Summary
A local authority deciding whether to transfer publicly operated care homes must base its comparison of in-house and external provision on legally sound material. Using a comparator figure that is two financial years out of date, without addressing that fact, may amount to a logical error or critical gap in the reasoning.
The authority is required to make only such inquiries as are reasonable. It need not model an unformulated alternative or assess every resident’s individual needs where services will continue and the relevant cost comparison is otherwise rational. The Public Sector Equality Duty requires a proper and conscientious focus on the statutory criteria, but the weight given to equality considerations remains for the decision-maker.
Factual background
The claimant, a resident of Castle Grange, challenged Kirklees Council’s decision to transfer Castle Grange and Claremont House, specialist dementia care homes, to a private provider as going concerns.
She alleged irrationality and material error of fact, breach of the Tameside duty of inquiry, breach of the Public Sector Equality Duty, inadequate consultation, lack of promptness, and lack of standing in relation to Claremont House. The central financial challenge concerned the Council’s use of a £852.69 weekly comparator for external dementia provision, adopted in 2024 and retained for a 2025/26 decision.
Held
- Delay and standing. The February 2025 Cabinet resolution was a fresh decision following statutory scrutiny, fresh financial analysis and reconsideration. Time therefore ran from 11 February 2025. The claim was brought promptly and without undue delay. The claimant also had sufficient interest to challenge the single decision in relation to both homes.
- Irrationality and material error. The Council was entitled to use an average rate based on payments for people with dementia generally. The evidence did not establish that the residents’ higher needs made that comparator irrational, and the court could not substitute a better comparison. However, continuing to use the £852.69 figure without addressing that it was two financial years old, while Cabinet considered 2025/26 budgeted costs and provider rates were rising, involved a logical error or critical gap in reasoning.
- Tameside duty. The Council made the inquiries reasonably required by the decision-making stage. It was not obliged to model an unformulated non-sale proposal, investigate the causes of its overspend where that would only increase the apparent savings from transfer, or complete a detailed viability assessment that depended on the subsequent competitive process. It was required to update the external-cost comparator.
- Equality and consultation. The Council’s Integrated Impact Assessment was imperfect but, read with the reports and proposed mitigation, demonstrated awareness of the potential adverse impact on elderly and disabled residents and active consideration of mitigation. The Public Sector Equality Duty was complied with. Consultation did not require presentation of an undeveloped alternative involving continued Council ownership, since that information was not necessary for meaningful responses.
- Relief. Although the comparator error was established, the court concluded that it was highly likely that the outcome would not have been substantially different. The annual saving would still have exceeded £500,000, with other financial considerations remaining. Leave was therefore refused under section 31(3D) of the Senior Courts Act 1981. The exceptional-public-interest exception was not engaged.
The court’s approach to earlier authorities
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Appeal route
- This judgment [2025] EWHC 3136 (Admin) High Court (Administrative Court)
- Appealed to[2026] EWCA Civ 308Outcomeappeal dismissed unanimously
Key cases cited
The 30 most senior of 43 authorities cited.
- R (on the application of Samuel Smith Old Brewery (Tadcaster) and others) v North Yorkshire County Council [2020] UKSC 3
- Mauritius Shipping Corporation Ltd v Employment Relations Tribunal and others (Mauritius) [2019] UKPC 42
- Hotak v Southwark London Borough Council [2015] UKSC 30
- R (Moseley) v Haringey London Borough Council (R (Stirling) v Haringey London Borough Council) [2014] UKSC 56
- R (on the application of McDonald) v Royal Borough of Kensington and Chelsea [2011] UKSC 33
- R v Secretary of State for the Home Department, Ex p Venables (R v Secretary of State for the Home Department, Ex parte Thompson, Thompson, Ex parte, Venables, Ex parte) [1998] AC 407
- R v Secretary of State for the Home Department, Ex p Bugdaycay (Ex p Bugdaycay, Bugdaycay v Secretary of State for the Home Department, Musisi, In re, Nelidow Santis, Ex parte, Nelidow Santis v Secretary of State for the Home Department, Norman, Ex parte, Norman v Secretary of State for the Home Department, R v Secretary of State for the Home Department, Ex parte Nelidow Santis, R v Secretary of State for the Home Department, Ex parte Norman) [1987] AC 514
- Musarat Bibi, R (on the application of) v The Secretary of State for the Home Department [2025] EWCA Civ 622
- Dr Rosalind Bradbury, R (on the application of) v Awdurdod Parc Cenedlaethol Bannau Brycheiniog (Brecon Beacons National Park Authority) [2025] EWCA Civ 489
- ASY & Ors v Home Office [2024] EWCA Civ 373
- Plan B Earth v Secretary of State for Transport [2020] EWCA Civ 214
- Talpada, R (On the Application Of) v The Secretary of State for the Home Department [2018] EWCA Civ 841
- Robson, R (on the application of) v Salford City Council [2015] EWCA Civ 6
- R (Baker & Ors) v Secretary of State for the London Borough of Bromley [2008] EWCA 141
- London Borough of Newham v Khatun & Ors [2004] EWCA Civ 55
- E v Secretary of State for Home Department [2004] EWCA Civ 49
- Young, R (on the application of) v Oxford City Council [2002] EWCA Civ 990
- Susan Evans & Anor, R (on the application of) v Care Quality Commission & Ors [2025] EWHC 2015 (Admin)
- KP, R (on the application of) v Secretary of State for Foreign, Commonwealth and Development Affairs & Anor [2025] EWHC 370 (Admin)
- R(NAA) v An Independent Review Panel [2025] EWHC 1845
- R (Anaesthetists United Limited) v General Medical Council [2025] EWHC 2270
- R(BC) v Surrey County Council [2025] EWHC 719
- Law Society of England and Wales, R (on the application of) v The Lord Chancellor [2024] EWHC 155 (Admin)
- AB by his litigation friend MB (R on the application of) v SLOUGH BOROUGH COUNCIL [2022] EWHC 1772 (Admin)
- Inclusion Housing Community Interest Company v Regulator of Social Housing [2020] EWHC 346 (Admin)
- Wells, R (On the Application Of) v Parole Board [2019] EWHC 2710 (Admin)
- L (An Infant), R (On the Application Of) v Buckinghamshire County Council [2019] EWHC 1817 (Admin)
- R(Hollow) v Surrey County Council [2019] EWHC 618
- Public And Commercial Services Union & Ors v Minister for the Cabinet Office [2017] EWHC 1787 (Admin)
- A v Rotherham Metropolitan Borough Council [2014] EWFC 47
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Cases citing this case
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