Tiffany Cloynes 12 January 2016

Reorganising troubled services

Reorganisation of local authority services can be a sensitive matter. Opponents will look for any opportunity to challenge proposed changes, so local authorities need to be confident that there are no flaws in the processes leading to their decisions.

The judgment in a second challenge to Lincolnshire County Council’s proposed reorganisation of library services is instructive as to how to address the issues of consultation and the community right to challenge in the Localism Act 2011. The community right to challenge gives specified types of body a right to submit expressions of interest in providing or assisting in providing a relevant service on behalf of a local authority.

On receiving an expression of interest a local authority must consider it and decide whether to accept, reject or modify it. Having accepted an expression of interest, the authority must conduct a procurement exercise for the provision of the service to which the expression relates.

Lincolnshire Council had already been successfully challenged by the same claimant over its proposed reorganisation. The council had received an expression of interest from Greenwich Leisure Ltd (GLL) in providing library services pursuant to the community right to challenge. The court found that the Council had not considered that appropriately, as required by the Localism Act 2011 and subordinate legislation.

Following this, the council undertook further consultation. Again it received a proposal from GLL to provide library services, which it accepted as a valid expression of interest under the community right to challenge. It therefore carried out a procurement exercise for future provision of library services.

The claimant challenged the council again, alleging:

• The consultation had been flawed in that it did not consult in general terms as well as on specific alternative proposals. It also did not provide sufficient information on the GLL proposal or any other prospect of outsourcing.

• The procurement exercise had been flawed as it had not covered the entire service which GLL had expressed interest in providing.

• The council had failed to seek an improvement in the provision of its library services, as required for compliance with its duty to secure best value.

The court rejected all these grounds of challenge, finding that:

• The consultation document made clear that although the council had a preferred option, it would look at alternatives provided they were within budgetary limits. A consultation document had to achieve an acceptable minimum standard and was not a counsel of perfection. The council’s consultation met that standard.

• The question of how to achieve improvement required to comply with the best value duty was a matter for the council’s expert judgement. The council’s report was lengthy and detailed and it could not be argued that the decision to choose a particular option was Wednesbury unreasonable.

The different outcomes of the two challenges against Lincolnshire show the importance of following appropriate processes. Courts recognise local authorities have difficult decisions to take in managing resources but courts cannot uphold decisions which show failure to comply with legal requirements.

Actions local authorities can take to minimise the risk of decisions being quashed include:

• Ensure consultation is comprehensive, meaningful and accessible. Throughout a reorganisation process, identify any specific statutory requirements (such as, in Lincolnshire’s circumstances, those relating to the community right to challenge).

• Ensure reports considered by decision makers provide information on all relevant issues and minutes.

Tiffany Cloynes is a partner at the Public Services Group of law firm Geldards LLP

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