London Borough of Lambeth, R (on the application of) v Secretary of State for Work & Pensions

A refusal to alter an earlier administrative decision may itself be reviewable where, in substance, a fresh decision has been made or ought to have been made. It must nevertheless be examined in the light of the earlier valid and unchallenged decision. A subsequent non-retrospective change in policy or legislation will not generally require reconsideration. Mechanical implementation of the earlier decision does not create a series of fresh discretionary decisions. Where statutory powers overlap, the decision-maker may use either power if the legislation permits it. A published policy for genuinely outstanding cases does not necessarily apply to a quantified overpayment already decided and being recovered.

The claimant local authority sought judicial review of the Secretary of State’s 2004 decision to resume deductions recovering housing benefit subsidy overpaid for 1991/92 to 1996/97. The overpayment, caused mainly by failures to refer rents to rent officers, was approximately £31.5 million. In 1998 the Secretary of State decided to recover the whole sum over ten years without interest, and the authority accepted that decision.

Following later proceedings by other local authorities and Circular HB/CTB S1/2002, Lambeth asked the Secretary of State to stop recovering the balance and repay sums already deducted. The request was refused. The central issues were whether the 2004 refusal was reviewable, whether continuing recovery was irrational or disproportionate, whether consistency and precedent effects were relevant, and whether the later circular required reconsideration.

1. Reviewability. Whether a refusal to change an earlier administrative decision is a fresh reviewable decision depends on the facts. A claimant cannot evade CPR Part 54.5 or section 31(6) of the Supreme Court Act simply by requesting reconsideration. New facts may require fresh consideration, but a non-retrospective change in policy or English law will not generally suffice. The 2004 decision was reviewable, but had to be assessed against the valid 1998 decision.
2. Recovery. Failure to refer cases to rent officers resulted in no subsidy entitlement in the relevant cases. Recovery of excess subsidy was recovery of an overpayment, not a legal penalty. Section 137(6) provided recovery machinery, did not impose a duty to recover the whole overpayment, and permitted recovery in whole or in part over several years. Continuing recovery was neither perverse nor disproportionate. Perversity, rather than proportionality, was the applicable criterion because no Convention right was engaged.
3. Relevant considerations. The Secretary of State was entitled to treat Lambeth consistently with authorities that had repaid their overpayments. Ending recovery could give Lambeth an uncovenanted advantage and generate comparable claims by other authorities. The precedent effect was therefore relevant.
4. Statutory powers and policy. Section 137(6) and section 140C could coexist for the relevant subsidy years, so the Secretary of State could continue to use section 137(6). Circular HB/CTB S1/2002 concerned cases in which overpayments had not been quantified and no recovery decision had been made. It did not require reconsideration of Lambeth’s quantified and previously decided case.
5. Disposition. No sufficiently great and unforeseen change in circumstances required reconsideration of the 1998 decision. The Secretary of State was entitled to adhere to it. The claim was dismissed.

First-instance judicial review. No prior appellate decision is stated in the judgment.