High Court rules against Stoke-on-Trent Council in care fees case

In the recent case of R (SARCP) v Stoke-on-Trent City Council (2025), the Administrative Court quashed Stoke-on-Trent City Council’s decision to impose a below-inflation annual increase on care home fees. The ruling came after SARCP, a representative body for care providers in Staffordshire and Stoke-on-Trent, challenged the decision. Philip Rue KC represented SARCP in the judicial review.

The council had decided to increase annual indexation fees for residential care placements by 1.4%; the minimum stipulated under its contract with care providers. SARCP argued that this increase was insufficient and raised concerns about the potential impact on care standards and the risk of vulnerable residents being displaced.

What did the court allow?

The court allowed the judicial review on five key grounds:

• When making its decision, the council failed to adequately consider the results of the consultation, including SARCP’s response
• The council failed to comply with statutory duties under section 78 of the Care Act 2014 and the associated Care and Support Statutory Guidance issued by the Department of Health and Social Care. In particular, the council did not adequately assess actual care costs or inflationary factors such as National Living Wage increases
• The council neglected to consider and properly regard the actual costs of care and other statutory factors that are either implicitly or expressly relevant
• The council breached its Public Sector Equality Duty under section 149 of the Equality Act 2010 by failing to consider the needs and potential discriminatory impact on disabled and elderly care home residents
• The council’s decision was deemed irrational due to an evidential gap, lack of justification, and inadequate reasoning. The council’s focus on ‘keeping people in their own homes’ failed to account for its duties to existing care home residents who were unlikely to return home.

The council contended that this was a private law matter governed by contractual terms. However, the court ruled that while the decision involved contractual rights, it also engaged the council’s statutory ‘market-shaping duty’ under section 5 of the Care Act 2014. As a result, the decision had a significant public law element and was subject to judicial review.

Notably, the court recognised that SARCP, although not a contracting party, had standing to bring the claim because it sought public law remedies rather than contractual enforcement. The judgment underscored the broader public law implications, particularly for third parties affected by the decision.

As a result, the court quashed the council’s decision and ordered it to reconsider within 28 days, ensuring proper consideration of consultation responses, statutory duties, and guidance.

This case reinforces the obligation of local authorities to look beyond financial constraints when setting care home fees. It highlights the judiciary’s role in holding councils accountable to public law standards and affirms the right of representative bodies to advocate for care providers.

Moreover, the ruling underscores the importance of adhering to statutory guidance, conducting thorough consultations, and accurately assessing the costs of care. The outcome has significant implications for care providers, staff, residents, and their families, as decisions on fee adjustments directly impact the sustainability of care homes and the financial burden on residents and their families.