Select Committee on Delegated Powers and Deregulation Sixteenth Report



PART III: Financial provisions

CLAUSE 71 - PROVISIONS SUPPLEMENTAL TO SECTION 70

Subsection (5) Provides that the Secretary of State for the Environment Transport and the Regions will be able to amend, by regulation, the rules governing the calculations of the budget requirement.

Purpose To enable the Secretary of State for the Environment, Transport and the Regions to amend the rules governing the calculations of the budget requirement, for example, to change the items to be treated as expenditure and income in the calculation of the budget requirement. Thus the Secretary of State may decide that certain grants should be treated as income within the narrow definition in clause 70(5)(a) or should be added to the list set out in clause 70(5)(a) (i) to (iii) of sums not to be taken into account when calculating budget requirements, when previously the grants were to be treated differently in budget requirement calculations.

Reason for proposing delegated powers Changes to the rules governing calculations of the budget requirement by billing authorities and other major precepting authorities are normally made under delegated powers (sections 32(9) and 43(7) of the Local Government Finance Act 1992 respectively).

Parliamentary procedure Negative resolution procedure.

SCHEDULE 5 - Procedure for determining the Authority's consolidated budget requirement

Paragraph 10 Enables the Secretary of State to substitute, by regulations, other dates for the date by which the Mayor must present the draft consolidated budget to the Assembly (1 February), and the date by which the Mayor must present the final draft budget to the Assembly (before the last day of February).

Purpose To enable the Secretary of State to change the dates by which the Mayor must present the draft consolidated budget and final draft budget to the Assembly to take account of any delay in the announcement of the Local Government Finance Settlement.

Reason for proposing delegated powers To take account of any delay to the annual Local Government Finance Settlement that may adversely affect the Mayor's ability to produce a draft consolidated budget, or final draft budget, by the specified dates. The Local Government Settlement is usually announced in late January or early February in time for authorities to set their budgets for the next year. The Secretary of State usually announces a provisional Finance Settlement in late November or early December of the preceding year. If the announcement of the Settlement is delayed significantly, the Mayor will be able to take account of it in his draft budgets only if the date by which he must present them to the Assembly is changed.

Procedure Negative resolution procedure.

CLAUSE 73 - CALCULATION OF BASIC AMOUNT OF TAX

Subsection (3) Enables the Secretary of State for the Environment, Transport and the Regions to specify, by regulation, those parts of various grants to be paid to the authority which relate to the provision of non-police services.

Purpose To enable the authority to carry out calculations for the amount of council tax in respect of non-police services.

Reason for proposing delegated powers Since the authority only provides police services over a part of its area (it will not provide police services in the City of London), it is necessary to make two precept calculations, one for police services and the other for non-police services. The authority needs to know how to divide up various grants between police and non-police services in order to carry out these two calculations. The amounts for non-police services have to be specified anew for each financial year since they will vary from year to year.

Procedure Negative resolution procedure.

Subsection (6) Enables the Secretary of State for the Environment, Transport and the Regions to specify, by regulation, rules for calculating the taxbase for the whole GLA area.

Purpose To enable the Secretary of State for the Environment, Transport and the Regions to amend the existing Statutory Instruments setting out the taxbase rules. The Statutory Instruments need to refer to the GLA and the relevant parts of the GLA Bill.

Reason for proposing delegated powers The existing taxbase rules are made under delegated powers.

Procedure Negative resolution procedure.

Subsection (8) Enables the Secretary of State for the Environment, Transport and the Regions to amend, by regulation, the rules and procedures for calculating the basic amount of tax.

Purpose To enable the Secretary of State for the Environment, Transport and the Regions to amend the calculation of the basic amount of tax to allow for additional sources of grant income.

Reason for proposing delegated powers To provide for new sources of grant income. The proposed powers are wider than the existing delegated powers in respect of other precepting authorities. This is because of the greater likelihood of new sources of grant income for the GLA plus the need to accommodate the GLA only providing police services over a part of its area.

Procedure Negative resolution procedure.

CLAUSE 74 - ADDITIONAL CALCULATIONS WHERE SPECIAL ITEM RELATES TO PART ONLY OF GREATER LONDON

Subsection (5) Enables the Secretary of State for the Environment, Transport and the Regions to specify, by regulation, those parts of various grants to be paid to the authority which relate to the provision of police services.

Purpose To enable the authority to carry out calculations for the additional amount of council tax for police services supplied over only a part of the GLA area.

Reason for proposing delegated powers Since the authority only provides police services over a part of its area it is necessary to make two precept calculations, one for police services and the other for non-police services. The authority needs to know how to divide up various grants between police and non-police services in order to carry out these two calculations. The amounts for police services have to be specified anew for each financial year since they will vary from year to year.

Procedure Negative resolution procedure.

Subsection (7) Enables the Secretary of State for the Environment, Transport and the Regions to specify, by regulation, rules for calculating the taxbase for the part of the GLA area in which the GLA provides police services.

Purpose To enable the Secretary of State for the Environment, Transport and the Regions to amend the existing Statutory Instruments setting out the taxbase rules. The Statutory Instruments need to refer to the GLA and the relevant parts of the GLA Bill.

Reason for proposing delegated powers The existing rules are made under delegated powers.

Procedure Negative resolution procedure.

Subsection (9) Enables the Secretary of State for the Environment, Transport and the Regions to amend, by regulation, the rules and procedures for calculating the additional amount of council tax for police services supplied over only a part of the GLA area.

Purpose To enable the Secretary of State for the Environment, Transport and the Regions to amend the calculation of the additional amount of council tax for police services supplied over only a part of the GLA area to allow for additional sources of grant income.

Reason for proposing delegated powers To provide for new sources of grant income. The proposed powers are wider than the existing delegated powers in respect of other precepting authorities. This is because of the greater likelihood of new sources of grant income for the GLA plus the need to accommodate the GLA only providing police services over a part of its area.

Procedure Negative resolution procedure.

CLAUSE 79 - SUBSTITUTE CALCULATIONS UNDER SECTION 49 OF THE 1992 ACT

Subsection (4C) Enables the Secretary of State for the Environment, Transport and the Regions to specify, by regulation, the division of any new additional grant into a part relating to the provision of police services and a part relating to the provision of non-police services.

Purpose To enable the authority to carry out substitute calculations for the basic amount of council tax for non-police services and the additional amount of council tax for police services.

Reason for proposing delegated powers Since the authority only provides police services over a part of its area it is necessary to make two precept calculations, one for police services and the other for non-police services. When the authority is making a substitute calculation it needs to know how to divide up any new additional grant between police and non-police services in order to carry out these two calculations. The amounts for police and non-police services have to be specified anew for each new additional grant.

Procedure Negative resolution procedure.

CLAUSE 80 - MINIMUM BUDGET FOR METROPOLITAN POLICE AUTHORITY

Subsection (2) Gives the Secretary of State a reserve power of direction to set a minimum level for the Metropolitan Police Authority's (MPA's) budget.

Purpose To enable the Secretary of State to specify a minimum level for the MPA's budget if he considers that the budget set by the GLA for the MPA is too low to enable the MPA to maintain an efficient and effective police force. The level can only be the minimum the Secretary of State considers necessary to do this.

Reason for proposing delegated powers To ensure that service standards for the police force in London are maintained at satisfactory levels. This power is similar to the Home Secretary's power to set minimum budgets for police authorities outside London.

Procedure Negative resolution procedure.

Subsection (10) Enables the Secretary of State for the Environment, Transport and the Regions to specify, by regulation, the division of any new additional grant into a part relating to the provision of police services and a part relating to the provision of non-police services.

Purpose To enable the authority to carry out substitute calculations for the basic amount of council tax for non-police services and the additional amount of council tax for police services when a Secretary of State specifies a minimum level for the MPA's budget.

Reason for proposing delegated powers Since the authority only provides police services over part of its area it is necessary to make two precept calculations, one for police services and the other for non-police services. When the authority is making a calculation, it needs to know how to divide up any new additional grant between police and non-police services in order to carry out these two calculations. The amounts for police and non-police services have to be specified anew for each new additional grant.

Procedure Negative resolution procedure.

CLAUSE 101 - AMORTISATION

Subsection (1) Enables the Secretary of State to make regulations which would require amortisation periods to be specified when issuing aggregate and additional credit approvals.

Purpose An amortisation period is a period over which the local authority using the credit approval must set aside amounts out of revenue sufficient to repay any credit liabilities (including borrowing) incurred on the strength of the approval. The power would enable the Secretary of State to determine an amortisation period in relation to the use of the approval for different purposes or different amounts, and to specify the method of determining the amounts required to be set aside.

Reason for proposing delegated powers Provisions on amortisation apply in relation to other local authorities by virtue of sections 53 and 54 of the Local Government and Housing Act 1989. Clause 101(1) makes equivalent provision in relation to the GLA and the functional bodies. No regulations have been made under section 53 or 54 of the 1989 Act, and there are no plans to make regulations under clause 101(1). But this power would allow the Secretary of State to impose an amortisation period if that became necessary for financial reasons, and it corresponds with the power he has for other local authorities.

Procedure Negative resolution procedure. This is the procedure provided for regulations under sections 53 and 54 of the Local Government and Housing Act 1989.

CLAUSE 104 - POWER TO REDISTRIBUTE CAPITAL RECEIPTS OF FUNCTIONAL BODIES

This clause enables the Secretary of State to make regulations to confer on the Mayor power to direct the payment to the GLA by a functional body of part of the body's usable capital receipts.

Purpose To allow the Secretary of State to make regulations to enable the Mayor to direct a functional body to pay him part of its usable capital receipt. Amounts paid to the Mayor under such a direction could only be used to meet capital expenditure of another functional body or the GLA.

Reason for proposing delegated powers Capital finance controls will apply to the GLA and each of the functional bodies independently, and each will therefore retain their own capital receipts. This power provides a mechanism to enable the Mayor to redistribute a proportion of functional bodies' capital receipts should this at some time in the future become necessary to ensure an efficient use of receipts across the GLA and the functional bodies as a whole.

Procedure Negative resolution procedure.

CLAUSE 119 - SUMMARY STATEMENT OF ACCOUNTS OF AUTHORITY AND FUNCTIONAL BODIES

The Authority and the functional bodies are under clause 118 brought within the provisions of the Audit Commission Act 1998 with regard to the keeping of accounts and the audit of these accounts. Clause 119 provides for a summary statement of account to be drawn up in respect of the Authority and the functional bodies.

Subsection (6) Provides that section 27 of the Audit Commission Act 1998 (accounts and audit regulations) shall apply in relation to any summary statement of accounts as it applies in relation to accounts or statement of accounts.

Purpose To allow the Secretary of State to make regulations with respect to the form, preparation, certification and deposit of the summary statement of accounts, the publication of information relating to it and the exercise of rights of inspection conferred by the application of section 14 of the 1998 Act by subsection (4)of this clause.

Reason for proposing delegated powers To make regulations regarding the detailed content and conditions for the summary statement of account, which the Authority will prepare covering the Authority and the functional bodies, and which will reflect the detailed provisions applying to accounts and statements generally. Regulations can be revised to take account of developments in accounting and audit practice.

Procedure Negative resolution procedure.


 
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