the duty to have due regard to the goals specified in the 2010 Act;
2. The duty must be consciously fulfilled before and at the time that a particular policy which might affect such persons is being considered;
3. The duty must be exercised in substance, with rigour and with an open mind;
4. The duty cannot be delegated;
5. The duty is continuing;
6. It is good practice for such decision makers to keep an adequate record showing the consideration given to such a duty.

Also (per Cranston J at first instance in R (Greenwich Community Law Centre) v Greenwich London Borough Council [2012] EWCA Civ 496) noted was that the equality duty applies not only to the formulation of policies but also to the application of those policies in individual cases. The Court of Appeal in the same case approved this approach and Elias remarked that: "I would emphasise the need for the court to ask whether as a matter of substance there has been compliance, it is not a tick box exercise. At the same time the courts must ensure that they do not micro-manage the exercise."

In addition, Pill LJ had remarked in Harris v. London Borough of Haringey [2010] EWCA Civ 7093 that the requirement for authorities to have due regard to the relevant elements of the public sector equality duty means analysis of the material available to the decision maker "with the specific statutory considerations in mind”.

As indicated, the Judge also had regard to the European Convention on Human Rights and the UN Convention on the Rights of Disabled Persons 2006, noting that the European Court of Human Rights regards the UN Convention as highly material to interpreting the provisions of the European Convention. But although the Council accepted that the section 149 duty was engaged in the exercise of setting the ‘usual cost’ of care fees (i.e. what the Authority would usually expect to pay, having regard to assessed needs) it contended that that exercise was remote from the provision of accommodation and care. The Court was, however, unable to accept this since (in the Judge’s view) the result of the exercise may affect relevant European and UN Convention rights and should therefore be conducted having due regard to the need to eliminate discrimination and to advance equality of opportunity.

Given that the public sector equality duty was found to be engaged, was it complied with? Unfortunately for the Council the Judge found not. The Council had failed to have due regard "in substance or with rigour or with an open mind, to the need to eliminate discrimination and to promote equality of opportunity amongst elderly or disabled residents." And the Council "in carrying out this exercise failed to ask itself what it could do in respect of those needs." There had been no proper consideration of mitigation measures or proper management of potential home closures in setting the fees. The EIA should have been reconsidered in the light of this. Moreover, there had been no proper consideration of the staff costs of engaging and interacting with residents suffering from dementia.

However, as noted the Council had better fortune with the other two grounds of claim. The Judge found the consultation process to have been "a fair one which gave a sufficient opportunity for a meaningful response" despite the complexities involved and residual concerns from South West Care Homes. And the Court decided that there had been no irrationality in the Council’s decision process despite logical flaws alleged by the Claimant and differences in professional view from expert reports before the Court. The Judge noted that in the nature of judicial review, the decision on the relevant determinations is for the appropriate decision-maker and not for the Court. Consequently, having regard "to the respect which must be afforded to the functions of the decision maker and attempting to strike a judicious balance" he was not "persuaded that a lack of logic or irrationality, over and above professional disagreement, has been demonstrated".

In the circumstances, he found the Council’s decision to have been rational and preceeded by a fair consultation. However, it had been reached "without the necessary due regard to the need to eliminate discrimination against and to promote equality amongst elderly or disabled residents".

Comment

The ‘due regard’ element of the public sector equality duty is inevitably fact and context sensitive. For one person’s ‘due regard’ may well be another’s ‘disregard’ depending upon the situation and how it is viewed. And just when does judicial supervision become micro-management and inappropriate trespass into the proper decision territory of the decision maker? These will no doubt continue to be resonant issues in future litigation as the fierce costs pressures on care home owners collide with similar pressures encountered by local authorities across the land.

However, Devon has apparently undertaken to conduct a more detailed equalities assessment, and take any specific findings into account. As the Council pointed out, this exercise may, or may not result in a change to fee rates. But Councillor Stuart Barker, Devon’s Cabinet Member for Adult Social Care, expressed the sincere hope that the Court’s decision "means we can now all move on and get back to working together to provide for Devon’s growing numbers of older people instead of wasting valuable time and money on expensive legal action".

© Nicholas Dobson[2]

November 2012.