Zacchaeus 2000 Trust, R (on the application of) v Secretary of State for Work and Pensions [2013] EWHC 233 (Admin)

Case No CO/5916/2012[2013] EWHC 233 (Admin)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 15/02/2013
Before
THE HONOURABLE MR JUSTICE UNDERHILL
Between
THE QUEEN (ON THE APPLICATION OF ZACCHAEUS 2000 TRUST)ClaimantSECRETARY OF STATE FOR WORK AND PENSIONSDefendant
(Transcript of the Handed Down Judgment ofWordWave International LimitedA Merrill Communications Company165 Fleet Street, London EC4A 2DYTel No: 020 7404 1400, Fax No: 020 7831 8838Official Shorthand Writers to the Court)
ELISABETH LAING QC and CHRISTOPHER KNIGHT (instructed by Leigh Day& Co.) for ClaimantMARTIN CHAMBERLAIN (instructed by the Department for Work and Pensions/Department of Health Legal Services) for the DefendantHearing Hearing dates: 19 and 20 December 2012
JudgmentThe Hon. Mr Justice Underhill :INTRODUCTION
[1]This application for judicial review concerns recent changes in the provisions relating to housing benefit purportedly effected by the Rent Officers (Housing Benefit Functions) (Amendment) Order 2012 (2012 SI no. 646) (“the 2012 Order”), which was made by the Defendant, the Secretary of State for Work and Pensions, on 29 February 2012 and came into force on 2 April. In summary – I give more details later – the nature of the changes in question is as follows: (1). Housing benefit for private-sector tenants is calculated by reference to an “appropriate maximum housing benefit” (“AMHB”): see section 130 (1) and (3) of the Social Security Contributions and Benefits Act 1992 (“the 1992 Act”). The amount of benefit payable is the lower of the actual rent paid by the claimant and the AMHB. (2). Section 130A of the 1992 Act provides for AMHB to be determined by regulations, which may provide for it to be ascertained “by reference to rent officer determinations”: see sub-sections (2) and (3). (3). The relevant regulations – most recently the Rent Officers (Housing Benefit Functions) Order 1997 (“the 1997 Order”) – provide for rent officers to determine, for each “broad rental market area” (“BRMA”), a “local housing allowance” (“LHA”) for each of a series of categories of dwellings, defined by the number of bedrooms: see article 4B. (4). Until the changes challenged in these proceedings the nature of the exercise performed by the rent officer under the 1997 Order was that he would ascertain the range of actual levels of rent being charged in the BRMA for each category in that month, using information gathered locally, and would fix the LHA at a prescribed point in that range. Originally the prescribed point was the median of the rents in question. The LHA so determined constituted the AMHB. With effect from April 2011 changes were introduced which (a) substituted for the median the thirtieth percentile point in the range, (b) introduced an overall monetary cap for the LHA in each category and (c) removed the previous five-bedroom category, so that the maximum rate of housing benefit would relate only to four-bedroom houses. These changes were effected by the Rent Officers (Housing Benefit Functions) Amendment Order 2010 (“the 2010 Order”). The introduction of the cap was unsuccessfully challenged in R (Child Poverty Action Group) v Secretary of State for Work and Pensions [2011] EWHC 2616 (Admin) (“the CPAGcase”). (5). The effect of the 2012 Order is to substitute for that regime a system under which the LHAs in force as at 2 April 2012 are frozen until April 2013 and are thereafter to be uprated annually to the lower of (a) the figure produced by a determination using the method described at (4) above and (b) the current figure as uprated by the percentage annual increase in the Consumer Price Index (“the CPI”). In crude terms, the effect is that any increases in housing benefit will be capped at the level of general inflation, even if inflation in the rental market has been higher. These particular changes are concerned only with housing benefit paid to private sector tenants.[2]It is not inevitable that those changes will mean that less is paid by way of housing benefit, either generally or to particular claimants, than would have been the case under the previous regime. If levels of rent in every part of the country remain stable during the current year and only increase thereafter by the amount of the CPI the effect will be neutral; and it is the Government’s expressed hope that the changes may themselves exert a downward pressure on rental levels. But, to put it no higher, it cannot be certain that that will be the case. To the extent that, this year, rental levels do in fact rise, generally or in particular areas, or, next year, rise above the level of general inflation as measured by the CPI, there will be an adverse effect on claimants because it is more likely that there will be a gap between the rent which they have to pay and the benefit payable (or, if there is already a gap, that it will increase). If that occurs it will be more difficult for claimants to remain in their current homes; and if they do have to move it may have to be to an entirely new area, since – in this scenario – properties where the rent is within current housing benefit limits will be scarcer.[3]The Claimant, which is a charity concerned with the relief of poverty, believes that those consequences are likely to arise in many cases, and that many poorer tenants will have to move to more deprived areas, which will both be disruptive and will affect their quality of life for the worse. That would not of course in itself be a ground of legal challenge, but the Claimant contends that the 2012 Order is unlawful on two specific bases:(a) (A) that it is ultra vires; and(b) (B) that the Secretary of State in making it failed to comply with his duties under section 149 of the Equality Act 2010.[4]The Secretary of State contends that both grounds of challenge are unfounded; but he also argues that relief should be refused in any event because the claim was filed out of time. I consider the substantive issues first.[5]The case has been well argued, with conspicuously helpful skeleton arguments, by Ms Elisabeth Laing QC and Mr Christopher Knight (acting pro bono) for the Claimant and Mr Martin Chamberlain for the Secretary of State. A. THE VIRES CHALLENGE

The Statutory Provisions

[6]The statutory scheme can only be understood by piecing together a peculiarly intricate jigsaw puzzle. But the essential pieces for present purposes are as follows.[7]The 1992 Act. Section 123 (1) (d) of the 1992 Act provides that a prescribed scheme “shall provide for … housing benefit”. The scheme in question is contained in the Housing Benefit Regulations 2006, as to which see paragraph 10 below. Section 130 sets out the conditions of entitlement under such a scheme. So far as material for present purposes, it reads:
“(1) A person is entitled to housing benefit if - (a) he is liable to make payments in respect of a dwelling in Great Britain which he occupies as his home; (b) there is an appropriate maximum housing benefit in his case; and (c) either - (i) he has no income or his income does not exceed the applicable amount; or (ii) his income exceeds that amount, but only by so much that there is an amount remaining if the deduction for which subsection (3) (b) below provides is made. (2) In subsection (1) above “payments in respect of a dwelling” means such payments as may be prescribed, ... (2A) ... (3) Where a person is entitled to housing benefit, then— (a) if he has no income or his income does not exceed the applicable amount, the amount of the housing benefit shall be the amount which is the appropriate maximum housing benefit in his case; and (b) if his income exceeds the applicable amount, the amount of the housing benefit shall be what remains after the deduction from the appropriate maximum housing benefit of prescribed percentages of the excess of his income over the applicable amount. (4)-(5) ...”
Section 130A, which was introduced by the Welfare Reform Act 2007, reads (so far as material): “(1) For the purposes of section 130 above, the appropriate maximum housing benefit (in this section referred to as “the AMHB”) is determined in accordance with this section. (2) Regulations must prescribe the manner in which the AMHB is to be determined. (3) The regulations may provide for the AMHB to be ascertained in the prescribed manner by reference to rent officer determinations. (4) - (6) … (7) A rent officer determination is a determination made by a rent officer in the exercise of functions under section 122 of the Housing Act 1996.” (a) he is liable to make payments in respect of a dwelling in Great Britain which he occupies as his home; (b) there is an appropriate maximum housing benefit in his case; and (i) he has no income or his income does not exceed the applicable amount; or (ii) his income exceeds that amount, but only by so much that there is an amount remaining if the deduction for which subsection (3) (b) below provides is made. (a) if he has no income or his income does not exceed the applicable amount, the amount of the housing benefit shall be the amount which is the appropriate maximum housing benefit in his case; and (b) if his income exceeds the applicable amount, the amount of the housing benefit shall be what remains after the deduction from the appropriate maximum housing benefit of prescribed percentages of the excess of his income over the applicable amount.[8]Section 122 (1) of the 1996 Act. The key concept for the purpose of the issues in the present case is that of a “rent officer determination”. As appears from the previous paragraph, that term is defined in section 130A (7) by reference to section 122 of the Housing Act 1996 (“the 1996 Act”). That section falls under Part IV of the Act. The only relevant provision for present purposes is sub-section (1), which reads (so far as material): “(1) The Secretary of State may by order require rent officers to carry out such functions as may be specified in the order in connection with ... housing benefit ... .” (Sub-section (7) provides that “housing benefit” has the same meaning as in part VIII of the Social Security Administration Act 1992, which in turn refers back to section 122 of the other 1992 Act.)[9]The 1997 Order. The current order made under section 122 (1) specifying the functions of rent officers in connection with housing benefit is the 1997 Order. Article 4B of that Order (as it stood immediately prior to 2 April 2012, i.e. incorporating the changes made by the 2010[10]The 1996 Regulations. The relevant provisions of the Housing Benefit Regulations 1996 (as amended) duly plug into the provisions of the 1997 Order. “Appropriate maximum housing benefit” is defined as 100% of “eligible rent” (regulation 70). “Eligible rent” is defined in regulation 12B, but is subject to the provisions of (inter alia) regulation 12D, which provides (so far as relevant for present purposes) for eligible rent to be the “maximum rent (LHA)”. That term is defined in regulation 13D (1) as: “... the local housing allowance determined by the rent officer by virtue of article 4B (2A) or (4) of the Rent Officers Order which is applicable to— (a) the broad rental market area in which the dwelling to which the claim or award of housing benefit relates is situated at the relevant date; and (b) the category of dwelling which applies at the relevant date …”. (“The Rent Officers Order” is defined as the 1997[11]The 2012 Order. The 2012 Order, which, as explained above, is the order introducing the new regime, amends various provisions of the 1997 Order. The essential amendments for present purposes are: (1). For the obligation in paragraph (2A) of article 4B to make a monthly determination of an LHA for each BRMA is substituted an obligation to make an annual determination, within twenty days of the publication of the CPI for annual inflation as at September of any given year. (2). Schedule 3B is amended by introducing a paragraph (1A) in the following terms:
“Subject to sub-paragraph (12), the local housing allowance for a category of dwelling is – (a) the rent at the 30th percentile determined in accordance with sub-paragraphs (2) to (10) where that does not exceed the amount determined in accordance with sub-paragraph (11); or (b) in any other case, the amount determined in accordance with sub-paragraph (11).”
The “amount determined in accordance with sub-paragraph (11)” is, in effect, the previous LHA uprated by reference to the CPI. (3). A new paragraph (3B) is introduced into article 4B providing that any determination made under the new paragraph (2A) will take effect on the following 1April. It is this provision which produces the freeze in the current year referred to at paragraph 1 (5) above. (4). In short, therefore, in each BRMA from 1 April 2013 onwards, the LHA will be either the 30th percentile figure using the old method or the current figure increased by the CPI, whichever is the lower. The old-method calculation will accordingly still have to be performed in every case.

The Claimant’s Case

[12]The 2012 Order is purportedly made under the powers conferred by section 122 (1) of the 1996 Act. It is the Claimant’s case that that sub-section does not give power to make an order in the terms summarised in paragraph 11 above. Although Ms Laing acknowledged that the language appears very wide – “such functions as may be specified … in connection with … housing benefit” – she submitted that when it is read in the full legislative context it is clear that Parliament intended that AMHB would be set by reference, and by reference only, to an assessment of actual rental levels prevailing in the market. An AMHB set by reference to the CPI, which is not a measure of rent, would not satisfy that requirement. If that is right, the freeze is also unlawful because it is essentially ancillary to the introduction of the new regime.[13]More specifically, Ms Laing submitted that the language of section 122 (1) of the 1996 Act must be read in the context of section 130A (3) of the 1992 Act, which provides for “rent officer determinations”: the “functions … in connection with … housing benefit” referred to in section 122 (1) are evidently the function of, or functions associated with, making such determinations. A “rent officer determination” must connote the kind of determination which a rent officer is peculiarly fitted to perform. Rent officers were established by the Rent Act 1968 with the purpose of maintaining a register of rents and of determining the level of fair rents by reference to evidence about the actual level of rents in the market. When they were first given functions in relation to housing benefit – which was by section 121 of the Housing Act 1988 – Parliament was making use of a well-established institution with well-recognised functions. The intention was evidently that the determination would be by reference to evidence of actual rental levels, ascertained using the established expertise of rent officers. The determination of AMHB by reference to the CPI falls outside that intention. It does not require any ascertainment of actual rental levels and could be performed, as Ms Laing put it, by anyone with a calculator.[14]That is the central point, but Ms Laing sought to reinforce it by drawing attention to what she said was clear evidence that the Government itself was doubtful whether section 122 (1) of the 1996 Act conferred the necessary powers to make the changes purportedly effected by the 2012 Order. She relied primarily on section 69 of the Welfare Reform Act 2012, which amends section 130A of the 1992 Act, but which had not come into force at the time that the 2012 Order was made. (It in fact did so, for the purpose of empowering the making of regulations, on 27 November 2012, though no regulations have so far been made.) The drafting of the amendments in question is opaque, but I need not set them out because what matters for the purpose of Ms Laing’s argument is their intended effect. This is apparent from the explanatory notes. Notes 342 and 344 read, as far as material, as follows:
“342. The amendments made by section 69 generalise section 130A to reflect the Secretary of State’s intention to exercise the powers in that section to provide for AMHB to be determined by methods other than by reference to rent officer determinations. 343 ... 344. Using these powers the Secretary of State will bring forward regulations that will: • set out that eligible rent may be determined by reference to either rent officer determinations or the rate of CPI. Currently local housing allowance (LHA) determinations are made by rent officers. The amendments made by section 69 will ensure the Secretary of State has the power to set LHA rates from April 2013, by reference to the lower of either the CPI or the bottom 30th percentile of private sector rents. • ...”
If the Secretary of State’s contentions in the present case are right, Ms Laing submitted, he would have no need to make amendments having the effect described. The only explanation for their introduction is that he was in fact – to put it no higher – doubtful whether he had the power under the 1996 Act to introduce reference to the CPI by the route of rent officer determination. Ms Laing referred to statements by civil servants, in materials produced by the House of Commons Library, and by experienced outside commentators, which all appear to assume that the introduction of uprating by reference to the CPI was to be effected through section 69 of the 2012 Act. • set out that eligible rent may be determined by reference to either rent officer determinations or the rate of CPI. Currently local housing allowance (LHA) determinations are made by rent officers. The amendments made by section 69 will ensure the Secretary of State has the power to set LHA rates from April 2013, by reference to the lower of either the CPI or the bottom 30th percentile of private sector rents. • ...”[15]Ms Laing also drew attention to evidence given to the Residential Landlords Association (“the RLA”) to the House of Commons Work and Pensions Committee in, it seems, 2010. According to a research paper published by the Committee the RLA said that:
“When market rents were introduced by the Housing Act 1988 the then Government gave a promise to link housing benefit rates to market rents.”
Although Ms Laing did not seek to rely on the alleged promise as such, she said that it assisted her argument in that it stated explicitly what in her case is the necessary implication of the reference in section 130A to “rent officer determination”. The Claimant’s solicitors had asked the Treasury Solicitor to confirm that such a promise had been made but had received no answer: I was asked to infer that the Government was unable to dispute the RLA’s assertion. (Ms Laing acknowledged that the Claimant had not done any research of its own about the alleged promise, for example by asking the RLA on what it had based its statement.)

Conclusion

[16]Persuasively though Ms Laing advanced those submissions, I cannot accept them. My reasons are as follows.[17]The formal starting-point is the definition of “rent officer determination” in section 130A (7), namely “a determination made by a rent officer in the exercise of functions under section 122 of [the 1996 Act]”. Mr Chamberlain submitted that that definition could and should be read literally. The Secretary of State has by the 2012 Order conferred on rent officers the functions in question, and that is the end of the matter. Even if the new functions did not overlap in any way with the previously recognised functions of rent officers, that was neither here nor there. Rent officers derived their functions from two separate legislative streams, and there was no reason in principle why the two should be of the same character. Thus, even if the Secretary of State had conferred on rent officers a function which did not involve the use of their characteristic expertise in any way he was entitled to do so.[18]I am inclined to agree with Ms Laing that Mr Chamberlain’s approach is too literal and that Parliament must have intended that the functions referred to in section 122 (1) must to at least some extent involve the use of the characteristic expertise of a rent officer: you do not confer functions on a doctor all of which could be performed by any unqualified person. However, the regime under the 2012 Order does still require the use of rent officers’ expertise. As noted at paragraph 11 above, an “old-method” assessment will still be necessary in every BRMA in order to ascertain whether it or CPI-uprating produces the lower figure. Thus there is no question of rent officers being required to perform a task which does not employ their characteristic expertise.[19]Ms Laing sought to meet that point by contending even if a “true” rent officer determination were still required, the possibility – in fact she said the probability – that it would be trumped in all or most cases by the figure derived from the CPI was antithetical to the core concept, implicit in a “rent officer determination”, of rents being set by reference to actual market values. I do not agree. The reference in section 130A to “rent officer determination” will not bear the weight of an inference that Parliament intended that rental market values would be the only criterion for setting the level of housing benefit. The broad scheme of the legislation as a whole – i.e. not only, though of course including, section 122 of the 1996 Act – is that the Secretary of State should have a wide discretion to set the terms of the scheme, including the levels of benefit. Other things being equal, that discretion would unquestionably include the power to cap increases in housing benefit at the level of general inflation, notwithstanding that in some or all parts of the country rents may have increased at a greater rate. Any limitation on that discretion would need to be clearly expressed: in my view the language of section 130A (3) does not do so.[20]If I am right about that, I do not think that the other arguments on which Ms Laing relied can alter the position. I take them in turn.[21]So far as section 69 of the 2012 Act is concerned (with which I take the other material of a similar character relied on by Ms Laing), I am not in fact entirely sure that it does indicate a concern that the 2012 Order may have been ultravires. As I understand it, the essential change effected by section 69, as explained in the notes, is that the level of eligible rent/LHA could be set directly by the Secretary of State rather than by a rent officer determination as such. If so, there might be reasons why that change was thought desirable other than the existence of doubts about the validity of the 2012 Order. I was told that there was nothing in Hansard that casts any light on the legislative purpose in this regard. However, even if, as Ms Laing submitted, the correct inference is that there were indeed such doubts, that does not ultimately advance the argument. The only question for me is whether the powers conferred by section 122 (1) of the 1996 Act did in fact, construed objectively, extend to the making of an order in the terms of the 2012 Order. If they did it is irrelevant that the Secretary of State or his advisers may have been unsure on the point at the time or – which is probably more likely, particularly in the light of the fact that the CPAG case was pending – that they may have become doubtful subsequently and decided to give themselves a fallback position. I can well understand Ms Laing’s forensic interest in section 69, but ultimately it cannot affect the decision which I have to make.[22]As for the promise said by the RLA to have been made in 1988, I have no evidence of what precisely was said, by whom or in what circumstances. For that reason alone I can attach no real weight to it. But even assuming that some such promise was made, I cannot see that it would be admissible on ordinary Pepper v Hart principles as an aid to the construction of section 122 (1) of the 1996 Act (or its predecessor). In this connection Mr Chamberlain referred me to the decision of the House of Lords in R v Secretary of State for the Environment Transport and the Regions, ex p. Spath Holme Ltd. [2001] 2 AC 349.[23]I accordingly do not believe that the terms of the 2012 Order fall outside the scope of the power conferred by the section 122 (1) of the 1996 Act.[24]I should add for completeness that Mr Chamberlain argued that if Ms Laing’s submissions were correct they would have applied equally to the imposition of the monetary cap effected by the 2010 Order – see paragraph 1 (4) above – and accordingly that the challenge mounted to that order in the CPAG case should have succeeded. On the face of it, that seems right, but the point does not merit detailed examination because no vires issue was raised in that case.

The Law

(B) THE EQUALITY ACT CHALLENGE The Law

[25]I start by setting out the terms (so far as material) of section 149 of the 2010 Act: “149. Public sector equality duty(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.(2) ...(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.(4) The steps involved in meeting the needs of disabled persons that are different from the needs of persons who are not disabled include, in particular, steps to take account of disabled persons' disabilities.(5) –(6) …(7) The relevant protected characteristics are— age; disability; gender reassignment; pregnancy and maternity; race; religion or belief; sex; sexual orientation.(8) -(9) ...” (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. (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. age; disability; gender reassignment; pregnancy and maternity; race; religion or belief; sex; sexual orientation. Provisions to essentially the same effect appeared in earlier anti-discrimination statutes: I note in particular, because they feature in the authorities cited to me, section 76A of the Sex Discrimination Act 1975, section 71 of the Race Relations Act 1976 and section 49A of the Disability Discrimination Act 1995.[26]There has now been a good deal of case law on the effect of section 149 and its predecessors. I was referred to the leading authorities, but I need not attempt a general summary of their effect, particularly as one theme which clearly emerges from them is that what is required by the section 149 duty will inevitably vary according to the circumstances of the case. In so far as I need to refer to particular authorities I will do so at the point where they become relevant.[27]Purportedly pursuant to that duty, the Secretary of State conducted an equality impact assessment (“EIA”), published in March 2011, directed at the policy of uprating increases in housing benefit by reference to the CPI. A revised version was published in October 2011, and for practical purposes I need only be concerned with that. I can summarise its approach and conclusions as follows: (1). Paragraphs 1-6 outline the proposed changes and describe what consultation has taken place and is planned. They make it clear that the measure the impact of which is being assessed is the restriction of increases in housing benefit in the private rented sector by reference to annual increases in the CPI. (2). Paragraphs 7-25 address the impact of the measure by reference to the protected characteristics. The unit of analysis is, understandably, not actual individuals but households containing at least one individual with a protected characteristic. I will use the shorthand “protected households”: its convenience outweighs its inaccuracy. (3). Paragraphs 7-9 are introductory to the characteristic-by-characteristic analysis. Paragraph 7 acknowledges that the measure will affect many housing benefit claimants in the private rented sector because (though this is implicit rather than explicit) their rents may increase by more than CPI; but paragraph 9 anticipates the overall conclusion, which is that “breakdown of the composition of the private rented sector housing benefit caseload as a whole … [shows that] … no [sc. protected] group is likely to be disadvantaged more than another”. It goes on to say that a breakdown has also been performed of “the overall Housing Benefit caseload”, i.e. including also the social housing sector, “as a comparator”. I am not sure how that comparison could provide relevant information, given that the measure in question applies only to private-sector claimants; but the point does not matter for present purposes. (4). The EIA then proceeds to consider each protected characteristic in turn. Gender reassignment, sexual orientation, religion or belief, marriage and civil partnership and pregnancy and maternity are – plainly sensibly – dealt with very summarily. As regards gender, disability, age (broken down simply into “aged under 60” and “aged 60 or over”) and race, there are simple statistical tables provided, but these are concerned with the (at best) secondary question noted above of possible differentials between the proportions of protected households as between the private and social sectors. As regards the primary question of the impact of the measure on protected households in the private sector, the assessment consists in each case of a single sentence to the effect, to take disability as an example, that “as the measure potentially affects everyone in the private rented sector on Housing Benefit, disabled people are no more likely to be affected than people without a disability”. (There are minor differences of wording as regards the other protected characteristics, but the point is the same.) (5). Paragraph 25 is headed “Mitigation” and reads as follows:
“The Government recognises that many Housing Benefit private rented sector customers paid accordingly to Local Housing Allowance rules may be affected by these changes. However, we already have measures in place to support those who need it most. In particular, Discretionary Housing Payments can be considered by local authorities for those affected households where the type and level of disability places restrictions on the amount of suitable alternative accommodation available. For those that can move additional financial support can be considered to help facilitate including help with removal expenses. The Secretary of State will be able to review rates and, if he considers it necessary set them at a different level than the increases in the Consumer Price Index through secondary legislation.”
In the witness statement of Marie Savage, a civil servant in the Department of Work and Pensions, the reference to “discretionary housing payments” is explained (see paragraphs 54-57). The Government has allocated to local authorities an additional £130m. over the (unspecified) 2010 spending review period in order “to enable [local authorities] to provide support where they consider it is most needed as a result of the [housing benefit] reforms”, together with a further £49m. “to assist people with housing advice and removal costs”. (6). Paragraphs 26-27 set out what steps the Department intends to take to monitor and evaluate the impact of the proposed measures.[28]It is worth spelling out exactly what “impact” that analysis was addressing. It of course obvious that the restriction of increases to the level of increase in the CPI affects protected and non-protected households alike, in the sense that the legislation applies to all (private-sector) households claiming housing benefit. But that will only produce a real impact if and to the extent that the increase in the level of rent actually charged to a particular claimant exceeds the rate of increase in the CPI. In such a case there is necessarily an impact, because the mismatch between rent and benefit necessarily means that the claimant, who will by definition already be on a very tight budget, will have less money to spend on items other than accommodation; but the most serious and particular manifestation of that impact is if the claimant (and their family if any) has to move to cheaper accommodation, which may well be in an area geographically remote from their current home. This is not said in so many words in the EIA, but it is obviously understood (as indeed appears from the references to alternative accommodation and removal expenses in the “mitigation” paragraph). Thus what the “no differential impact” conclusion means is that there is no reason to suppose that rents will rise faster than the CPI, with the consequent increase in the risk of claimants having to move, for a higher proportion of protected than non-protected households. The EIA appears to accept, though again this is not spelt out, that if there were such a differential impact that would engage head (b) under section 149 (1) – “equality of opportunity”.[29]It is convenient to mention at this point a separate Impact Assessment (“IA”) relating to the changes effected by the 2012 Order which was produced by the Department in late March 2012 (i.e. after the Order was made and shortly before it was due to come into force). This does not address any equality issues, but it contains a discussion, of a kind not attempted in the EIA, of whether, and if so to what extent, the level of rents would in fact increase above the level of housing benefit. The discussion is, however, inconclusive. The IA predicts a reduction in housing benefit expenditure of £400m. as between 2012/13 and 2014/15. It says, to paraphrase, that if there is no “behavioural change” – either in the form of landlords restricting increases to the level of the CPI or of tenants moving to cheaper accommodation – there is liable to be a mismatch of, on average, £6 p.w. between levels of rent and levels of benefit; but it does not seek to predict the extent of such behavioural change. It is nevertheless of some value in as much as(a) it shows that there is, to put it no higher, a real prospect of such a mismatch arising and(b) it recognises that if there is any such mismatch some tenants will have to move.

The Claimant’s Case

[30]As far as it goes, and subject to the particular point considered at paragraphs 43-45 below, the analysis as summarised at paragraph 28 above is uncontroversial - that is, the Claimant does not suggest that there is any reason to suppose that the predicted mismatch will occur more often (or be greater) in the cases of protected than of non-protected households, or that where it does occur members of protected households are more likely to have to move than members of non-protected households. But Ms Laing submitted that the analysis is nevertheless flawed or inadequate in what are essentially three respects, which I consider in turn. (1). Same Impact but Greater Disadvantage[31]Ms Laing submitted that it was wrong to confine the analysis, as she said the EIA does, to the single question of whether the changes effected by the 2012 Order would have a disproportionate impact, in the limited sense identified above, on more protected than non-protected households. Even if they did not, it was necessary to consider the further question of whether having to move might be more disadvantageous for members of protected households than for other housing benefit claimants: if so, the Secretary of State had to have regard to the need to remove or minimise those disadvantages (and/or take steps to meet the needs which they reflected) – see heads (a) and (b) under section 149 (3). She said that there was an evident risk that having to move – at least where, as would often be the case, the move was to a wholly different area – would create substantially greater problems for members of two protected groups than for others, namely: (a). the disabled; and (b). children of school age - these constitute a particular age group, however precisely it may be defined, and thus share the protected characteristic of age (see section 5 of the 2010 Act). The disproportionate disadvantage to the members of those two groups was not addressed at all.[32]I consider the position as regards those two groups in turn[33]As for the disabled, the case is pleaded in the Claimant’s Grounds (paragraph 60) as follows:
“Those with physical disabilities who live in adapted housing, or are reliant on local support services, will experience … disruption and an effect on their equality of opportunity. A similar argument applies to those who suffer from mental illness, particularly those whose conditions mean that they benefit from settled surroundings and a regular routine.”
[34]In principle I think Ms Laing is right that the Secretary of State was required to consider not only the potential impact of the 2012 Order in the sense identified at paragraph 28 above but also the risk that the consequences identified might be more disadvantageous for members of protected groups – the impact of the impact, so to speak – and I see the force of the argument that the disabled constitute such a case (though it is not entirely self-evident). However, Mr Chamberlain pointed out that paragraph 25 of the EIA – “mitigation” – refers in terms to the particular difficulties which disabled people may encounter if they have to move. That shows, he submitted, that the Secretary of State had in fact a clear awareness of the problems to which Ms Laing referred and indeed that he had considered how they might be mitigated. Ms Laing’s response was that that was not enough. The mitigation tail should not be allowed to wag the assessment dog: you cannot properly consider mitigation until you have identified the disadvantages requiring mitigation (or the needs requiring to be met).[35]In my view Mr Chamberlain was entitled to rely on paragraph 25 of the EIA. I confess that I am not particularly impressed by the way in which the EIA is structured and expressed. Ms Laing is right that it would have been better if the section relating to disability, after making the initial point about there being no disproportion in the numbers of households likely to be affected, had proceeded to identify separately and explicitly the point about the greater difficulties (some) disabled people might encounter in having to move. But we are not concerned with a drafting competition, and EIAs are not legal documents. Their purpose is to evidence that due regard has been had to the specified factors (so far as they are in play), and if the necessary points are addressed it does not ultimately matter in what part of the document that occurred. I should add for completeness that Ms Laing – rightly, I think – did not advance a separate submission that the way that the disability issue is addressed in paragraph 25 was itself inadequate.[36]I turn to the case of children. The Claimant’s Grounds plead as follows (at paragraph 59):
“… [C]hildren who are settled at school will have not only to move house but to change schools. This is likely to affect both their social development and educational prospects, and thus their equality of opportunity.”
[37]In this regard it is not possible for Mr Chamberlain to refer to any explicit acknowledgment in the EIA of the possibility that having to move will have a more serious impact on children of school age than on adults. The question for me is thus squarely whether this was a factor to which the Secretary of State was obliged to have specific regard. It is well-established that a decision-taker subject to the public sector equality duty is obliged to consider an equality issue only where there is some reason to believe that the measure in question may raise (in shorthand) an equality issue: see, most recently, R (Hurley) v Secretary of State for Business Innovation and Skills [2012] Eq LR 447 ([2012] EWHC 201 (Admin)), per Elias LJ at para. 95 (p. 461).[38]I start by acknowledging that it is hard to deny the possibility, as a matter of common sense and common experience, that some individual children who have to move school as a result of moving home may find the change difficult, socially and/or educationally, and that in some of those cases real long-term damage to their educational prospects may occur. But the question is whether the chance of that happening as a result of the changes introduced by the 2012 Order was sufficiently substantial to engage the section 149 duty. There are two obvious areas of uncertainty –(a) as to number of cases in which children might have to change school as a result of their parents having to move home and(b) as to the proportion of those cases in which real damage might be anticipated.[39]As for (a), the uncertainty on this question would be very difficult to resolve. It is evident from the IA referred to at paragraph 29 above that the incidence of households which may have to move as a result of the changes in question is unpredictable; and the number of such cases in which a child may have to move school must be still more unpredictable. But I am content to assume for present purposes that there was reason to suppose that the incidence could be substantial.[40]As for (b), I was shown no evidence on the question of the damage done to children by having to move school: I was simply invited to proceed on the pleaded proposition that I have set out above. My untutored reaction is that serious damage of this kind would be rare. It is not at all uncommon for children to have to change schools, whether because their parents have moved home or for some other reason, and I have never heard it suggested that in most cases (of course, there will be inevitably be individual exceptions) this leads to any long-term problems: children are generally adaptable. However, it could be said that part of the point of the section 149 duty, and of the EIAs by which it is generally sought to be implemented, is precisely to ensure that policy decisions are not taken on the basis of untutored reactions of that kind: in this case what the Secretary of State should have done is to look for evidence on the impact that having to change school may have on children. Hurley is indeed an example of a case where the Secretary of State was held to be in breach of the section 149 duty by failing to ask sufficiently focused questions, even though there was no particular reason to suppose that if he had done so the answers would have thrown up any (in shorthand) equality issue.[41]The question here is ultimately one of degree. I am not persuaded that there was any sufficient reason in this case for the Secretary of State to believe that there might be an equality issue affecting the impact on children who have to move schools to require him to have specific regard to that risk. In the first place, I refer to my own sense of the inherent likelihood of there being any such risk, as set out in the preceding paragraph. I fully acknowledge that a judge must use his own impressions on a point of this kind with great caution. But I am entitled to take into account the fact that I have been given no evidence on the point: if the educational damage to children of an enforced change of school were a commonly recognised fact or even a commonly discussed risk – either in the context of these proposed changes or more generally – I could have expected to have had that drawn to my attention. That links to my second point, which is that although Ms Savage says in her witness statement that the Department consulted widely with interested parties, as I would expect, about the potential impact of the introduction of uprating by reference to the CPI it has not been suggested to me that any interested group raised any equality issue based on the potential impact of the measure on school-age children; and I can see no mention of this as an issue in any of the various committee reports and similar materials placed before me. I am bound to say that it strikes me, like the question of the possible impact of library closures on Asian residents of Brent in R (Bailey) v London Borough of Brent [2012] LGR 530 ([2011] EWCA Civ 1586), as something of a lawyers’ point: cf. the remarks of Davis LJ at para. 89 (pp. 555-6). I quite accept that the Secretary of State’s duty under section 149 is not limited to considering equality issues which have previously been raised with him, but in appropriate circumstances the fact that they have not may suggest that they that they were not indeed issues of substance.[42]Accordingly I do not believe that the Secretary of State was in breach of his duty under section 149 by failing to have regard to the possibility that having to move home might be peculiarly disadvantageous either for the disabled or for children of school age. (2). Ethnic Minorities[43]The starting-point for the Claimant’s case under this head is most conveniently summarised at paragraph 62 of the skeleton argument of Ms Laing and Mr Knight:
“… [It] is generally accepted, and has previously been accepted by the Defendant (see CPAG judgment paragraph 60), that families of claimants who are from ethnic minorities tend to be larger than those who are not from ethnic minorities. The effect of the earlier caps, exacerbated by the widening gap between actual rents and housing benefit which this change will lead to, is likely to mean that members of bigger families are more likely to be homeless, or to have to move, than members of smaller families.”
That differential impact is nowhere addressed in the EIA. (This point is an exception to the Claimant’s overall acceptance – see paragraph 30 above – that the 2012 Order will not lead to more protected than non-protected households having to move.)[44]Mr Chamberlain contended that that submission was ill-founded because, whereas the 2011 Order imposed an absolute cap on housing benefit levels, which was inherently more likely to affect tenants of larger (and therefore more expensive) houses, the 2012 Order takes as its starting-point the level of benefit currently paid and only (potentially) restricts the level of increase. I do not think that that is logically a complete answer. A housing benefit claimant who is, because of the size of his family, occupying in 2012/13 an exceptionally large property, and who is accordingly having to pay rent in excess of the level of benefit, may nevertheless not have reached the point at which he cannot afford to stay. If housing benefit in 2013/14 increases in line with the market that state of affairs will in principle be maintained. But the potential effect of the changes introduced by the 2012 Order is that housing benefit will not increase in line with the market, in which case the mismatch between rent and benefit will increase and he is more likely to have to move.[45]Having said that, it does also follow that the changes introduced by the 2012 Order may only have a disproportionate impact on claimants with large families – and thus also on claimants from ethnic minorities – by way of exacerbating a situation created by the 2011[46]As noted above, the EIA on which the Secretary of State relies was produced in October 2011, some six months before the making of the 2012 Order, and the Claimant contends that it is not directed, either in form or in substance, at the Order as actually made.[47]So far as form is concerned, the Claimant relies on the fact that the EIA refers to the changes with which it was concerned as being made by what was then the Welfare Reform Bill, whereas what we are concerned with here is changes effected by the 2012 Order to the 1997 Order. This point was not developed by Ms Laing in her oral submissions and there is nothing in it. The EIA does in fact refer also to changes to the 1997 Order; but, even if there was some lack of clarity as to the statutory route to be adopted, what matters for the purpose of section 149 is whether the Secretary of State had due regard to the impact of the substance of the measures in question, whatever their statutory clothing.[48]As for substance, the complaint is that the EIA contained no consideration of the impact of the freezing of benefits during the current year, which either had not been decided on at the time that the work was done or had in any event not been identified as a separate impact. The subject matter of the EIA was expressly identified as the impact of “restricting any increase in [LHA] to the [CPI]”. But it was the evidence of Ms Savage that the Department did not believe that the freeze would have an impact of a different character from that of CPI-uprating or, therefore, that any separate assessment was necessary; and Mr Chamberlain submitted that that was plainly correct. I agree. Indeed Ms Laing in her oral submissions accepted that the nature of the impact would be the same. Her point was that it would begin to be felt in the current year and that it would have a cumulative effect with the impact of the introduction of CPI-uprating in the following year. I do not believe that that answers the point. The impacts in question, and the steps that might require to be considered in the light of them, were never going to depend on precise financial assessments, which were in truth unattainable: see paragraph 29 above.

Conclusion on the Equality Act Challenge

[49]For the reasons given above I do not accept that in making the 2012 Order the Secretary of State failed to comply with his duty under section 149 of the 2010 Act. I need not in those circumstances consider a fallback argument advanced by Mr Chamberlain to the effect that even if the EIA was defective I should decline to quash the Order since there had been broadly substantial compliance and the consequences of my doing so would be very serious, (cf. the course taken by the Divisional Court in Hurley (above)). That submission overlapped with his case on delay. I would only say that the point had in my view some force.[50]I should add that despite my conclusion on this issue I was not – as indeed I have already observed – very impressed by the form of the EIA. It is not of course strictly necessary for the purpose of section 149 that decision-makers should produce any kind of formal document. The value, however, of doing so is twofold: it helps to ensure that the necessary regard is indeed paid to the specified issues, and it provides evidence that that has occurred in the event of a subsequent challenge. From both points of view it is desirable that the document demonstrates real thought about the impact of the measure in question. A formulaic or tick-box approach is dangerous, and those performing EIAs would be well-advised to spell out in concrete terms and ordinary language the contemplated consequences of the measure. If the EIA in the present case had said something to the effect that “if the level of rents increases above the level of benefit, there is a risk that people may have to leave their homes and move to cheaper properties, which may be some distance away”, and had then addressed the question whether that risk could be quantified (as was to some extent done in the IA) before considering its equality implications, it would have been less vulnerable to the criticisms advanced by Ms Laing. However, for the reasons given, I do not think that those criticisms went so far as to establish a legal flaw.

DELAY AND RELIEF

[51]My conclusion on the substance means that I need not decide whether relief should be withheld on the grounds that the Claimant was guilty of delay in bringing these proceedings and that the grant of relief now would be detrimental to good administration. The issues raised by the parties’ submissions on this aspect were not straightforward, and I do not believe that anything would be gained by my seeking to address them now, on what would be a hypothetical basis.

CONCLUSION

[52]I dismiss this application.

Order

see paragraph 1 (4) above) reads, so far as material: “(1A) On 20th March 2008 and so often thereafter as a rent officer considers appropriate, a rent officer shall, in relation to each local authority, -(a) determine one or more broad rental market areas which will (during the month which next begins after the determination is made) fall, in whole or in part, within the area of the local authority so that every part of the area of that local authority falls within a broad rental market area and no part of the area of that authority falls within more than one broad rental market area; and(b) ... (2A) No more than 10 and not less than 8 working days before the end of each month a rent officer shall - (a) for each broad rental market area determine, in accordance with the provisions of Schedule 3B - (i) a local housing allowance for each of the categories of dwelling set out in paragraph 1 of Schedule 3B; and ... (b) ... . (3A) Any broad rental market area determination made in accordance with paragraph (1A), or local housing allowance determination made in accordance with paragraph (2A) before 7th April 2008, shall take effect on 7th April 2008 and any subsequent determination shall take effect on the first day of the month which begins after the day on which the determination is made.” Schedule 3B, as referred to at paragraph (2A) of article 4B, prescribes, at paragraph 1, the various categories of dwelling: I need not set those out. Paragraph 2 provides for how the LHA required by paragraph (2A) (a) (i) of article 4B is to be determined. It begins: “(1) … [T]he rent officer must determine a local housing allowance for each category of dwelling in paragraph 1 in accordance with the following sub-paragraphs.” The details of the method of determination set out in the following sub-paragraphs are immaterial for present purposes. Essentially the rent officer is required to maintain a list of rents being charged within the BRMA for assured tenancies in each category which satisfy certain criteria. Paragraph (9) then provided: “Subject to paragraph (12), the local housing allowance for each category of dwelling specified in paragraph 1 is the amount of the rent at the 30th percentile in the list of rents for that category of dwelling.” (Paragraph (12) provided for the cap introduced in 2010, as referred to at paragraph 1 (4) above.) (a) determine one or more broad rental market areas which will (during the month which next begins after the determination is made) fall, in whole or in part, within the area of the local authority so that every part of the area of that local authority falls within a broad rental market area and no part of the area of that authority falls within more than one broad rental market area; and (b) ... (2A) No more than 10 and not less than 8 working days before the end of each month a rent officer shall - (a) for each broad rental market area determine, in accordance with the provisions of Schedule 3B - (i) a local housing allowance for each of the categories of dwelling set out in paragraph 1 of Schedule 3B; and ... (b) ... . (i) a local housing allowance for each of the categories of dwelling set out in paragraph 1 of Schedule 3B; and ... (3A) Any broad rental market area determination made in accordance with paragraph (1A), or local housing allowance determination made in accordance with paragraph (2A) before 7th April 2008, shall take effect on 7th April 2008 and any subsequent determination shall take effect on the first day of the month which begins after the day on which the determination is made.” Order: see regulation 2.) Order: indeed that is the way that Ms Laing herself expresses it (see above). In the CPAG case Supperstone J held, in the specific context of the “large families” point, that the Secretary of State had paid due regard to his duties under section 149: see paragraphs 70-76. There is no material before me to indicate the size of any additional or adjuvant effect of the 2012 Order in this regard, but it is inherently secondary. There is no basis on which I could find that if the issue was sufficiently considered in 2011 there were any new issues raised by the 2012 Order that required the Secretary of State to carry out a further assessment. (3). EIA not Directed to the 2012 Order

Cited in 2 later judgments