London Councils must rerun a consultation on cuts of up to £16.5m to a voluntary sector grants programme after a High Court judge ruled the original exercise failed to meet statutory equality duties.
London Councils, which represents the capital’s 33 local authorities, decided in December to repatriate funds from its £26m grants programme to individual councils, meaning they would be free to spend the money as they chose.
It would have meant the scheme falling in value to £17.6m in 2011/12 and to £9.9m the following year if no new funding was found.
A judicial review brought by service users from one of the 200-plus charities that would have been affected by the move found in the charities’ favour.
Mr Justice Calvert-Smith ruled that London Councils’ consultation process was flawed and that it failed to meet statutory equality duties. The judge quashed all of the cuts and ruled that London Councils must rerun the consultation process with full impact equality assessments.
The claimants’ solicitor, Louise Whitfield of Pierce Glynn solicitors, said the case showed that even in the current economic climate it was important that public spending cuts were assessed for gender, disability and race equality impacts.
"If they are not, public sector funding cut decisions will be unlawful," she said.
London Councils did not consider the full effect of the cuts "on the hundreds of voluntary sector groups and tens of thousands of members of the public who would be affected", she said. "They will now be required to do so."
Peter Lewis, chief executive of London Voluntary Service Council, said London Councils needed to put in a higher revised budget to meet the judge’s requests.
"London Councils should now take this time not only to reflect on its failed processes, but also to reconsider its overall objective of reducing its support to London's voluntary and community organisations, which serve many Londoners so well," he said.
A spokesman for London Councils said it would not be making any comment until the rest of the judgement on the case, which will include details on how it should set its budget this year, was made later today.