Birmingham City Council v Balog

A housing authority complies with its duty to have regard to statutory homelessness guidance by addressing its substance. A review officer need not identify every relevant paragraph expressly. The decision must be read realistically and as a whole, without undue technicality.

When deciding whether accommodation was affordable, the authority must consider the applicant’s financial circumstances and whether housing costs would deprive the household of basic essentials. Statutory guidance may be departed from for good reason. The authority must give reasons sufficient to explain its conclusion, but affordability remains primarily an evaluative judgment for the experienced review officer, subject to ordinary public law review.

The council decided that the respondent had become intentionally homeless after leaving privately rented accommodation. On review, an independent officer upheld that decision. The officer considered periods of employment and unemployment, housing benefit, a possible monthly rental shortfall and whether household expenditure could be reduced without sacrificing essential amenities.

On an appeal under section 204 of the Housing Act 1996, the Recorder quashed the review decision because the officer had failed to have regard to the relevant statutory guidance on affordability. She rejected challenges based on inadequate reasons and irrationality.

The council appealed. By respondent’s notice, the respondent renewed the latter two challenges. The principal issues were whether the officer adequately considered the statutory guidance, gave sufficient reasons and reached a rational conclusion on affordability.

1. Appeal allowed. Kitchin LJ, with whom Briggs and Sullivan LJJ agreed, held that the review officer had adequately regarded the statutory guidance. Although the decision did not refer expressly to paragraph 17.40 of the Homelessness Code of Guidance for Local Authorities, a review officer need not identify every paragraph bearing upon the decision. Such a requirement would impose an unreasonable and unnecessary burden.

2. The review decision had to be read as a whole and in its practical context. The officer identified the omission of affordability from the original decision, expressly listed the statutory guidance among the materials considered and examined the respondent’s income and expenditure. He considered the occasions on which a rental contribution was required, the existing household deficit and whether expenditure could be reduced without sacrificing essential amenities. That was precisely the kind of analysis contemplated by paragraph 17.40.

3. The recommendation concerning residual income below the applicable benefit level did not compel a finding that accommodation was unaffordable. Statutory guidance must be considered, but an officer may depart from it for good reason. The officer’s conclusion that the modest shortfall could be met through reduced housekeeping expenditure without deprivation demonstrated substantive engagement with the affordability issue.

4. The reasons were adequate. They identified the relevant financial circumstances, explained when the shortfall arose and stated why it could reasonably be paid. They therefore enabled the respondent and his advisers to understand how and why the decision had been reached. Review decisions prepared by housing officers should receive a realistic and benevolent interpretation, rather than the technical analysis appropriate to legislation, contracts or judicial decisions.

5. The decision was rational. Experienced review officers are best placed to assess affordability, and their conclusions are reviewable on ordinary public law grounds. Material concerning the poverty line, which had not been presented to the review officer or the Recorder, could not be introduced at this stage. The officer had neither acted perversely nor reached an irrational conclusion on irrelevant grounds.

1. Court of Appeal (Civil Division): Allowed the council’s appeal and restored the review decision that the respondent was intentionally homeless. The challenges advanced by respondent’s notice concerning reasons and irrationality were rejected: [2013] EWCA Civ 1582.
2. Birmingham County Court: Miss Recorder McNeill QC allowed the respondent’s section 204 appeal on 4 March 2013 because the council had failed to have regard to the relevant statutory guidance. She rejected the grounds alleging inadequate reasons and irrationality.
3. Local authority review: An independent review officer upheld the original decision that the respondent had become intentionally homeless.