England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE (ADMINISTRATIVE COURT)
MR JUSTICE CRANSTON
CO/10969/2011

		Royal Courts of Justice Strand, London, WC2A 2LL
		24/04/2012

Lord Justice Elias :

1. This is an appeal by Greenwich Community Law Centre ("Greenwich CLC") against the judgment of Mr Justice Cranston, who dismissed its application for judicial review brought against Greenwich London Borough Council. Greenwich CLC provides free legal advice and assistance to some of the most vulnerable people in the area of Greenwich in London. It operates mainly in the field of immigration, welfare benefits, housing, employment and debt. It was established in 1984 and it relies upon funding from a number of sources, but one of the key funders has traditionally been the Council. For example, it has occupied rent-free accommodation from them.
2. From about 2007 until April 2011 it was a member of a consortium called Greenwich Legal Advice Services (GLAS). The Council funded the members of GLAS to provide legal advice services and Greenwich CLC received almost £200,000 per annum in order to provide advice services in the areas of work in which it specialised. The other members of that consortium were Greenwich Citizens' Advice Bureau, Plumstead CLC, Meridian Money Advice, and Greenwich Housing Rights. These are based in different parts of the Borough.
3. In February 2010 the Cabinet of the Council agreed a draft "Third Sector Commissioning Framework" for 2011/2013. The Third Sector includes charities as well as community and voluntary groups.
4. In mid-July bids were invited for the provision of a range of services. By January 2011, however, the overall grant available for the voluntary sector had to be reduced from £7 million by about 30%. This was the consequence of the Government's comprehensive spending review in October 2010. Affected organisations were informed on 3 December 2010 that when the current funding arrangements expired on 31 March 2011, there would be an adverse impact which may lead to redundancies.
5. The Cabinet made a provisional decision on the allocation of its grants and commissioning budget on 25 January 2011. At that time GLAS was the only bidder for legal services funding, but the Cabinet was not satisfied with its bid and had provisionally decided to undertake a further commissioning exercise. However, the Cabinet did not at that stage take any final decisions. They were deferred until the March meeting. The Council's Overview and Scrutiny Committee was asked to review the decision-making process adopted to determine to whom funds should be given, as well as the provisional funding proposals. There was at this stage an initial equality impact assessment but Cabinet agreed that they should be provided with a full equality impact assessment of the implications of their provisional decisions at the March meeting.
6. The Overview and Scrutiny Committee met and prepared a report. It was satisfied that the commissioning process was sufficiently robust but it identified areas for further improvement, which included equality impact assessment. In particular, the Committee was concerned that the Council should take account of the impact which reduced funding would have on some of the smaller providers, as well as the consequences for locally based and socially isolated groups in the borough. There was a further consultation with representative groups. The Committee agreed with the Cabinet's proposal to re-commission the legal advice sector. Given the need to vary the commissioning arrangements, the Committee recognised that interim funding would be necessary until final allocations were made later in the year.
7. The final EIA presented to Cabinet in March recognised that the cuts in funding would adversely affect residents. It referred to the representations from GLAS who stated that there was a risk of disproportionate impact on grounds of race, gender, disability and age since 74% of their clients belonged to the black and minority ethnic groups, 21% were disabled, and 24% were lone parents. One of the mitigating measures recommended in the EIA was that the re-commissioning exercise should improve efficiencies by reducing duplication and costs within the sector.
8. The Committee's recommendations were agreed by the Council's Cabinet at its meeting on 15 March. Cabinet empowered the Director of Culture and Community Services, in consultation with the Deputy Leader, to agree interim funding of legal advice services, and it also agreed that there should be re-commissioning in the advice and legal services area with a further report to be presented to Cabinet. Subsequently an agreement for interim funding was entered into with Greenwich CLC for a six month period.
9. The re-commissioning exercise was prepared by officers and they presented a report to the Overview and Scrutiny Committee on 12 May 2011. This set out the principles underpinning the objective of helping the vulnerable, namely that the mix of advice should meet the Council's needs-based priorities; that a range of accessible delivery points with outreach facilities must be included so as to ensure the advice would be available throughout the Borough; that the provision should ensure improved efficiency and value; and that a single agency should provide general help and advice identifying priority cases which would then be referred to the appropriate specialist agency which would operate as a centre of excellence. Four modules were identified, namely general advice; housing, which subsequently became housing and welfare rights; money/debt; and other specialist, which later became immigration and employment. It was stated in the report that this did not rule out a single provider securing all the four modules but the officers considered that to be an unlikely outcome.
10. The Overview and Scrutiny Committee endorsed the report. This led to a tendering document being issued on 21 June 2011. It highlighted certain requirements, in particular that the services of the legal advice providers should be delivered throughout the community and to specific targeted priority groups. Indeed it was specified that 75% of the advice should be directed at priority groups. These groups included the unemployed and people on low incomes; people with long term illness and disability; older people (50 and above); people from BME communities; migrant workers; victims of violence; and people with accommodation problems. It was envisaged that the contract for each module would run from October 2011 until 31 March 2013.
11. Greenwich CLC applied for three of the contracts but they did not get any of them. We are now concerned with only one, namely the employment and immigration bid. That was awarded to Plumstead CLC who in a whole range of criteria scored more highly than Greenwich CLC. For example, under each of the headings "Equalities", "Location", and "Expanding the reach of the Services" the scores were significantly in favour of Plumstead.
12. The officers met with Greenwich CLC to inform them in confidence on 31 August that it was unlikely they would be awarded any contract, although it was emphasised that the final decision would have to be taken by Cabinet and further, that the decision could be reconsidered if it was called in under the Council's scrutiny arrangements. It was considered by the Cabinet on 20 September when there was a reminder to councillors that they would need to take account of the Council's equality duties and the impact of the recommendations on different equality groups. The Cabinet agreed with the report's recommendations, although it was recognised that the detail of some of the outreach arrangements was still to be finalised.
13. Two councillors did then exercise their right to call in the Cabinet's decision on the ground that the west of Greenwich, which is where the Greenwich CLC was located, did not have a suitable provider. They sought to clarify whether the recommendations fully took into account the geographical spread of advice centres. This resulted in a further meeting of the Cabinet on 18 October which considered a further report from officers in response to the call in, as well as further submissions from Greenwich CLC. It was pointed out that the evaluation panel had directly considered accessibility and geographical spread when appraising and scoring the applications. The officers were confident the successful bidders would be able to deliver an accessible service across the Borough targeted towards priority groups. There was a discussion at the Cabinet meeting of questions of accessibility and the geographical spread of the services and indeed Mr Mills of Greenwich CLC addressed the Committee and stressed the long history of the Law Centres at Greenwich. After considering all these matters, the Cabinet reaffirmed its previous decision.
14. At a later meeting of the Overview and Scrutiny Committee on 10 November officers reported that they were in the process of finalising the outreach requirements throughout the Borough. Greenwich CLC then lodged its application for judicial review on the 11 November, the day before the new providers commenced the provision of services under the new funding arrangements.

The public sector equality duty.

15. The basic duty is set out in section 149(1) of the Equalities Act 2010 as follows:

(1) A public authority must, in the exercise of its functions, have due regard to the need to—

(a) eliminate discrimination, harassment, victimisation and any other conduct that is prohibited by or under this Act;
(b) advance equality of opportunity between persons who share a relevant protected characteristic and persons who do not share it;
(c) foster good relations between persons who share a relevant protected characteristic and persons who do not share it.

16. The purposes identified in sub-paragraphs (b) and (c) are then the subject of more detailed clarification in subsections (3) and (5):

(3) Having due regard to the need to advance equality of opportunity between persons who share a relevant protected characteristic and persons who do not share it involves having due regard, in particular, to the need to—


(a) remove or minimise disadvantages suffered by persons who share a relevant protected characteristic that are connected to that characteristic;

(b) take steps to meet the needs of persons who share a relevant protected characteristic that are different from the needs of persons who do not share it;

(c) encourage persons who share a relevant protected characteristic to participate in public life or in any other activity in which participation by such persons is disproportionately low …..


(5) Having due regard to the need to foster good relations between persons who share a relevant protected characteristic and persons who do not share it involves having due regard, in particular, to the need to—



(a) tackle prejudice, and

(b) promote understanding.

17. The relevant protected characteristics are then defined in subsection (7). They are age; disability; gender reassignment; pregnancy and maternity; race; religion or belief; sex; and sexual orientation.

Grounds of appeal.

18. Before the judge a number of submissions were pursued, all unsuccessfully. Initially the appellant sought to appeal virtually all the judge's conclusions, but the only grounds for which permission to appeal was given by Sir Richard Buxton concern the question whether there was proper compliance by the Council with its public sector equality duty.
19. I make three preliminary observations about this challenge. The first is that the focus is not on the specific decision not to award the contract for employment and immigration work to Greenwich CLC and instead to award it to Plumstead CLC. There is no complaint about the tendering procedures, nor about the way the tendering exercise itself was carried out. Rather the submission is that the final decisions were made by the Cabinet without any compliance with the section 149 duty. The consequence of that breach, it is asserted, is that the contract awards must be unscrambled and the exercise begun again. This will give the appellant a further chance to compete for one or more of the contracts.
20. Second, the appellant did not raise any point about the breach of the public sector equality duty until they had been informed by officers that the recommendation would be for Plumstead and not Greenwich to be awarded the contract for employment and immigration services.
21. Third, there has been no complaint that the Council failed to comply with the public sector equality duty when it resolved to reduce the budget, nor is it suggested that the Equality Impact Assessment prepared with respect to that decision was unsatisfactory in any way.
22. The submissions advanced before the court were essentially those pursued and rejected by Cranston J. Mr Manning, counsel for the appellant, has advanced three inter-related grounds to support his principal challenge. First, whilst accepting that the Council had proper regard to their equality duty at the point when they resolved to cut the budget, thereafter there was a significant change to their funding policy by choosing to fund one organisation only to provide each module of legal advice rather than funding each member of GLAS to provide all the relevant types of legal advice. He submits that this change to a module approach was significant and required that there should be a fresh assessment of the equality impact, but that did not happen.
23. Furthermore, not only was this a breach of the section 149 duty but in addition it infringed the council's own equality policy which in terms states that:

"Equality Impact Assessments will be carried out for all proposed new policies or policies for which significant changes are proposed."

24. Finally, he says that there was in any event a failure by the cabinet itself to have regard to their equality duties. True it is that at the meeting on 20 September, when the decision was taken to approve the outcome of the tendering exercise, the cabinet was told to take into account their equalities duty. However, they had no material before them which would have enabled them to do that. There was a reference to background documents, which included the EIA, produced when the decision to cut the budget was taken, but no evidence that this was before the committee. In any event it did not focus on the new policy and was inadequate for the purpose.
25. In addition to these points, Mr Manning contended that even if it can be said that the Council had given proper consideration to the needs of the priority groups, these did not in all respects reflect the groups with protected characteristics identified in section 149. There was no direct correlation between the two. Mr Manning expressly disavowed any submission to the effect that it was necessary for the Council to address each of the detailed policy objectives with respect to each protected characteristic in turn; he accepted that the Council did not have to address aspects of the duty that were plainly going to be irrelevant. Mr Manning said that he was not contending for a formulaic approach to these provisions. But he did contend that the onus was on the Council to show that there had been compliance, and that was plainly lacking here.
26. Mr Coppel, counsel for the respondent, contends that Mr Manning's analysis misrepresents the true position. The Cabinet allowed the officers to adopt and apply procedures for advertising and awarding appropriate contracts. This was within strict parameters which did not involve any significant change from the original policy of targeting priority groups. In essence it involved a shift from each provider offering all types of legal advice one provider only being responsible for each module, but the same service was otherwise being provided in essentially the same way to the same people. The Council properly identified the groups who would be adversely affected by the cut back in public expenditure in the original EIA.
27. Furthermore, the Council was only obliged to pay due regard to those aspects of the duty which it could be anticipated might reasonably be engaged. There was no duty to consider such characteristics as were not likely to be engaged by the exercise of the function in question. Mr Coppel relied on dicta to that effect by Pill LJ in the Bailey case para 83 (read with paras 37-40) and Elias LJ in R (Hurley and Moore) v Secretary of State for Business, Innovation and Skills [2012] EWHC 201 Admin para 95. Far from being a significant change, the shift to the modular delivery of the service was only a minor variation of the original proposal which was in part at least designed to cut duplication costs so as to ensure that as much money as possible was available for the priority groups. These groups in fact covered almost all the specified characteristics identified in section 149. The only reason why the move to modular providers might have an impact on equality considerations is that the service from any specialist adviser might be located in an area not readily accessible across the borough. Indeed, the officers recognised that there may be difficulties for some of the elderly and disabled if the provision of services was not conveniently accessible across the borough. However, Mr Coppel submitted that this was a matter which was addressed in the commissioning process itself. The specification required out-reach provisions to ensure that the service was available across the borough. Indeed, this was a factor where Plumstead scored more highly than Greenwich in the evaluation of bids. Moreover, this was a matter which was expressly considered at the reconsideration meeting of the Cabinet in October. At no stage has the appellant ever identified any other equality consideration which the proposed change to the service would create.
28. In addition, the move to multiple providers meant that it was important to try and ensure so far as possible that a client who needed advice in different areas would be able to receive it. This again was recognised as a potential area where the elderly and disabled in particular could be adversely affected, and the problem was dealt with by stipulating in the contract specification that the successful tenderer would have to work in partnership with other organisations providing different modules so as to provide as seamless a service as possible, and would need to provide the service across the borough.

The judgment below.

29. Cranston J rejected these arguments and essentially accepted the submissions of Mr Coppel. He expressed his conclusions in the following terms (paras. 48-51):

"48. Due regard is the regard that is appropriate in all the circumstances: R (Baker) v Secretary of State for Communities and Local Government [2008] EWCA Civ 141; [2009] PTSR 809, [31]. In that case Dyson LJ said: "The question is whether the decision-maker has in substance had due regard to the relevant statutory need. It is necessary to turn to the substance of the decision and its reasoning": [37]. Paying due regard is an essential preliminary to any decision: R (BAPIO) v Secretary of State for the Home Department [2007] EWCA Civ 1139, [3]. While the circumstances may point strongly in favour of undertaking a formal equality impact assessment, that is not a statutory requirement: R (Brown) v Work and Pensions Secretary [2008] EWHC 3158 (Admin); [2009] PTSR 1506, [89]. In that case the Divisional Court identified a number of helpful principles that demonstrate how a public authority should fulfil its due regard duty: [90]-[96]. These included that the due regard duty must be fulfilled before and at the time that a particular policy which might affect relevant persons is being considered; the duty has to be integrated within the discharge of the public functions of the authority; and the duty is a continuing one. Clearly the duty applies not only to the formulation of policies, but also to the application of those policies in individual cases: Pieretti v Enfield LBC [2010] EWCA Civ 1104; [2011] HLR 3. "

49. Stepping back from the details, it seems to me that what the Council was attempting to do was to mitigate inequalities in what it thought was the most effective way, against a background of a significant reduction in government expenditure. The Council conducted an equalities impact assessment in March 2011 in advance of its decision not to award funding for legal advice services and instead to conduct a fresh commissioning round. The whole purpose of its funding legal advice services was to assist priority groups. That theme runs through the whole of the commissioning exercise, in particular under the heads mentioned earlier in the judgment, "equalities", "location of services", and "expanding the reach of the services". It then selected those organisations which in terms of the criteria would best achieve the objectives.

50. As a matter of law there is no obligation to conduct a formal equality impact assessment before every decision. Here the Council conducted an equality impact assessment in March 2011 in advance of its decision not to award funding for legal advice services and instead to conduct a fresh commissioning round. It paid due regard in substance to its equalities duties under the Equality Act 2010 by remaining faithful to the focus on priority groups in the tendering exercise. In my view there was no need for a further equality impact assessment with regard to the outcome since the logic of the tender process meant that performance of the duty was integral to the outcome. Selection of the winning tenders would inevitably pay due regard to the equalities objectives. No new or different equalities considerations arose.

51. Mr Manning's submissions on accessibility were based on several faulty premises. Notwithstanding the assertion, later abandoned, Greenwich CLC is not at the centre of the borough. (When Cllr. Drury called in cabinet's September decision it was because not funding Greenwich CLC might deprive the western part of the borough of legal advice and assistance). More importantly, accessibility was in fact considered by the Council during the tender process. As we saw that was an issue on which Greenwich CLC scored badly in the tender evaluation. Whatever the effectiveness or otherwise of outreach services, that was identified by Councillors, amongst others, as necessary to take the services to the priority groups. Greenwich CLC proposed inadequate outreach services. By contrast the successful tenderers had thought through outreach proposals, including in children's and community centres, albeit that they were not finalised until later. Mr Manning's submissions in this regard were self-defeating."

Discussion.

30. The relevant legal principles are now well established and were not in dispute. The basic approach is summarised in paragraph 48 of Cranston J's judgment set out in the previous paragraph. 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. Furthermore, as Pill LJ observed in R (Bailey) v Brent London Borough Council [2011] EWCA Civ 1586 para 83, it is only if a characteristic or combination of characteristics is likely to arise in the exercise of the public function that they need be taken into consideration. I would only add the qualification that there may be cases where that possibility exists in which case there may be a need for further investigation before that characteristic can be ignored: see the observations of Elias LJ in Hurley and Moore para 96. (Perhaps more accurately it may be said that whilst the Council has to have due regard to all aspects of the duty, some of them may immediately be rejected as plainly irrelevant to the exercise of the function under consideration - no doubt often subliminally and without being consciously addressed. As Davis LJ observed in Bailey, para 91, it is then a matter of semantics whether one says that the duty is not engaged or that it is engaged but the matter is ruled out as irrelevant or insignificant).
31. In this case I have no doubt that the Council's own priority groups in practice dealt with all those groups with the protected characteristics identified in section 149 which realistically might be affected by the decision. Not only did the Council have due regard to the implications of the decision on those groups, it actually structured its policy so as to ensure that they were the principal beneficiaries of such funds as remained available. As Cranston J aptly remarked, the logic of the tendering exercise meant that the performance of the duty was integral to the outcome.
32. The alteration between March and October effected by the re-commissioning exercise was not in my view a significant change in policy at all. It was a shift in the way in which the objectives of the policy were achieved which was designed to ensure greater savings for the good of the beneficiaries of the service. A change from one provider to another without more will not usually engage equality considerations as Ouseley J recognised in R (Barrett) v London Borough of Lambeth [2012] EWCA Admin para 92; nor should it matter that it changes from one provider to four. Mr Manning found considerable difficulty in identifying any possible impact the change might have on the prescribed groups. The only potential impact he could suggest was that it would have accessibility implications, both geographic - ensuring that advice is available across the borough so that certain groups, such as some elderly or disabled, are not disadvantaged by the problems of getting to an advice centre; and functional – requiring clients to go to separate providers where they had more than one problem e.g immigration and social security. It is not clear how the latter would have any specific equality implications, although in any event cohesion between services figured as a specific criterion against which bids were measured. However, I agree that the former would. But this was fully recognised in the way the specification for the services was constructed, and the equality implications were also specifically discussed by the Council at the final meeting in October. It was the very reason that the two councillors wanted the call-in. It is impossible to suggest that there was not due regard to this consideration.
33. I agree with Mr Manning that the simple statement to the councillors at the September meeting that they should have regard to their equality obligations would not on its own be enough to demonstrate that they had complied with their duties. But that is to consider that statement out of context. Given the full EIA in March and the fact that the modifications thereafter were minor and fully in accordance with the commissioning principles which had been approved in March, it was unnecessary to require more.
34. Mr Manning bridled at being pressed to identify which other equality considerations might be engaged. He rightly asserted that the obligation lies on the Council to comply with its duty, and it was not for the appellant to tell them how that should be done. That is true; but if the appellant is going to allege a breach of that duty, it should in my view at least identify some characteristic which might realistically be said to have been engaged as a result of the change in policy and yet was not considered.
35. Mr Manning even went so far as to contend that the fact that by October the final locations for the various services had still not been determined - the detail being left in the hands of the officers - demonstrated that the duty could not have been complied with. In my judgment, that submission is misconceived. The purpose of the duty is to require consideration of equality implications at the time policy is drafted. The fact that it is a continuing duty does not mean that there has to be further detailed consideration when the general framework is made concrete, or whenever there are minor changes of detail. It would make administration intolerable and grossly inefficient if every aspect of policy left to officers' discretion had automatically to be returned for further consideration of the equality implications.
36. For these reasons, which essentially reflect those of Cranston J below, I would dismiss this appeal. In the circumstances it is not necessary to consider Mr Coppel's submission that even if the section 149 duty had been infringed, it was not an appropriate case in which to grant any substantive relief.

Lady Justice Black:

37. I agree.

Lord Justice Ward:

38. I also agree.