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High Court upholds University Fees Regulations

February 22nd, 2012 by Tom Cross

The High Court this morning handed down judgment in R (on the application of Hurley and Moore) v Secretary of State for Business Innovation and Skills) [2012] EWHC 201 (Admin), in which sixth form students hoping to go to University challenged the Secretary of State’s decision, made through Regulations (SI 2010/3021 and 2010/3022) to allow universities significantly to increase their fees.
The decision to make the Regulations had been preceded by an independent review into university fees chaired by Lord Browne of Madingley. Under the Regulations, the fees which universities are entitled to charge go up to £9000 per year (if they have in place a plan approved by the Director of Fair Access to High Education), or to £6000 in other cases. Previously, the maximum charge in any case was £3,290. The student is not obliged to pay the fees back, however, until his or her studies are completed and his or her salary in employment exceeds £21,000 a year. The Secretary of State’s view is that a quarter of graduates will repay less over their lifetimes than they would do under the present arrangements.
Two grounds of challenge were advanced on behalf of the students.
It was argued, first, that the fees increase brought about by the Regulations was contrary to the right to education in Article 2 of the First Protocol to the ECHR (including if read together with the non-discrimination provision in Article 14). The primary argument was that the almost threefold increase in the size of the fees constituted a limitation on access to education which was disproportionate to the aim the Government was seeking to achieve. It was further claimed that the new funding arrangements indirectly discriminated against those from the lower socio-economic groups.
Elias LJ, giving the lead judgment, rejected both arguments, commenting that it would “take a very exceptional case indeed before it can be said that the charging of fees of itself, absent discrimination, deprives the right of its effectiveness at least where loans are made available to those who need them” (see para [42]). As to Article 14, the Court held that it could not be inferred from the evidence that the Regulations would, in fact, disparately impact on students from the lower socio-economic groups (paras [52] and [54]). Even if that was wrong, the Regulations could still be justified notwithstanding any discriminatory effect. Their objectives derived from the Browne analysis; namely to achieve the sustainable funding of high quality higher education and to secure that education is open to students who have the talent and motivation to succeed (but not simply “to save money”) (see paras [59], [61] and [62]). This was an area of macro-economic judgment involving prioritising particular public resources; significant leeway should be given to the Secretary of State in exercising it (para [63]).
The second ground of challenge was that the decisions to adopt the Regulations breached the Public Sector Equality Duties (“PSED”) which were found, at the material time, in s.71 of the Race Relations Act 1974 and s.49(1) of the Disability Discrimination Act 1995. In response, the Secretary of State relied on impact assessments which drew on material garnered as part of the Browne review.
Elias LJ held that there had on any view been very substantial compliance with the PSED (see [95]), but went on, at paragraph 96:
“However, I accept that if there is any doubt about whether a particular statutory objective is engaged, the issue needs to be explored before any conclusion can be safely reached that it is not. Insofar as the EIA purported to focus on the full package of reforms then under consideration and not merely the decision to increase fees, I cannot be sure that this has been done. I cannot discount the possibility that a more precise focus on the specific statutory duties might have led to the conclusion that some other requirements were potentially engaged and merited considerations…”
He “therefore conclude[d] that the Secretary of State did not carry out the rigorous attention to the PSEDs which he was obliged to do”, but was “satisfied that he did give proper consideration to those particular aspects of the duty which related to the principle of levying fees and the amounts of those fees”. Since the challenge was directed against the aspect of the Regulations which increased fees, it was not appropriate to grant all the relief which the Claimants were seeking (including a wholesale quashing of the Regulations), but it was appropriate to make a declaration to the effect that the Secretary of State had failed fully to carry out his PSEDs before implementing the Regulations. That was also because it would cause “administrative chaos” to quash (see paras [97] and [99]).
The Regulations remain set to come into force on 1 September 2012.

FUNDING FOR HE ABROAD

February 21st, 2012 by James Goudie QC

Advocate General Sharpston begins her Opinion, delivered on 16 February 2012, in Case C-542/09, European Commission v Kingdom of the Netherlands, with an important historical reminder:

            “Erasmus of Rotterdam was an early beneficiary of funding to study abroad. The then bishop of Cambray, Henry of Bergen (for whom Erasmus had started to work as secretary), gave him both leave and a stipend in 1495 to go and study at the University of Paris. Erasmus never looked back; and, in a career that spanned Paris, Leuven, Cambridge and Basel, he became arguably the outstanding scholar of his generation: the ‘Prince of the Humanists’. It is tolerably safe to say that he put the funding for his university studies abroad to excellent use – and, indeed, the current exchange programmes between EU universities bear his name.”

The Advocate General continued that modern day compatriots of Erasmus now enjoy similar good fortune.  Under the Law on the Financing of Studies, the WSF, they can often obtain funding for Higher Education pursued outside the Netherlands. The question before her was whether the detailed rules governing the grant of such funding – in particular, the rule under which an applicant must, in addition to being eligible for funding to study in the Netherlands, also have resided lawfully in the Netherlands during at least three out of the last six years (the ‘three out of six years rule’) – fall foul of Article 45 TFEU (formerly Article 39 EC) and Article 7(2) of Regulation (EEC) No 1612/68  inasmuch as they discriminate indirectly and without justification against migrant workers and their dependent family members. The Advocate General’s conclusion was that they did not fall foul, and she has proposed to the Court of Justice accordingly.  As regards the residence requirement indirectly discriminating against migrant workers, she said

            “61. A requirement of past, present or future residence (especially if it stipulates residence for a particular duration) is intrinsically likely to affect national workers of a Member State less than migrant workers who are in a comparable situation. That is because such a condition always distinguishes between workers who do not need to move to satisfy it and workers who do need to move. The former are usually, although possibly not invariably, more likely to be nationals of the host Member State”

Not only was the residence requirement not justified on the basis of an economic objective, in any event the residence requirement was not appropriate to achieve such an objective.  Moreover, it could not be justified by reference to the social objective of increasing student mobility from the Netherlands to other Member States.  This was a legitimate aim, serving the public interest, by promoting cultural and linguistic diversity and enhancing professional development, and contributing to a pluralistic society.  However, again, the residence requirement was not appropriate or proportionate to achieve that objective.  The Advocate General was (para 147) not convinced that there is an obvious link between where students reside prior to pursuing higher education and the likelihood that they will return to that Member State after completing their studies abroad. She did not regard it as inherently likely that a majority of students who reside in the Netherlands and then study abroad will necessarily return to reside in the Netherlands. There may be ways of encouraging that to happen, but it is not self-evident that past residence is a good way of predicting where students will reside and work in the future.

Injunction against suspension of teachers refused

February 20th, 2012 by Holly Stout

In Macauley v Newham LBC, the High Court (Lloyd Jones J) has refused the application for an injunction on behalf of teachers suspended from working at one of the borough’s schools pending an investigation into allegations of falsification of attendance registers. The teachers (supported by the NUT) argued that their suspension was a breach of the implied term of trust and confidence because there was insufficient evidence to support the allegations and no need for them to be suspended pending the investigation, which had already lasted 4 months. They sought interim relief pending trial compelling the authority to end their suspension and make reasonable endeavours to find alternative work for them.

This was an usual claim. It is relatively common for investigations into teacher’s conduct to take some considerable time, and 4 months is by no means longer than the norm, although it is of course highly undesirable that investigations of this sort do take so long to resolve, given the inevitable deleterious effect on the careers of the teachers involved and (in some cases) their emotional and mental health.

Lloyd Jones J refused the applications. In doing so, he recognised that what was sought by way of interim relief would effectively dispose of the proceedings and therefore that it was appropriate to consider the likelihood of the teachers obtaining relief at trial and not simply whether there was a ‘serious issue to be tried’ in accordance with standard American Cyanamid principles.

He concluded that the suspensions on full pay were properly in accordance with the school’s disciplinary procedure, which provided for suspensions in cases of alleged gross misconduct. He further considered that the local authority had a sufficient basis for investigating the allegations, and that the authority was acting reasonably in withholding further evidence pending the completion of the investigation as to do otherwise might prejudice the outcome of the investigation. He accepted that the authority had acted reasonably in concluding that having the teachers at school during the investigation might prejudice the outcome of that investigation. He also accepted that although the investigation was taking some time, the period to date had been reasonable having regard to the nature of the investigation and the steps that had been taken.

In the circumstances, he considered that there was not a serious issue to be tried, or a good arguable case and accordingly the teachers failed the first American Cyanamid hurdle.

However, he observed that even if they did have a good arguable case, an injunction would have been refused because damages would not have been an adequate remedy for either party and, moreover, there had been a breakdown of trust and between the teachers and the school which meant that an injunction was inappropriate.

School Finance Regulations 2012

February 17th, 2012 by Holly Stout

The new School Finance (England) Regulations 2012 are out: see http://www.legislation.gov.uk/uksi/2012/335/pdfs/uksi_20120335_en.pdf.

These apply for the financial year 2012-2013 and replace previous versions of the regulations.  As previously, they define the non-schools education budget, the schools budget, the central expenditure and the individual schools budget and require local authorities to determine budget shares for schools maintained by them in accordance with the appropriate formula.  They also prescribe the amounts to be allocated in respect of nursery classes in schools maintained by them and relevant early years providers in their area and impose requirements in relation to local authorities’ financial schemes. 

There are three significant changes from the regime applicable under the 2011 Regulations:

(1)   Where a pupil in respect of whom a pupil premium is payable is permanently excluded from one school and admitted to another school, provision is made for the budget shares of both schools to be adjusted by an amount which equates to the appropriate portion of that premium.

(2)   Provision is made to allow for the remission of boarding fees for pupils registered at Academies to be charged to the schools budget.

(3)   There are changes to the calculation of the minimum funding guarantee and to the circumstances in which the guarantee may be varied or disapplied

Pilot scheme for SEN direct payments

February 10th, 2012 by Rachel Kamm

I posted back in March 2011 about the Green Paper “Support and aspiration: A new approach to special educational needs and disability” and the plan to test proposals in local areas from September 2011. The Green Paper included a proposal that all families with children with a statement of SEN or a new ‘Education, Health and Care Plan’ would have the option of a personal budget by 2014.

Section 532A of the Education Act 1996 came into force on 15 November 2011. It allows local authorities to make a payment to a person with a SEN statement or learning difficulty assessment for the purpose of securing (a) special educational provision specified in a SEN statement, (b) provision identified in a learning difficulty assessment (under section 139A of the Learning and Skills Act 2000) as required to meet education and training needs, and/or (c) transport or anything else that may be subject to arrangements in section 508B(1) (school children), section 508F(1) (adult learners) or section 509AA(7)(b) (sixth formers). Local authorities are only permitted to make such a payment in accordance with a pilot scheme made under section 532B.

Section 532B enables the Secretary of State to make pilot schemes by order. There are now regulations made under this section: the Special Educational Needs (Direct Payments) (Pilot Scheme) Order 2011 (SI 2012/206). The regulations came into force on 30 January 2012 and the pilot scheme is for a period of two years. The pilot applies to the 36 local authorities listed in Schedule 2. The pilot scheme is fairly complicated, so the following is just a summary:

  • The local authority must provide information and advice about direct payments to parents / beneficiaries who are 16+ whenever it serves a copy of a SEN statement or prepares a learning difficulty assessment;
  • Direct payments can be made to parents of beneficiaries who are under 16 or to beneficiaries who are 16+. In either case, it must appear to the local authority that the recipient is capable of managing direct payments without assistance (or with any available assistance), is 16+, has capacity to consent to receiving direct payment and is not excluded by Part 4 of the regulations.
  • Alternatively, direct payments can be made to a person nominated by the parent (if the beneficiary is not 16) or the beneficiary (if 16+) provided that the parent/beneficiary has capacity to consent to receiving payments and the nominee agrees to act on behalf of the parent/beneficiary, to use the direct payments to secure the agreed provision and to act in the best interests of the beneficiary. Anyone who is excluded by Part 4 cannot be a nominee.
  • Alternatively, direct payments can be made to a representative if the parent (of a beneficiary under 16) or the beneficiary (if 16+) does not have capacity to consent to receive direct payments and the representative agrees to act on behalf of the parent/beneficiary, to use the direct payments to secure the agreed provision and to act in the best interests of the beneficiary. Anyone who is excluded by Part 4 cannot be a representative.
  • There are transitional provisions where a beneficiary reaches the age of 16.
  • Before making a direct payment, the local authority must agree with the recipient which goods/services are to be secured by means of direct payments and the recipient must consent. In the case of a nominee, the parent or beneficiary (as applicable) must also consent. The written consent must include the name of the beneficiary, the agreed provision, the amount of the direct payment, whether there is a lump sum and if so the date, and whether there are instalments and if so the intervals.
  • Before deciding to make a direct payment, the local authority must be satisfied that the way in which the recipient proposes to use the payment to secure the provision is appropriate, that the parent/nominee/representative will act in the best interests of the beneficiary, that the direct payment will not have an adverse impact on other local authority services for other people with a SEN statement or learning difficulty assessment, and that the direct payment is compatible with the efficient use of its resources.
  • Where a direct payment will be used for goods/services in a school or college, the head teacher / principal or equivalent must consent.
  • Where a local authority decides not to make direct payments, it must inform the proposed recipient and parent and any beneficiary who is 16+ of the decision and its reasons. They have a right to request a review.
  • The amount of a direct payment must be sufficient to secure the full cost of the agreed provision. It can be increased or reduced at any time provided that the local authority is satisfied that the new amount is sufficient. The local authority can also reduce the amount if direct payments have not been used and it is reasonable to offset the accumulated sums against future provision.  It must give reasonable notice of any change, with reasons for any reduction.
  • The local authority must monitor the use of direct payments. A review of specified matters must take place at least once in the first three months, at the end of the first year and thereafter at appropriate intervals. It must also undertake a review whenever any changes are made to the goods/services.  If notified of a change in circumstances, it must consider whether the amount is sufficient. If the local authority reduces the amount following a review, the recipient can request a reconsideration.
  • There are specified circumstances in which the local authority must stop making payments. There are also specified circumstances in which the local authority can require repayment of sums that have not been spent on agreed provision.
  • There is a duty to provide information, advice and support to recipients and beneficiaries.
  • The recipient must use the direct payments only to secure the agreed provision, must notify of any change in relevant circumstances, must ensure a bank account approved by the local authority is only used for purposes connected with direct payments and only accessible by the recipient and approved named persons, must keep a record of money paid in and out, and must on request provide information or evidence about that account or the goods/services secured. The local authority has the power to prohibit the recipient from securing services from a particular person or provider.

This is a significant change to how SEN provision is provided. Whilst it is only a pilot scheme, it applies to a fairly large number of local authorities and those pilot authorities are required to follow the scheme for all people with SEN statements or learning difficulty assessments. This means that there is no discretion for the pilot local authorities to test out the proposals with a small sample of potential beneficiaries for example. It will be interesting to see how many potential beneficiaries choose to take up the option of direct payments and, for those who do, how they choose to secure the goods/services in their statements. It will also be interesting to see how many schools or colleges veto the beneficiary’s first choice for how goods/services will be used in their institutions and whether local authorities use their power to veto a particular provider.

On a separate note, following up from my post on 11 January, as expected the School Admissions Code and School Admission Appeals Code (Appointed Day) Order 2012 (SI 2012/216) provides that the School Admissions Code and the School Admission Appeals Code came into force on 1 February 2012.

Rachel Kamm

Suspension and withdrawal of sponsor licences

February 7th, 2012 by James Goudie QC

In R (on the application of New London College Ltd) v Secretary of State for the Home Department [2012] EWCA Civ 51 the Court of Appeal has considered the suspension and withdrawal of a Tier 4 General (Student) Sponsor Licence issued by the United Kingdom Border Agency (UKBA).  The College provides FE courses.  It held such a Licence.  That enabled it to issue a visa letter or a confirmation of acceptance of studies (CAS) to non-EEA students who wished to study in the UK.

The College mounted three challenges to the decisions to suspend and then withdraw its Licence.  First, it argued that the system of sponsor licensing, pursuant to which the decisions were taken, is unlawful, because it is contained in Policy Guidance, and not in the Immigration Rules themselves.  This challenge failed.   It is only the substantive criteria for entitlement for leave to enter and remain that must be in the Rules laid before Parliament under the Immigration Act 1971.

Second, the College argued that the lack of a right of appeal to an independent body is in breach of ECHR Article 6.  This challenge failed.  The availability of judicial review is sufficient.

Third, the College argued that the suspension and withdrawal of a Licence engaged ECHR Article 1 of the First Protocol.  This challenge failed.  A Sponsor Licence is not a “possession”, an interference with the peaceful enjoyment of which has to be justified as being proportionate.  It is not marketable or even transferable.  Nor is it obtained at a market price.  There was not an adverse effect on goodwill, in the sense of the capitalised value of the business as a going concern.  The Licence does not touch on the freedom of the College to provide courses of education to students. What it does is to confer the right to issue a CAS which will be recognized by UKBA and will contribute to a student’s ability to meet the substantive criteria for leave to enter or remain under the Immigration Rules.  Richards LJ said, at para 97: “That certainly enables the sponsor to attract non-EEA nationals wishing to apply for leave to enter or remain as students, and the loss of that ability through suspension or withdrawal of the licence, with a consequential loss of income from that source, is clearly a serious matter.  But it is far from clear that the expected income stream from such students can be capitalised as part of the value of the business, in particular because it depends on a licence that is non-transferable and has no market value in itself: in order to maintain the income stream, a purchaser of the business would have to obtain a licence of its own.  (I accept that if the business is run in such a way that the current owner qualifies for a licence, it will facilitate the obtaining of a licence by the new owner; but on that basis it is the underlying state of the business that matters and the existing licence of itself has no substantive significance.)”