Licence to make policy decisions?
The Court of Appeal’s judgment in the 007 Stratford Taxis case addresses the issue of whether the Cabinet of a local authority has the power to adopt a policy to direct the discharge of a non-executive function. Peter Keith-Lucas considers problems raised by the judgment, and its wider implications.
In R (007 Stratford Taxis Ltd) v Stratford on Avon DC [2011] EWCA Civ 160, the District Council’s General Purposes Committee considered the merit of having a policy that all new taxis must have wheelchair access. But although taxi licensing is a non-executive function discharged by the General Purposes Committee under powers delegated to it by Council, the Committee recommended the draft policy to the authority’s Cabinet, and it was the Cabinet which formally adopted the policy.
That decision was challenged by a taxi operator (007 Stratford Taxis) some six months later on a number of grounds, including that the Cabinet was not competent to take the decision. The taxi operator contended that under the Local Authorities (Functions and Responsibilities) (England) Regulations 2000 (“the Functions and Responsibilities Regulations”), a decision to adopt a policy that all taxis should have wheelchair access was the exercise of a function which was calculated to facilitate, or was conducive or incidental to, the discharge of the power to license hackney carriage and private hire vehicles and so was a non-executive function, rather than the adoption of a plan or strategy that was an executive function.
At first instance the Recorder allowed the operator’s application on a number of grounds, while upholding that the Cabinet’s adoption of the policy was valid, but he dismissed their application as being out of time and refused an extension.
The District Council appealed to the Court of Appeal, but had no interest in challenging the Recorder’s view that its policy had been validly adopted. So the issue appears as Ground 3 in the Court of Appeal’s judgment and the polite thing would be to suggest that the absence of a strong challenge on this point meant that the Court of Appeal’s determination of this point was less rigorously reasoned than it might have been.
Vires
The Court of Appeal started by approaching the issue of vires: did Council or did the Cabinet have the statutory authority to adopt such a policy? The service legislation (the Town Police Clauses Act as supplemented by the Local Government (Miscellaneous Provisions) Act 1976) makes no mention of a policy. So the Court of Appeal considered whether the making of such a policy could be covered by s.111 of the Local Government Act 1972, which empowers an authority to do anything which is calculated to facilitate, conducive or incidental to, the discharge of the function of determining applications for taxi licences. The court admitted that, at first sight, the adoption of a policy might appear to facilitate the determination of applications to which the policy applied. However, it felt that the adoption of a policy fell more readily within the wording “plan or strategy” in the Functions and Responsibilities Regulations.
The court recognised a distinction between the political decision to adopt a policy and the determination of individual applications for taxi licences. However, it took the surprising view that the adoption of a policy did not facilitate or make easier the determination of individual applications as the policy was not directed to the individual exercise of the power to determine such applications. The court therefore held that the adoption of the policy was a function distinct from the determination of individual applications, and did not come within s.111.
Allocation of functions
This determination was critical, as the allocation of functions between Council and the Executive (Cabinet) also rests on the application of s.111. Section 13 of the Local Government Act 2000 allocates the authority’s powers between the Council and the Cabinet. It provides that all the powers of the authority are to be exercised by the Cabinet unless they are specifically reserved to Council by legislation, including regulations made under s.13. The Functions and Responsibilities Regulations are just such regulations, and reg.2 and Schedule 1 define that the determination of individual application for taxi licences shall be a non-executive function and, as such is exercisable by Council and can be delegated to a committee. But s.48(4) of the 2000 Act provides that any reference to the discharge of a function shall include reference to the doing of anything which is calculated to facilitate, conducive or incidental to the discharge of that function.
So, having determined that the adoption of the policy was not calculated to facilitate the determination of individual applications, the Court of Appeal concluded that, in line with the reference in the Regulations to “plan or strategy”, it must be an executive function.
This element of the judgment is surprising for three reasons:
- the policy sets a framework within which the individual application must be determined, such that clear and substantial reasons would be required for the Committee to depart from the policy. At least in common parlance, it would therefore seem to make the determination of individual applications easier (unless worded so poorly that it merely caused confusion);
- having started its analysis on the basis of vires, and finding the vires of the Council unsatisfactory, the court failed to examine the vires of the Cabinet with equal rigour. Local authorities are statutory corporations. They can only do what statute permits them to do. The Court of Appeal appears to have felt that the reference in the Functions and Responsibilities Regulations to “plans and strategies” provided the Cabinet with vires. But the Regulations do not purport to provide an original source of powers, they merely allocate existing powers between the Cabinet and Council. If there was legislation outside the regulations which gave a power to adopt a policy on taxi licensing, the regulations could allocate that power as between Cabinet and Council, but it could not grant the Cabinet a new power;
- further, the Court of Appeal failed to consider how a policy adopted by the Executive might govern the discharge of a function by the General Purposes Committee. Regulation 5 and Schedule 4 to the Regulations cover this in respect of the Cabinet, providing that, if the Cabinet wish to take a decision which is contrary to a policy approved by Council, it is a “departure decision” and must be referred by Cabinet to full Council for determination, except in cases of urgency. The regulations make no such provision in respect of a Committee of Council. In truth it would be redundant for the regulations to do so. The Committee’s powers to determine taxi licensing applications are delegated to the Committee by Council. So the Council’s adoption of a policy comprises an instruction to its agent Committee on how it is to discharge this delegated power. Even if Cabinet had the statutory power to adopt a policy in respect of the discharge of a nonexecutive function, there is no mechanism by which that policy would be binding upon the Committee.
Our view remains that, except where there is a specific statutory power to adopt a policy, the preparation and adoption of a policy for the discharge of a function is “calculated to facilitate, conducive or incidental to the discharge of” that function and comes within s.111. This means that the policy-making power would rest with Cabinet for executive functions and with Council (delegable to Committees) for non-executive functions. What reg.4 of the Functions and Responsibilities Regulations (which does not rate a mention in the Court of Appeal judgment) then does is to vary that arrangement in specific instances. So reg.4(1) - (3) provides that, in the specific instance where the policy is one which is either listed in Schedule 3 or which Council has resolved to adopt:
- the Council resolves that a draft policy is required;
- the policy preparation activity, which would normally fall to Council where the policy related to a non-executive function, falls to the Cabinet; and
- the approval of the policy remains with Council.
Implications of the judgment
The implications of the Court of Appeal’s judgment are far-reaching. Whereas the Local Government Act 2000 provided that the Cabinet must operate within the policies and budget set by Council, the Court of Appeal seems to have given the Cabinet the power to adopt policies which constrain the Council and its Committees in the discharge of their non-executive functions. The view that Council and its Committees should be subordinate to the Cabinet represents a radical re-invention of the 2000 Act.
The District Council is not appealing the Court of Appeal’s judgment, so it is unclear how this constitutional impasse can be resolved, unless and until a similar case reaches the Court of Appeal.
Peter Keith-Lucas is a partner at Bevan Brittan. He can be contacted at This email address is being protected from spambots. You need JavaScript enabled to view it..
