On December 18, 2014, Mr Justice Cranston published his decision – that the 2015 ARF of £890 set by the GDC was unlawful.
The hearing took place on December 15, 2014, and it seems the Court needed little time, and had little trouble, reaching its decision.
The BDA had contended that the ARF level was unlawful due to the way it had been decided, the way in which the consultation on it had been carried out, and in particular the lack of information provided that was necessary for consultees to adopt an informed view and respond appropriately. The BDA also claimed that the last-minute change of fee level, a reduction from £945 to £890, a change that occurred after the consultation closed, was also unlawful
as no consultation on that change was carried out at all.
The GDC relied upon an earlier ‘successful’ consultation on the policy to be adopted for the calculation and basis of any ARF level adjustment in the future.
Ironically, the GDCs repeatedly published commitment to transparently consult and provide sufficient financial information in such consultations, was part of its downfall.
This was very much a game of three halves. There were three different stages, two consultations and two claims by the BDA that were relevant:
1) Consultation in early 2014 in relation to the basis on which the ARF should be set and how it should be calculated in future.
As the costs of fitness to practise (FTP) proceedings against dentists make up such a large proportion of the GDC’s expenditure it was proposed that the ARF for each group be set fairly on the basis of the respective costs of regulating each group (dentists and DCPs).
Due to the cost of FTP cases against dentists and the trend of increased complaints and hearings, that promised a higher ARF (and greater increases) for dentists proportionately than for DCPs. Sixty-five per cent of consultees agreed
with that proposal. This became policy. That consultation and the policy were not reviewed by the court.
2) Consultation mid-to-late 2014 in relation to the actual ARF level for 2015.
The new policy had to be followed to decide the 2015 ARF. The consultation document (the second consultation) in relation to the actual 2015 ARF proposal, attempted to use historical (up to 2013) information regarding the number of complaints and FTP hearings to project the likely costs in 2015 and beyond, and estimate the funds that
would be required via collection of the
ARF to meet those costs.
However, the consultation document failed to explain how the projections were reached. In particular, it failed to describe how the expected continued rise in complaints would lead to a disproportionately larger rise in FTP hearings. Certain assumptions were made and set out, but the reasons for the assumptions (and the ‘science’ behind the figures) were not.
The failure to provide that detail (especially in circumstances where increased costs were partially attributed to perceived GDC failings to deal with cases promptly and an anticipated additional large expenditure to clear a backlog of cases) was crucial.
How could consultees properly assess the proposals? How could they form a proper opinion or propose alternatives? They could not. Once the GDC committed to travelling down the road of transparent consultation, consultees had a legitimate expectation of such transparency. Transparency requires full and proper financial information and explanation, and that was missing.
3) The claim that the GDC should have consulted further on the reduction in the proposed ARF from £945 to £890.
The consultation closed with many consultees (including the BDA) formally responding that they believed there was insufficient financial information, that more should be provided and the consultation extended or re-opened.
However, the GDC did not extend or re-open the consultation. Nor did they provide further information in the consultation process, other than to KPMG who they commissioned to review their process.
KPMG agreed that the proposals for the ARF were based on generally appropriate assumptions, but suggested that certain assumptions the GDC had made were too prudent (so that predicted costs may be less).
As a result the GDC announced an ARF for 2015 of £890, reduced from the proposed £945.
The BDA challenged that decision as unlawful as there had been no consultation at all in relation to it.
The Law
The Court pointed out that the common law duty of fairness does not impose a duty to consult.
Many decisions by a public body can be made by it without consultation.
Indeed, if every decision that was ever made by a public body could only be made following consultation the country would grind to a halt!
Furthermore, the potential relevance of consultation is affected by the nature of the decision, the impact it would have on individuals and the legitimate expectations of those individuals.
The GDC had to consult because it repeatedly said it would. If it had not made that commitment and led dentists to expect to be consulted then legally it may not have needed to consult at all especially as the impact of the decision (the increase in the ARF) on individuals was relatively minor (a ‘real’ increase of £251.20 net of tax per annum for each dentist was discussed).
As a result, the reduction from £945 to £890 would not have necessarily been unlawful without consultation as such a change was in the dentists’ interests and not a fundamental change (only £55).
However, once committed to transparent consultation, the failure to consult transparently (by failing to provide the key explanations, calculations and reasons for assumptions in relation to the costs to be met by the ARF) meant the consultation was flawed and therefore the decision to set the ARF at £890 was unlawful.
Whilst this was a legal victory for dentists, the BDA and common sense the court failed to order the quashing of the actual ARF rise, which stood (and had by then been paid by most dentists). The functions of the GDC must be funded and those funds are obtained primarily from the ARF. However, the GDC has been left in no doubt as to what will be required of it next time it wishes to review the ARF.