R (Devon County Council) v Secretary of State for Communities and Local Government
| Jurisdiction | England & Wales |
| Judge | Mr Justice Ouseley,MR JUSTICE OUSELEY |
| Judgment Date | 05 July 2010 |
| Neutral Citation | [2010] EWHC 1456 (Admin),[2010] EWHC 1847 (Admin) |
| Docket Number | Case No: CO/2486/2010,CO/2486/2010 |
| Court | Queen's Bench Division (Administrative Court) |
| Date | 05 July 2010 |
[2010] EWHC 1456 (Admin)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT
Before: MR JUSTICE OUSELEY
Case No: CO/2486/2010
Mr T Straker QC, & Mr J Moffett (instructed by Knights Solicitors) (1) Devon County Council
Mr Straker QC and Mr A Sharland (instructed by Knights Solicitors) for (2)Norfolk County Council
Mr R Drabble, QC, Mr S Grodzinski and Mr T Buley (instructed by Treasury Solicitors) for the Secretary of State
Mr J Goudie, QC and Mr P Oldham, QC (instructed by solicitors for Exeter City Council and Norwich City Council) for the Interested Parties
Hearing dates: 28 th and 29 th April 2010
Mr Justice Ouseley:
Introduction
On 10 February 2010, the Secretary of State for Communities and Local Government decided, pursuant to the Local Government and Public Involvement in Health Act 2007, that the City Councils of Exeter and Norwich should become unitary authorities on their existing boundaries, instead of being District Councils within the two tier system of local government which applies in most of Devon and throughout Norfolk. He decided therefore to lay before both Houses of Parliament the draft Orders by which those changes would be effected. An announcement was made on the same day by the Minister for Local Government in the House of Commons. The draft Orders required approval by affirmative resolution of both Houses, and the necessary resolutions were passed by the House of Lords on 22 March 2010, and on the next day by the House of Commons. On 24 March 2010, the final Orders were made by the Minister and they came into force on 25 March 2010, beginning the transitional arrangements for the new authorities to be fully operational in 2011.
Devon and Norfolk County Councils challenge the Ministerial decisions taken on 10 February 2010. They each contend that the basis on which the decisions were taken was radically different from that upon which the statutory consultation had been carried out and from that which Ministers had always said would underlie their decisions. Hence the consultation was unfair and did not comply with the requirements of the 2007 Act. Their legitimate expectations as to the basis upon which the decisions would be taken were breached. The decisions were irrational in the sense that they were made without any evidence to support the critical points upon which the decisions turned. The decisions were pre-determined and should have been accompanied by reasons.
It was not in issue but that if the legal errors were as asserted by the County Councils, the decisions fell to be quashed as did the Orders themselves. The Secretary of State, and the City Councils who appeared as Interested Parties in support of his decisions, accepted that although the nature of the decisions and the statutory decision-making process might create a very high hurdle for the County Councils, the sort of errors they asserted could in principle lead to the quashing of both the decisions and the consequent Orders.
Issues were raised in correspondence on behalf of the House Authorities about what use might be made of Committee Reports, debates and the Resolutions of either House but these were helpfully resolved immediately before the hearing.
The hearing was to be a permission and substantive hearing rolled up together. I decided to grant permission.
The Local Government and Public Involvement in Health Act 2007
This Act permits the Secretary of State to invite or direct District or County Councils to propose changes to local government structures so that a two tier authority becomes a single tier either on the same or different boundaries; section 2. The proposals by Exeter and Norfolk City Councils responded to an invitation.
Section 3 (5) provides:
“(5)In responding to an invitation under section 2, or complying with a direction under that section, an authority must have regard to any guidance from the Secretary of State as to-
what a proposal should seek to achieve;
matters that should be taken into account in formulating a proposal.”
The guidance is at the heart of this case.
Sections 4 and following deal with the role of the Boundary Committee of the Electoral Commission, from the start of April 2010 itself a Commission, the Local Government Boundary Commission. The Secretary of State can ask for its advice on any matter that relates to a proposal for change, section 4 (2); and he did so in relation to both of these changes. Where he has asked for advice, the Committee, if it thinks it appropriate in addition to providing the advice, can also recommend whether he should or should not implement the proposal, or make an alternative proposal to that originally proposed, including that a whole County Council area should be a single tier authority; section 5.
But, by section 6 (2), in making a recommendation on an original proposal or for an alternative proposal, the Committee must have regard to any guidance from the Secretary of State about its functions under section 5. This was very largely the same as the guidance given under section 3. Section 6 also imposes a duty on the Committee to take account of representations made to it about draft alternative proposals, which it has to publish before recommending them to the Secretary of State. Here the Committee recommended to the Secretary of State that these two proposals upon which its advice was sought should not be implemented. It recommended that alternative proposals for unitary Councils for the whole of two tier Devon and the whole of Norfolk should be implemented instead.
The Secretary of State's powers, as set out in section 7, are to decide whether or not to implement original or alternative proposals by order, with or without modification. A timetable is set out. But he cannot make an Order to implement an original proposal, that is one which he has invited or directed, “unless he has consulted the following about the proposal—(a) every authority affected by the proposal(except the authority …which made it); and (b) such other persons as he considers appropriate.”; section 7 (3).
Two additional provisions deserve mention: section 240 deals with the laying of Orders. Section 21 applies the Act retrospectively to invitations and guidance issued before the commencement of the Act in November 2007. The invitation process actually commenced in October 2006.
The decision-making process
A White Paper of October 2006 “Strong and Prosperous Communities” was accompanied by “Invitations to Councils in England”, whereby the Secretary of State invited proposals for unitary Councils in England. The White Paper, para 3.58, said that the Government would assess the proposals it expected to receive against the criteria which were set out in the Invitation; a small number only were expected to meet them.
The Invitation contained the guidance which was later to become the statutory guidance under s3 of the Act. The Invitation required councils submitting proposals to have regard to the guidance, including the criteria, adding at para 2.6,”Any proposal should conform to the criteria set out in section 3 of the guidance.” Paras 5.4 and 5.8 said that, at the first stage in the process, proposals would be assessed against the criteria in section 3 and “Only proposals which in the Government's opinion meet the criteria set out in section 3 will proceed to stage 2 of the process”. The Secretary of State in the House of Commons on 22 January 2007 said that proposals were to be judged against the criteria, only a few were expected to meet the strict criteria drawn up by the government for unitary status, and people could opt into the process on the basis of strict criteria, all of which was contrasted with previous efforts to achieve more single tier authorities.
Section 3 of the Invitation set out the headline criteria as follows:
“3.1 The criteria with which any proposal must conform are:
the change to the future unitary local government structures must be:
affordable, i.e. that the change itself both represents value for money and can be met from councils’ existing resource envelope; and
supported by a broad cross section of partners and stakeholders; and
those future unitary local government structures must:
provide strong, effective and accountable strategic leadership;
deliver genuine opportunities for neighbourhood flexibility and empowerment; and
deliver value for money and equity on public services.”
The five criteria fall readily into two parts: the first two deal with the cost of and support for the change; the other three deal with the objectives the new body must meet.
Each of these criteria was the subject of considerable elaboration. Under “Affordability”, restructuring had to be self-financing so the overall transitional costs “must” be more than offset over the payback period by savings, and that payback period “must” be no more than 5 years. There were separate provisions limiting resources which could be used to meet capital and revenue transitional costs; no costs, foreseen or not, could come from council tax increases.
There was a modest change to the way in which two headline criteria were described and elaborated in the later guidance given to the Boundary Committee when the Secretary of State requested its advice in February 2008. I highlight the changes because...
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