Fanning v Secretary of State & Scottish Ministers: The “Ripple-Effect” Test for Standing and a Restatement of Equality-Duty Compliance in Devolved Social-Security Policy

Fanning v Secretary of State & Scottish Ministers: The “Ripple-Effect” Test for Standing and a Restatement of Equality-Duty Compliance in Devolved Social-Security Policy

1. Introduction

The Outer House of the Scottish Court of Session, in Peter John Fanning and Florence Agnes Fanning for Judicial Review ([2025] CSOH 50), confronted a multi-layered challenge to the UK and Scottish Governments’ decisions to restrict the longstanding Winter Fuel Payment (WFP) and its Scottish successor, the Pension Age Winter Heating Payment (PAWHP). The petitioners—elderly Scottish residents with medical vulnerabilities—sought wide-ranging remedies, including reduction of both UK and Scottish regulations, on grounds of:

  • Failure to comply with the Public Sector Equality Duty (PSED) under s.149 Equality Act 2010;
  • Breach of a common-law duty to consult;
  • Wednesbury irrationality;
  • Incompatibility with Articles 2 and 8 ECHR.

Although Lady Hood ultimately refused the petition, the judgment establishes two important points of principle:

  1. The “Ripple-Effect” test for standing: Scottish residents may have sufficient interest to challenge a UK-ministerial decision that applies only to England & Wales when there is a foreseeable and foreseen financial ripple into devolved budgets that directly affects them.
  2. A restatement of compliance with the PSED: High-level fiscal or social-security policy decisions satisfy s.149 where Ministers demonstrably consider equality impacts in real time, even via succinct “High Level Equality Analyses”, and ongoing parliamentary scrutiny may obviate any implied duty to consult.

2. Summary of the Judgment

Lady Hood’s key holdings can be distilled as follows:

  • Standing: The petitioners had locus to proceed against the UK Secretary of State because the decision to means-test WFP predictably reduced Scotland’s block-grant and caused the Scottish Government to mirror the restriction. Thus, the UK decision “directly affected” the petitioners.
  • Parliamentary privilege: References to Hansard or Lords committee reports were excised where they invited the court to test the truth of parliamentary statements, reaffirming the limits set by Article IX of the Bill of Rights.
  • Public Sector Equality Duty: Both respondents complied. The UK Minister had a “conscious and rigorous” regard to equality impacts before deciding; the Scottish Ministers revised and published an EQIA in reasonable time under the Specific Duties (Scotland) Regulations 2012.
  • Duty to consult: Absent statute, promise, settled practice, or conspicuous unfairness, neither respondent was obliged to consult. High-level fiscal decisions affecting millions do not trigger an implied common-law consultation duty.
  • Irrationality: The policy choices lay in the socio-economic realm and easily passed the high Wednesbury threshold; courts will not second-guess resource-allocation choices ratified by Parliament.
  • Human Rights: Articles 2 and 8 were not engaged. The Convention does not guarantee socio-economic benefits, and, even if Article 8 applied, the measures were proportionate within a wide state margin of appreciation.

3. Detailed Analysis

3.1 Precedents Cited and Their Influence

  • AXA General Insurance v Lord Advocate (2012) — Confirmed interest-based standing in Scotland; used to admit the petitioners’ locus.
  • Bracking v Secretary of State for Work and Pensions (2013) — Leading exposition of the PSED principles (“rigour, substance, open mind”); applied to evaluate both Ministers’ equality analyses.
  • R (BAPIO Action Ltd) v SSHD (CA 2007) — Warned courts against implying a general duty to consult central-government policy-making; foundational for rejecting the consultation argument.
  • R (SC) v SSWP (2022) & Johnson (2020) — Emphasised judicial deference in socio-economic policy and the heightened threshold for irrationality; Lady Hood adopted this approach.
  • Heathrow Hub (2020) & Kimathi (2018) — Set limits on admissibility of parliamentary material under Article IX; informed the excision of pleadings.
  • Environmental rights cases (Budina, Verein KlimaSeniorinnen Schweiz) were distinguished; the court held that energy-cost benefits do not fall within the environmental or life-saving contexts engaged by Articles 2 or 8.

3.2 The Court’s Legal Reasoning

  1. Standing (“Ripple-Effect”)
    The judgment synthesises AXA with devolved-finance mechanics. Where a UK decision foreseeably alters the block-grant and thereby constrains devolved policy, affected Scottish residents are not “mere busybodies”; they possess a “material inter-relationship” interest. This implicit “ripple-effect” test is new territory.
  2. PSED Compliance
    • Content: Ministers saw equality impacts on age, disability, gender.
    • Timing: Analysis preceded the decision; not post-hoc (“rearguard”).
    • Documentation: A concise High-Level Equality Analysis is permissible.
    • Weight: Court will not revisit the relative weight a Minister affords equality versus fiscal objectives.
  3. No Implied Consultation Duty
    Drawing on Plantagenet Alliance and BAPIO, Lady Hood stressed democratic legitimacy: Parliament, not courts, decides whether large-scale fiscal reforms require consultation. Parliamentary negative-resolution procedures furnished adequate democratic control.
  4. Wednesbury Threshold
    Means-testing versus universality is quintessentially a policy “bright-line”. Unless bad faith, improper motive, or manifest absurdity is shown, the court defers. None were established.
  5. ECHR Analysis
    • Article 2: Positive duties arise mainly in life-threat contexts (e.g., policing, dangerous activities). Heating-cost subsidy withdrawal is socio-economic, outside Article 2.
    • Article 8: Unless tied to discrimination (Art 14) or intimate aspects of private life, benefit changes fall outside its ambit (Beeler; X v Ireland). Even if engaged, proportionality is satisfied within the wide margin.

3.3 Impact on Future Litigation and Policy

  • Standing in Devolution Cases: Petitioners can sue UK Ministers in Scottish courts where devolved funding pathways cause direct practical effects. Future claimants will cite the “ripple-effect” rationale.
  • Equality-Duty Practice: Governments may rely on shorter, iterative equality analyses for time-sensitive fiscal measures, provided they demonstrate real-time ministerial awareness and mitigation steps.
  • Consultation Expectations: Large-scale welfare reforms, even where life and health interests loom, will not automatically trigger a consultation duty absent a clear promise or statute.
  • Human-Rights Scope: The decision curtails attempts to stretch Articles 2 and 8 to general welfare entitlements, signalling that socio-economic grievances must hinge on discrimination (Art 14) or exceptional vulnerability.

4. Complex Concepts Simplified

  • Public Sector Equality Duty (PSED): A legal requirement that public bodies think consciously about how their decisions affect people with protected characteristics (age, disability, etc.). It demands process (due regard), not a particular outcome.
  • Wednesbury Irrationality: A decision is unlawful if so unreasonable that no reasonable authority could have made it, or if legally relevant factors were ignored / irrelevant ones considered.
  • Block Grant Adjustment & Barnett Formula: The UK Treasury adjusts Scotland’s funding to reflect functions devolved. If Westminster cuts a benefit in England & Wales, Scotland’s grant shrinks accordingly—creating the “ripple-effect”.
  • Means-testing vs Universality: Means-tested benefits are restricted to low-income recipients; universal benefits go to everyone in the category (e.g., all pensioners).
  • Parliamentary Privilege (Article IX): Courts cannot question or rely on the truth of statements made in Parliament when adjudicating outside disputes.
  • Margin of Appreciation: Deference international and domestic courts give to States when balancing individual rights against public-interest policy choices.

5. Conclusion

Lady Hood’s opinion provides a textured blueprint for future judicial-review challenges at the intersection of devolved competence, fiscal federalism, and equality law.

  • She confirmed that Scottish courts can entertain challenges to England-and-Wales-only regulations when financial repercussions predictably traverse the devolution boundary.
  • Ministers meet the PSED if they possess and consider equality information contemporaneously, even under severe time pressure.
  • The judgment vigorously re-asserts the high bar for irrationality attacks on socio-economic legislation and confines ECHR arguments to their established terrain.

While the Fannings lost the battle for reinstatement of a universal Winter Fuel Payment, practitioners have gained authoritative guidance on how standing, equality-impact analysis, and consultation principles operate in the devolved social-security landscape. The “ripple-effect” standing doctrine and the pragmatic endorsement of concise equality analyses are likely to resonate well beyond the specific realm of heating benefits.

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