Summary: Mrs X complains about the Council’s decision to stop setting up market stalls for traders and its decision making on discretionary grants, causing her financial loss. We find the Council at fault as it did not have due regard to its public sector equality duty and it did not allow Mrs X a right of review. We recommend the Council provide an apology, explanation, payment and review its decision on Mrs X’s grant. We also recommend the Council revisit its decision making on stalls and take action to prevent recurrence of identified faults.

The complaint

1. Mrs X complains:
• the Council stopped providing market stalls for traders, without consultation. As a result she cannot return to work at the market.
• the Council refused her a discretionary grant. She considers its policy is contrary to Government guidance and the policies of other councils. Further, that the Council decided requests inconsistently. She has suffered financially and had to sell her van.

Back to top

The Ombudsman’s role and powers

2. We investigate complaints about ‘maladministration’ and ‘service failure’. In this statement, I have used the word fault to refer to these. We must also consider whether any fault has had an adverse impact on the person making the complaint. I refer to this as ‘injustice’. If there has been fault which has caused an injustice, we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
3. We cannot question whether a council’s decision is right or wrong simply because the complainant disagrees with it. We must consider whether there was fault in the way the decision was reached. (Local Government Act 1974, section 34(3), as amended)
4. This complaint involves events that occurred during the COVID-19 pandemic. The Government introduced a range of new and frequently updated rules and guidance during this time. We can consider whether the council followed the relevant legislation, guidance and our published “Good Administrative Practice during the response to COVID-19”.

5. If we are satisfied with a council’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended)

Back to top

How I considered this complaint

6. I spoke to Mrs X and I reviewed documents provided by Mrs X and the Council.
7. I gave Mrs X and the Council the chance to comment on this draft decision. I considered any comments provided before finalising my decision.

Back to top

What I found

Public sector equality duty

8. The public sector equality duty is part of the Equality Act 2010. It requires all local authorities to have due regard to the need to:
• eliminate unlawful discrimination, harassment and victimisation and other conduct prohibited by the Act,
• advance equality of opportunity between people who share a protected characteristic and those who do not, and
• foster good relations between people who share a protected characteristic and those who do not.
9. The broad purpose of the public sector equality duty is to consider equality and good relations into the day-to-day business and decision making of public authorities. It requires equality considerations to be reflected into the design of policies and the delivery of services, including internal policies, and for these issues to be kept under review.
10. The Ombudsman cannot find that a body in jurisdiction has breached the Equality Act. However, we can consider whether a council had regard for the public sector equality duty as part of its decision making. Case law says it is good practice for a public authority to keep records of its consideration of the aims of the general equality duty when making decisions.

Principles of good administrative practice

11. In 2018 the Ombudsman published a guidance document setting out the standards we expect from bodies in jurisdiction. This included:
• Ensuring people can access services easily, including those needing reasonable adjustments.
• Having clear and accessible appeal routes.
• Providing clear and timely information on how and when to appeal or complain.
12. In May 2020 we issued an addendum in response to the COVID-19 pandemic; “Good Administrative Practice during the response to Covid-19”. The following points are relevant in this case:
• Basic record keeping is vital during crisis working. There should always be a clear audit trail of how and why decisions were made.
• The basis on which decisions are made and resources allocated, even under emergency conditions, should be open and transparent.
• Decision reasons should be clear, evidence based and where necessary explained in the particular context and circumstances of that decision.
• If you use new or revised policies and processes this should not lead to arbitrary decisions and actions. Ensure you have a clear framework for fair and consistent decision making and operational delivery.

Council’s decision making on market stalls

13. The Council closed its markets on 24 March 2020 due to the COVID-19 pandemic. On 24 May the Government said markets could reopen from 1 June provided they were COVID safe.
14. The Council has provided a copy of a report to its Cabinet dated 16 June 2020, setting out its consideration of reopening market stalls. This included a recommendation to temporarily suspend its practice of providing and erecting stalls for traders, for safety reasons, pending consultation. The alternative to the proposed recommendations was that the market would not be safe to reopen at all.
15. The report says “the author has considered the likely implications of the decision - particularly in terms of … Equality & Diversity/Human Rights… Where the report author considers that there may be implications under one or more of these headings, these are identified [in the report].”
16. I note there are no further comments in the report regarding Equality and Diversity or Human Rights.
17. The report says the Council contacted traders to consult them about potential changes that would need to be made to enable the safe re-opening of the market. The original proposals were shaped following feedback from traders. Subsequent feedback further altered the proposals in this report.
18. The report notes that usually any proposal would go to the full Council for consideration. However, the next meeting was not until September 2020 and so any decision to amend its practice arising from the consultation would be taken by the Chief Executive under her emergency delegated power.
19. The Council has provided a further confidential record regarding its consultation. This says the Council contacted market traders and heard views from 16 that engaged with discussion. I note this does not show whether the Council contacted Mrs X.

Discretionary grants

20. In response to the COVID-19 pandemic the Government introduced support for businesses, including a discretionary grant fund. In May 2020 it published “Local Authorities Discretionary Grants Fund- guidance for local authorities”.
21. Councils could give a discretionary grant of £25,000, £10,000 or any sum under £10,000 to businesses which could not access other grant funding (other than the Job Retention Scheme). The value of the payment was at the council’s discretion.
22. In making payments under £10,000, councils could adapt the approach to local circumstances, such as providing support for micro-businesses with fixed costs or support for businesses crucial to their local economies.
23. The funding was aimed at:
• small and micro businesses.
• businesses with relatively high fixed property costs.
• businesses that suffered a significant fall in income due to COVID-19.
• businesses which occupied a property, or part of a property, with a rateable value or mortgage payments of under £51,000.
24. Businesses eligible for cash grants from any central government COVID related scheme (apart from Self- employed income support (SEISS)) were ineligible for funding. Those that received SEISS were eligible for funding.
25. The Government wanted councils to exercise their local knowledge and discretion and recognised economic need would vary across the country. It therefore set some national criteria for the funds but allowed councils to decide which cases to support within those criteria.
26. It considered the following types of business should be a priority for funding but this was a guide only. Councils were to decide themselves if a business was similar and, if so, whether it should be eligible for grants. These businesses were:
• small businesses in shared offices or other flexible workspaces, who did not have their own business rates assessment
• regular market traders with fixed building costs, such as rent, who did not have their own business rates assessment
• Bed and Breakfasts which paid Council Tax instead of business rates
• charity properties in receipt of charitable rates relief
27. Where limits to funding required councils to prioritise which types of businesses received funding, it would be at their discretion as to which types of business were most relevant to their local economy.
28. In taking decisions on the appropriate level of grant, councils could take into account:
• the level of fixed costs faced by the business
• the number of employees
• whether businesses had to close completely and could not trade online and
• the consequent scale of impact of COVID-19 losses.
29. Councils were to set out their discretionary grant scheme on their website, providing clear guidance on which types of business were prioritised, and how they would decide on the level of grant.

Council’s discretionary grant policy

Phase one

30. The Council published a guidance document for phase one of the scheme in June 2020.
31. I note the eligibility criteria mirrored that in the Government guidance.
32. The priority businesses also mirrored the Government guidance but included more businesses. The Council’s priorities for support were:
• small businesses in shared offices or other flexible workspaces, who did not have their own business rates assessment
• businesses with fixed building costs, such as rent, who did not have their own business rates assessment
• businesses which paid Council Tax instead of business rates e.g Bed & Breakfasts
• charity properties in receipt of charitable rates relief
• businesses with their own business rates assessment who were not eligible for funding under the ‘Small Business Grants Fund scheme’ or ‘Retail, Hospitality and Leisure Fund scheme.
33. The guidance explained how the Council would decide on the level of grant payable.
34. As it had a limited amount of funding it would assess and decide on grants on a first come first served basis. It recognised this may have meant businesses that applied later may not receive a grant if the funding was over-subscribed. Similarly, if there were delays in a business submitting relevant information, this may have impacted upon their likelihood of obtaining funding.
35. It included answers to FAQS. This included:
36. “Are annual pitch fees and storage costs classified as 'fixed property costs' for market traders? Yes, pitch fees and storage costs would count as fixed property costs.”
37. The guidance said the scheme would run from 8 June and would close once all funds were committed.

Phase two

38. The Council has provided a copy of its decision notice on phase two of the grant scheme.
39. This noted phase one of the scheme closely mirrored the Government guidance. However, funds remained and it was now able to expand the scheme further to support those who had not yet received any formal support.
40. The Council proposed to remove the requirement to demonstrate fixed property costs as those businesses had already been prioritised under phase one. And it decided to target small and micro businesses that had not yet received any form of financial support, including support through the Self-Employment Support Scheme.
41. The Council would earmark some of this funding for market traders that regularly trade and operate in its area and were of importance to its local economy. It would administer this in accordance with the mandatory eligibility criteria set out in the Government guidance. (The Council later referred to this as “phase three”.)
42. The Council has provided a copy of its published guidance for phase two of its scheme. I note this reflects its decision notice, though there is no specific reference to market traders or a further phase of the scheme to support market traders.
43. The guidance explained a grant of £5000 would be payable to each qualifying business. The scheme would run from 3 August and would close once all funds were committed.

Council’s complaints policy

44. The Council publishes its complaints policy on its website.
45. This explains that where a person has views on a matter of Council Policy that has already been agreed democratically in accordance with the Council's Constitution, the Council will treat this as feedback and pass it to the relevant service area.
46. A complaint is "An expression of dissatisfaction about service, action or lack of action, however made, provided directly by the Council or by a contractor or partner, affecting an individual resident or a group of residents, that requires a response”. This is said to include: failure to consider relevant matters in coming to a decision or implementing it.

What happened

47. Mrs X was a regular market trader within the Council’s area.
48. In March 2020 the Council closed its markets for safety reasons due to the COVID-19 pandemic.
49. On 24 May the Government said markets could reopen from 1 June provided they were COVID safe.
50. The Council says it asked traders, including Mrs X, whether she would return to the market when it reopened. Mrs X says she told the Council she would not return. This was because the Council would no longer provide and erect stalls. She did not have her own stall or the necessary transport for such. And, even if she did, she could not erect her own stall due to a long-term health condition.
51. The Council decided when it reopened it would no longer provide and erect stalls for traders; they would have to arrange this themselves.
52. Mrs X says she completed a hardcopy application for a discretionary grant under phase one of the Council’s scheme in July 2020. She says she delivered this to the Council’s offices by hand. However, the Council has no record of receiving this.
53. Mrs X followed this up with the Council on 10 July and it explained it was only accepting online applications.
54. Mrs X applied online on 20 July. She later chased the Council for the outcome of her application.
55. The Council’s record of a call with Mrs X on 3 August shows it told her that she did not have fixed property related costs to qualify for a grant at phase one and it would send a rejection email in due course. In the meantime she should apply under the second phase of its scheme, so as not to miss out.
56. On 3 August Mrs X applied for a grant at phase two.
57. Mrs X says she chased the Council by phone for the outcome of her applications and asked for call backs but did not hear further until 3 September.
58. On 3 September the Council told Mrs X it could not offer a grant under phase one as her business had no fixed property costs. It could not offer a grant under phase two as she received support from the SEISS scheme. And it could not offer support under phase three as she did not plan to return to the market after lockdown.
59. Mrs X and the Council exchanged further correspondence then Mrs X made a complaint.
60. Mrs X formally complained on 15 September. She said she was unaware the Council would consider pitch fees and storage costs as property related costs when she applied under phase one. She stored goods in a van with upkeep costs and paid pitch fees to another council. The refusal to support any traders under phase one was contrary to Government guidance and the policy of other councils. She knew other traders who received a grant under phase two despite also receiving SEISS. Further, she would have received support under phase three, but for the Council’s decision to stop providing and erecting stalls for traders. The Council decided this without consultation. Further she knew of another trader who had not returned to the market yet had received a grant at phase three.
61. In response the Council explained at phase one it focused on supporting businesses with ongoing fixed property costs in line with Government guidance. It had waived pitch fees for market traders and understood from her application that she had no other property costs. At phase two it focused on supporting those who had not received any support at all, such as from SEISS. The scheme was oversubscribed and funds went to those who applied within 24 hours. At phase three it supported those market traders who planned to return to the market, but she did not. Its complaints process did not cover complaints about policy. This was its final response.
62. Mrs X said the Council had ignored her concerns and she wanted to go to stage 2 of the complaints process. However, the Council said it had nothing further to add and referred her to the Ombudsman.
63. As part of my enquiries I asked the Council for evidence it had regard to its public sector equality duty when deciding to stop erecting stalls for traders. In response the Council explained its consultation was limited as it sought to balance the need for fairness with the need to respond appropriately and quickly to the public health threats posed to both staff and residents by the pandemic. It explained it would undertake a further formal consultation in 2021. Its engagement at that stage would be full and wide ranging to ensure any long-term decision making was as well informed as possible, including taking steps to meet the needs of people who share a protected characteristic.   
64. I also asked the Council for a copy of phase three of its discretionary grant scheme. The Council said there was no phase three of the discretionary grant scheme and so it could not provide me with a copy of such. However, it did have a scheme aimed specifically at market traders. I asked for a copy of this scheme and the Council referred me to its decision notice, as referenced at paragraphs 38 to 43 above.
65. The Council addressed whether a third party received a grant at phase two despite also receiving SEISS, as Mrs X had suggested. It provided documents in support of its response.
66. The Council also addressed whether a third party had received a grant at phase three despite having no intention to return to the market, as Mrs X had suggested. It provided documents in support of its response.
67. In response to a draft of this decision the Council:
• Denied it failed to have due regard to its public sector equality duty; that it failed to consult with Mrs X and that it failed to address her complaint about this.
• Provided a record of its discussions with traders in May and on 5 June 2020. These show in May, the Council asked traders if they planned to return to the market and asked how they made use of the stalls and any changes they would like to see. In June, the Council told traders they would no longer be able to provide and set up stalls, due to safety reasons.
• Provided a record of discussions with Mrs X in May and June 2020 to evidence it did consult with her with a view to understanding how any change in policy relating to market stalls would impact her. The Council notes that Mrs X did not raise any health or disability issues as barriers to trading. Further, Mrs X did not raise any complaint about a lack of consultation until September 2020. Had she raised any concerns earlier it would have addressed them.
• However, I note neither of these records show the Council queried or otherwise gathered information from Mrs X or other traders to assess how its proposal may impact those physically unable to set up a stall themselves.
• Provided email evidence to show it engaged with a market representative. However, I find this does not evidence any consideration of its public sector equality duty.
• Said it also engaged with the representative face to face and by phone. There was opportunity for the representative to identify any personal needs arising from its proposal however they did not raise any equality issues. Had they done so the council would have completed a fuller assessment of how it could support any adversely impacted traders.
• It offered to provide free lightweight stalls, to support market traders while they secured their own stalls. However, the market representative said no-one returning to the market required this.
• Said its engagement did not uncover any issues or concerns regarding equality issues. If any health concerns were raised it would have addressed these.
• Acknowledged the Council’s decision report of 16 June 2020 did not include reference to equalities issues. It also acknowledged it did not undertake a formal Equalities Impact Assessment. However, believed it could demonstrate matters of equalities were clearly considered through engagement with market traders ahead of any decisions taking place, and that this engagement did not raise any matters of concern relating to equalities.
• Said the Ombudsman’s ‘Good Administrative Practice During the Response to Covid19’ states that “…normal expectations on the need to consult service users and stakeholders may not be feasible or appropriate. You should document and explain departures from normal practice”. The Council believes that it engaged and consulted traders as much as practicably possible during a pandemic.
• Explained the decision taken in June was a temporary measure to deal with the specific circumstances of the Covid-19 pandemic. It was (and remains) the Council’s full intention to review the position on market operations as the country recovers from the impacts of Covid. In considering the draft decision, the Council commits to undertaking a comprehensive Equalities Impact Assessment on this decision and other decisions on similar matters going forward.
• Explained it used an online system for grant applications as its offices were largely unoccupied; to ensure swift processing; to ensure secure handling and to minimise contact during the pandemic. Further, it had no record of receiving Mrs X’s application.
• Explained it did not operate a ‘Phase 3’ discretionary business grants scheme. As part of the formal approval of the Council’s Phase two discretionary business grant scheme, it agreed to ring-fence an element of funding to provide direct business grant support to known market traders that operate across the Council. It did not design this to be accessible to the general public via application. It publicised details of the scheme through its communications channels and the scheme was reported widely in local press.
• Enclosed an undated press article. I note this details the grants available to market traders as part of phase two of the Council’s discretionary scheme. Its sets out eligibility criteria and the level of grant payable.
• Accepted Mrs X’s complaint was not handled in accordance with the Council’s existing policies and procedures.
• Said it had no record of receiving Mrs X’s paper application. However, it took steps to ensure businesses could apply for grants where they had difficulty with digital access, including taking applications by phone and collecting paperwork in person. If Mrs X had said she could not apply online it would have offered support.
68. In comments on a draft of this decision Mrs X said:
• In May the Council called her to ask if she would be returning to the market in June when it re-opened. She explained it would be impossible to return because they were not erecting stalls. She did not have her own, nor could she afford to buy a stall or a bigger van which she would need to transport it. At no point did the Council offer help in providing a light weight stall or a grant to help her buy her own stall or any other assistance. This May phone call was the first indication and confirmation from the Council that was going to stop erecting stalls.
• The Council was wrong to reject her requests for a discretionary grant under phase one and phase two.
• She considers the Council stopped erecting stalls as a cost cutting exercise.
• She believes she qualified for the discretionary grant at phase two.

Findings

Market stalls

69. We cannot question whether a council’s decision is right or wrong simply because a complainant disagrees with it. We must consider whether there was fault in the way the decision was reached.
70. The Council has evidenced it spoke to traders, including Mrs X, about how they used the market and stalls in May. Further, that it discussed its intention to stop setting up stalls with traders in June, prior to the Cabinet decision. Mrs X accepts the Council told her it would stop setting up stalls and that she expressed her unhappiness about this. I acknowledge Mrs X considers the Council failed to consult with her about its decision. However, I find in the context of the pandemic and with the need to make decisions quickly, the Council’s discussions with traders and Mrs X amounted to a consultation.
71. The Council must have due regard to its public sector equality duty when making decisions and I would expect it to have evidence of such. Case law says it is good practice for a public authority to keep records of its consideration of the aims of the general equality duty when making decisions.
72. The Council’s report of 16 June, regarding its proposal to stop setting up market stalls, suggests it did not identify any equality and diversity implications. The Council’s decision records otherwise make no mention of equality and diversity. In response to my enquiries, the Council could not point to any evidence to show it had due regard to its public sector equality duty. In response to a draft of this decision, the Council provided further evidence of its consultations. However, I find these do not show any specific consideration of equality issues or show the Council invited comments on such. Further, I have not seen any documents which show the Council considered how its proposal accorded with the aims of its equality duty. I acknowledge the Council’s comments that both the market representative and traders themselves had opportunity to raise any equality issues and did not do so. However, I do not consider this adequately evidences the Council had due regard to its equality duty. This is because the Council should show consideration of equality issues whether or not concerns are raised.
73. Therefore, on the information I have seen, I find there is a lack of evidence to show the Council had due regard to its public sector equality duty in deciding to stop setting up stalls for traders. Though the Council had limited time to make a decision, its legal duties remained. This is fault. The Council’s decision may have impacted anyone unable to set up a stall themselves, for instance due to a disability or a long-term health condition as Mrs X has. I note the Council has planned a full consultation for later in the year and committed to carrying out an Equality Impact Assessment (“EIA”). My recommendations will reflect this. I will also recommend it make a payment to Mrs X in recognition of the uncertainty suffered as to whether she lost the opportunity to continue trading at the Council’s market. This is a payment for uncertainty only, as I cannot say, even on balance, that the Council’s decision outcome would have been different if there was no fault.

Discretionary grants

74. I note Mrs X is unhappy the Council did not act upon her hardcopy application form. However, the Council says it has no record of receiving Mrs X’s application. It has explained its reasons for using an online system and confirmed it offered support to anyone unable to apply online. I cannot say what happened to Mrs X’s hardcopy application however I am satisfied Mrs X remained able to apply online. I find further investigation into this matter is not appropriate or proportionate because any fault did not cause Mrs X significant injustice.
75. I note Mrs X chased the Council for a response to her grant applications however I do not consider any delay in its responses of 3 August and then 3 September so great as to amount to fault.
76. Councils had discretion which businesses to support under their discretionary grant schemes while having regard to the Government guidance. The Council’s discretionary grant scheme at phase one closely mirrored the Government guidance. I find no fault in its decision making.
77. At phase one the Council required businesses to evidence relatively high fixed property costs. Its guidance made clear the Council would consider storage and pitch costs as evidence of this. However, Mrs X did not provide evidence of property related costs on her application. The Council therefore refused Mrs X a grant in line with its policy. I find no fault in this regard.
78. However, the Council should have given Mrs X a written response to her request for a grant under phase one and allowed a right of review. That it did not do so amounts to fault. Mrs X missed the opportunity for the Council to review any evidence she had of property costs as a result and suffered distress and uncertainty. I therefore recommend the Council now consider this evidence and award Mrs X a sum equivalent to the grant if it finds she would have met the qualifying criteria at phase one.
79. At phase two the Council decided to prioritise those businesses that had not received any formal support previously, including SEISS. The Council decided this in full knowledge of the Government guidance, having included these businesses under phase one. It also recorded reasons why it would not include these businesses at phase two. I am satisfied on the evidence the Council followed a proper decision making process. I do not find fault in how the Council exercised its discretion.
80. The Council refused Mrs X a grant at phase two because she received SEISS. The Council decided in line with its policy, I therefore do not find fault.
81. Mrs X has complained a third party received a grant at phase two despite also receiving SEISS. I cannot disclose details for confidentiality reasons, however, on review of the documents provided by the Council, I am satisfied its decision regarding the third party was consistent with its policies.
82. The Council’s decision records and communications with Mrs X refer to a “phase three” of its grant scheme. Despite these references, I accept on the information seen that the Council did not have a “phase three” as such, rather this was an additional part of phase two. The Council has evidenced information about this was publicised in the local press.
83. Under this additional part of phase two, the Council decided to support traders that regularly operate in its area as they were important to the local economy. In view of the Government guidance I am satisfied the Council was able to prioritise support in this way. The Council refused Mrs X a grant as she did not plan to return to the market and so would not regularly operate in its area. The Council decided in line with its policy and so I do not find fault in its decision outcome.
84. Mrs X has complained a third party received a grant despite having no intention to return to the market. I cannot disclose details for confidentiality reasons, however, on review of the documents provided by the Council, I am satisfied its decision regarding the third party was consistent with its policies.

Complaint handling

85. The Council’s complaint response did not address all the points Mrs X raised. It did not respond to:
• her new information on property costs;
• the complaint it had applied its policy inconsistently or;
• the complaint it had failed to consult on its decision to stop putting up stalls.
86. The Council also told Mrs X she could not use it complaints process however the matters she raised fell within it published complaints process. Therefore, the Council did not provide a suitable complaint response or follow its own complaints process. This is fault. Mrs X suffered distress and uncertainty, and she was put to time and trouble bringing her complaint to the Ombudsman as a result.

Agreed action

87. To remedy the injustice set out above I recommend the Council carry out the following actions:
88. Within one month:
• Provide Mrs X with a written apology for identified failings;
• Pay Mrs X £500 for distress and uncertainty;
• Pay Mrs X £100 for the time and trouble in bringing her complaint;
• Ask Mrs X for evidence of property costs, consider this evidence, and decide whether Mrs X would have been entitled to a grant at phase one had it seen this evidence at the time. If so, pay Mrs X an amount equivalent to the grant she would have received.
89. Within three months:
• Provide training or guidance to relevant staff to ensure they:
1. have due regard to the public sector equality duty in decision making;
2. take account of the Ombudsman’s guidance on Good Administrative Practice and;
3. handle complaints in line with the Council’s published complaints policy.
90. Within six months:
• Carry out its planned consultation and undertake an Equality Impact Assessment on its decision to stop setting up stalls. And notify Mrs X and the Ombudsman of the decision outcome and its reasons.
91. The Council has accepted my recommendations.

Back to top

Final decision

92. I have found fault in the Council’s decision making and complaint handling. The Council has accepted my recommendations and I have completed my investigation.

Back to top

Investigator's decision on behalf of the Ombudsman