Harringay, Haringey - So Good they Spelt it Twice!
Judgement day … on Magistrates and LBH
THIS MORNING, with other members of the public, I attended the High Court for the Hearing of The Queen on the application of Nicolson v Tottenham Magistrates (CO/976/2014).
The case concerns the £125 charge that – via the Magistrate's Court – the Council levies on top of unpaid Council Tax. This often impacts those who are least able to pay. In any event, the charge is supposed to reflect the Council's direct and reasonable costs (only).
It's not supposed to be (in accounting terminology) a profit centre. Though I did not hear it today, this could also be expressed such that, the charge ought to do no more than to reflect the Council's marginal costs (i.e. the extra, or incremental costs), rather than somehow amortising some of the fixed costs and ongoing overheads of a whole department.
One fellow member of the public – whose knowledge of the mechanising of the process is much better than mine – suggested that the actual, direct, costs could be as little as 83p/claim (more information, if and when it comes to hand).
The Judicial Review was brought by the Rev. Paul Nicolson and was heard in Court 3 of the Royal Courts of Justice before Mrs Justice Andrews.
Reverend Nicolson had asked for a breakdown of the £125 charge.
In respect of an 'explanation' eventually offered, the Judge used the word (amongst other pithy description), waffle.
A distinction is drawn between costs reasonably incurred and incurring reasonable costs (or, kind-of-cost vs. level-of-cost). There was a claim that there had been an explanatory schedule on paper back in 2010 ... but that could not now be found.
At one point, the Judge suggested that Magistrates were the only thing that stood in the way of the Council charging whatever it liked.
Although Justice Andrews reserved judgement, she expects to be able to deliver it next week. The Court's decision could have wide ramifications.
More about the case here
and here:
Tags for Forum Posts: Council, Court, High, JR, Judicial Review, Magistrates, charge, tax, £125
Replies to This Discussion
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Permalink Reply by Over2you on
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I understand the Reverend is awaiting Haringey's external auditor, Grant Thornton, to assess the costs. The article in Haringey Independent (seeking declaration on costs), informs us that a meeting was held on Friday 5th June.
This now all hinges on whether HBC's 'Independent' Auditor, can really be relied upon to be impartial in doing the job of deciding whether or not the council can possibly incur £125 costs to institute the complaint.
Presumably there are others who have concerns about the conflict of interest having a private company whose loyalty must be with its client to ensure it continues providing its services in future years.
Even if the company opts to take a fair approach in its assessment, it still requires that the auditor has enough background to do the job justice. It's one thing to confirm whether or not the sums add up, but quite another knowing exactly the relationship between lawfully recoverable expenditure, and at which stage in the procedure it is incurred.
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Permalink Reply by Clive Carter on
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This now all hinges on whether HBC's 'Independent' Auditor, can really be relied upon to be impartial
Look I agree with the general point you're making Over2you, but it's the same with every Auditor. All I can say is that Grant Thornton are expected to be scrupulously fair and impartial. They know and we know they are being paid out of public funds to be objective. Their reputation depends on it.
If they produce a report that is published, then we can see what they say.
It is a sad day when a retired man of the cloth has to fight all the way up to the United Kingdom Supreme Court to show the error of Council's way and then obliged to continue to fight, in order to force a moral compass into the hands of the management-focussed dominant Group.
If I can add a small party political note, one might have expected the governing party to be more sensitive to some of, manifestly, the least advantaged in the Borough. Instead, they appear to operate in a moral vacuum.
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Permalink Reply by Alan Stanton on
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Not every member of the Labour Group, Clive. But what currently passes for leadership, yes "moral vacuum" seems pretty accurate. Though what I find most frustrating is their apparent closed-mindedness.
It's perfectly possible to disagree with someone - perhaps with passion - yet still respect their views and acknowledge that they've made good points and may even be correct.
Yet this self-righteous incurious shower seem unable even to engage with Rev Paul Nicolson. Let alone to ponder and think that perhaps he might just have got things right.
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Alan the general retreat from meaningful engagement is exemplified by the shutting-up-shop of the Area Forums.
The ones I attended (including one each in St Anns and Tottenham), were well-attended, contrary to claims made by the Council.
Some (senior) Council employees were obliged to attend these meetings. One of the points made to me by a Liberal Democrat colleague, is that it is beneficial for officers to be exposed to something quite difficult, assertive, inquisitive and argumentative… the public!
The Council would do well to admit they got it wrong over the £125 charge. And, apologise to Rev. Paul Nicolson and to invite him in order to receive a sermon on practical ethics.
CDC
Councillor
Liberal Democrat Party
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Permalink Reply by Sarah on
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I work for a local authority. I love dealing with residents, even the angry ones! Especially the angry ones - we have something in common in that we are both passionate about the same thing. Meetings can be difficult though in that they can be derailed by louder people with an agenda. Others can't always get their point across.
But it's a dialogue. My favourite resident was not well liked by my colleagues, but he's learned to deal with officers now and to get what he wants a lot more effectively!
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Haringey is not the only local authority that has lost the ability to tell the truth. There are probably around 300 to 400 lost or discarded moral direction devices in England and Wales (if that is the existing number of local authorities).
In a similar vein to HBC's missing spread sheet fiasco, North East Lincolnshire Council dishonestly exploited its Independent Auditor (KPMG) to support its costs in defence to formal allegations of falsely accounting for them. It did this by proudly stating that its calculation had been through stringent checks by its District Auditors, upon whom it called to endorse and add authenticity to its estimated standard summons cost, even though the council's auditor admitted that the figures were not subject to audit as it was not within its responsibilities.
Although circumstances are different in Haringey's case because the high court judgment obliges that the accounts are now subject to audit, there is still value to be had in reading the content relevant to the auditor's involvement at paragraphs 79 to 94 of this document, regarding moral compasses ( or the lack thereof).
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TAX CREDITS, ALREADY PAYING RENT AND COUNCIL TAX,CANNOT BE CUT BY £1700 A YEAR WITHOUT DAMAGING PEOPLE'S HEALTH.The proposed budget cuts to welfare will create more hardship in the London Borough of Haringey
The proposed £12 billion cuts in welfare includes the £1,700 a year the Institute for Fiscal Studies estimates will be taken from the tax credits of 3.7 million families.
It is worse than that.
Cuts in council tax and housing benefits from April 2013 have left rent and council tax to be paid out of those about-to-be-cut tax credits.
The consequent rent and council tax arrears are ferociously enforced with extra costs and threats of eviction and prison.
The GPs surgeries, already dealing with malnutrition and debt related stress, are at risk of being overwhelmed.
But the DWP never considers the negative impact on health of cuttin...
Rev Paul Nicolson
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There is an assertion contained in Justice Andrews' judgment at paragraph 42 which could be understood in two different ways. The matter is relevant to the process which I assume to be now underway and fear that if there is any ambiguity it will be the wrong meaning that will be elected, i.e., the one supporting higher recoverable expenditure.
Anyway, para 42 states, so far as is relevant:
It seems to me that in principle the intention in the Regulations is to enable the local authority to recover the actual cost to it of utilising the enforcement process under Regulation 34....
This, out of context, could be understood to mean that the actual cost of the enforcement process may be recovered under the provision of Regulation 34 (completely the wrong interpretation); Or – the actual cost of the enforcement process described at Regulation 34 may be recovered under that Regulation.
This is important because a billing authority’s incurred expenditure in securing a liability order makes up only a small element of its overall cost of recovery, and is the only costs which the Regulations enable councils to recharge to the 'customer'.
There is however, (and luckily) clarification in the judgment at para 35 where it states, so far as is relevant:
....It would obviously be impermissible (for example) to include in the costs claimed any element referable to the costs of executing the order after it was obtained, or to the overall administration of council tax in the area concerned.
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I haven't looked up Regulation 34, but I sat through the Hearing.
My general impression is that the law allowed Council's to recover the extra, marginal or incremental costs incurred. Not some kind of amortising of the costs of an entire department.
It is terribly important that this cost be fair and be seen to be fair. We don't know what that figure is, but we do know that the Council deals with late payers en masse. Not the hand-tailored, custom-service the Court was led to believe by LBH's representative.
As you've pointed out we, the public, will depend on Grant Thornton to be unbiased, objective and independent, notwithstanding that it is the Council, i.e. the public, who pay them.
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My general impression is that the law allowed Council's to recover the extra, marginal or incremental costs incurred. Not some kind of amortising of the costs of an entire department.
There is plenty of evidence suggesting that most, if not all local authorities, aim to identify all their expenditure that can be linked to the recovery process, and recharge it all to the 'customers' driving that activity. Though plainly that is not what the Regulations enable – if making their own laws up this way avoids cost falling on the taxpayer in general they seem to consider justified in doing so.
Just one example (and there are plenty of others) that suggests that any expenditure considered attributable to recovery and enforcement activity is recoverable by recharging it via costs claimed in an application for a liability order, is a letter from one Authority to the relevant Magistrates' court. The letter included the following:
....the current charges are insufficient to cover the true cost of this area of work and therefore a review has been undertaken to avoid this cost being borne by the majority of taxpayers who pay their bills on time.
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It appears to have sold out on three of the six scheduled venues, but with the limited information as to the workshop's content you wonder if it's just an excuse for Revenue, Benefits and Recovery officers to get out for the day and cash in on the free (to the employees) lunch at the expense of the taxpayer.
Institute of Revenues Rating and Valuation (IRRV)
Consequences of the Reverend Nicolson Case on Court Costs
This workshop is designed for officers who have an involvement in recovery of council tax and / or non-domestic rate. It will focus on the consequences of the decision in ‘R (On the application of the Reverend Paul Nicolson) and Tottenham Magistrates 2015’ regarding costs that can be applied for by a billing authority at a liability order hearing.
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Scepticism may be in order. But it seems that at minimum, some local councils have noticed the judgement and realise that they need to get things right. Or they risk laying themselves open to successful legal challenge. Which could be both very costly and seriously damage their public reputation.
Will Haringey Council be among the learners? For many people, its reputation must be in tatters and badly in need of urgent repair. So we can live in hope. In the meantime Taxpayers Against Poverty Reverend Paul Nicolson's campaigning organisation, has made an appeal for funds.
Please consider if you can spare them a few quid.
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