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	England and Wales High Court (Administrative Court) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Administrative Court) Decisions >> London Secure Services Ltd, R (on the application of) v The Youth Justice Board [2009] EWHC 2347 (Admin) (29 September 2009) URL: http://www.bailii.org/ew/cases/EWHC/Admin/2009/2347.html Cite as: [2009] EWHC 2347 (Admin)

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IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT

		Royal Courts of Justice Strand, London, WC2A 2LL
		29th September 2009

Sir Thayne Forbes:

Introduction

1. Each of these three linked claims consists of an application for permission to apply for judicial review "rolled up" with the hearing of the substantive application, if permission is granted. Each claim is concerned with the tendering process under which the principal Defendant, the Youth Justice Board ("the YJB"), awarded a total of ten contracts for the provision of accommodation for children and young people in Secure Children's Homes ("SCHs": as to which, see below). Where appropriate, I will hereafter refer to the individual "rolled up" applications as JR1, JR2 and JR3 respectively.
2. The linked proceedings are all concerned with the YJB's decision dated 26^th March 2009 not to enter into long-term contracts in respect of two particular SCHs, namely "Orchard Lodge" in South London and "the Atkinson Unit" in Exeter, Devon. The individual Claimants are as follows:

(i) In JR1 the Claimant is a disappointed tenderer, London Secure Services Limited ("LSS"), a private contractor and the owner and operator of "Orchard Lodge", in respect of which LSS tendered unsuccessfully for a contract.

(ii) In JR2 the Claimant is "T", a young person who was at all material times detained on Court Ordered Secure Remand ("COSR") at Orchard Lodge.

(iii) In JR3 the Claimant is "JV", a young person who was at all material times detained on COSR at the Atkinson Unit. It is to be noted that the unsuccessful tenderer in respect of the Atkinson Unit (Devonshire County Council) does not itself seek to challenge the YJB's decision not to award it a contract.

3. In each claim the challenge is to the particular decision not to contract in respect of either Orchard Lodge or the Atkinson Unit. Whilst many of the grounds of challenge seek to attack aspects of the tendering exercise, no Claimant seeks to unravel the tendering exercise itself and none of the successful tenderers has been joined as an interested party. In the event, the YJB has now signed the contracts with the successful tenderers and those contracts came into effect on 1^st July 2009.
4. The hearing before me lasted eight full days, an extraordinarily long time for such applications in the Administrative Court. This was partly due to the fact that the proceedings had been brought on with almost undue expedition, with the result that there was a proliferation of late documentation and evidence, leading to a somewhat fractured hearing against a background of wholly unrealistic time estimates. However, I am extremely grateful to all Counsel and their solicitors for making every effort to keep the proceedings within manageable limits (as far as was possible in such circumstances) and for working extremely hard after court hours (often late into the night) to deal with various developments as they arose in the course of the hearing. Without those efforts, and the assistance that I have received from the detailed written skeleton arguments, my task in writing this judgment would have been even more daunting than it already is. In reaching the conclusions that I have, I have sought to identify and deal with the main points made by the parties. Inevitably, I have not referred to every single point, nor have I summarised every argument. To do so would render this already lengthy judgment even longer and to no good purpose. However, I do wish to stress that I have taken account of all the points and submissions that were made in reaching the decision that I have.
5. Finally by way of introduction, I have come to the conclusion that permission to apply for judicial review should be granted in each case. I am satisfied that the various points raised are sufficiently arguable. Indeed, for the purposes of LSS's two unsuccessful applications for Interim Relief, I was prepared to assume that the level of arguability was sufficiently high to justify the grant of interim relief had such a grant been otherwise appropriate (in the event, I refused each application for other reasons).

The Background and Relevant Legal Framework

6. The YJB is a statutory body established by section 41(1) of the Crime and Disorder Act 1998 ("the 1998 Act"). The YJB forms part of the youth justice system, the aim of which is to prevent offending, including re-offending, by children and young people (see section 37(1) of the 1998 Act). By means of the Youth Justice Board for England and Wales Order (2000/1160), as amended ("the YJB Order"), Parliament has given the YJB the operational discretion to enter into agreements for the provision of such accommodation as it considers will best meet the needs of the youth justice system.
7. The YJB's relevant powers and duties are set out in section 41(5) of the 1998 Act and, by article 4 of the YJB Order, additional functions have been given to the YJB, to be exercised concurrently with the Secretary of State for Justice ("the Secretary of State"). Amongst its other roles, the YJB enters into agreements for the provision of secure accommodation for children and young persons remanded or sentenced by the Courts.
8. Children are generally defined as those less than 14 years of age and young persons as those aged 14 to 17 years old.
9. Under section 41(5)(i) of the 1998 Act, the YJB has power to enter into agreements for the provision of accommodation for certain children and young persons sentenced to and remanded in custody under various enactments. One form of accommodation in which young people may be placed is an SCH; another is a Secure Training Centre ("STC"), though most young people are, in fact, detained in Young Offender Institutions ("YOIs").
10. (a) Remands of Children and Young Persons. Children and young persons remanded by the courts and not released or remanded on bail may be remanded in custody in one of two ways, depending on their age and sex. They may be made the subject of a court ordered remand to local authority accommodation under section 23 of the Children and Young Persons Act 1969, as amended ("the 1969 Act") and this may include a security requirement (i.e. a "COSR"). When a court remands a young person to local authority accommodation, it must, under section 23(2) of the 1969 Act, designate the local authority that is to receive that young person. Alternatively, a young person may be remanded to prison (in practice a YOI).
11. Children and young persons remanded or committed to local authority accommodation may be placed by the local authority in their own accommodation, another local authority's accommodation or, in the case of a COSR or secure committal, in an STC, pursuant to section 23(7A)(a) of the 1969 Act and article 4(2)(t) of the YJB Order, with the consent of the Secretary of State or the YJB.
12. The YJB does not itself determine the placements of such persons, although it assists in such placements, working with Local Authorities and Youth Offending Teams ("YOTs"), which are made up of representatives from police, social services, health and education bodies. The power of the YJB in this respect is contained in section 41(5)(k) of the 1998 Act which empowers the YJB "to offer assistance to local authorities in discharging their duty under section 61 of the 1991 Act [as to which, see below], whether by acting as the agent of a local authority or facilitating arrangements under section 61(2), or otherwise". The YJB's Placement and Casework Team discharge this particular function.
13. It is the local authority concerned that is legally responsible for the placement of children and young persons who are remanded to its accommodation. Section 61(2) of the Criminal Justice Act 1991 ("the 1991 Act") provides that it is the duty of every local authority to ensure that they are in a position to comply with any security requirement that may be imposed on them under section 23(4) of the 1969 Act.
14. Section 61(2) of the 1991 Act provides that a local authority may discharge that duty either by providing secure accommodation itself or by making arrangements with persons carrying on an appropriate children's home for the provision or use by them of such accommodation. An appropriate children's home is one in respect of which a person is registered under Part 2 of the Care Standards Act 2000 and approved by the Secretary of State for use as secure accommodation.
15. (b) Children and Young Persons who are subject to custodial sentences. The YJB is responsible for placing most sentenced children and young people, although the Ministry of Justice retains responsibility for the placement of those who have been sentenced under the "dangerousness" provisions of the Criminal Justice Act 2003.
16. The relevant agencies involved, including the local authority and the local YOT, have a duty under section 11 of the Children Act 2004 ("the 2004 Act") to make arrangements to safeguard and promote the welfare of the child. In addition, these bodies must act in accordance with Article 3.1 of the United Nations Convention on the Rights of the Child, which requires that the best interests of the child should be "a primary consideration".
17. (c) Types of Secure Accommodation for Children and Young Persons. As I have already indicated, there are three types of secure facilities in which young people can be placed, namely Secure Children's Homes (SCHs), Secure Training Centres (STCs) and Young Offender Institutions (YOIs). Collectively these form "the secure estate".
18. (i) SCHs. The Local Authority for the area in which they are located generally operates SCHs. Young people sentenced by a Court or who are remanded to local authority accommodation can be placed in these establishments, as can children and young persons who are subject to "welfare orders" under section 25 of the Children Act 1989 ("the 1989 Act"). Provision for the latter is often referred to as "welfare beds".
19. Young persons and children can only be detained in premises approved as secure accommodation by the Secretary of State for Children, Schools and Families. All SCHs operating in England hold this approval for use as secure accommodation. In addition, they are regulated by the Care Standards Act 2000 and the Children's Home Regulations 2001.
20. There are a total of nineteen SCHs in England and Wales, some of which only accommodate young persons who are subject to welfare orders. Of the nineteen SCHs, fourteen formerly had contracts with the YJB, which effectively reserves a number of beds for criminal justice places ("criminal justice beds"). The present position is that, following the commissioning and tendering process with which this case is concerned, the YJB has now entered into contracts with a total of ten SCHs (nine in England and one in Wales).
21. With the exception of Orchard Lodge, which is privately run, local authorities run all the SCHs with which the YJB has contracted.
22. (ii) STCs. STCs were established by the Criminal Justice and Public Order Act 1994 for the purpose of detaining young persons between the ages of 12 and 17 who had been sentenced to or remanded in custody. STCs are purpose-built centres for young people, run by private operators under managed contracts with the YJB, which set out detailed operational requirements. STCs are specifically for young people who have been sentenced or who are made the subject of a COSR. Section 23(7A) of the 1969 Act entitles the designated local authority, with the consent of the Secretary of State or the YJB (under article 4(2)(t) of the YJB Order) to arrange for a young person who is subject to a COSR to be detained in an STC rather than an SCH.
23. STCs are procured via the Private Finance Initiative ("PFI"). The provider designs the facility, raises the funding necessary for its construction, completes the construction and then maintains and operates the facility. In essence, it is a commercial enterprise. The YJB enters into contracts for the provision and running of such establishments under article 4(2)(i) of the YJB Order. The STCs are governed by the STC Rules 1998.
24. (iii) YOIs. YOIs are mostly Prison Service-run secure facilities (although HMP YOI Ashfield and HMP YOI Parc are both privately operated). In respect of the Prison Service-run YOIs, the Prison Service carries out the day-to-day management. The YOIs are governed by the YOI Rules 2000.
25. The Relationship between SCHs and STCs. For the purposes of accommodating children and young people where security is a requirement, SCHs exist alongside STCs. As indicated above, the YJB and local authorities have the statutory authority to detain children in either of these types of accommodation. Although the two types of accommodation are different, they are complementary in nature. On behalf of the YJB and the Secretary of State, Ms Gemma White submitted (correctly, in my view) that it was entirely rational for the YJB to have regard to the availability of places in both types of accommodation when assessing demand and supply of secure accommodation for the purposes of the youth justice system.
26. However, SCHs and STCs differ from YOIs in that boys aged under 15 and girls aged under 17 who are the subject of a COSR can only be placed in SCHs and STCs. Sentenced children and young persons may also be placed those institutions, depending on their age, sex, vulnerability and the availability of places.
27. While all SCHs and STCs have to meet the Secretary of State's National Standards, they may differ from one another in certain respects, and are all individually distinct in terms of the services that they offer and the way in which they offer them. A particular young person's needs may make him/her suitable for accommodation in an SCH or more suitable for an STC. Those needs can change over time, making an individual more suitable for an SCH at one stage and an STC at another. However, in broad terms, SCHs and STCs can fairly be said to be interchangeable for many purposes.
28. Miss White emphasised that both the Divisional Court and the Court of Appeal have recently accepted that SCHs (referred to in the reports as "LASCHs", i.e. Local Authority Secure Children's Homes) and STCs are broadly interchangeable: see the judgment of Buxton LJ in R (C) v Secretary of State for Justice (2009) 2 WLR 1039 ("C"), in which he quoted the observations of Maurice Kay LJ in the Divisional Court, as follows:

"A comparison between STCs and LASCHs

29. Second, there are significant difficulties for the Secretary of State's argument in a comparison with the arrangements in secure children's homes. The Divisional Court explained the nature of these institutions in paras 8-9:

"8. STCs exist alongside secure children's homes run by local authority social services departments ("LASCHs"). According to the YJB, LASCHs "focus on attending to the physical, emotional and behavioural needs of the young people they accommodate … [they] provide young people with support tailored to their individual needs. To achieve this, they have a high ratio of staff to young people and are generally small facilities, ranging in size from six to forty beds. [They] are generally used to accommodate young offenders aged 12 to 14, girls up to the age of 16 and 15-to-16 year old boys who are assessed as vulnerable.

9. If one takes, for example, a 15 or 16-year-old vulnerable male, he could be detained in a STC or a LASCH, the decision resting as much on matters of geography and place availability as on anything else. LASCHs are governed by different primary and secondary legislation. Pursuant to powers conferred upon him by the Care Standards Act 2000, the Secretary of State has made the Children's Homes Regulations 2001 (SI 2001/3967). These Regulations, and in particular regulation 17 which governs behaviour management, discipline and restraint, are structured differently from the Secure Training Centre Rules, and there is a distinct Good Practice Guidance issued in relation to LASCHs by the Secure Accommodation Network. It is common ground that removal from association and physical restraint purely for GOAD [good order and discipline] purposes are not permitted under the LASCH regime."

30. If allocation to STCs and to LASCHs is interchangeable in the way described by the Divisional Court, it is very difficult to see why PCC [physical control in care] to ensure GOAD is essential in STCs, but not essential in LASCHs. When this point was put to him, the Secretary of State sought to meet it by saying that LASCHs are significantly different institutions from STCs. I examine that claim in the following paragraphs, but first it should be noted that, as the Children's Commissioner pointed out in valuable submissions to this court, the view expressed by the Divisional Court was fully justified by evidence before it that had gone unanswered by the Secretary of State. That evidence was provided by Mr Roy Walker, a manager of a LASCH and deputy chairman of the Secure Accommodation Network ("SAN"), the umbrella organisation for LASCHs. He said:

"LASCHs provide care for the same groups of young people who may also be placed in [STCs] and in fact STCs are associate members of SAN. By way of example we presently have children in the age range of 12 – 17 including those charged with serious offences up to and including murder as well as sentenced young people."

31. The Secretary of State said that that was an incomplete picture. Differences between STCs and LASCHs included that LASCHs also accommodated children in care, rather than involved in the criminal justice system, of as young as ten years; could refuse to accept a particular child, as an STC could not; and had a higher staffing ratio than did STCs.

32. The first of these points is irrelevant. The question is whether PCC to enforce GOAD is necessary for the range of children that find themselves in STCs. If it is needed there, it is needed for those children if they find themselves in a LASCH. That there may be other children in LASCHs for whom the regime is unnecessary or inappropriate only goes to demonstrate a further difficulty for the case, which will appear when it is tested against the requirements of the Convention. PCC to ensure GOAD is made available to an institution in "blanket" terms without any formal consideration of the types of person within the institution for whom it is appropriate. I agree that the second point has some potential relevance, but without further information about the extent and terms in which a LASCH can or does refuse a placement it is impossible to assess its force. Had the point been raised earlier it would have been important to have the view of Mr Walker upon it. That this is a significant difference does not seem consistent with the general tenor of his evidence.

33. The third point, that STCs have a worse staffing ratio than LASCHs, caused the court great concern when it was raised before us. Prudently, Miss Lieven declined an invitation to explain the exact relevance of the point, contenting herself with saying that it was merely a respect in which the two types of institution are different. It is hardly necessary to say that if the Secretary of State was indeed influenced in his policy of introducing PCC to enforce GOAD in STCs but not in LASCHs by any need to cover defects in staffing provision in the former, commercially run, establishments, then that would be fatal to any prospect of justifying that policy in Convention-compliant terms."

29. Placement in SCHs and STCs and YJB's Placement Policy. The decision as to which type of institution in the secure estate a young person is placed is made by taking into account the individual needs and circumstances of the young person, availability of places and discussions with the YOT and prospective secure establishments in order to take into account the current mix of young people in the unit: see the terms of YJB's 2004 and 2008 Placement Policies and Placement Protocols (it is accepted that the Protocol forms part of the Policy in each case).
30. The 2004 and 2008 Placement Policies. (i) So far as material, the 2004 Placement Policy stated as follows:

"4. Places within Local Authority Secure Children Homes (LASCHs) and Secure Training Centres (STCs) will be utilised for the placement of young people under the age of 15. The balance of any capacity in this sector will be utilised for the placement of other young people assessed as vulnerable. Those young people not placed in LASCHs or STCs will be placed in Young Offenders Institutions (YOIs). The YJB's Placement Protocol sets out in detail the process and criteria for placing young people in secure accommodation."

31. (ii) The relevant paragraphs of the 2008 Placement Policy are in the following terms:

"3. The YJB recognises that the young people who enter the youth justice system are a diverse group with complex needs; many have significant risk factors, mental health problems, are members of gangs, have care histories, poor school attendees and/or may be chronically abused or abusers.

…

5. To ensure that the key functions relating to the placement process are met the YJB has established a Placement and Casework Service (P&CWS) which is appropriately resourced with staff trained to make placement decisions in a timely and professional manner.

6. P&CWS will endeavour to place children and young people into establishments that can most effectively manage their identified individual needs and risk factors. Responsibility for assessing needs and identifying risk factors lies with the Youth Offending Team (YOT).

…

10. Places within secure children's homes and STCs will be used mainly for the placement of boys under the age of 15 and young women under the age of 17. The balance of any capacity in this sector will be used for the placement of boys aged 15 or 16 who have been assessed by a YOT as having significant risk factors which would make them particularly vulnerable if placed into a YOI. Young people not placed in SCHs or STCs will be placed in YOIs. The YJB's Placement Protocol details the process and criteria for placing young people in secure facilities."

32. The 2004 and 2008 Placement Protocols. (i) So far as material, the YJB's 2004 Placement Protocol is in the following terms:

"Youth Justice Board

Placement Protocol

This document describes the process and sets out the criteria for the placement of young people in the secure estate.

Introduction

…

4. The Youth Offending Team (Yot) is responsible to alerting the YJB Placement Team to each young person appearing before a court where an outcome of a placement to a secure facility may be required. Ideally this should be no later than the day before the court appearance.

5. The YJB Placement Team will allocate places to young people who are remanded or sentenced by a court based upon the vulnerability information provided by the Yot and the beds available on the day of the court appearance.

The assessment of a young person's vulnerability

1. The Youth Offending Team is required to undertake a vulnerability assessment on all young people appearing before a court where an outcome of a placement to a secure facility may be needed and providing this information to the YJB Placement Team.

2. The Youth Offending Team is responsible for undertaking the initial assessment of a young person by completing the ASSET documentation. The ASSET tool sets out how the Yot should consider the vulnerability of the young person and evidence their concerns. The relevant section in the ASSET documentation is headed "Indicators of Vulnerability". This is in the process of being revised by the Youth Justice Board.

The following factors should be [taken] into account by the Yot in their assessment, whether they are or have been:-

at risk of self-harm or suicide

bullied, abused or neglected (behaviour of others);

affected by separation, loss, change of care (other events);

risk taking, including substance misuse (own behaviour); and

whether in the Yot's view are able to manage and cope within a YOI environment.

Placement Process

…

5. In order for the YJB to make a final judgement as to which particular placement or type of establishment is the most suitable for each young person the following factors are considered:

Yot assessment of vulnerability, and in particular risk of self harm or suicide;

Age and gender of the young person which informs which type of accommodation is legal and suitable;

Type of offence;

Information from the Yot and other sources;

Previous offending history and whether they have previously been in a secure facility;

What particular services they may need due to their individual circumstances (healthcare, substance misuse, ante-natal care);

Where places are available in relation to their home.

6. Where there are competing cases for available beds in LASCH and STC accommodation those beds are normally prioritised as follows, although individual circumstances are considered on a case by case basis;

12-14 males or 12-16 females subject to DTO/S90/1 sentences;

12-14 males or 12-16 females made subject to a court ordered secure remand;

15-16 males assessed by a Yot as at risk of, or having previously made, a serious attempt of self harm or suicide either on remand or sentenced;

15-16 males assessed as vulnerable by a Yot where a high number of risk factors are present where self harm or suicide is not evident;

17 year old sentenced males or females assessed by a Yot as at risk of, or having previously made, a serious attempt of self harm or suicide.

7. …

8. The final decision on placement will be made taking into account the available vacancies, current circumstances of the young person and the total number of young people requiring non prison beds.

9. If the Yot's assessment is that the young person is not vulnerable boys aged 15 and over and 17 year old girls will be placed in their catchment YOI.

10. Placements in the secure estate are normally made as follows:-

Age	Gender	Order	Placement
12-14	Male & Female	COSR/Custodial Sentence	Lasch/STC
15-16	Male	COSR/Custodial Sentence	If assessed as vulnerable – Lasch/STC
		RC/Custodial Sentence	If not assessed as vulnerable – YOI
	Female	COSR/Custodial Sentence	Lasch/STC
17	Male & Female	RC/Custodial Sentence	Can only be remanded to YOI. If sentence[d] and assessed as vulnerable – Lasch/STC

…"

33. (ii) For the purposes of this judgment, it is only necessary to refer to paragraph 6.10 of the 2008 Placement Protocol, which is worded as follows:

"6.10 Placements in the secure estate are normally made as follows (this is a guide only and depends on the availability of places):

Age	Gender	Order	Placement
12-14	Male and Female	COSR/Custodial Sentence	Secure children's home/STC
15-16	Male	COSR/Custodial Sentence	If assessed as having significant risk factors – secure children's home/STC
15-16	Male	RC/custodial sentence	If not assessed as having significant risk factors – YOI
15-16	Female	COSR/custodial sentence	Secure children's home/STC
17	Male and female	RC	Can only be remanded to a YOI
17 …	Male …	Custodial sentence …	YOI or, if assessed as having significant risk factors, secure children's home/STC …

…"

34. The role of the YOT in discussions as to the most appropriate placement for a young person is important because the YOT is responsible for carrying out "ASSET" assessments of all young people who are remanded or sentenced to custody. The ASSET is a structured assessment tool to be used by YOTs on all young offenders who come into contact with the criminal justice system which aims to look at the young person's offence or offences and identify a large number of factors or circumstances – ranging from lack of educational attainment to mental health problems – which may have contributed to such behaviour.
35. As indicated in the Placement Protocols, as part of the ASSET assessment the YOT has to determine whether or not a child or young person is vulnerable. The key factors from this assessment that determine the YOT's assessment of the vulnerability of a young person include those identified in the relevant Placement Protocol. However, it appears that, although the YOT is specifically tasked with assessing whether a child or young person is vulnerable, that assessment does not necessarily determine the issue of "vulnerability" for the purposes of placement by the YJB. According to the first Witness Statement of Peter Minchin, YJB's Head of Placement and Casework, the position is this (see paragraphs 46 to 50 of his witness statement):

"ASSESSMENT AND VULNERABILITY

46. It is the responsibility of the YOT to carry out an assessment of a young person who has offended and for whom they have responsibility. They do this using an assessment form called an ASSET. This ASSET is a comprehensive tool used by YOTs to record their assessment of every young person who has committed an offence. It is used by the YOT for young people in both custody and in the community. On the basis of the ASSET the YOT puts together a risk management plan to address offending behaviour; this process is undertaken whether or not custody is the outcome.

47. An ASSET is passed to the YJB if a young person is likely to be remanded or sentenced by a court [and] should be current and relevant to the offence before the court. As part of the assessment the YOT has to determine whether or not a Young Person shows indicators of vulnerability. …

48. The YJB undertakes a completeness check on every ASSET received as part of the placement process. The quality of these forms can be variable but when completed thoroughly and accurately the forms are an important part of informing the final placement choice of a sentenced young person.

VULNERABILITY

49. The statutory provisions under which the YJB operates neither use nor define the term "vulnerability". The YJB uses the term to encompass a wide range of circumstances in which a young person may pose a risk to him or herself or others. Vulnerability is a relative expression and covers a wide range of factors and needs. Moreover, vulnerability can and does change on a daily basis depending on a number of factors that can influence and impact on the lives of young people both inside and outside of custody. … Key to the YJB's placement decisions is the identification of a number of key risk factors that may impact on the needs of young people. The YJB uses individual or a combination of those to identify the overall profile of a young person to determine the appropriate placement. The YJB works hard to ensure that risk can be appropriately managed in all types of establishments within the secure estate and that young people are appropriately placed to best match the risk factors to the available place.."

36. Orchard Lodge Orchard Lodge is situated at Annerley, near Bromley. It is the only SCH in London and has the capacity to provide 24 children with secure accommodation. It has been an SCH for about 20 years, having been initially owned and operated by the London Borough of Southwark ("LB Southwark"). By 2006, Orchard Lodge was a "failing" SCH and apparently was threatened with closure if LSS had not taken it over.
37. Although it is said to have been a commercially unattractive proposition, LSS bought Orchard Lodge from LB Southwark on 31^st March 2006 and continued to operate it as an SCH. It appears that, since acquiring Orchard Lodge, LSS has invested some £6 million and has succeeded in transforming a failing SCH into one that has recently received an "adequate assessment" from Ofsted and one whose learning centre and reading initiative has been singled out for praise. From 31^st March 2006, the YJB initially purchased 18 beds at Orchard Lodge, initially pursuant to a two-year contract and then purchased 16 beds under the terms of a one-year contract, which expired on 30^th June 2009.
38. The Re-Commissioning of the SCH Provision. YJB carried out a re-commissioning process with regard to the SCHs in the secure estate in 2008/2009, in accordance with a Commissioning Plan dated July 2008. As a result, the YJB has now commissioned 301 STC places and 191 SCH places, which it has assessed as being sufficient to meet the needs of this group of young people.
39. The YJB claims that its monitoring data over a three-year period has identified that demand for places in this group is reducing. According to the YJB: (i) the average number of 12 to 14-year olds in custody for 2007/2008 was 190 and the average number in 2008/09 was 168; (ii) the average number of 15 and 16-year olds placed in SCHs or STCs for 2007/2008 was 262 and the average for 2008/2009 was 242; and (iii) average occupancy rates in 2008/2009 were 80% and 89% for STCs and SCHs respectively; i.e. one in five STC beds and one in 10 SCH beds were unoccupied: see paragraph 33 of the composite grounds of opposition filed on behalf of the YJB and Secretary of State.
40. The Moran Note. However, somewhat earlier, in February 2005, the Head of the YJB's Secure Estate Development Programme, Ms Kelli Moran, produced a detailed written note ("the Moran Note") that painted a somewhat different picture. So far as material, the Moran Note stated as follows:

"Introduction

We are coming to the end of the first year of a new round of contracts with Local Authority Secure Children's Homes (LASCHs). These contracts are with 15 providers. Five providers have a 5 year contract, whilst ten were awarded a 2-year ("Tier B") contract. Those ten contracts are due to expire in March 2006.

This paper will assess the options for extending some or all of the Tier B contracts for periods of up to 3 years. It will also update members on other key issues of note in relation to 2 of the YJB's LASCH providers (Orchard Lodge and Aycliffe).

…

Background

3. Following a competitive tender in 2003, the YJB has contracted with 15 Local Authority Homes for a total of 235 places. This is a reduction on previous levels of commissioned LASCH places, as we were required to substitute funding from LASCH contracting to pay for places in the new Oakhill STC. Five LASCHs have signed a contract with the YJB which gives a contracting commitment of 5 years, whilst the remaining ten have agreed contracts for 2 years, extendable to 5.

…

LASCHs were advised that performance, value for money and location would all be factors in the decision as to which contracts would be extended. By keeping the majority of LASCHs on short-term contracts, we could provide greater "incentives" for those 10 LASCHs to perform as well as they could (essentially because they would be in competition with each other). It should be noted that this appears to have been the case – the only LASCH to have been penalised under our contracts thus far is East Moor, one of the LASCHs with a 5-year contract.

Without having a clear strategy for the future secure estate, Committee members were reluctant to commit to long-term contracts for more than the five Tier A LASCHs anyway

…

Issues

Rationale for Extending all LASCH contracts beyond 2006

4. The YJB Strategy for the Secure Estate, currently a consultation draft, states that all boys under 15 and girls under 17 will be cared for in STCs or LASCHs. This number totals approximately 320. Furthermore, there are an additional 450 boys aged 15-16 with identified risk factors. As the total number of places in the non-Prison estate is 509, there are approximately 260 vulnerable young men (aged 15-16) who must therefore be accommodated in Prison Service accommodation.

(a) Young people who must be placed in a LASCH/STC

(indicative figures only):

girls aged 10-16	110
boys aged 10-14	180
boys aged 15-16, remanded to secure accom.	30
Total	320

(b) Boys aged 15-17 who are deemed to have identified risk factors:

(indicative figures only):

boys aged 15-16	450
boys aged 17	360
Total	810

5. We currently have 119 LASCH beds secured in five-year contracts and 274 in STC contracts. This totals 393 and in fact exceeds the core 320 places we need for those who must be placed in a LASCH/STC.

6. To tackle the issues for boys with identified risk factors we are looking at piloting enhanced units in the Prison Service (akin to those being provided for 17 year-old women). However even if we were to make a decision to substitute funding from LASCH Tier B places to Prison Service provision (i.e. to the development of an enhanced regime), our experience of the Prison Service's ability to implement major new developments is such that we could not expect any new services to be in place for at least 2 years from inception. Based on these assumptions, the options outlined below all assume that the YJB will need to extend Tier B contracts by at least 1 year, to March 2007, but probably longer.

…"

41. The Strategy for the Secure Estate for Children and Young People. Shortly after the Moran Note and as anticipated in paragraph 4 of that note (see paragraph 40 above), the YJB published its "Strategy for the Secure Estate for Children and Young People" ("the Secure Estate Strategy"). The Secure Estate Strategy set out YJB's Plans for the Secure Estate for 2005/06 and 2006/07. The opening paragraph of the Introduction is in the following terms:

"If the Youth Justice Board for England and Wales (YJB) is to work with its partners to continue the transformation of the secure estate for children and young people, it is vital that we set out our plans as clearly as possible … This strategy sets out the assumptions and principles that the YJB will use in developing the secure estate and the steps it intends to take in the next three years to deliver these within the available resources. …"

42. In the section headed "Achievements", the Secure Estate Strategy states (inter alia):

"Since April 2000, considerable improvements in the secure estate have been achieved. These include:

significant progress in the establishment of a discrete secure estate for children and young people, in contrast with the situation before 2000, when there was little separation from adults

the establishment of a national placement system that matches placement to need, subject to resource constraints …"

43. Included in the proposals that form the basis of the YJB's plans as stated in the Secure Estate Strategy are the following passages:

"The YJB's commissioning plans over the next three years are based on the following premises

All boys under 15 and girls under 17 will continue to be cared for in secure training centres (STCs) or secure children's homes, and the overall numbers in these establishments (unless there is access to significant further resources) will not exceed 510. Consideration will be given to further specialisation of regimes in the non-YOI sector in seeking to ensure that individual needs are better catered for.

The YJB values highly the contribution secure children's homes make to the secure estate and wishes to sustain the current level of provision. In order to give more financial and operational security, the YJB will revisit contractual arrangements with secure children's homes on shorter contracts, to see if more long-term arrangements can be entered into.

…

… If the [custodial] population falls to a point where there are routinely more than 8-10% of beds unused, then the YJB plans to decommission places from its core agreement with the Prison Service. Precisely where decommissioning occurs will depend on the age distribution and character of the custodial population at that time, but places are likely to be decommissioned first in split-site Prison Service YOIs providing older, large-scale, cell-block accommodation. …"

44. The Commissioning Plan. As I have already indicated, the Commissioning Plan was published in July 2008 and, so far as material, was in the following terms:

"1. Introduction

The YJB currently contracts for 235 places for children and young people in Secure Children's Homes (SCH) across 15 establishments in England and Wales. Recent developments mean that this will become 218 contracted places in 14 establishments with effect from 1 April 2008. … The SCH Commissioning Plan (the Plan) gives services providers an indication of the YJB's commissioning intent for the renewal of SCH contracts … and is based on an assumption that supply will reduce to 218 beds from 1 April 2008.

…

The Plan sets out an approach to securing provision for 10 to 14 year old boys, girls under 17 and vulnerable boys aged 15 to 17 held in the secure estate beyond March 2009.

…

Supply and Demand

In summary:

SCH facilities will provide first for the youngest and the least mature people in secure custody and for those who have assessed risks and needs that require the most intensive support. This includes boys between 12 and 14, girls under 17 and more vulnerable 15-17 year old boys.

The YJB will commission as many beds in SCHs [as] are affordable, indications are that the YJB will require 205 beds in England and Wales assuming 93% occupancy levels.

Priority will be given to addressing regional imbalances in supply and demand and using investment of the built environment to support this as well as to improve SCH provision for all placements.

Priority will be given to expanding provision in the South East and the North West and potentially decreasing supply in the North East.

…

The YJB see SCH facilities as meeting the needs of the youngest and most vulnerable children and young people in custody due to their particular characteristics, in particular: being smaller units with higher staff ratios and their close links with local authority provision and services in the communities they work with. Whilst SCH and STC will continue to be seen as interchangeable in the short term, this role for SCHs will be formalised within placement protocols.

…"

45. By its written Invitation to Tender dated 15^th August 2008 ("the ITT"), the YJB invited tenders for contracts for the provision of SCH places for children and young persons in the secure estate. The YJB's Head of Commercial Projects, Mr David Gunaratnam ("Mr Gunaratnam"), was responsible for the composition of the ITT and described the re-commissioning process in his first witness statement. Having regard to the issues in the case, it is necessary to quote at some length from that witness statement, as follows:

"The Re-Commissioning of SCH Provision

31. YJB currently contracts with 14 Secure Children's Homes (SCH) in England and Wales for 219 places. Of the 14 contracted SCHs, 13 are in England and one in Wales (Hillside). The contract for Hillside expired on 31 March 2009 and the contracts for the other 13 SCHs are due to expire on 30 June 2009. Accordingly, in around November 2007 YJB initiated a competitive tendering project to commission sufficient good quality, outcome focused and cost effective secure accommodation services in SCHs in England to meet fully the needs of 12-14-year old boys, girls up to and including 17 and more vulnerable 15 to 17 year old boys placed there. New SCH contracts for England were to be put in place from 1 July 2009. Outside of the competitive tendering process, but as part of the same commissioning process, a replacement contract for Hillside was put in place commencing on 1 April 2009.

32. It is important to note that this commissioning exercise did not reflect a change of policy in relation to YJB's use of SCHs. The process was undertaken to find replacement contracts for existing Agreements that were originally tendered for in 2004 and would expire in 2009.

The Exclusion of Hillside

33. The decision to exclude Hillside in Wales from the competition was taken because of a number of factors. Wales is a country with its own legislature and cannot be realistically compared with a large district/conurbation in England such as London. The Welsh Assembly Government has responsibilities for a range of devolved policy areas including education and training, health social welfare, safeguarding, housing and local government that are all of critical importance to the youth justice system. Wales has devolved legislative power under these subject areas under the Government of Wales Act 2006. London is part of the south east region and not a region in its own right; the title of "London and the South East" was only used on the regional map in the ITT for the avoidance of doubt as the assumption is sometimes made that the "South East" does not necessarily include London. London does not have a devolved government with legislative powers.

34. Hillside is also the only SCH in England and Wales which attempts to meet the very specific needs of Welsh young people in custody. For example, Welsh young people are taught under the Welsh school curriculum (Curriculum Cymreig) which has a different set of requirements around a range of subject areas, such as history. The curriculum also contains the requirement that young people should experience bilingual education – i.e. some education should take place in Welsh. Arrangements also need to be made for careers advice (for those over school leaving age) to be delivered by Careers Wales. Finally, there is a minority of young people from Wales who think and learn in Welsh as their first language, and the YJB needs to take these needs into account when commissioning services.

35. Although Hillside was not included in the competitive exercise, the contract award came under the umbrella of the commissioning project and Hillside had to submit a full response to our specification in the same manner as the English homes and was fully evaluated. If the response had not been of sufficient quality, or if costs had been prohibitively high, then no contract would have been offered.

The Exclusion of STCs

36. Although, for reasons which I explain below, STCs are broadly interchangeable with SCHs, and between them can meet a wide range of needs of young people, they were not included in the exercise either. This is because STCs are operated according to PFI contracts of either 15 or 25 years. YJB have 4 STC contracts and these were let following open and fair competitions. These contracts have end dates between April 2012 and August 2029 and could not therefore be included in this competitive exercise.

37. Although STCs were not included in the competitive tendering exercise, their provision was taken into account in assessing demand for SCH places because they are broadly interchangeable with SCHs, and between them can meet a wide range of needs of children and young people. STCs and SCHs together serve the same group of young persons, all of who[m] may legally be placed in either type of unit. Some individuals may be suitable for accommodation in either type of unit. Others may be more suited to one type of unit. For example, those needing vocational training may be better suited to an STC. All depends on an individual assessment of a person's needs and best interests but we believe that together they can meet the diverse range of needs of children and young people.

38. Important respects in which SCHs and STCs are similar include:

Both have relatively high levels of staffing allowing them to operate a high quality of education and/or training together with a focus on addressing offending behaviour

Both provide the majority of services for children and young people on-site

Both permit the use of restraints, but only as a last resort

Both are required to comply with the National Standards for Youth Justice

Both are monitored by the YJB as well as inspected annually by Ofsted.

…

42. Having considered the current level of STC provision as part of our assessment of demand for STC places, it follows that when each of the STC contracts become due for renewal we will undertake a thorough analysis of the demand for SCH and STC placements at that time and make future contracting decisions accordingly.

The Project Planning Process

43. The Department for Children, Schools and Families (DCSF), who have responsibility for making grants to local authorities to assist with the capital cost of providing secure accommodation in accordance with section 82(2) of the Children Act 1969, joined with YJB for the commissioning project so that applications for grant funding could also be assessed by DCSF to better align the award of grants with YJB's contract awards.

44. The procurement exercise was conducted under the Public Contracts Regulations 2006 and I believe that the process was conducted in an open, fair, transparent and non-prejudicial manner. …

45. Because the tendering process did not entail a change of policy, YJB did not conduct an external consultation exercise, although every SCH that YJB had a contract with was visited by a member of the project team, prior to the issue of the Invitation to Tender (ITT), to inform them of the forthcoming commissioning exercise and gather their views. There was no requirement to contact the Children's Commissioner, particularly at the tender stage when no contract award decisions had been made. However, along with a number of other interested parties the Children's Commissioner was notified of the contract award decisions.

46. There was no statutory requirement to conduct a formal equality impact assessment. Nor was an equality impact assessment otherwise carried out prior to the issue of the ITT because there was no change of policy and the contract decisions had not been made. However, the YJB specification is clear on the need to monitor, promote and take account of equality when delivering the services. Relevant examples from the specification include:

Para 3.4: …

Para 6.1: …

Para 6.3: …

Para 6.4.9: …

Para 6.8: …

All SCHs also have to comply with the relevant sections of the Children's Homes Regulations 2001 relating to race and equality.

47. Prior to the issue of the ITT, YJB asked all homes that were licensed and registered in England to register an interest in the re-commissioning project. …

…

The Invitation to Tender

49. The ITT was subsequently issued on 15 August 2008 to the 14 SCHs who responded to the expression of interest exercise. It included a comprehensive summary of the evaluation criteria (Section B, Part 2 of the ITT document) together with a guide figure as to 209 being the number of SCH places that might be purchased (Section B, Part 1, p10 of the ITT document). This figure was based on historical average demand across SCHs and took account of the number of contracted beds (301) available in STCs using data collected for a two year period ending in December 2007, because SCHs and STCs are broadly interchangeable and legally individuals can be placed into either type of establishment. Indeed, this was also the basis on which demand was assessed for the 2004 tendering exercise.

50. The figure of 209 places was clearly stated to be a guide, the ITT making clear that … "YJB can give no guarantee to purchase a minimum or any number of places via this exercise". The reason for this is that there are many factors that can influence the custody rates of young people, not least the use of preventing offending programmes and use of alternatives to custody, given that the stated aim of the YJB being to reduce custody. This makes it very difficult to accurately forecast figures on a long term basis for this group.

51. On 10 September 2009 all SCHs receiving the ITT also attended a YJB meeting for bidders, where the evaluation criteria and methodology were explained in detail. Representatives from Orchard Lodge and Atkinson Secure Unit were present at the meeting and did not raise any objections to the evaluation criteria, methodology or markings or weightings to be applied. In fact no objections were raised to the evaluation by any SCH throughout the process.

52. … The best interests of the young people placed in YJB contracted SCHs would not be met by the provision of poor quality services and the criteria therefore focused on quality.

53. Cost was also a criteria because places in SCHs are the most expensive in the secure sector … It was important that SCHs tendered competitive prices to enable YJB to purchase the number of places it required. …

54. In the evaluation two criteria were scored: quality (worth 65% of the marks) and cost (35%) and this was clearly indicated in the ITT (Section B, Part 2). …

55. There is no legal obligation for YJB to place young people in any specific region, and geographic proximity was not scored as there was no rational scoring mechanism that could be applied fairly and consistently to a fixed supplier base. We used a broad regional approach, which still allowed quality of service provision to be the primary factor in the evaluation. A similar approach to geography was used for the YJB 2004 tender exercise. Again it is important to highlight that all bidders were aware that geography would not be scored and no objections to this were raised during the tender process.

…

57. The regional approach we took involved England being divided into four regional corridors (North, Midlands, South West and South East) in order to determine the level of historic demand for SCH and STC beds within each corridor. Following the evaluation process the SCHs were ranked in order of their final overall scores (based on 65% quality and 35% financial). We then undertook to match the demand for beds in each regional corridor by allocating beds on the basis of this final ranking. However, we had clearly stated in the ITT that some beds could be assigned from adjacent corridors to meet the demand in those corridors where a shortfall of SCH beds exists.

58. A worked, theoretical example is provided below.

England was divided into four regional corridors (North, Midlands, South West and South East) and the level of historic demand for SCH and STC beds within each corridor over a three-year period was calculated. We then took into consideration the location of each of the STCs to give the requirement for SCH beds in each regional corridor, for example:

Corridor SCH places required

North	80
Midlands	40
South East	20
South West	30

Following the evaluation process the SCHs were ranked in order of their final overall scores (based on 65% quality and 35% financial). We then undertook to match the demand for SCH beds in each regional corridor by working methodically through the final ranked list, as demonstrated in the example table below. Beds could be assigned from adjacent corridors to meet the demand in corridors where there was a shortfall of SCH beds of sufficient quality, for example:

Home	Overall Score	Number of beds offered to YJB by each SCH	Corridor in which home located	Allocation of beds
				Starting position of beds required in each regional corridor North 80 Midlands 40 South East 20 South West 30
First placed	85%	30	North	30 beds netted off North figure of 80 to give revised position as follows: North 50 Midlands 40 South East 20 South West 30
Second placed	80%	20	North	20 beds netted off North figure of 50 to give revised position as follows: North 30 Midlands 15 South East 0 South West 30
Third placed	75%	25	Midlands	25 beds netted off Midlands figure of 40 to give revised position as follows: North 30 Midlands 15 South East 20 South West 30
Fourth placed	70%	20	South West	20 beds netted off South West figure of 30 to give revised position as follows: North 30 Midlands 15 South East 20 South West 10
Fifth placed	65%	20	South East	20 beds netted off South East figure of 30 to give revised position as follows: North 30 Midlands 15 South East 0 South West 10
Sixth placed	60%	40	North	Only 30 beds required in North, therefore 10 remaining beds from this home netted off Midlands, which is an adjacent corridor. Revised position as follows: North 0 Midlands 5 South East 0 South West 10
Seventh placed	55%	15	South West	Only 10 beds required in South West, therefore 5 remaining beds netted off Midlands, the only adjacent corridor with an outstanding requirement: North 0 Midlands 0 South East 0 South West 0

The Bid Evaluation

59. The evaluation of bids was undertaken by an evaluation panel specifically selected because of its members' expertise and experience (including SCH managerial roles) of the SCH services required by the YJB. … Using the criteria and scoring methodology described in the ITT (Section B, Part 2), an overall score was allocated to each bidder and a final ranking list compiled on which contract award decisions were based.

60. Both Orchard Lodge and the Atkinson Secure Unit were treated on the same basis as all the other SCHs in the competition. However, the results of the evaluation meant that neither SCH gained sufficient marks to be awarded a contract. Their scores were 58.27% and 57.75% respectively for quality, (respectively 12^th and 13^th out of the 14 bids) and their best financial options were scored at 80% and 76%. … When quality and price scores were combined in accordance with the evaluation criteria, Orchard Lodge scored 65.9%, ranking 11^th out of 14 bids and the Atkinson Unit scored 64.1, ranking 12 out of 14 bids.

The Demand Calculation

61. By the time the evaluation was completed we were able to update the indicative figures as to SCH places required using data for the period from January 2006 to December 2008. Accordingly, overall we analysed three years of historical data of demand for SCH and STC places to obtain an annual average of 463 plus 29 (a figure calculated by reference to the historical percentage (94%) of actual placements made by YJB) to cater for demand fluctuation. The number of contracted STC beds (301 – which remain fixed until 2013) was then subtracted from the total of 492 to obtain a revised figure of 191 SCH places. Again, the data looked at demand across both SCHs and STCs in the same way as the indicative figures had because they are broadly interchangeable and legally individuals can be placed into either type of establishment.

62. The revised figure reflects the fact that there has been a downward trend in the demand for SCH places in recent years, and a high number of vacancies over the past year. As a result, in April 2008 for example, we reduced the number of contracted beds in Orchard Lodge by 2 to 16.

63. The source of this reduction in demand appears to be a reduction in the number of 12 to 14 year-olds being remanded or sentenced to custody. The average number of 12 to 14 year-olds in custody for 2007/2008 was 190; the average number in 2008/2009 was just 168. This represents a 8% reduction. The number of commissioned SCH beds has been reduced from 219 to 191; a reduction of 13%. In 2008/2009, the average monthly occupancy rates for STCs and SCHs were 80% and 89% respectively; i.e. one in five STC beds was unoccupied and one in ten SCH beds was unoccupied.

64. The downward trend in the number of children and young people being remanded or sentenced to custody has continued throughout 2009 since our contract award decisions. If we were to use the same approach that formed the basis of our contract decisions, but to analyse three years from January 2006 to December 2008) then the revised optimum number of SCH beds that we would seek to commission would be 184. If we were to analyse the last two years of data only (i.e. from June 2007 to May 2009) then the optimum number of SCH beds that we would seek to commission would be 174.

65. …

66. Budgetary cuts were not therefore the reason for the reduction in the number of commissioned SCH beds. Although there were indications that the YJB budget allocation for SCHs was to have been reduced, ultimately we received the full required settlement to enable us to contract for 191 places. The decision to proceed with 191 beds was approved at a full YJB board meeting on 4 February 2009. …".

46. As Mr Gunaratnam stated in paragraphs 33 to 35 of his first witness statement (quoted above), the only SCH in Wales, Hillside, was not included in the competitive part of the re-commissioning process, although it had to submit a complete response, which was fully evaluated to ensure that it was of satisfactory quality and good value for money.
47. As I have already indicated, the ITT was issued on 15^th August 2008 and, so far as material, provided as follows:

"(2) Background

In preparation for this new round of tendering the YJB drafted a Commissioning Plan with the following overarching aim:

The YJB will work in partnership with the Department for Children, Schools and Families (DCSF), Local Authorities and service providers to support and meet the needs of children and young people in custody. We aim to commission good quality outcome focused and cost effective services with a resettlement and reducing offending focus and support DCSF to maintain welfare bed provision within a mixed economy.

The key objectives were to:

Establish needs and priorities; deliver sufficient secure accommodation of appropriate quality that meets the needs of 12-14 year old boys, girls up to 17 and more vulnerable 15 to 17 year old boys.

Supply and demand; better match demand and supply on a regional basis;

Manage cost and value for money to the YJB through appropriate risk transfer to the provider and an appropriate mixed economy of provision; and

Manage quality and drive up performance in the SCH market, providing a flexible service that can meet the needs of children and young people over the life of the contract and be flexible according to changes in the levels of demand.

Improve the built environment through investment in refurbishment works and capital expansion subject to affordability constraints and the objectives of the YJB and DCSF.

As part of the process to assess the correct level of demand, YJB looked at data over a period of 24 months on a regional basis using the regional corridors developed for the YJB 10 Year Estate Development Strategy. The exercise produced indicative figures for demand in the regional corridors and will form the basis for the number of SCH places that YJB will look to purchase through this tendering exercise (see Figure 1).

Figure 1

SCH Regional Demand

Region	Demand
South East	52
Midlands	34
North	110
South West	13
[Total]	[209]

Whilst YJB can give no guarantee to purchase a minimum or any number of places via this exercise "subject to the results of the quality and financial evaluation" YJB will use these figures as a guide when deciding on the number of places it may purchase at SCHs in each region. However, there will need to be some flexibility around the numbers to allow YJB to place young people outside their home regions when required. It is also likely that in some regions supply will not meet demand and where this occurs YJB will look to purchase additional places in other regions where there is excess capacity. Part 2 of this Section B gives further details of the evaluation process.

…

(8) Evaluation and Evaluation Criteria

The Contract will be awarded to the Tenderer submitting the most economically advantageous bid taking into account quality, cost, geography and any capital investment plans.

The factors to be taken into account for the evaluation are detailed below, together with the weighting allocated to each criterion. The importance of each criterion in the evaluation is indicated by the weighting allocated to it: the higher the weighting number, the more important it is in the evaluation.

…

Section B – Part 2

SCH Recommissioning Evaluation Criteria – Information for Bidders

Executive Summary

This document outlines the broad principles and criteria that will be used throughout the evaluation of the submissions received from secure children's homes (SCHs) as part of the Youth Justice Board's Recommissioning project. The YJB and Department for Children, Schools and Families (DCSF) will evaluate submissions received in response to the Invitation to Tender (ITT) against an agreed set of evaluation criteria. These criteria include:

quality (including the existing built environment);

cost (including the overall budget available);

geography;

Other factors which will be included as part of the evaluation process include;

the capital investment proposals of each SCH;

the impact of any decisions on potential welfare bed provision;

the impact of any decisions on the wider secure estate;

the risks associated with any proposed contract award or capital grant.

Both the quality and cost elements of each submission will be scored by the YJB's evaluation team. These scores will then be used to calculate an overall rating for each bidder. Quality will be worth 65% of the final rating and finance 35%. The SCHs will be ranked in order and the YJB will then begin allocating beds according to their demand figures in each regional corridor. A number of different scenarios will be modelled to assess both affordability and the impact on the YJB's ability to place children as close to home as possible. …"

48. In his second witness statement, Mr Gunaratnam gave further details as to how the demand for SCH beds was calculated, as follows:

"3. There are, attached to this witness statement, two tables, Table 1 and Table 2. This is the data we used to inform our demand for the 191 beds ultimately contracted for.

Table 1

4. Table 1 shows the 24 month period of demand which we stated we had looked at in the ITT. In red [reproduced in bold italics] I have highlighted the figures we gave out. These figures are about placements in any SCH not just the S/E, and, therefore include children and young people placed in and outside the region, which will always occur (as the statistics for 28% for London young people in Orchard Lodge shows). Table 1 therefore shows the demand (which is in reality placements) over that 24 month period and also shows the number of STC places used and the number of STC beds we had contracted for.

5. What the YJB showed in the ITT was just the SCH totals, to give indicative figures. If we had shown both SCH and STC figures in the ITT it would have shown a net demand of 205 of SCH beds required.

January 06 – December 07		Demand
Corridor	Facility where Held	Total	STC Supply
South East	SCH STC Total	52 120 173	156
Midlands	SCH STC Total	34 55 89	87
North	SCH STC Total	110 6 18	0
South West	SCH STC Total	13 6 18	0
Wales	SCH STC Total	16 5 21	0
Total	SCH STC Total	226 250 476	301

Total of 476 (average number places used)

Plus necessary "headroom" (assume max 94% occupancy rate of contracted beds) – 506

Less STC beds of 301

Total SCH requirement = 205

Table 2

6. The second table shows updated figures for 3 years using the same method, giving the net total of 191 once headroom and STC supply have been factored in. The overall demand for SCH places has gone down but the S/E SCH figure has stayed the same. The figure of 28 S/E SCH places ultimately required results from the factoring in of headroom and STC supply.

7. For the 2004 exercise we also used similar methodology and used the number of STC beds available to offset against the number of SCH beds needed.

January 06 – December 08		Demand
Corridor	Facility where Held	Total	STC Supply	SCH NET Beds Required
South East	SCH STC Total	52 121 173	156	(Headroom total 184-156) 28
Midlands	SCH STC Total	32 53 85	87	(Headroom total 90 – 87) 3
North	SCH STC Total	105 62 167	58	(Headroom total 178-58) 120
South West	SCH STC Total	13 5 18	0	(Headroom total 19-0) 19
Wales	SCH STC Total	15 5 20	0	(Headroom total 21 – 0) 21
Total	SCH STC Total	217 246 463	301	191

Total of 463 (average number places used)

Plus necessary "headroom" (assume max (4% occupancy rate of contracted beds) – 492

Less STC beds of 301

Total SCH requirement = 191."

49. It is to be noted that, in his third witness statement, Mr Gunaratnam acknowledged that he had drafted the ITT and that the "guide figure of 209" for the total SCH demand, which he had said in paragraph 49 of his first witness statement (see above) was "based on historical average demand across SCHs and took account of the number of contracted beds (301) available in STCs using data collected for a two year period ending in December 2007, had been erroneously based on the figures in figure 6 of the Commissioning Plan (see above), whereas the relevant figures were those in figure 8 of the Commissioning Plan (see above). So far as material, Mr Gunaratnam said this in his third witness statement:

"3. There are, attached to this witness statement, 2 exhibits to which I refer in the course of this statement. Exhibit 1 is the YJB Commissioning Plan for Secure Children's Homes. It is a working document that was prepared over a number of months to help inform the exercise of commissioning SCHs in 2008. It was signed off by the Project Board in July 2008. The minutes of that meeting are at Exhibit 2.

4. The principle of looking at SCH and STC demand and STC supply in order to determine the required SCH provision was established in the Commissioning Plan. I refer to Figure 8, which demonstrates that total demand (in both SCHs and STCs for a two year period ending December 2007, plus headroom based on 93% occupancy, less STC supply gave us figures for SCH places needed.

5. The Invitation to Tender (ITT) was issued to 14 Secure Children's Homes on 15 August 2008 with a deadline for responses of 31 October 2008. The ITT gave details of the requirement and also gave some background information and instructions to bidders, together with details of the evaluation criteria. The guide figures for required SCH places in the ITT reflect Figure 6 in the Commissioning Plan, which shows SCH demand for a two year period ending December 2007. These are also the figures in Table 1 of my Second Witness Statement.

6. The statement in paragraph 49 of my First Witness Statement that the guide figure of 209 was "based on historical average demand across SCHs and took account of the number of contracted beds (301) available in STCs using data collected for a two year period ending in December 2007" was intended to reflect the fact that because SCHs and STCs are broadly interchangeable and the supply of STCs is fixed, availability in this sector impacted upon the number of historical placements in SCHs over the two year period.

7. I drafted the ITT and cannot now recall why I used the Figure 6 figures in the ITT as a guide. I ought to have included the relevant figures from Figure 8 since that was the basis upon which the YJB had decided to commission SCH provision.

8. Following receipt of responses, an evaluation of bids then took place between November 2008 and February 2009 with the process culminating in contract awards being announced on 26 March 2009. The awards were based on YJB intending to contract for 191 beds, a figure calculated using the methodology reflected in Figure 8 of the Commissioning Plan, updated for a three year period ending December 2008. The methodology used is that in Table 2 of my Second Witness Statement and described in paragraphs 58 and 61 of my First Witness Statement. It was important that the figures were updated, particularly as demand had continued to fall in both the SCH and STC sectors, so that the revised figure for SCH contract awards could be determined for the evaluation. Similarly, an average occupancy rate of 94% rather that 93% was used to calculate "headroom" as this was the average rate of occupancy in the YJB estate for the 2006/7 and 2007/8 years. The core number of YJB contracted beds in STCs was 301 rather than 307 in Figure 8 of the Commissioning Plan as the Plan had assumed that 6 beds were to be added on a short-term basis. …"

50. In response to the YJB's Invitation to Tender, LSS submitted a tender for a new contract in respect of Orchard Lodge, to run from 1^st July 2009, as did Devon County Council in respect of the Atkinson Unit.
51. In due course, the YJB's Project Manager, Mr Dan Shotter, produced a "Board Decision Paper" ("the Board Decision Paper") for the YJB Board meeting of 4^th February 2009. Paragraphs 3.4 and 3.13 of this paper (see below) make it clear that, since STCs were regarded as "broadly interchangeable with SCHs", for each of the regions the requirement for SCH places was calculated by deducting all the currently available STC places (all of which were the subject of long term contracts) from the historic total demand for both STC and SCH places. The result was an approximately 14% overall reduction in the number of SCH places (i.e. from 219 places to 191). For the South East Region, the reduction was almost 50% (i.e. from 52 places to 28). So far as material, the paper was in the following terms:

"1. Purpose

The purpose of this paper is to:

inform Board members of the approach that was used to evaluate tenders received from secure children's homes as part of the current Recommissioning project;

inform Board members of the approach that was used to appraise the different options for contract award;

inform Board members of the further work that will be undertaken before contracts are awarded at the end of March 2009;

seek approval for the contract award options within this paper.

2. Decisions required

The Board is recommended to:

2.1 Approve the options for the award of new contracts for secure children's homes, …

3. Background

3.1 The YJB currently contract with 14 secure children's homes in England and Wales for a total of 219 places; the recommissioning project will place new contracts with effect from 1 July 2009. …

3.2 The commissioning plan, approved by the project board in July 2008, established the following key objectives:

to commission sufficient secure accommodation of appropriate quality to fully meet the needs of 12-14-year-old boys, girls up to 17 and more vulnerable 15 to 17 year old boys;

to better match secure children's homes demand and supply on a regional basis;

to manage cost and value for money to the YJB through appropriate risk transfer to the provider and an appropriate mixed economy of provision;

to manage quality and drive up performance in the secure children's homes market; and

to improve the built environment through investment in refurbishment works and capital expansion subject to affordability and the objectives of both the YJB and the Department for Children, Schools and Families (DSCF).

3.3 The plan was based on the following assumptions:

that secure children's homes and secure training centres are broadly interchangeable in terms of placement decisions, but that some differentiation should and does exist (i.e. those younger people with higher risk factors are more likely to be placed in secure children's homes);

that the YJB sees a distinct role for secure children's homes based on their smaller size, higher staff ratios, highly qualified staff and their strong ties with local communities and local authority children's services; and

that the YJB will commission as many places in secure children's homes as required, within affordability constraints.

3.4 We have undertaken a comprehensive analysis of three years of population data (2006, 2007 and 2008) alongside analysis of the home locations of those young people placed in secure children's homes and STCs during this period. Based on these three years of data (and taking into consideration STC provision) the required number of secure children's home beds in England and Wales is approximately 191, and the regional breakdown of that figure is detailed in the table below.

Regional corridor	Required STC & SCH capacity	STC provision	Approx SCH beds required
North (NE, NW, Y&H)	178	58	120
Midlands (WMIAL and EM)	90	87	3
South East (Lon, SE and E)	184	156	28
South West	19	0	19
Wales	21	0	21
Total	492	301	191

3.5 Board members should note that as a result of the decreasing population we will decommission the six beds that came on stream at Hassockfield in 2008, with STC provision in the North therefore reverting to 58.

…

Option analysis

Option 1 – renew all existing contracts at secure children's homes

3.12 If we receive funding in line with current levels … we would have the option of maintaining the current contractual position with the 13 English secure children's homes (i.e. 204 beds) and also undertaking an expansion at Hillside of up to five beds (with capital funds for this expansion being provided by the Welsh Assembly Government). Although this would avoid the closure of any homes and is thus the safest option, our population analysis at 3.4 above clearly shows that we no longer require this number of beds. Maintaining the current contracts would therefore be difficult to justify in terms of value for money.

Option 2 – preferred solution (191 beds)

3.13 The data analysis at 3.4 above established a requirement of approximately 191 secure children's home beds. Working through the ranked list of homes following the evaluation exercise, the beds offered by each home were netted off the total number of beds required in each regional corridor, with any excess of supply being assigned to adjacent corridors. This provides us with the solution below:

Homes	Beds
Overall SCH req	191
Hillside	17
English SCH req	174
Redbank	29
East Moor	34
Aycliffe	30
Vinney Green	21
Barton Moss	20
Clayfields	15
Aldine	4
Swanwick	12
Lincolnshire	9
Total English beds	174
Total SCH beds	191

…

The solution above allows the YJB to purchase the required total of secure children's homes beds: 174 in England and an expansion at Hillside to 17 beds. Therefore it fully meets the requirements of our commissioning plan. The regional breakdown of the beds purchased in each regional corridor is detailed in the table below.

Regional corridor	Proposed SCH beds
North (NE, NW, Y&H)	117
Midlands (WM & EM)	24
South East (Lon, SE and E)	12
South West	21
Wales	17
Total	191

This can be compared to the table at 3.4 above which gave an approximate number of required beds in each regional corridor. It can be seen that our preferred solution provides and excellent fit in terms of the North, the South West and Wales. … Although we are not able to fully meet the required number of beds in the South East this is compensated for by increasing the number of commissioned places in the Midlands.

Our preferred option would mean that the following homes would not be awarded a YJB contract:

Home	Location	Current YJB contract	Current welfare
Kyloe House	Northumberland	3 beds	9 beds
Sutton Place	Hull	8 beds	2 beds
Orchard Lodge	London	16 beds	8 beds
Atkinson	Exeter	10 beds	6 beds

…

… the YJB could still be faced with criticism for reducing the number of contracted secure children's home beds, despite our data analysis which shows that we should commission fewer. …

…

3.16 Orchard Lodge is the only remaining secure children's home in London. However, their bid was poor and there have been ongoing performance issues since Glen Care took over its running. The South East corridor includes Medway, Oakhill and Swanwick Lodge and we are therefore confident that the needs of children and young people from London will still be well met. …"

52. On 26^th March 2009, the YJB informed both LSS and Devon County Council that their bids had not been successful. It is the YJB's decision to that effect that is the subject of challenge in these proceedings. So far as material, the YJB's letter to LSS dated 26^th March 2009, in which the YJB communicated its decision was in the following terms:

"I am writing to formally advise you that Orchard Lodge's bid to the YJB for a new contract from 1 July 2009 has been unsuccessful. It is with regret that I provide you with this notification.

As you will be aware the evaluation of the tenders received from secure children's homes was conducted on the basis that the quality of the bids (as evaluated by the evaluation panel) was worth 65% of the final rating and finance 35%. All homes were marked against six categories of indicators, Quality Management, Admission, Management of young people, Assessment, Case Management and Service Delivery. The homes were then ranked in order and decisions made on contract award based on the criteria in the evaluation plan. As a result of this process we will be contracting for a total of 191 beds in England and Wales from 1 July 2009. Using the ranking for each home out of the 29 options received, the overall placing for your home was eleventh out of fourteen homes. The overall score for your home was 65.9%, while the top score across all the homes was 82.5%.

We recognise that this will have an operational impact and wish to work with homes who are not receiving contracts to discuss and agree transitional arrangements in 2009/10 which help to deliver adequate and sustainable provision of welfare beds across the country. As a short term measure there will be funds available for the purchase of beds from those units who have not been awarded a YJB contract for the financial year 2009/10, to support a transition to welfare-only provision. …"

53. The Atkinson Unit entered into a transitional agreement with the YJB whereby 3 places are to be funded until March 2010. As I have already indicated, Devon County Council has not made any claims in these proceedings, or at all (although JV, one of its inmates, has).
54. For its part, LSS decided not to take up the offer of a transitional arrangement and on 7^th April 2009 its solicitors wrote a detailed letter to the YJB expressing various concerns with regard to the unsuccessful outcome of LSS' bid, making the assertion that LSS should have been awarded a contract and inviting the YJB to postpone the award of the contracts until the dispute was resolved. On 23^rd April, the YJB's Chief Executive replied as follows:

"Thank you for your letter dated 7^th April in which you commented on the tendering process the Youth Justice Board (YJB) and the Department for Children, Schools and Families (DCSF) recently undertook in relation to the provision of secure children's home places for young people.

I realise that the result of the competition is disappointing for Glencare Group, but I would like to assure you that the YJB and DCSF have conducted the procurement in an open, fair and non-discriminatory manner.

As part of the exercise YJB analysed data on demand within the secure estate for a 3 year period ending in December 2008 and this included Secure Training Centres which are considered as being broadly interchangeable with SCHs in terms of placement decisions. With Swanwick Lodge Secure Children's Home in Southampton and the Secure Training Centres at Medway and Oakhill now operating at full capacity, we believe there will be sufficient and appropriate secure accommodation available to meet demand in the south east region.

In your letter you also asked about the award procedure used. The services procured are classified as Part B services and are therefore not subject to the full rigours of the Public Contracts Regulations 2006. As such there is no requirement to use any of the award procedures laid down in the Regulations.

The decision made to award contracts following the tendering process stands and the award process will continue. …"

55. In due course, LSS issued its claim for judicial review on 1^st June 2009.

The Grounds of Challenge

56. The various grounds of challenge can be summarised in the following terms. Several of the challenges to the tendering process are expressed as Wednesbury/Rationality challenges and several on the basis of the human rights of the children at SCHs. T and JV make a consultation challenge and JV also claims that an equality impact assessment ought to have been conducted. In addition, LSS makes a legitimate expectation challenge on its own account, which it is convenient to consider first.
57. (1) LSS' Legitimate Expectation Claim. During the course of the hearing, Miss Philippa Whipple made it clear on behalf of LSS that the original basis of the legitimate expectation claim was no longer pursued (i.e. the claim based on statements allegedly made by Mr Kevin Venosi, the YJB's Head of Secure Commissioning). Instead, Miss Whipple founded LSS' legitimate expectation claim firmly upon the terms of the ITT and the representations that it is said were made in that document: see paragraphs 58 to 66 of LSS' Re-amended Statement of Facts and Grounds.
58. The general principles of law relating to legitimate expectation were not in dispute and are conveniently summarised in the judgment of Peter Gibson LJ in R v Secretary of State for Education and Employment, ex parte Begbie (2000) 1WLR 1115, at pages 1123H to 1124D, as follows:

"1. Legitimate Expectation

Mr Beloff submits: (i) the rule that a public authority should not defeat a person's legitimate expectation is an aspect of the rule that it must act fairly and reasonably; (ii) the rule operates in the field of substantive as well as procedural rights; (iii) the categories of unfairness are not closed;(iv) the making of an unambiguous and unqualified representation is a sufficient, but not necessary trigger of the duty to act fairly; (v) it is not necessary for a person to have changed his position as a result of such representations for an obligation to fulfil a legitimate expectation to subsist; the principle of good administration prima facie requires adherence by public authorities to their promises. He cites authority in support of all these submissions and for my part I am prepared to accept them as correct, so far as they go. I would however add a few words by way of comment on his fifth proposition, as in my judgment it would be wrong to understate the significance of reliance in this area of the law. It is very much the exception, rather than the rule, that detrimental reliance will not be present when the court finds unfairness in the defeating of a legitimate expectation."

59. Miss Whipple submitted that the YJB made the following principal material representations in the ITT:

(1) That the YJB was looking to purchase, through the tendering process, a total of 52 SCH places in the South East (see figure 1 of the ITT).

(2) That the YJB had arrived at the figure of 52 SCH places by considering data over a period of 24 months on a regional basis and that the figure reflected average actual placements at any one time in SCHs in the South East over that 24 month period.

(3) That the figure was indicative but would nevertheless form the basis for the number of SCH places that the YJB would look to purchase through this tendering exercise.

(4) That, accordingly, the YJB would use the calculation based on previous actual use of SCHs as the basis for the number of SCH places that it would purchase through this tendering exercise.

60. It was Miss Whipple's submission that the ITT clearly meant what it said but that, when it came to awarding contracts pursuant to the tendering process, the YJB awarded only 28 SCH places in the South East region and arrived at its calculation of required SCH places on a completely different basis than that used to arrive at the figures in the ITT, namely by, in effect, setting-off existing STC places against the SCH requirements (and then uplifting by a percentage). Miss Whipple characterised this "STC set-off" as an "irrational factor" and stressed that the resulting change of approach had not been notified to LSS or to any other interested party (so far as LSS is aware). She submitted that the "STC set-off" appears to have originated in the Board's Decision Paper of 4^th February 2009: see, in particular, paragraph 3.4 of the paper (quoted above), and then found its way into and "infected" Option 2, which the Board proceeded to approve.
61. Miss Whipple submitted that the YJB made a clear representation in the ITT as to how it would determine the number of SCH places to be purchased and that the ITT meant what it said, before the process was "infected" by the irrational factor of the STC set-off. She contended that this clear representation in the ITT gave rise to a legitimate expectation on the part of LSS that the YJB would indeed use that basis for calculating numbers. Miss Whipple submitted that the YJB's use of a different approach altogether (i.e. an approach that was "infected" by the irrational STC set-off factor) was in breach of that legitimate expectation and an abuse of its powers.
62. In the alternative, Miss Whipple maintained that, for the YJB to have used a different basis for calculating the number of SCH places that were required, without any indication or explanation to LSS or any other interested person, was procedurally/substantively unfair. She submitted that, at the very least, the YJB should have put LSS and other interested parties on notice of its change of basis in a clear and transparent manner.
63. Finally, on this aspect of the matter, it was Miss Whipple's submission that if the YJB had arrived at the appropriate purchase figure for SCH places in the South East on the basis put forward in the ITT, LSS would have been a successful bidder because the number of required SCH beds in the South East would have been significantly higher.
64. For her part, Miss White submitted that, on this aspect of the matter, LSS' complaints relate to the private law tendering relationship between LSS and the YJB and, as such, do not involve any error of public law and do not give rise to grounds for judicial review. She pointed out that, in contrast with the other grounds put forward by LSS, the Claimant children could not have relied upon this particular one, since they were not within the class of persons to whom the alleged representations were made. It was Miss White's submission that this particular challenge was, in reality, a private law complaint that should have been brought under Part 9, regulation 47(6) of the Public Contract Regulations 2006, rather than by way of Judicial Review. In my view, there is much force in that submission, although I am prepared to accept that the same set of facts may give rise to a perfectly proper public law challenge as well founding the basis of a private law claim.
65. Be that as it may, I am satisfied that there was no clear and unambiguous representation of the sort normally required to found the basis of a legitimate expectation claim. As Miss White observed: (a) the ITT stated that the YJB had considered data over a period of 24 months on a regional basis using the regional corridors and had produced indicative figures for demand that would form the basis for the number of SCH places that YJB would seek to purchase; (b) the ITT did not represent that those indicative figures represented average actual placements at any one time over the 24 month period (contrary to Miss Whipple's submission summarised in paragraph 59(2) above), accordingly the YJB did not represent that it would use a calculation based on previous actual use of SCHs as the basis for the number of SCH places that it would purchase; and (c) it was clear that, whatever the basis of their calculations, the ITT figures were a guide rather than any unambiguous representation as to the number of SCH places that would in fact be purchased. I therefore agree with Miss White's analysis to that effect. Accordingly, I am satisfied that the YJB acted both reasonably and fairly in this regard and I reject Miss Whipple's submissions to the contrary effect.
66. Furthermore, I agree with Miss White's submission that there is nothing to suggest that LSS relied on the alleged representation in the ITT to its detriment. If the so-called STC set-off had been stated to be an integral part of the calculation of the demand for SCH places, there is nothing to suggest that any of the bidders (in particular, LSS) would have acted any differently or would have reformulated their bids in any way. As Miss White observed, it is inconceivable that LSS would not have tendered for a contract or would have formulated its bid in a different way if the basis upon which the demand for SCH places was to be calculated had been set out in full detail in the ITT (i.e. by giving details of the proposed STC set-off). There was, therefore, no unfairness in practice, despite Miss Whipple's assertion to the contrary. In short, this is not one of those exceptional cases where (as envisaged by Peter Gibson LJ in Begbie) the court can find unfairness in the defeating of a legitimate expectation in the absence of detrimental reliance.
67. I also accept Miss White's submission that the demand calculation actually used by the YJB was an appropriate and rational assessment of the true demand for SCH places, bearing in mind the YJB's existing commitments to STC places, which were broadly interchangeable with SCH places, and which were clearly thus a relevant consideration.
68. Accordingly, for those reasons, I have come to the conclusion that LSS' legitimate expectation challenge fails.
69. (2) Inconsistency of Treatment. Miss Whipple suggested that the YJB had deliberately excluded Hillside SCH in Wales from the competitive part of the recommissioning process on the grounds that it was the only SCH in Wales. She submitted that, by the same reasoning, Orchard Lodge SCH ought to have been excluded from the competitive part of the process, because it is the only SCH in Greater London, and its contract with the YJB ought also to have been renewed separately.
70. It was Miss Whipple's submission that it is both irrational and procedurally unfair to treat the last SCH in two clearly defined regions differently, particularly given that the regions in question share many characteristics in common. Thus:

(1) Both Hillside SCH and Orchard Lodge SCH were the last SCHs in their areas with a recognised need for SCH services for the local population;

(2) The likely demand for SCH services in London is greater than the likely demand for SCH services in Wales: thus

The population of Greater London is almost 2½ times the population of Wales.

There are over double the amount of 10-14 year old boys in Greater London than there are in Wales.

There are over double the number of boys between 15-19 years in Greater London than there are in Wales.

(3) Wales and London are both governed by their respective regional Assemblies.

(4) London was given particular recognition over and above other cities or areas. London is specifically named on the YJB's map in the tender documentation and the region was entitled "South East and London."

71. However, I agree with Miss White that there are very good reasons for concluding that Wales cannot properly be compared with London. Wales is a Principality, with devolved government in many areas that impact on criminal justice such as education and training, health, social welfare, safeguarding, housing and local government. I accept the submission that there is no meaningful comparison to be made between the powers of the Welsh National Assembly and those of Mayor of London and the London Assembly. As Miss White pointed out, provision for young people in Wales has to have regard to the Welsh language and to Welsh culture. I agree that Wales cannot properly be compared to London.
72. Furthermore, Hillside is the only SCH in England and Wales which attempts to meet the specific needs of Welsh young people in custody, by provision of the Welsh school curriculum, bilingual education and careers advice (see paragraph 34 of Mr Gunaratnam's first witness statement, quoted in paragraph 45 above).
73. I am therefore satisfied that there was nothing irrational or procedurally unfair in excluding Wales/Hillside from the competitive part of the recommissioning process, nor was there anything irrational about treating London as part of the South East region of England, within the context of matching demand to supply on a regional basis. These were perfectly fair and rational operational decisions that the YJB was entitled to take. Accordingly, for those reasons, this ground of challenge also fails.
74. (3) Irrationality in Failing to Score Geographical Proximity. Miss Whipple stressed that the YJB clearly recognises and acknowledges that, as a matter of policy, a close geographic proximity to the child's home is an important factor in selecting a suitable placement for the child or young person. In support of that assertion, Miss Whipple referred to a number of matters, including the following:

(1) The ITT, in which the need to "better match demand and supply on a regional basis" (emphasis added) is identified as a "key objective" and which goes on to indicate that one of the three principle evaluation criteria is "geography" (both matters quoted in paragraph 47 above).

(2) The YJB's general policy aim of placing children in SCHs within 50 miles of their home: see, for example, the "Protocol for the Refusal of Placements within Local Authority Secure Children's Homes in relation to Referrals made by the YJB" dated 30 June 2003, a letter from the YJB's Chief Executive, John Drew, dated 13 May 2009, the YJB's Corporate Plan 2002/03 to 2004/05, its Business Plan 2002/03 and Issue 21 of the YJB News, February 2004, which stated (inter alia):

"This follows an assessment of how the Board can obtain the best standards for young people in secure accommodation while working towards its target of 90 per cent of young people being placed within 50 miles of their home … Sir Charles Pollard, acting chairman of the Youth Justice Board, said: "The reduction in the number of young people being sent to custody has allowed the Board to focus even more on ensuring that young people are placed in safe, secure establishments as close as possible to their homes."

75. Miss Whipple therefore submitted that it was irrational for the YJB not to include in its evaluation methodology for scoring the various bids an appropriate score/weighting for geographic proximity to home, in view of the following:

(i) the importance of children being placed in SCHs within 50 miles of their home as a consistent application of YJB policy;

(ii) the importance of children being placed close to home so that they can be visited by their families both to assist in the resettlement process and to reduce the risk of suicide and/or self-harm; and

(iii) the importance of children being placed in SCHs close to home so that the SCH can work effectively with the child's family or carers, YOT, school and local community, in order to promote resettlement on release and rehabilitation.

76. Miss Whipple therefore submitted that the YJB's decision not to score or to give appropriate weighting to geographical proximity necessarily amounted to a failure to take account of a material consideration and was thus irrational. She also suggested that, given that the YJB did score the cost of the SCH places as part of the evaluation process, but made no allowance for the higher costs of places in the South East, this unfairly skewed the evaluation process towards the selection of less expensive places in the North and Midlands (where, as a matter of fact, the YJB did purchase most SCH places).
77. For her part, Miss White made it clear that the YJB does not have a specific policy of placing young people within fifty miles of their homes. She accepted that the YJB's 2001/02 corporate plan included a target to "ensure that, by March 2004, 90% of children and young people sentenced and remanded to secure facilities are accommodated within 50 miles of home." By December 2003, it appears that the YJB had achieved a figure of 71%. Miss White pointed out that the YJB's corporate plan for 2004/05 to 2005/06 was then modified to state, "the reconfiguration of the juvenile secure estate, within the available budget, means that further progress toward achieving this target may be limited." Accordingly, placement within fifty miles from home has not even been a firm "corporate target" for YJB since March 2004. I therefore accept Miss White's submission that YJB does not have a specific policy of placing children and young people within 50 miles of their homes because, although the fifty-mile figure was earlier identified as an appropriate corporate target, the YJB now accepts that its full attainment is, in effect, unlikely. In my view, it would be wrong to characterise such a target as a firm policy commitment, at least from March 2004 onwards.
78. Miss White submitted (correctly, in my view) that it is significant that no practical suggestion has been forthcoming as to how geographical proximity could be scored or weighted appropriately as part of the evaluation process. In my view, this is not surprising because (as Miss White pointed out), to award a score by reference to the actual distance between an SCH and a fixed geographical point would be arbitrary and to award a score based on the average or maximum distance between an SCH and the homes of the various young persons currently detained there (or on some other fixed date) would be artificial, given the ever-changing population of children and young people in SCHs.
79. I accept Miss White's submission that there is no real evidence that the failure to make allowances for the higher cost of places in the South East has necessarily skewed the evaluation process in favour of the North and Midlands. I also agree with Miss White that the YJB did not fail to have regard to a material consideration. "Geography" was specifically identified in the ITT as one of the evaluation criteria (albeit a "non-scoring" one). However, as Miss White pointed out, the YJB addressed the geography issue by identifying it specifically as an evaluation criterion and by having regard to the provision of accommodation on a regional basis, rather than by reference to any particular geographical location or point. The YJB sought to assess and meet demand by reference to "regional corridors" and allowed for the possibility that beds from adjacent regions could be used to make up shortfalls in any particular region. I accept Miss White's submission that such an approach was a perfectly rational way in which to take proper account of the need to achieve appropriate geographical proximity. Furthermore, this was precisely the approach that the YJB stated that it would take in its ITT and one that, in my view, it was entitled to take.
80. Accordingly, for those reasons, I am satisfied that the approach adopted by the YJB to the issue of geographic proximity was not irrational. This ground of challenge therefore also fails.
81. (4) Irrationality in Placing Children far from home. Miss Whipple submitted that the decision in question was irrational because it would have the immediate and obvious effect of defeating YJB's own clearly stated policy objective of placing children close to their homes. Miss Whipple suggested that the YJB has an acknowledged aim (set out in various policy documents, correspondence and ministerial answers) to place a child as close to home as possible. Miss Whipple submitted that the purpose of such a policy is self-evident, because:

(i) it promotes the well-being of the child – children detained a long way from home are more likely to sustain self-harm, including suicide;

(ii) it facilitates visits by close family and other relatives and their participation in the child's assessment and rehabilitation; and

(iii) it enables links with the relevant YOT to promote successful re-integration into society after release.

82. Miss Whipple pointed out that one of the "outcomes" identified by the YJB in its tender scoring system was that "young people will maintain family and carer contact". The YJB also specified that it required the provision of various facilities and activities by the SCH, including: (i) visits to the children by their families; (ii) pre-release home visits by the child; and (iii) family participation in reviews. It was Miss Whipple's submission that such facilities/activities are obviously facilitated by geographic proximity of the SCH to the child's home.
83. Miss Whipple suggested that, once the YJB ceases to place children at Orchard Lodge (the only existing SCH in the London area), the result will be that the youngest and most vulnerable children from London will be detained all over the country, in many cases far in excess of 50 miles from home, thus defeating YJB's own highly beneficial policy objective. She supported that submission by pointing out the mileages from London of the ten remaining SCHs whose bids were successful and/or with whom the YJB has now concluded new contracts:

(1) Swanwick Lodge, Southampton: South East, 80 miles from London;

(2) Vinney Green, Emersons Green: South West, 117 miles from London;

(3) Hillside, Neath: North Wales, 186 miles from London;

(4) Clayfields House, Stapleford: East Midlands, 110 miles from London;

(5) Barton Moss, Manchester: North West, 201 miles from London;

(6) Red Bank, Merseyside: North West, 213 miles from London;

(7) Aycliffe, Newton Aycliffe: North West, 255 miles from London;

(8) East Moor, Leeds: North East, 195 miles from London;

(9) Aldine House, Sheffield: East Midlands, 167 miles from London; and

(10) Lincolnshire Unit, Sleaford: East Midlands, 118 miles from London.

84. Miss Whipple pointed out that, since Swanwick Lodge in Southampton has a limited capacity of 16 beds and may well have to accommodate children who would otherwise have been placed at the Atkinson Unit, as well as children from its own area, it is unlikely to have any meaningful capacity to accommodate children from London. She therefore submitted that the probability is that children from London, most of whom are from impoverished backgrounds and with family circumstances making them particularly vulnerable, will be placed in the Midlands and/or the North, many miles from their homes and from their own support network.
85. Miss Whipple submitted that, in the case of such children, the likelihood is that the high cost of travel will greatly inhibit the maintenance of any meaningful family contact. In consequence, it is unlikely that many families will be able to attend review meetings and, thus, the invaluable family input into the rehabilitation and resettlement process will be lost. It was Miss Whipple's submission that these obvious and seriously detrimental (but avoidable) consequences to very vulnerable children demonstrate and emphasise the irrationality of the YJB's decision not to award a new contract to Orchard Lodge SCH.
86. However, as I have already indicated (see paragraph 77 above) I accept Miss White's submission that placement within fifty miles of home has not been a corporate target or policy of YJB since (at the latest) March 2004. Miss White stressed that SCHs are not run on a localised basis or run to serve a set catchment area and I accept that it is important to bear that in mind. Miss White submitted that individuals are accommodated according to assessments as to their needs and that placement is always based upon best interests and quality of care. I accept that is so. She acknowledged that the availability of places close to a young person's home still remains one of a number of factors that are considered in the assessment that is conducted before any placement decision. However, in the result, from December 2005 to December 2008 only 28% of the placements at Orchard Lodge (for example) were for children/young people from inner London and placements were made for young people from locations such as Bury, Wales and Nottingham.
87. Nevertheless, the fact that, as part of the assessment process, the YJB does take into account the availability of places close to a young person's home has meant that the average distance from home for young people from each of the regions has remained relatively low (see the table of average distances for the year June 2008 to May 2009 in paragraph 61 of the YJB's grounds of opposition).
88. As it seems to me, the picture painted by Miss Whipple is an unduly pessimistic one and one that is not borne out by the facts. As Miss White pointed out, to assist in cases where children and young persons are not accommodated close to home, families visiting young persons may obtain payment for travel expenses. In the case of sentenced offenders, the YJB can provide assistance and in the case of those on remand, the relevant local authorities can do so. Placement is decided upon best interests and quality of care, following an appropriate assessment of the child/young person's needs. Closeness to home remains an important factor in that assessment process and the figures strongly suggest that, in practice and for the most part, placements are made at not too great a distance from home.
89. As Miss White observed, if Orchard Lodge closes, it is envisaged that the young people from London will be placed elsewhere in the South East – at Swanwick Lodge SCH, or at Oakhill STC or Medway STC. It is very important to bear in mind that placements will depend upon individual factors in each case and there is no reason to doubt that the appropriate assessments will be carried out conscientiously and bona fide decisions made in the light of all the relevant factors, including the availability of places close to home. I accept Miss White's submission that it is highly improbable that young persons from London will be placed in northern SCHs.
90. I have therefore come to the firm conclusion that the rationality of YJB's decision cannot be called into question on the basis that it will have the inevitable effect of placing children/young persons far from home and I am not persuaded that such would be the case in any event. The availability of a place close to home remains one of a number of important factors to be taken properly into account in the assessment process upon which the decisions as to the placement that best meets the needs of the child/young person in question is made. In short, there is no reason to doubt that the assessment process will be conscientiously carried out and that the resulting decision will not place the child/young person far from home. Accordingly, for those reasons, this ground of challenge also fails.
91. (5) Irrationality in Reducing SCH Places and (6) Irrationality in treating places at STCs as equivalent to SCHs. I agree with Miss White that these two grounds overlap considerably and, therefore, can conveniently be addressed as one.
92. Miss Whipple submitted that SCHs are appropriate for the youngest and most vulnerable children in custody, that STCs are not equivalent to SCHs and that it was irrational for the YJB to reduce the number of SCH places given that: (i) there is no reduction in the number of children aged between 12 to 14 who are subject to custodial sentences; (ii) the same is true of vulnerable children aged 15 and 16; (iii) England and Wales impose more custodial sentences in respect of children/young people that any other European country; and (iv) the demand for SCH places reasonably local to the child in question means that at least the same number of SCH places is required and very probably an increase is necessary.
93. Miss Whipple submitted that, in assessing the demand for SCH places, the YJB had adopted a flawed methodology. She maintained that instead of looking at the SCH places that were used or required over three years, the YJB had treated SCHs and STCs as equivalent and had thus looked at the places in SCHs and STCs actually used over three years. She also submitted that, even if all the STC beds are also taken into account in the South East, the total falls far short of the regional demand (see paragraph 35 of Miss Whipple's written skeleton argument).
94. It was Miss Whipple's submission that an STC is a completely different type of institution from an SCH because, so Miss Whipple contended, an STC is more in the nature of a prison. She submitted that the differences between SCHs and STCs include the scale and the care provided. In SCHs the staffing ratios are higher and there is more intensive supervision of young people with special needs, including mental health problems. Miss Whipple stressed that the small-scale, therapeutic environments provided by SCHs are generally considered to make them the best places for younger convicted offenders, as well as those on remand facing charges.
95. In contrast, Miss Whipple suggested that STCs have had serious welfare and kindred problems on a scale and of a type that have not occurred in the smaller and more intimate SCHs; i.e. (i) STCs have had a widespread practice of using unlawful force on children; and (ii) STCs have had incidents of child death – either as a result of self-harming or as a result of the use of unlawful restraint.
96. Miss Whipple therefore submitted that the YJB had been quite wrong and Wednesbury unreasonable to treat STCs as the equivalent of SCHs for placement purposes. She submitted that the irrationality of YJB's decision was apparent from the fact that, as a result of the decision not to award a contract to Orchard Lodge, there will be inadequate SCH provision in the South East. Thus, vulnerable children/young people from London and the South East, who should be accommodated in SCHs, will have to be accommodated in STCs such as Oakhill and Medway (neither of which had been involved in the competition for the new contracts for SCH places) or even in a YOI. Miss Whipple submitted that by effectively awarding SCH places to STCs that had not been involved in the tendering process. YJB's decision-making was, ipso facto, Wednesbury unreasonable. She also contended that a YOI is, in effect, a prison with a staffing ratio of about 2 officers to 40 young people. As such, she argued, it was wholly inappropriate accommodation for a vulnerable child/young person, even if he is as old as 17.
97. For her part, Miss White submitted (correctly, in my view) that the YJB's treatment of SCHs and STCs as related and complementary types of accommodation, which are broadly interchangeable, is entirely rational. I reject Miss Whipple's submissions to the contrary effect. As Miss White observed, as a matter of law, those sentenced by a Court may be detained in either an SCH or an STC and those subject to COSRs may be placed by the local authority in an STC as an alternative to an SCH, with the consent of the Secretary of State or the YJB. As the legislation recognises, both types of accommodation can be suitable for vulnerable children. However, as Miss White was at pains to point out, this is not to say that any particular child could appropriately be placed interchangeably in an SCH or an STC. Any such placement will entirely depend upon the assessment of the child's particular needs, and it may be appropriate for a young person to transfer from one type of accommodation to another as his/her needs change. In my view, the importance of this aspect of the matter cannot be overstated. The assessment of the child's particular needs is the key to whether he/she is placed in an SCH or an STC. In some cases, placement in only one of those types of institution will be appropriate; in other cases, appropriate placement could be in either.
98. As Miss White pointed out, a number of factors will be taken into account when considering where a child or young person ought to be placed. For example, where a child or young person has greater need for therapeutic type interventions and high staff inputs, he/she is more likely to go to an SCH, because SCHs do offer more intensive support of this nature. Similarly, where a young person would benefit from vocational training opportunities, he/she is more likely to be placed in an STC, because STCs are generally able to offer a broader training curriculum.
99. As I have already indicated (see paragraph 28 above), the YJB's view that for the purposes of procuring the secure estate STCs and SCHs are broadly interchangeable, is supported by the decisions of the Divisional Court and the Court of Appeal in the case of "C", both of which recognised that SCHs and STCs are broadly interchangeable. Both Courts accepted evidence from an SCH manager that SCHs and STCs cater for the same group of young people and rejected the Secretary of State's argument that the two institutions were very different. It is also important to bear in mind that the YJB's evidence, based on data obtained through a 3-year monitoring exercise, is that the demand for places in SCHs/STCs for this group of young people is actually declining (see paragraph 35 above).
100. Furthermore, I am satisfied that there is nothing in the contention that the number of beds for which the YJB has awarded contracts in the South East is insufficient to meet demand even if STC beds are taken into account. I accept Miss White's submission that the figures upon which Miss Whipple relied in support of that suggestion are annual totals and not, as appears to have been assumed, average numbers in SCHs and STCs at any one time.
101. For the reasons given above, I have come to the conclusion that it was not irrational for the YJB to treat SCHs and STCs as broadly interchangeable and to calculate the required number of SCH beds accordingly (i.e. against the background of an overall decline in demand and the existing long-term contractual commitment for STC beds). I am therefore also satisfied that the resulting reduction in the number of SCH beds is not a consequence of irrational decision-making or Wednesbury unreasonableness on the part of the YJB. Accordingly, both these grounds also fail.
102. (7) Breach of the Children's Human Rights. Mr Paul Bowen on behalf of JV put forward the main submissions with regard to this particular ground of challenge. Stated in broad terms, it was Mr Bowen's submission that in deciding not to offer new contracts to Orchard Lodge and the Atkinson Unit (thus reducing the number of SCH places in the secure estate) the YJB acted unlawfully because of its failure to comply with its duties to safeguard children's human rights, in particular those enshrined in Articles 2, 3 and 8 of the European Convention on Human Rights ("the ECHR"). Mr Bowen submitted that, as result of YJB's decision, the reduction in available places in SCHs means that a significant number of children and vulnerable young people who should be accommodated in SCHs/STCs will now be accommodated in YOIs and thus exposed to the risk of significant harm, in breach of the YJB's primary obligations under Articles 2, 3 and 8.
103. Mr Bowen submitted that Articles 2, 3 and 8 impose positive obligations on the State and its organs/agents (in this case the YJB) to those that it detains to provide accommodation that safeguards their welfare and enables them to maintain contact with the outside world, in particular with their families. He referred to the speech of Baroness Hale in R (R) v Durham Constabulary (2005) 1 WLR 1184 at paragraph 26 and suggested that these duties have particular potency in the case of children because, as Baroness Hale made clear, the State's obligations in this regard are to be read in the light of its international obligations under the UN Convention on the Rights of the Children (UNCRC) which require, inter alia, that state parties should undertake to ensure the child such protection and care as is necessary for his or her well-being (Article 3) and ensure "to the maximum extent possible" the survival and development of the child (Article 6).
104. Mr Bowen also referred to the decision of the House of Lords in Savage v South Essex Partnership NHS Foundation Trust (2009) 2 WLR 115 ("Savage") and, in particular, to the speeches of Lord Rodger and Baroness Hale. He then submitted that the positive obligation to detain a vulnerable child in suitable conditions of detention is better expressed as forming part of the "primary duty" upon the State to put in place a legislative and administrative framework designed to provide effective deterrence against threats to the right to life, rather than as an aspect of the additional positive obligation on the authorities, that can arise in certain well defined circumstances (i.e. where there is a "real and immediate risk to life" about which the authorities knew or ought to have known), to take appropriate preventative operational measures to protect the life of an individual: see Lord Rodger's speech in Savage at paragraphs 18/19, where he said this:

"The positive obligations to protect life

18 Article 2 declares that "Everyone's right to life shall be protected by law". In the 1980s, principally in a line of cases arising out of the violence in Northern Ireland, the commission recognised that article 2 could give rise to positive obligations on the part of the state to protect life. But this did not mean that a positive obligation to exclude all possible violence could be deduced from the article. …

19 Fundamentally, article 2 requires a state to have in place a structure of laws which will help to protect life. In Osman v United Kingdom 29 EHRR 245, 305, para 115, the European court identified the "primary duty" of a state under the article as being:

"to secure the right to life by putting in place effective criminal law provisions to deter the commission of offences against the person backed up by law-enforcement machinery for the prevention, suppression and sanctioning of breaches of such provision."

But, as the parties in Osman's case recognised, the state's duty goes further, and article 2: "may also imply in certain well defined circumstances a positive obligation on the authorities to take preventative operational measures to protect an individual whose life is at risk from the criminal acts of another individual."

105. Mr Bowen accepted that the European Court of Human Rights ("the ECtHR") has not explicitly addressed the scope of this "primary obligation" in the context of child detainees, but submitted that the speeches in Savage are consistent with the Claimant's case that the obligation includes matters such as the provision of suitably trained staff, including suitably trained medical and social work staff, the provision of suitable accommodation, the provision of suitable training and education, the making of suitable policies for the prevention of self-harm and suicide and the like – all of which, he suggested differ between SCHs/STCs on the one hand and YOIs on the other.
106. Mr Bowen submitted that a decision (like the one under challenge) that leads to a reduction in the appropriate forms of secure accommodation which, he suggested, will have the consequence that vulnerable children will be more likely to be detained in inappropriate conditions may engage the State's primary obligations under Articles 2, 3 and 8 of the ECHR. Mr Bowen accepted that, for the Articles in question to be engaged, some significant risk of harm must be demonstrated, but submitted that for the purposes of the "primary duty" there is no need to demonstrate an immediate risk to life (cf the position with regard to the additional positive obligation to take preventative operational measures): see R (Munjaz) v Mersey Care Trust (2006) 2 AC 148 at paragraphs 29 (Lord Bingham) and 80 (Lord Hope).
107. Mr Bowen submitted that, in the present case, the YJB's decision to reduce the number of SCH beds across the secure estate, and in particular at the Atkinson Unit and Orchard Lodge, has given rise to the following real or significant risks of harm to children and vulnerable young people:

(1) There will be a number of vulnerable children, who need to be detained in either an SCH or an STC, who are or will now be detained in a YOI, in conditions of detention that may cross the threshold of Article 3 and/or 8 and/or that create the risk of such detention and where the risk of self-harm will be materially increased so as to engage Article 2;

(2) There will now be a number of vulnerable children who will be detained in the unsuitable conditions of an STC rather than an SCH, where those conditions of detention will cross the threshold of Article 3 and/or 8 and where their risk of self-harm will be materially increased, thus engaging Article 2; and

(3) In any event, it is now far more likely that vulnerable children will be detained further from their homes and families and professionals working with them, with consequences for their welfare and development that engage Article 8.

108. Mr Bowen therefore submitted that Articles 2, 3 and 8 of the ECHR (when read together with UNCRC) are each engaged and, in determining whether there has been a breach of the primary obligation under each or any of those Articles, the question to be determined is whether a fair balance has been struck between the interests of this vulnerable group (which includes the Claimant JV and others in her situation) and the general interests of the community. Mr Bowen accepted that, in making that assessment, the Court cannot impose a disproportionate burden upon the authorities.
109. Mr Bowen submitted that the YJB did not strike a fair balance in reaching its decision for the following reasons:

(1) The YJB's calculation of the demand for SCH placements was over simplistic, insufficiently researched, was not based upon up to date information as to the true level of need for SCH/STC placements and failed to consider properly or at all the evidence (e.g. as demonstrated by the Moran Note) that there was a demand for such placements that was not being met, except by placement in YOIs (this became known as "the unmet demand point"): in particular, the YJB failed to take account of the increase in the number of young people under 17 who are being detained in YOIs and the resulting likelihood that a significant number of vulnerable children/young people are now being detained in YOIs instead of SCHs/STCs;

(2) The YJB failed to give due weight to geographical proximity and the need for vulnerable children and young people to maintain contact with their families and professionals;

(3) The YJB wrongly treated SCHs and STCs as "equivalent" for the purposes of the tendering exercise when, in fact, SCHs are intended for younger and more vulnerable children and young people and are therefore more appropriate for this group than STCs.

(4) There is no evidence that the YJB gave any consideration to the effect that the closure of "justice beds" would have in terms of undermining the viability of the affected SCHs in continuing to provide "welfare beds".

(5) The YJB failed to carry out individual assessments on those children and young people who were already detained in the SCHs whose beds they decided to close in circumstances where they could have no reasonable expectation that they would be provided with suitable beds elsewhere.

110. Of the five points identified in the previous paragraph, Mr Bowen made it clear that he relied, in particular on points (1) to (3) and did not seek a decision based on points (4) and (5) (although he did not formally withdraw them). He then went on to summarise his submissions on this ground of challenge in the following terms (see paragraph 35 of Mr Bowen's Written Reply dated 28^th July 2009):

"In summary, it was evident to the YJB in 2005 that there was a significant degree of unmet need [see the Moran Note]. As a result of that information the YJB undertook to maintain the current provision of SCH beds [see the Secure Estate Strategy] and to implement any reductions in the secure estate in the YOI estate, not the SCH/STC estate [see the Secure Estate Strategy]. The YJB since that time has not collated the necessary information to enable them to be satisfied that there is no longer that unmet need, because they do not collate it. They were therefore under a duty to make appropriate investigations (whether by way of consultation, EIA or their own researches) to establish whether this unmet need still existed. … Their failure to do so demonstrates that they have not struck a fair balance between competing interests. …"

111. For her part, Miss White accepted that the YJB is subject to the primary duties contended for with regard to Articles 2, 3 and 8 of the ECHR. However, in relation to Article 2, she suggested that the nature of the duty is "to employ competent staff and take steps to see that they [are] properly trained to high professional standards … to take account of the risk that detained [young people] might try to commit suicide" (see Savage, paragraph 50), for example by "removing belts etc from prisoners" (see Savage at paragraph 40). She submitted that, similarly, Article 3 requires that detention be "in conditions which are compatible with respect for his human dignity, that the manner and method of the execution of the measure do not subject him to distress or hardship of an intensity exceeding the unavoidable level of suffering inherent in detention and that, given the practical demands of imprisonment, his health and well-being are adequately secured": see Dybeku v Austria App. No. 41153/06 at paragraph 38.
112. However, Miss White submitted (correctly, in my view) that the Claimants have not come anywhere close to establishing that the decision not to award a contract to Orchard Lodge and/or the Atkinson Unit engages any of Articles 2, 3 and 8 of the ECHR or constitutes a breach of any of its duties arising under those Articles, whether primary or otherwise. As Miss White observed, the decision in question does not give rise to any of the alleged real or significant risks to children and vulnerable young people and, in any event, no breach can be demonstrated without establishing that: (i) the YJB's demand calculation for SCH places is flawed, (ii) children who could only have been appropriately placed in SCH places will now be placed elsewhere and (iii) in general terms, conditions in STCs and YOIs are such as to breach Articles 2, 3 and 8 of the ECHR. I agree with Miss White that, despite the enormous amount of detail that was comprehensively explored by the Claimants, they have failed to demonstrate any of those critical matters.
113. Although I accept that there have been individual cases where breaches of Articles 2, 3 and 8 have been established, I agree with Miss White's submission that, in general terms, the normal conditions of detention in STCs and YOIs cannot possibly be said to be such as to amount ipso facto to a breach any of the Articles in question.
114. I have already rejected the argument that the YJB's demand calculation was flawed because SCHs and STCs were treated as broadly interchangeable for placement provision (see, in particular, paragraphs 97 to 99 above). So far as concerns Mr Bowen's "unmet demand" point and the criticism of the demand calculation that stems from it, I am not persuaded that there is any "unmet demand" and certainly not one of the scale and significance for which Mr Bowen argued, having regard in particular to the evidence of Mr Peter Minchin, the YJB's Head of Placement and Casework, as set out in his witness statement dated 10^th July 2009.
115. As Mr Bowen readily accepted, the "unmet demand" argument is heavily dependent on the significance to be attached to the Moran Note and its apparent acknowledgment that there were, in effect, 260 vulnerable young men (aged 15 – 16) who had to be accommodated in YOIs because of the lack of available places in SCHs/STCs. In my view, the Moran Note (which was, of course, written in 2005) and the other points made by Mr Bowen based on and/or derived from it are quite insufficient to call seriously into question the detailed evidence about the current position given by Mr Minchin.
116. In my view, Mr Minchin's evidence clearly shows (inter alia) that: (i) numbers in the secure estate have been falling over the past two years (see paragraphs 73 to 75), (ii) that the vulnerability of each young person is assessed and that there is nothing to suggest that there are any instances of inappropriate placement (see paragraphs 61 and 76 to 84), (iii) that transfers are carried out where appropriate (paragraphs 61, 67 to 72 and 85), (iv) that there have been a significant and increasing number of average vacancies in both SCHs and STCs over the last 3 years and that, despite "regular trawls" of young people currently placed in YOIs, the YJB Placements and Casework Service has been unable to use all available SCH and STC beds (paragraph 86 to 89). There is no question as to Mr Minchin's bona fides and none of the points put forward by Mr Bowen persuade me that (as Mr Bowen suggested was the case) Mr Minchin was not in a position (through lack of relevant information) to conclude, in effect, that the unmet need identified in February 2005 no longer exists.
117. As for the risk of harm to children that are said to arise out of inappropriate placement in an STC (rather than an SCH) and/or as a result lack of geographic proximity, I have already rejected the irrationality challenges based on these factors (see paragraphs 74 to 101 above). By a parity of reasoning, I am satisfied that neither of those factors give rise to the alleged or any risk of significant harm to children and/or vulnerable young persons and I reject Mr Bowen's submissions to the contrary effect.
118. Furthermore, as Miss White observed, the YJB is a body specifically established by the 1998 Act (see paragraph 6 above) for making the type of judgments that are questioned in this case. I accept Miss White's submission that the appropriate standard of review for any rationality and/or similar challenge is Wednesbury reasonableness. The Court should therefore be slow to impugn the YJB's decisions of fact and even slower to impugn its educated predictions for the future. I also agree with Miss White's suggestion that the Court should be particularly slow to interfere with the YJB's application and interpretation of its own statistics, which is at the heart of the challenges to (i) the demand calculations and (ii) to the allocation of places to meet that demand.
119. In short, therefore, for the foregoing reasons I am satisfied that none of Articles 2, 3 and 8 is engaged on the facts of this case. However, if I am wrong about that, for the same reasons I am also satisfied that, in making the decision that it did, the YJB did strike a fair balance between the interests of this group of vulnerable children/young people and the general interests of the community and I reject Mr Bowen's submissions to the contrary effect. Accordingly and for those reasons, this ground of challenge also fails.
120. (8) The Best Interests of the Claimant: Lack of Reassessment. Although this ground of challenge was not formally withdrawn, Mr Bowen made it clear that the Claimant was content for the argument not to be resolved: see paragraph 37 of Mr Bowen's Written Reply dated 28^th July 2009. Accordingly, I propose to say no more about it.
121. (9) Lack of Equality Impact Assessments. Mr Bowen submitted that because the decision not to award a contract to Orchard Lodge and/or the Atkinson Unit was taken without any prior race, disability or sex equality impact assessment (an "EIA"), the decision is unlawful because of the YJB's failure to have due regard to its general equality duties under section 71 of the Race Relations Act 1968, section 76A of the Sex Discrimination Act 1975 and section 49A of the Disability Discrimination Act 1995.
122. It was Mr Bowen's submission that the scale of the reduction in SCH beds that results from the YJB's decision (i.e. an overall reduction of 34 beds, namely 225 beds to 191) was bound to have and has had a disproportionate effect on the females, the disabled and the ethnic minorities who are included in this vulnerable group of children and young people (i.e. the group for whom secure accommodation in SCHs/STCs is necessary). He submitted that, in those circumstances, it was necessary for the YJB to carry out an EIA in the proper discharge of its general equality duties as the relevant public authority and, to the extent that the YJB had proceeded on the basis that it was not required to carry out an EIA because the decision in question did not involve any significant change in policy, the YJB had misdirected itself in law.
123. Mr Bowen also contended that the YJB's own current guidelines, as set out in the "Equality Impact Assessment Toolkit" (the "EIA Toolkit"), clearly demonstrated that an EIA was required in the circumstances of this case: see paragraphs 1.1, 2.1, 2.2, 3 and 4 of the EIA Toolkit. He suggested that, at the very least, the screening process should have been carried out, but it was not.
124. For her part, Miss White emphasised that formal EIAs are not required by statute. She submitted that, put at its highest, the YJB's statutory equality duties required it to consider undertaking an EIA, along with other means of gathering information, and to consider whether it is appropriate to conduct an assessment in relation to the policy/decision/function at issue, when it would or might have an impact on the relevant group of people. I agree with that submission: see the judgment of Aikens LJ in R (Brown) v Secretary of State for Work and Pensions (2008) EWHC 3158 ("Brown") at paragraph 89. As Aikens LJ went on to observe: "the public authority must balance all, and bring all to mind before it makes its decision on what it is going to do in carrying out the particular function or policy in question."
125. Broadly stated, the public authority's general equality duties under the relevant legislation are to have due regard to the need to eliminate unlawful discrimination and to promote equality of opportunity between the relevant groups. I accept Miss White's submission that those duties are discharged by the public authority in question (in this case the YJB) having the regard that is appropriate in all the particular circumstances in which the public authority concerned is carrying out its function as a public authority (see the case of Brown at paragraph 82), taking account of any relevant concerns: see Brooke v Secretary of State for Justice (2009) EWHC 1396 (Admin) ("Brooke") at paragraphs 25 to 28.
126. As to whether the YJB did discharge its general equality duties in the present case, Miss White submitted that the YJB had clearly done so. In support of that submission, Miss White made the following main points.

(1) Miss White pointed out that in the case of C it was accepted that, having regard to the Race Equality Schemes of the Home Office and the Department for Constitutional Affairs, the effect of section 7(1) of the Race Relations Act 1976 was to require a race equality impact assessment where it was proposed to change policy on a matter that might raise issues about racial equality (see paragraphs 38 and 39). Miss White submitted that, in the present case, the decision not to award a contract to Orchard Lodge and/or the Atkinson Unit did not involve any such change in policy. For the reasons that are apparent from the earlier parts of this judgment, I agree with that submission. I also agree that it is clear that the YJB did not regard this aspect of the matter as the sole reason for not carrying out an EIA. I am therefore satisfied that the YJB did not misdirect itself as suggested by Mr Bowen.

(2) Miss White submitted that, in the circumstances of this case where: (a) the commissioning decision was based principally on quality of provision of services and where the YJB had included within the tender specification provisions designed to ensure that the SCH promotes equality when delivering that service (see paragraph 46 of Mr Gunaratnam's first witness statement) and (b) the YJB expressly had regard to the particular need to provide sufficient male and female beds across the SCH sector (see paragraph 9.1 of the February 2009 Board Decision Paper), the YJB's duty to have "due regard" to its general equality duties was discharged.

127. I agree with Miss White's submissions. I also agree with her contention that the mere fact that the population of the secure children's estate contains significant numbers of mentally disordered individuals (who may or may not be disabled) and ethnic minorities does not require the YJB to take any particular steps over and above those that it has taken and I reject Mr Bowen's submissions to the contrary effect. Accordingly, for those reasons, this ground of challenge also fails.
128. (10) The Failure to Consult. This particular ground was the main subject of submissions by Mr Nicholas Bowen QC on behalf of T. Stated shortly it was Mr Bowen QC's submission that the YJB was under a duty to consult the various interested public bodies and the Children's Commissioner before making a decision involving such a marked reduction in the number of SCH beds, that it failed to do so and that, accordingly, the decision not to grant a contract to Orchard Lodge and/or the Atkinson Unit is unlawful.
129. Mr Bowen QC referred to a number of the provisions of the 1998 Act, the 1969 Act, the 1991 Act and the 2004 Act (see paragraphs 22 and 53 of Mr Bowen QC's written outline submissions). In broad terms, it was his submission that YJB's duty to consult springs from the statutory scheme that set up the youth justice system and controls the provision of secure accommodation, as well as from the terms of the 2004 Act which created the office of the Children's Commissioner.
130. Mr Bowen QC pointed out that it is clear that many agencies make up the youth justice system and that several government departments also have an interest in the YJB's activities such as the formulation, reformulation or change of a policy as to the number of SCH beds required and/or a decision that demand for such beds is reducing. He accepted that there was no express provision that required consultation by the YJB in circumstances such as the present case, but submitted that the duty arose by clear implication from the statutory scheme and its various co-operative and interlinking provisions, which demonstrate that consultation with other stakeholders and other interested parties must have been envisaged by Parliament, particularly in relation to the YJB's duties of assessing demand for secure accommodation and reporting to the Secretary of State pursuant to section 41(5)(l) of the 1998 Act.
131. Mr Bowen QC submitted further that, by a parity of reasoning, procedural fairness to those affected by a reduction in SCH beds required that the YJB give an opportunity to the various interested public bodies/agencies to be consulted before taking a decision of such importance. He also maintained that paragraph 5 of the YJB's 2004 Placement Policy, which is repeated in paragraph 12 of the current 2008 Placement Policy effectively recognises the existence of such a duty by accepting the importance of other stakeholders with responsibilities for children being placed in secure accommodation being able to influence the YJB's decision-making, by promising joint working and, in effect, creating an expectation that could only be fairly met by an appropriate process of consultation. Thus that paragraph makes specific mention of (inter alia) the Ministry of Justice, the Home Office, the Prison Service Population Management Team, YOTs and the providers of secure accommodation and continues:

"Accordingly the YJB … will undertake to work collaboratively with those stakeholders to ensure the effective operation of the placement system. Where issues or deficiencies are identified it will seek to work with the stakeholder(s) concerned to resolve the issue."

132. Mr Bowen QC also referred to and relied upon the Secure Estate Strategy which, as he pointed out, followed a widely conducted consultation process. Mr Bowen QC submitted that it is clear from the terms of this document that YJB's policy (see, in particular, those passages quoted in paragraphs 41 to 43 above), following that consultation process, was to sustain the numbers of places funded in SCHs. He therefore contended that subsequent events (see paragraphs 7 to 12 of his written addendum to his outline submissions), culminating in the decisions under challenge amounted to a clear change or shift in policy required a fresh consultation exercise as a matter of straightforward procedural fairness.
133. Mr Bowen QC submitted that there was clearly no proper consultation in this case and submitted that, to the extent there may have been any informal discussions or the like, this was plainly insufficient: see the observations of Lord Woolf in R ~v~ North and East Devon Health Authority, ex parte Coughlan (2001) QB 213 at paragraph 108, where he said this:

"It is common ground that, whether or not consultation of interested parties and the public is a legal requirement, if it is embarked upon it must be carried out properly. To be proper, consultation must be undertaken at a time when proposals are still at a formative stage; it must include sufficient reasons for particular proposals to allow those consulted to give intelligent consideration and an intelligent response; adequate time must be given for this purpose; and the product of consultation must be conscientiously taken into account when the ultimate decision is taken."

134. I have no difficulty in accepting that YJB did not carry out any process of consultation of the type said to be required of it. Indeed, Miss White did not suggest that any such consultation had been carried out. It was her submission that the YJB was not under any duty to carry out any such consultation, whether by reason of implication from the statutes in question or as a matter of procedural fairness. I agree.
135. So far as concerns the suggested statutory implication, I agree with Miss White that, on analysis, the duty contended for is so lacking in specificity, both as to the intended consultees and the matters in relation to which consultation is required, as to be unworkable. As Miss White observed, it was precisely such a "conspectus of statutory provisions", set against "the need for specificity in a requirement of consultation" that led the Court of Appeal in R (Bapio Action) v Secretary of State for the Home Department (2007) EWCA (Civ) 1139 to conclude (at paragraphs 46-47) that no such duty arose in that case. As it seems to me, this is such a case and I reject Mr Bowen QC's submissions to the contrary effect.
136. As for the submission that YJB's prior practice and/or procedural fairness required that there should have been an appropriate consultation process before YJB embarked on the policy shift that resulted in the decision not to award contracts to Orchard Lodge and/or the Atkinson Unit, I agree with each of the following submissions by Miss White.

(1) The statement in paragraph 5 of YJB's Placement Policy upon which Mr Bowen QC relied (see paragraph 131 above) is no more than a statement of intention as to the operation of the placement system. It cannot and does not give rise to any legal duty as to the appropriate process for taking commissioning decisions.

(2) The Secure Estate Strategy was a policy document that set out assumptions and principles (i.e. a general strategy) upon which the YJB intended to develop the secure estate from 2005 to 2008. The language of the statements upon which Mr Bowen QC relied in particular did not represent a policy commitment by YJB that it would continue to fund placements in SCHs regardless of demand for such places. There was thus no policy shift as alleged. The decision not to award the contracts in question was not a strategic decision, it was a discrete operational decision of a fundamentally different nature and I accept the evidence of Mr Paul Bowers, the YJB's Director of Secure Accommodation, to that effect for the reasons that he gives (see paragraphs 6 to 12 of his witness statement dated 10^th July 2009).

(3) In any event, far from departing from the general strategy contained in the Secure Estate Strategy, the YJB followed it: it offered contract extensions to all SCHs which had been on short term contracts following the 2003 tendering exercise (see paragraph 10 of Mr Bowers' witness statement), which was precisely what it promised it would do. Thereafter, the YJB approached its commissioning on the basis that placements should meet need, consistent with its established approach as stated in the Secure Estate Strategy (see paragraphs 41 to 43 above).

(4) Accordingly, there was no promise or practice on the part of YJB that gave rise to any obligation on its part to carry out any consultation nor did procedural fairness require any such consultation.

137. As I have already indicated, I agree with Miss White's submissions as summarised in the previous paragraph. For all the foregoing reasons, therefore, I have come to the conclusion that this ground also fails.
138. (11) Lack of Transparency and Clarity in YJB's Placement Policy. Mr Bowen submitted that the change of wording in the YJB's 2004 and 2008 Placement Protocols from "assessed as vulnerable" in the 2004 protocol to "assessed as having significant risk factors" in the 2008 protocol (see respectively paragraphs 10 and 6.10 quoted in paragraphs 32 and 33 above, in particular with regard to the placement of 15-16 year old males) shows that the test for determining whether an individual meets the criteria for detention in an SCH/STC rather than in a YOI is insufficiently clear and transparent (particularly in the absence of any clear expression of how, why and to what extent YJB's assessment of vulnerability differs from that applied by YOTs) to meet the domestic principles of legality and the Strasbourg principle of lawfulness: see paragraphs 64-67 of the judgment in R (Nadarajah) v Secretary of State for the Home Department (2003) EWCA Civ 1768 and paragraph 65-69 of the judgment in R (Limbu) v MOD (2008) EWHC 2261 ("Limbu"), where the principle was stated thus (see paragraph 65):

"… the legal basis must be accessible and foreseeable. A rule's effects are foreseeable if it is formulated with sufficient precision to enable any individual – if needs be with appropriate advice – to regulate his conduct … the law must indicate the scope of any such discretion with sufficient clarity to give the individual adequate protection against arbitrary interference."

139. Furthermore, Mr Bowen also suggested that the change in wording may indicate an attempt by the YJB to set a more stringent criteria for the placement of 15-16 year old males. On either basis, Mr Bowen submitted that YJB's placement policy is unlawful and, in any event, the change in wording represents a change in policy of such significance that the YJB was obliged to consult interested stakeholders and to conduct appropriate EIAs.
140. For her part, Miss White pointed out that it is not suggested that the statutory test in section 23(5A) of the 1969 Act, with regard to 15-16 year old males, for the purpose of determining placement is insufficiently transparent or unclear: i.e. that "by reason of his physical or emotional immaturity or a propensity to harm himself, it would be undesirable for him to be remanded to a remand centre of a prison".
141. As Miss White observed, the Placement Protocols do not and could not alter the section 23(5A) statutory test and it is clear from the tables in the two protocols (quoted in paragraphs 32 and 33 above) that the "assessed as vulnerable" and "assessed as having significant risk factors" criteria are, in each case, precisely aligned with this clear and transparent statutory test, thus establishing their own clarity and transparency. Thus, in the 2004 Protocol "assessed as vulnerable" applies to both COSRs (where the assessment is made by the Court under section 23(5A) of the 1969 Act) and to Custodial Sentences (in relation to which the assessment is made by the YJB). Similarly, in the 2008 Protocol "assessed as having significant risk factors" applies equally to COSRs and custodial sentences.
142. I also accept that the assessment of vulnerability is necessarily a case sensitive judgment based on an appropriate assessment of a young person's physical and emotional state. In all the circumstances, I am satisfied that the Placement Protocols fulfil the need for a "delicate balance between rigidity and flexibility" (see the case of Limbu at paragraph 49). I also accept the evidence of Mr Minchin, who said this at paragraph 49 of his first witness statement:

"… vulnerability is a relative expression and covers a wide range of factors and needs. Moreover vulnerability can and does change on a daily basis depending on a number of factors that can influence and impact on the lives of young people both inside and outside of custody. For example a young person may receive a distressing phone call from a family member that could change their vulnerability status. Key to the YJB's placement decisions is the identification of a number of risk factors that may impact on the needs of young people. The YJB uses individual or a combination of those to identify the overall profile of a young person to determine the appropriate placement."

143. I agree with Miss White that the fact that a number of other factors come into play does not support a challenge to the placement policy on the basis of lack of clarity and/or transparency because these factors have always been clearly stated: see paragraph 8 of the 2004 Protocol and paragraph 6.6 of the 2008 Protocol.
144. I also agree that YJB's position is supported by the fact that Mr Bowen originally accepted that if the change of wording from "vulnerable" to "significant risk factors" was no more than an attempt to define vulnerability more precisely, then the placement policy was not susceptible to challenge (see the struck-through paragraph 26 of the Re-Amended Grounds). On this aspect of the matter, I accept the evidence of Mr Minchin, who explained, in paragraphs 57 to 59 of his first witness statement, that the change in wording was made in 2008 in an attempt to explain more clearly what "if assessed as vulnerable" in the 2004 Protocol meant: i.e. an assessment by reference to identified risk factors. In other words "if assessed as vulnerable" in the table in the 2004 Protocol meant "if assessed as having significant risk factors". There is no conflict between the two protocols; the wording was simply changed in order to be clearer. There was thus no attempt to introduce a more stringent criterion and no change of policy requiring consultation and EIAs.
145. For the foregoing reasons, I am satisfied that the YJB's placement policy does not lack the necessary clarity and transparency, nor is it unlawful for any of the other reasons put forward by Mr Bowen. Accordingly, this ground of challenge also fails. In the circumstances, although I acknowledge the force of Miss White's submissions, I do not consider it necessary to deal with her further point that this challenge is essentially an academic one in all the circumstances of this case.

Conclusion

146. For all the foregoing reasons, I have come to the firm conclusion that each of the grounds of challenge to the decision in question fails. It follows that each of these applications must be and is hereby dismissed.