R M and S v London Borough of Haringey

JurisdictionEngland & Wales
CourtQueen's Bench Division (Administrative Court)
JudgeMr Justice Underhill
Judgment Date07 February 2013
Neutral Citation[2013] EWHC 252 (Admin)
Docket NumberCO/832/2013
Date07 February 2013

[2013] EWHC 252 (Admin)




Royal Courts of Justice


London WC2A 2LL


Mr Justice Underhill


The Queen on the Application of M and S
London Borough of Haringey

Mr I Wise QC and Mr Jamie Burton (instructed by Irwin Mitchell) appeared on behalf of the Claimant (S)

Mr C Sheldon QC and Ms H Emmerson (instructed by LA Solicitor) appeared on behalf of the Defendant

(As approved)

Mr Justice Underhill



Section 33 of the Welfare Reform Act 2012 abolishes, with effect from 1 April 2013, the current system of council tax benefit. Council tax benefit is a central government benefit and wholly funded centrally, albeit administered locally. The amount of benefit varies according to the claimant's means, but in the appropriate case might cover the entire costs of their council tax liability — so-called 100% benefit. In place of council tax benefit local authorities are required, by amendments to the Local Government Finance Act 1992 effected by the Local Government Finance Act 2012, to introduce their own "Council Tax Reduction Schemes" ("CTRSs") under which claimants satisfying the specified criteria as to means will pay council tax at a reduced rate. Such a reduction is not perhaps a "benefit" in the same sense as under the previous central scheme, but I will in this judgment for convenience sometimes refer to it as such.


CTRSs will be funded by central government, but only at 90% of the level at which council tax benefit was paid in the current year, that is to say 2012-13. Local authorities will thus have in practice either to pay some, or all, claimants less by way of council tax reduction than they received previously by way of council tax benefit, or to fund the difference from their own resources either by reducing expenditure or by raising income, most obviously by raising the rate of council tax itself or by recourse to their reserves, if any.


Authorities are required to decide on their own schemes by 31 January 2013. If they fail to do so by that date a default scheme operates, which essentially replicates the terms on which council tax benefit was paid under the current central government scheme.


Regulations made under the Local Government Finance Act 1992 (as amended) set the parameters for the terms of CTRSs. The only point which I need to mention for present purposes is that it is required that pensioners should continue to receive the same level of benefit as previously.


The defendant, the Council of the London Borough of Haringey, resolved on 17 January to adopt a CTRS which accommodated the shortfall in funding entirely by a reduction in the level of benefit. Claimants of working age would be relieved from council tax liability at a level of just over 80% of council tax benefit levels in the current year. That 20% reduction was the product of three factors: first, the 10% reduction in central government funding; second, the requirement in the regulations that pensioners continue to enjoy reductions at the equivalent level to their previous benefit; and third, a predicted increase in the number of claimants as compared with the current year. As regards that third point, the government has made it clear that any such increases in the number of claimants would have to be funded by local authorities. Thus claimants who had previously had 100% benefit will now have to pay a sum by way of council tax, albeit only approximately 20% of what would otherwise be their liability. (About one third of householders in Haringey qualify for council tax benefit at present. Of those about two thirds, 23,000 households, receive 100% benefit.) There are some other features of the scheme adopted by the Council which represent changes from the previous position, namely a reduction in the amount of capital above which claimants are not entitled to benefit, the removal of entitlement in cases where the benefit is less than £1 per week, and a reduction in the maximum period that any claims for CTR can be backdated. However, those elements are not material for present purposes.


These proceedings are brought to challenge the lawfulness of that decision. As will be apparent, they have come on very quickly. The claim was lodged on 24 January, ie within a week of the Council's decision. Expedition was sought not simply on the basis that the new scheme would come into force on 1 April, but more specifically because of an impending deadline of 15 February for the Council to apply for a transitional grant which would substantially reduce the impact in the government central funding, but which would not be available if the current decision remained in place: I give more details of that below. On the same day Foskett J ordered a rolled-up hearing, to be listed in the week beginning 4 February.


As I understand it, the impetus for the proceedings came from a local clergyman and poverty campaigner, who enlisted the assistance of Irwin Mitchell. The original claimant was a member of his congregation, who was granted anonymity by Foskett J and to whom I will refer as "M". An unexpected problem has arisen with her legal aid, and with the consent of the Council I allowed another claimant to be joined and made a similar anonymity order: I refer to her as "S". M and S are both single mothers. M has three children and S four. Both are at present in receipt of 100% council tax benefit. They are on very tight budgets, and the sum of approximately £4 per week which they will have to pay by way of council tax under the new scheme is, they say, simply unaffordable. Strictly speaking, only S was represented before me at the hearing, though that is frankly a formality.


The case has been very well prepared over a short period, and I have had the advantage of helpful skeleton arguments from Mr Ian Wise QC and Mr Jamie Burton for the claimants, and from Mr Clive Sheldon QC and Miss Heather Emmerson for the Council. Because of the urgency of the matter I have myself only had a short time to prepare this judgment, and I have accordingly limited myself to the essential points.


The claimant originally pleaded two bases for her challenge, namely Tameside irrationality and failures by the Council in its duty to consult; but only the latter ground is now pursued. It is convenient to say at this stage that I regard that ground of challenge as arguable, and I accordingly give permission to apply for judicial review.



The relevant statutory provisions are to be found in the Local Government Finance Act 1992 (as amended). Section 13A (2) and (3) reads as follows:

"(2)Each billing authority in England must make a scheme specifying the reductions which are to apply to amounts of council tax payable, in respect of dwellings situated in its area, by—

(a)persons whom the authority considers to be in financial need, or

(b)persons in classes consisting of persons whom the authority considers to be, in general, in financial need.

(3)Schedule 1A (which contains provisions about schemes under subsection (2)) has effect."


Turning to Schedule 1A, paragraph 3(1) reads as follows:

"Before making a scheme, the authority must (in the following order)—

(a) consult any major precepting authority which has power to issue a precept to it,

(b) publish a draft scheme in such manner as it thinks fit, and

(c) consult such other persons as it considers are likely to have an interest in the operation of the scheme."



The story starts with a decision by the Council's Cabinet on 10 July 2012 to adopt a proposal for consultation with the Greater London Authority ("the GLA"), being the precepting authority with whom it was necessary to consult first, "that will reduce CCTB payments for all claimants in line with the reduction in Government grant". That was in essence, if rather over-summarily described, the proposal which was eventually adopted. The paper to Cabinet made it clear that other options had been considered. Part 7 of that paper reads as follows:

"7.1 We have considered a number of options for the overall scheme. However, these options have not been taken forward because they could have a disproportionate impact on some claimant groups over others or result in a shortfall in the Council's budget which would have to be met by reductions in services.

7.2 These include:

• Protecting certain vulnerable groups in addition to pensioners

• Protecting band A — C properties

• Protecting claimants on 100% CTB

• Protecting claimants who are working but on low income.

• Absorbing the cost

• Stagger the introduction of the scheme."


Following consultation with the GLA, the Council produced a draft scheme, and on 29 August 2012 it produced a consultation document. The document is four pages long and expressed in straightforward terms. Clearly considerable thought had been given to making it accessible and focused on what the Council regarded as the key points. I need not set it out in full. The particular points that I need to mention are as follows:

(1) On the first page, which headlines the nature of the change in the system, it is explained that council tax benefit is being replaced by local authority CTRSs and that "the Government will significantly cut funding for the new benefit". The document then says:

"Early estimates suggest that the cut will leave Haringey with an actual shortfall in funding of around 20%. This means Haringey claimants will lose on average approximately £1 in every £5 of support they currently receive in council tax benefit."


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