R (on the application of Rafaela Savva) v Kensington & Chelsea Royal London Borough Council (2010) EWHC 414 (Admin)

This case is one of the first to consider the legality of personal budgets to meet adult social care needs. In particular this case focused on the obligations placed on local authorities under the current adult community care legislation and whether the particular resource allocation scheme adopted was capable of meeting these obligations.
The claimant, Mrs Sawa, was 70 and suffered significant health problems, including diabetes, heart and respiratory problems, arthritis, poor eyesight and a history of CVA. She had been in receipt of community care support for 10 years and was unable to leave her flat unattended. In July 2009 she completed, with the assistance of a social worker, the self-assessment questionnaire so that her entitlement to services could be determined in accordance with the authority’s personal budget procedure. During this process she was admitted into hospital and, upon discharge, completed a second questionnaire in which the social worker noted a decline in skills, but felt her overall functioning had remained the same. Following the second assessment the Authority determined that, in accordance with the Resource Allocation Scheme she would qualify for a personal budget of £112.21 per week, adjusted to £142.02. However the Local Authority’s Resource Allocation Panel determined that the ‘indicative budget’ of £142.02 per week was too low and did not properly meet the Claimant’s needs particularly in terms of meal preparation. She was therefore awarded a weekly budget of £170.45. Mrs. Sawa was notified of the amount she would receive, but not given reasons as to how this figure had been determined.

She challenged this decision on three grounds; namely:
(i)the Authority’s system for calculating budgets was inadequate to discharge the statutory duty to provide care services adequate to meet an individual’s assessed needs;
(ii) The Defendant’s reasons were inadequate to discharge the duty to provide adequate reasons for the decision to allocate the Claimant a personal budget of £170.45 per week;
(iii) The Defendant assessed the Claimant’s needs to have increased substantially between July 2009 and December 2009, yet decided to keep the personal budget constant, at £170.45 per week. It is submitted that, in the absence of a proper explanation, this is irrational.

In respect of the first challenge the Court considered the obligations set out in the current legal framework and in particular the duty to assess (as contained in s.47 NHSCCA) and the duty to arrange appropriate provision if the result of the assessment requires community care services to be provided. Provision of services would be under the relevant community care provision, in this case s2 of the Chronically Sick and Disabled Persons Act 1970 [‘CSDPA’]. A local authority is able to discharge this duty by offering direct payments. However, regulation 14(1) of the Community Care, Services for Carers and Children’s Services (Direct Payments) (England) Regulations 2009 makes clear that the provision of a direct payment does not affect the local authority’s obligation to carry out its functions under the relevant enactment to which the payment relates, unless it is satisfied that needs which call for provision under the enactment will be secured by the payment; thereby requiring not only that the sum provided is sufficient to purchase the necessary care, but also that it is that care that is purchased with the direct payment.
The Court confirmed that R v Gloucestershire County Council and another, ex parte Barry [1997] was authority to enable a local authority to take into account its available resources when setting eligibility criteria for community care services. Although not expressly mentioned in this judgment this case also entitles local authorities to choose the cheaper option where there are two or more ways to appropriately meet eligible needs. What was made clear in Barry and followed in this judgment was that a local authority could not take into account its resource when deciding whether to meet already identified eligible needs; once someone has been assessed as having needs which are eligible for community care services, these must be met irrespective of the local authority’s resources. The question in this case therefore was whether the decision of   the local authority panel to provide the Claimant with a personal budget of £170.45 constituted a discharge of their legal duty. The Claimant sought to argue that the choice of resource allocation scheme (RAS) adopted by the defendant authority was unlawful as rather than approach the allocation in a linear way, either through a direct fixed price per cost, or per point based on the total current budget, the defendants had adopted a more relative one which matched points to the current distribution of care packages. This, the Claimant argued, did not meet individual claimant’s needs and was therefore unlawful. The Judge, having reviewed the Government’s guidance on developing Resource Allocation Schemes, accepted the submission from the defendant local authority that although they had chosen to adopt a non-linear approach for their RAS it did not take the view that the figure reached by the RAS was determinative. Instead this figure was a starting point, indicative of likely costs of needs, but adapted in a way that ensured the individual’s needs were considered and addressed. Given this assurance the Judge formed the view that the RAS adopted was not unlawful and rejected the first of the Claimant’s grounds for review.

On the second ground, the parties accepted that there was no statutory duty to give reasons for how it had calculated the personal budget; however the judge pointed out that the whole policy was founded on the principle of ‘Putting People First’. This document, and the guidance issued by the ADASS, demonstrated a clear policy to provide service users with transparent information about how personal budgets were arrived at, South Buckinghamshire DC v Porter (No2) (2004) applied. The Judge referred to the cases of R v Gloucestershire CC Ex p RADAR (1997-98) , R v Islington LBC Ex p Rixon (1997)  and Eisai Ltd v National Institute for Health and Clinical Excellence (NICE) (2008) as legal authority for finding a common law duty (required by procedural fairness) on local authorities to provide evidenced based reasons as to how and why it believes it has arrived at the RAS figure, so as that it could demonstrate it was discharging its statutory duties. He did not accept that requiring local authorities to do so, prior to the completion of the support plan, would be unduly burdensome on authorities, stating that “personal budgets are new and in many ways represent a fundamental shift in community care. It must be incumbent on those responsible for this provision, to be transparent, and to explain individual decisions in a precise and clear manner.”

On the final ground put forward, the Judge commented that there had been no evidence put before him that could show this was a decision that no reasonable Panel could have arrived at, but as “this is really a reformulation of the reasons challenge. I have decided that challenge in the Claimant’s favour” based not on irrationality, but on the lack of reasons given.

Finally on whether personal budgets (through the provision of direct payment) could engage article 6 the Judge concluded that they did not. Quoting the recent case of Tomlinson and others (FC) v Birmingham City Council [2010] he likened the creation of a personal budget, and the manner in which a personal budget is utilized, as within social welfare provision. The dependence on discretionary judgments, not only to establish entitlement but also to discharge the state’s obligation and the way in which this obligation can be met, meant that personal budget, like the provision of accommodation under the Housing Act 1996 was essentially a public nature duty which does not give rise to an individual economic right, so any dispute concerning  the question whether the applicant has been properly notified of the decision making process is not within Article 6.

Application granted

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