Select Committee on Delegated Powers and Deregulation Second Report


SECOND REPORT


15 DECEMBER 1999

By the Select Committee appointed to report whether the provisions of any bill inappropriately delegate legislative power, or whether they subject the exercise of legislative power to an inappropriate degree of parliamentary scrutiny; to report on documents laid before Parliament under section 3(3) of the Deregulation and Contracting Out Act 1994 and on draft orders laid under section 1(4) of that Act; and to perform, in respect of such documents and orders, the functions performed in respect of other instruments by the Joint Committee on Statutory Instruments.

LOCAL GOVERNMENT BILL [HL]

INTRODUCTION

1.  This bill covers many different aspects of local government law and contains many delegated powers. A number of the powers in the bill have been considered by the Committee last session in its pre-legislative scrutiny of the powers contained in the draft Local Government (Organisation and Standards) Bill.[1] This report describes briefly all the powers in the bill and indicates which of these the Committee has seen before (and where there have been changes, mentions those).

2.  The Department's Memorandum states that the Government is already proposing to table a number of amendments to the bill at committee stage which will confer new powers or affect powers already in the bill. We do not think it satisfactory to proceed in this way. The Committee can only properly assist the House when there is time for the Committee to consider provisions in the context of the bill as a whole before the House has to do so. The proposals may significantly affect the delegated powers in the bill but we cannot comment on them until we have seen the amendments. The House will expect these to be tabled in time for the Committee to be able to advise the House on them before they are considered in Committee - this is the timescale we recommended in our special report for 1998/99 and which was accepted on behalf of the Government by Lord Carter.

Clause 3

3.  Clause 2 is a new statement of the general powers of a local authority. Subsection (3) of clause 3 allows the Secretary of State to cut back these general powers by order specifying activities which a local authority may not undertake. This is obviously a wide-ranging power and the bill does not indicate how it is to be used. The Memorandum describes the power as "a reserve power to exclude particular activities where wider interests might need to be protected" and adds that an amendment will be brought forward to make the power subject to the draft affirmative procedure (in place of the negative procedure which the bill applies at present). The House will wish to consider whether affirmative procedure meets concerns about the width of the power or whether the purpose of preserving the balance between local and wider interests should appear on the face of the bill.

4.  The Committee notes that subsection (4) of the clause requires local authorities to have regard to any guidance issued by the Secretary of State before exercising a power under clause 2(1). Subsection (5) requires the Secretary of State to consult before issuing guidelines.

Clause 5

5.  The clause confers a Henry VIII power on the Secretary of State - a power by order to amend, repeal or revoke any enactment that he thinks "prevents or obstructs local authorities from exercising their power under [clause] 2(1)". This is a wide power which would have troubled the Committee if it had not been made subject to affirmative procedure by clause 69(5) and the special procedure set out in clause 8 (see below). The Memorandum says that the Government may wish to bring forward an amendment, on the lines of clause 6(4), to allow temporary provision to be made.

Clause 6

6.  This clause also creates a Henry VIII power subject to affirmative procedure and the special procedure set out in clause 8 (see note below). Subsection (1) allows the Secretary of State to amend, repeal or disapply any enactment which "requires a local authority to prepare, produce or publish any plan or strategy relating to any particular matter". Subsection (2) allows the power to be exercised in relation to a particular authority. An order dealing with the powers of a particular authority would be a hybrid instrument and so would have to be referred to the House's Hybrid Instruments Committee. To avoid that, subsection (5) provides that such an order is not to be treated as a hybrid instrument. The Committee notes that such exclusory provisions have been criticised on the floor of the House in the past, but considers this example justified as the local authority concerned will be consulted under clause 8.[2]

Clause 8

7.  The powers conferred by clauses 5 and 6 are Henry VIII powers which are potentially wide ranging. This is recognised in the Memorandum which concedes that "Parliament will rightly expect [the power in clause 5] to be subject to rigorous scrutiny procedures" (paragraph 52) and that similar considerations apply to clause 6 (paragraph 60). Clause 8 provides scrutiny procedures (and clause 69(5) applies affirmative procedure).

8.  Subsection (1) of clause 8 requires consultation. Subsection (2) requires the Secretary of State to lay before each House a document setting out his proposals and an account of the consultation together with a draft order. Subsection (3) gives Parliament 60 days (defined in subsection (4)) to consider the proposals before a draft order can be laid for approval. Subsection (5) requires the Secretary of State to consider any representation made during the 60 days. Subsection (6) requires a statement to be laid with the final draft order giving details of any representation and of any changes made to the proposals laid before Parliament earlier.

9.  The Committee considers that without the constraints in clause 8 it would be impossible to accept that the wide powers in clauses 5 and 6 were appropriate. But the scrutiny procedure in clause 8, which is not dissimilar to that governing deregulation orders, together with affirmative procedure, satisfies the Committee that the delegation is appropriate and that Parliament will have appropriate control over the exercise of the powers.

Clause 10 (DRAFT clause 2)

10.  Subsection (5) allows the Secretary of State to make regulations creating an additional form of local authority executive. Subsection (6) lists matters which can be dealt with in the regulations. Affirmative procedure is applied by clause 69(4). That Subsection (6) illustrates ways in which the power could be used and if these were the only ways, the Committee would have no hesitation in advising that delegation is appropriate, but subsection (5) is not so confined and we are concerned at the delegation of a power wide enough to allow the creation of a wholly novel form of local government. Paragraph 74 of the Department's memorandum describes the power in these terms:-

"This is an enabling power to allow any new forms of executive identified in future, as a result of local authorities working with new arrangements, to be made legally available to local authorities. There is no intention for this power to be used in the near future."

We expressed no reservations about this power when we considered it as part of our pre-legislative scrutiny but we now consider that we should invite the House to consider whether the power should be circumscribed to reflect what is said in the memorandum so as to ensure that the power can only be exercised after consultation with local authorities and with their consent.

11.  Subsection (9) confers power by regulations to amend subsection (8) of the clause to reduce the limit of 10 which that subsection places on the number of members of a local authority executive which takes the form specified in subsection (2) or (3). This is a Henry VIII power but it is extremely limited and the Committee accepted that negative procedure (applied by clause 69(4)) was appropriate when it reported on the draft bill.

Clause 11 (draft clause 3)

12.  Clause 9 defines "executive arrangements". In effect they are arrangements relating to an executive with responsibility for the executive functions of a local authority. Clause 11(1) allows the Secretary of State to make regulations determining which functions of a local authority are executive functions. Regulations will specify functions which may not be the subject of executive arrangements and functions which may (but need not be) the subject of those arrangements. Any function not mentioned in regulations is an executive function as is, for a particular authority, such functions specified in the "optional list" in the regulations as the local authority chooses to discharge as executive functions.

13.  Clauses 12 to 14 make provision in relation to the way in which a local authority executive is to be responsible for executive functions. Clause 11(3) allows regulations to specify circumstances in which executive functions must be discharged by the authority and not in accordance with clause 12, 13 or 14.

14.  The combined effect of subsections (1) and (3) of clause 11 appears to be that regulations will determine which functions must be discharged by the authority itself and not its executive. Regulations are subject to negative procedure.

15.  The Memorandum states that the Government will bring forward an amendment to clause 11(1) to include an additional power to specify functions which must be discharged by the full council.

16.  The Memorandum promises that draft regulations will be available before the Lords Committee stage.

Clause 15 (draft clause 7)

17.  This clause provides for the establishment of overview and scrutiny committees to oversee the work of the executive. Subsection (5) allows the Secretary of State to make regulations (subject to negative procedure) dealing with the operation and functions of these committees.

Clause 22 (draft clause 14)

18.  Subsection (1) provides that the Secretary of State may make regulations requiring a local authority which receives a petition signed by not less than 5% of the electors requesting a referendum on whether the local authority should have an executive with an elected mayor "to hold such referendum in such circumstances as may be prescribed in the regulations". This is expanded by subsections (2), (3) and (4) which list some of the matters which could be prescribed.

19.  Subsection (5) allows regulations to amend subsection (1)(a) i.e. to alter the requirement that 5% of the electors support the petition.

20.  The Memorandum states that the Government will bring forward amendments to extend this power to circumstances where the petition requests a directly elected mayor (with or without specifying the form of executive to go with the mayor); to allow regulations to specify how the 5% threshold is to be calculated; and to allow various new kinds of petition (eg. telephone voting and electronic signatures).

21.  The Memorandum also explains that the Government intend to introduce a bill creating an Electoral Commission and that when it has been introduced, the government will come forward with amendments to the Local Government Bill requiring the Commission to be consulted about any regulations to be made under clauses 22 to 24, 29, 30 and 32.

22.  Regulations under the clause are subject to negative procedure and the Committee accepted that this was appropriate when we reported on the draft bill. We are conscious that the absence of limits on the face of the bill raises the theoretical prospect of regulations lowering the barrier to a derisory level or raising it to an unattainable one. But we do not see this as at all likely and the proposed requirement to consult the new Commission will provide an additional guard against unreasonable changes.

Clause 23 (draft clause 15)

23.  Subsection (1) allows the Secretary of State to make regulations requiring a local authority to hold a referendum on whether there should be an executive with an elected mayor. Subsections (2) to (4) cover provisions that can be included in the regulations. Negative procedure applies.

24.  The Memorandum states that amendments to this clause are planned. One amendment will allow the Secretary of State to direct an individual authority to hold a referendum on any of the forms of executive. Another will allow him to require all authorities, or authorities of a specified class or description, to hold a referendum on any of the forms of executive. That power will extend to dealing with the position which will arise if a referendum held under it rejects the proposal - in such event the Secretary of State may require the authority concerned "to draw up, consult on and implement proposals for a different form of executive ..." (para. 124).

Clause 26 (draft clause 18)

25.  This clause allows the Secretary of State to make regulations as to the timing of elections of elected mayors, their term of office and the filling of vacancies. Clause 25(2) provides that the term of office of an elected mayor is to be four years unless regulations provide otherwise. Regulations are subject to negative procedure. The Memorandum (paragraphs 132 to 136) explains the thinking behind this clause and justifies its description of the power as concerned with transitional and administrative matters. While the language of the clause is wide enough to enable significant extensions to be made to the normal period of office of a mayor, for reasons similar to those we have given in relation to clause 22 we still consider that negative procedure is appropriate.

Clause 29 (draft clause 21)

26.  This clause provides for regulations to make provision about elections to the office of mayor. Subsections (2) and (3) list provisions which may be made by regulations and these include creating offences in connection with election expenses (subsection (2)(c)) and amending any enactment relating to the registration of electors (subsection (3)(c)). As the latter is a Henry VIII power, the Committee considers it satisfactory that the regulations are subject to affirmative procedure.

Clause 30 (draft clause 22)

27.  Subsection (3) allows the Secretary of State by regulations to make provision as to the conduct of referendums. Subsections (4) to (6) supplement subsection (3). Regulations are subject to affirmative procedure. Similar provisions have appeared in other bills which have come before the Committee, and the Committee considers these appropriate.

Clause 31

28.  This clause confers power by order to make "such incidental, consequential, transitional or supplemental provision" as the Secretary of State "considers necessary or expedient for the purposes of, in consequence of, or for giving full effect to, any provisions in this Part." Negative procedure applies. The memorandum explains the need for the power which extends to local Acts.

Clause 32 (draft clause 23)

29.  This confers a power by order to make modifications of enactments "which are no more than necessary to give full effect to any provision of this Part". This includes repealing or revoking enactments (subsection (2)(c)). This Henry VIII power is subject to affirmative procedure.

Clause 34 (draft clause 25)

30.  Subsection (1) of this clause allows the Secretary of State by order to "specify the principles which are to govern the conduct of members of relevant authorities in England". Subsection (3) lists those the Secretary of State must first consult. An order is subject to affirmative procedure.

31.  Subsections (2) and (4) make similar provision for Wales.

Clause 35 (draft clause 26)

32.  Subsection (1) of this clause allows the Secretary of State by order to issue a "model code as regards the conduct which is expected of members of relevant authorities". An order is subject to negative procedure. Subsections (2) to (6) make related provision covering, for example, consistency with the principles laid down under clause 34, consultation and an invitation to representative bodies to draw up a proposed model code.

33.  The clause also makes similar provision for Wales.

Clause 38 (draft clause 29)

34.  Subsection (5) allows the Secretary of State to make regulations about the size and composition of standards committees, their membership and proceedings. Negative procedure is applied. (The power has been slightly widened since appearing in the draft bill but the Committee did not find it necessary to reconsider its judgement.)

35.  Subsection (6) makes similar provision for Wales.

Clause 39 (draft clause 30)

36.  Subsection (4) allows the Secretary of State to make regulations with respect to the exercise of functions by standards committees. Negative procedure is applied.

37.  Subsection (5) makes similar provision for Wales.

Clause 40 (draft clause 31)

38.  This clause establishes a Standards Board for England and another for Wales. Subsection (5) provides that the Secretary of State may by order confer functions on the Standards Board for England. An order is subject to negative procedure. (The clause now sets out the basic functions of the Board but the change does not require the Committee to reconsider its judgement.)

39.  Subsection (7) makes similar provision for Wales.

Clause 51 (draft clause 40)

40.  The clause is concerned with adjudication by case tribunals. Subsection (2) allows the Secretary of State by regulations to "make such provision as appears to him to be necessary or expedient" with respect to such adjudications. Subsection (4) gives example of the kind of provision which might be made (see, for example, paragraphs (a) witnesses and oaths, (c) procedure and (d) costs). Negative procedure is applied. (Subsection (4)(c)(ii) is new but does not require the Committee to reconsider its judgement.)

41.  Subsections (3) and (4) make similar provision for Wales.

Clause 53

42.  This clause allows the Secretary of State to make regulations about the disclosure and registration of the interests of members of local authorities. Negative procedure is applied.

Clause 54 (draft clause 42)

43.  Subsection (1) allows the Secretary of State by order to issue a code of conduct for local government employees in England. The order is made subject to negative procedure.

44.  Subsection (2) makes similar provision for Wales.

45.  There are consultation requirements in subsections (3) and (4).

Clause 58

46.  Clause 57 provides three options for local elections (a) all councillors retire together and elections are held every four years, (b) one half retire in each election year and elections are held every other year (c) one third retire in each election year, elections being held in three years out of four.

47.  Clause 58 allows the Secretary of State to specify by order which option is to apply to a specified council or to councils within a special description. Subsections (2) to (7) make supplementary provision. Negative procedure is applied, which the Committee considers appropriate.

Clause 59

48.  Subsection (1) allows the Secretary of State by order to change the years in which the ordinary elections of councillors of a specified local authority are to be held. Such an order does not change the electoral option that applies in that area. Negative procedure applies, which the Committee considers appropriate. An authority may be specified by name or as falling within a class or description.

Clause 60

49.  If the Secretary of State makes an order under clause 58 or 59 there will be transitional provisions which have to be made. These could be included in that order by virtue of clause 69(2) but clause 60 confers an independent power, subject to negative procedure, to make such provisions. The memorandum explains the need for belt and braces saying, in effect, that the need for action may not be discovered until the primary order has been made and that at that point it is doubtful if clause 58 or 59 could be invoked to make a further order.

Clause 64

50.  This clause provides for grants to local authorities for welfare services. Subsection (8) refers to guidance and subsection (9) to direction given by the Secretary of State or the Welsh Assembly. There is nothing here that the Committee wishes to draw to the attention of the House.

Clause 66

51.  This clause allows regulations to make provision for allowances and pensions for local authority members. Negative procedure applies, which the Committee considers appropriate.

52.  The Memorandum states that amendments to this clause will be tabled. The aim is to place on the face of the bill much which is at present left to regulations leaving the scope of those regulations "significantly narrower." Clearly this is to be welcomed. The Memorandum promises "a supplementary memorandum" when the amendments are tabled.

Clause 67

53.  The clause deals with social services functions of local authorities. Subsection (3) inserts a new section 6(6A) in the Local Authority Social Services Act 1970 and paragraph (b) of that allows the Secretary of State to designate by order additional functions which are to be regarded as social services functions for the purpose of that Act. Negative procedure is attracted by an amendment in Schedule 4. This clause is not mentioned in the Memorandum.

Clause 69

54.  This clause deals with orders and regulations under the bill. Subsection (2) allows any order or regulation under the bill to make incidental, consequential, transitional or supplementary provision; to modify enactments; and to make different provision for different circumstances. Subsection (3) expands the power to modify enactments, in particular paragraph (c) allows the amendment or repeal of any enactment. The Memorandum describes the effect of this clause but makes no attempt to explain why it is needed. The Committee wishes to draw the House's attention to the width of this power the only restriction on it being that any amendment or repeal must be no more than necessary to give full effect to the order or regulations to which it is attached. The House may wish to consider whether, if the power is used to amend or repeal enactments, the order or regulations should be subject to affirmative procedure.

Proposed New Powers

55.  The Memorandum states that it is proposed to table amendments adding four new powers to the bill - two in Part II and two in Part III. The relevant paragraphs are 158 to 163 and 204 to 207. The Committee considers it premature to discuss the proposals at this stage.

Recommendations

56.  The Committee invites the House to consider whether concern about the width of the power in clause 3(3) will be met by the promised Government amendment to apply affirmative procedure or whether the purpose of maintaining a proper balance between local and wider interests should be written into the bill. We also draw attention to the power in clause 10(5) to create a new form of local authority executive and invite the House to consider whether the bill should require local authorities to be consulted before any regulations are made under the power. The House may also wish to consider whether it is appropriate that changes to the Statute Book made under clause 69 should be subject to negative procedure as the bill provides. There is nothing else in the bill which the Committee wishes to draw to the attention of the House.

57.  The Government propose to move many amendments affecting powers in the bill and some adding four new powers to it. The Committee must reserve its position on these amendments until it has seen them. The Government's intention in this regard emphasises once again the importance of tabling amendments in time for the Committee to comment on them before the House has to consider them.


1   23rd report, session 1998-99, HL Paper 86. Back

2   In our special report for last session, which has not yet been considered by the Liaison Committee, the Committee suggested that there was an issue for the House as a whole to consider as to whether there is still a need to make special provision for considering affirmative instruments which affect private or local interests. (Special report, session 1998-99, HL Paper 112, paragraphs 49-52.) Back


 
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