Just what did Sandwell think they were doing?  They set a minimum residence requirement of two years (why two you might ask) for their local council tax reduction scheme and thought that would be acceptable.  They did so on the basis that they were concerned about those nasty southerners taking advantage of their cheaper housing, such that Sandwell would be flooded with people from outside.  They were concerned about the financial impacts if those outsiders were poor and required a council tax reduction.  The empirical basis for that assertion lay, one can only think, in the minds of those who attended the full council meeting on 4th December 2012.  Mind you, as this meeting lasted a total of 39 minutes with a full agenda, it is likely that those in attendance might not have noticed.  And, of course, Sandwell, having already consulted on their scheme and compiled an equality impact assessment, didn’t bother to think about those tiny requirements in relation to this small exclusion.  And the residence exclusion is repeated the following year – here there is “consultation”  but, strangely you might think, no responses (although it is fair to say that some qualitative comments were reported to have been made).  I say strangely in part because the exclusion affected 3,600 applicants, including those accommodated in women’s refuges and other vulnerable persons.  (For those with long memories, Sandwell are returning us here to the old law of settlement under the Poor Relief Act 1662 – readers might refer here to Ross Cranston’s brilliant Legal Foundations of the Welfare State (1985), pp 22-6.  But, actually, we don’t need to go back that long because, in housing’s inglourious past, the Central Housing Advisory Committee found not dissimilar processes operating in housing allocation in 1969 and remarked pretty negatively about them.)

And so enter stage left, Richard Drabble QC and Tom Royston who frankly just clean up the mess – their combined brilliance could hardly have been stretched by the grounds of challenge which were ultra vires, failure to take into account material considerations, lack of consultation, barriers to freedom of movement, discrimination, and the public sector equality duty.  In R(Winder) v Sandwell MBC, EHRC intervening [2014] EWHC 2617 (Admin), Hickinbottom J rightly struck down the residence requirements on all grounds.  One can only feel a degree of empathy for Kelvin Rutledge QC who was forced to defend Sandwell and, in his usual way, produced rabbits from the hat (albeit insufficient to affect the outcome).

The first ground depends on the construction of section 13A(2)(b), Local Government Finance Act 1992.  This provides for the setting up of a council tax reduction scheme for “persons in classes consisting of persons whom the authority considers to be, in general, in financial need”.  This was the only possible provision which would give Sandwell its vires.  It looks pretty clear and unambiguous – it is about providing a scheme for persons in financial need.  That was the Claimant’s position. Sandwell’s position was that the class of persons, ie residents, was the pool from which financial need criterion was to be applied.  It was a Rutledge rabbit from the hat moment but not one which impressed Hickinbottom J who found that criteria which do not identify those more likely to be in financial need are ultra vires.  The residence test is such a criterion.  Thus, this subsection reflected “cases in a class of people where inclusion in the class is predictive because they are more likely to be in financial need, ie they are “in general” in financial need” ([54]).  Further, Sandwell had used the power for an unauthorised purpose, ie discouraging outsiders from relocating there. #ouch

Sandwell had failed to take into account material considerations.  It is an interesting form of localism that requires local schemes to have a minimum level of consistency.  And the Claimants’ point was that, if every local authority adopted such a criterion ….  Further, Sandwell had failed to take central government policy into account, “… in that [the residence criterion] has the potential adversely to affect vulnerable individuals such as those fleeing from domestic violence, and may act as a disincentive to move to look for work.  Whilst it might have been open to the Council to decide to take a course that was inconsistent with central government policy, that policy was at least a material consideration and the Council failed to take it into account or have any regard to it at all” ([64]). #ouchagain

Sandwell’s consultation problem on the first scheme was compounded, it seems, by their attempt at consultation on the amendments to it in the second year of its operation.  It consulted on its web page but in a ways in which, as Hickinbottom J suggests, “In all the circumstances, it is not at all surprising that, as a result of the web pages, the Council says it did not receive a single comment” ([76]).  Thus, each year “something did go clearly and radically wrong” in its consultation process #ouchagain

On free movement and discrimination (on the basis of EU, domestic and human rights law), we were in proportionality territory.  The Rutledge rabbit here was that the scheme was proportionate because it achieved financial savings and fairly in light of government cuts, the totality of the scheme and the guidance since 2014 (which insulated the homeless and those in reasonable preference), and the discretion to take account of an individual’s circumstances if they fell outside the scheme.  But Sandwell’s problems lay in the lack of evidence to support their propositions and, by return, the “collateral damage” (as Richard Drabble put it) caused by the residence requirement. #ouchagain

On the PSED, Sandwell lost again: “… there is simply no evidence that the Council conducted any assessment at all of the race or gender impact of the residence requirement at or before it adopted the 2013-14 CTR Scheme; and scant evidence that it did so prior to the 2014-15 Scheme.  I do not consider that the evidence that there is (e.g. with regard to feedback towards the end of 2013, from wherever it came: see paragraphs 27(ii) and 75 above) is sufficient to show that the Council grappled at all with the effects of the requirement on those with the identified protected characteristics” ([94]) #ouchagain