Select Committee on Delegated Powers and Deregulation Third Report


Supplementary Memorandum by the Department of the Environment, Transport and the Regions

INTRODUCTION

1.  The Delegated Powers and Deregulation Committee has already given its opinion on the Local Government Bill in its report of 15 December (HL Paper 16 (Session 1999-2000: 2nd Report)). On Part II of the Bill, it concluded that the House should consider whether the power on clause 10(5) should be exercised only after consultation with local authorities and with their consent. This was the only comment on Part II.

2.  However, the Department's Memorandum to the Committee recognised that a number of the enabling powers in the Bill could develop further and a number of specific developments were foreshadowed in the Government's response to the report of the Joint Committee (Cmnd 4529) which reviewed the draft Bill.

3.  Government amendments have now been tabled on Parts II and V of the Bill for the Committee stage. A numbered copy of the amendments as they were offered to the Public Bills Office is attached [not printed] and the rest of this Memorandum uses that numbering. (In the event, the PBO took the view that six of the amendments were trivial matters which could be picked up in printing if the House approves the associated amendments).

4.  This further Memorandum to the Committee deals with those powers that would, if the House makes such amendments, change from their current shape in the introduction print of the Bill and those which would be new powers.

TYPE OF PARLIAMENTARY SCRUTINY

5.  Where the amendment proposes a revision to one of the powers already in the Bill, the form of Parliamentary scrutiny remains the same as in the introduction print of the Bill. Those powers are:

  • Discharge of functions (clause 11, amendment 8) in forms of constitution set out in clause 10;
  • Petitions (clause 22, amendments 75, 79, 80, 91 and 92);
  • Power to direct referendums in circumstances set out in regulations (clause 23, amendments 105 and 106);
  • Guidance (clause 24, amendment 109); and
  • Allowances (clause 66, amendment 121).

6.  However, there are also the following new powers proposed:

  • Discharge of functions (first new clause after clause 14, amendment 39) in forms of constitution provided for by regulations under clause 10(5);
  • Discharge of functions by area committees (second new clause after clause 14, amendment 40);
  • Discharge of functions by another authority (third new clause after clause 14, amendment 41);
  • Joint exercise of functions with another authority (fourth new clause after clause 14, amendment 42);
  • Access to meetings and information (new clause after clause 15, amendment 54);
  • Consultation and content of proposals (clause 18, amendments 57, 58 and 60);
  • Deadline for proposals (clause 18, amendment 61);
  • Fall-back proposals (clause 19, amendment 68);
  • Changing executive arrangements (clause 21, amendment 71);
  • Alternative arrangements for fall-back options (first new clause after clause 21, amendment 72);
  • Changing alternative arrangements (second new clause after clause 21, amendment 73);
  • Power to order similar referendums to be held by a number of authorities (first new clause after clause 23, amendment 107;
  • Information on constitutions (second new clause after clause 23, amendment 108;
  • Elected mayors (clause 25, amendment 111); and
  • Assistants (schedule 1, amendment 135).

7.  The Government has adopted the same criteria in determining its proposals for the Parliamentary scrutiny of instruments made under these powers as was adopted for those in the introduction print of the Bill. Where an instrument is likely to have a material impact or contain significant modifications to primary legislation (or secondary legislation subject to the draft affirmative procedure) it is proposed that that instrument should be subject to the draft affirmative procedure. The only one of these new powers which falls into this category, in the Government's view, is that proposed in the first new clause after clause 21 (amendment 72).

8.  The proposed amendments also include some powers for the Secretary of State to make directions. These are to be found in amendments 58, 60, 68, 94 and 108. They cover circumstances in which Government wishes the Secretary of State to have the power to react to developing local circumstances in a defined way or where the power covers a point of largely administrative detail.

9.  It is proposed that the remaining powers sought in these amendments should be subject to negative resolution.

ARRANGEMENTS FOR WALES

10.  All the proposed or amended powers will be exercisable by the National Assembly for Wales.

THE POWERS

Discharge of functions (clause 11)

11.  Amendment 8 substitutes a new clause for clause 11. The new clause has modified regulation making powers and a new power (in subsection (12)) which was foreshadowed in the Department's original Memorandum to the Committee (paragraphs 84 to 86).

12.  The reshaping of this clause was necessary to give full effect, in the light of the complexity of some provisions in the statute book relating to the discharge of local authority functions, to the policy set out in Local leadership local choice (Cmnd 4298). Broadly, that is that the full council should set the budget and policy of the authority, that the executive should propose them, and that it should implement them - except for planning and licensing functions.

13.  As the Department indicated in its original Memorandum, the large number of functions involved, and the frequency with which they change, means that regulations provide the only realistic mechanism for these provisions. In view of the largely administrative and technical nature of these, the Government takes the view that the negative resolution procedure is appropriate.

Discharge of functions under new forms of executive

14.  Amendment 39 introduces a new clause which enables the Secretary of State to make regulations which define how any executive provided for under clause 10(5) may set out its delegations and operate. The key features of the new form of executive will be set out in the regulations under clause 10(5), which are subject to the draft affirmative procedure. Regulations under this provision would make consequential provision equivalent to provisions of clauses 12 to 14. The Government therefore believes the negative resolution procedure would be appropriate to this power.

Area committees

15.  Amendment 40 introduces a new clause which will enable the Secretary of State to make regulations enabling delegation of functions of an executive to area committees of that authority. It will also, if necessary, enable the Secretary of State to place some constraints on the ability of executives to delegate in this way if the clear accountability of the executive for its functions would otherwise be at risk.

16.  This arrangement was foreshadowed in the Department's original Memorandum to the Committee (paragraphs 158 to 161). As detailed technical provisions will be necessary to deliver the policy the Government believes they are appropriate to regulations subject to the negative resolution procedure.

Discharge of functions by another authority

17.  Amendment 41 introduces a new clause containing powers to enable an executive of a local authority to delegate the discharge of functions to another authority and making provision with respect to how those functions should be discharged, depending upon whether they are executive functions and whether either or both authorities are operating executive arrangements.

18.  The provisions will be complex but are merely designed to ensure that authorities operating executive arrangements under this legislation may continue to act in ways that are possible now under section 101 of the Local Government Act 1972. The Government therefore believes the negative resolution procedure would be appropriate to this power.

Joint arrangements

19.  Amendment 42 introduces a new clause containing a power to make regulations to govern the joint exercise of functions by local authorities one or more of which are operating executive arrangements. The nature of and reasons for these provisions will be similar to those under the power discussed above. The Government therefore believes the negative resolution procedure would also be appropriate to this power.

Access to information

20.  Amendment 54 inserts a new clause which enables the Secretary of State to make regulations about the access to information regime which would apply to meetings of the executive and its committees and to decisions taken by individual members of the executive. The regulations would relate to public access to meetings of the executive, to the recording and publishing of executive decisions, the reasons for those decisions and the background papers considered by the executive in reaching its decisions. The regulations would also be able to provide for an offence relating to the failure to ensure a decision is properly recorded or to ensure that such a record was made publicly available.

21.  The purpose is to make provision based very closely on Part VA of the Local Government Act 1972 but which makes provision for access to the information mentioned in the previous paragraph to councillors outside the executive and to the public to ensure that decision taking is transparent and accountable.

22.  The regulations will provide for minutes, papers, background papers, records of decisions and the reasons for those decisions to be made publicly available. The proposed criminal offences will also relate very closely to that in Part VA of the Local Government Act 1972 which applies in cases where public access is obstructed to such documents or where the public is refused copies of documents. However, an offence is proposed where an individual councillor who has taken a decision fails to ensure that is recorded as otherwise there would be no record and, possibly, no public knowledge of the decision.

23.  The Government considers that such provisions, although important and extensive would be constrained closely in terms of scope. They would entail either replication or detailed and technical amendment of particular existing statutory provisions. The Government therefore believes that the negative resolution procedure is appropriate to these regulations.

Consultation and content of proposals (Clause 18)

24.  Amendments 58 and 60 allow the Secretary of State to make directions specifying certain matters which authorities must include in their proposals for executive arrangements.

25.  Any such directions would be general to all local authorities, rather than specific to individual councils. For example, they might specify that all proposals must set out the arrangements for overview and scrutiny. The purpose behind these directions would be to leave authorities flexibility over precise details but to ensure that proposals contain standard core information to allow the local electorate to make an informed decision during consultation and at a referendum on those proposals.

26.  This is primarily a matter of good administrative practice and due process. The Government therefore believe that the use of powers of direction is appropriate.

Deadline for proposals (Clause 18)

27.  Amendment 61 adds a new subsection to the clause which would enable the Secretary of State to specify by order a date by which all councils must make proposals for executive arrangements. This power was foreshadowed in paragraphs 162-163 of the previous memorandum.

28.  This power would be expected to be used only where experience showed that certain councils were failing to discharge their legal duty to draw up proposals in a timely fashion and that the aim of the Bill to achieve more efficient, transparent and accountable local government was thereby not being brought about.

29.  There is no intention at present to use such a power unless it becomes clear that a significant number of councils are being dilatory in, or refusing to, bring forward proposals for executive arrangements. Given that the power is to ensure that authorities comply with an existing statutory duty by setting a date, the Government believes an order subject to negative resolution is appropriate.

Fall back proposals (Clause 19)

30.  The Joint Committee which reported on the draft Local Government (Organisation and Standards) Bill recommended that steps be taken to ensure that the implication of a no vote in a referendum under the legislation was clear to those voting in any such referendum. This provision relates to the definition of a fall-back - i.e. a statement of what the authority will do in the case of a no vote. Amendment 68 contains two new powers for the Secretary of State to give directions as to what must be contained in fall back proposals.

31.  These parallel amendments 58 and 60 which relate to the principal proposals and would be used in a similar fashion to ensure that proposals contained sufficient detail to allow the local electorate to make an informed choice about the proposals. The Government believes that the power to make directions is appropriate for the reasons given on the similar powers above.

Changing executive arrangements (Clause 21)

32.  Amendment 71 replaces clause 21 of the Bill. It introduces a new clause which provides a power for the Secretary of State to make regulations to enable local authorities operating executive arrangements to change to different executive arrangements.

33.  The Government has decided that more flexible provisions than those in the existing clause 21 are desirable. Under the replacement clause, regulations may make provision in relation to changes from, to or within any form of executive, including any form which might be made available under clause 10.

34.  The regulations made under this provision will be largely technical, setting out the steps to go through if different types of change to executive arrangements are sought by an authority. The Government believes that regulations subject to the negative resolution procedure are appropriate.

Alternative arrangements for fall-back options

35.  Amendment 72 introduces a new clause which enables the Secretary of State to make available alternative arrangements for the discharge of their functions and which are not available under clause 10.

36.  The power is a power to make available alternative arrangements which the Secretary of State considers likely to ensure that local authority decisions are taken in an accountable and efficient way. This is to ensure that all authorities move to arrangements which meet the aims of the Bill to provide greater efficiency, transparency and accountability.

37.  The arrangements provided for under this power would only be used in the event of a referendum rejecting a proposal for a directly elected mayor and the fall-back not being a form of executive arrangement. However, these regulations could include significant amendments or modifications to primary legislation, they could be wide-ranging and they would make available a new way of taking decisions in local authorities which may be adopted in a number of authorities. The Government therefore proposes that such regulations should be subject to the draft affirmative procedure.

Operating alternative arrangements

38.  Amendment 73 introduces a new clause which concerns the operation of alternative arrangements. It includes two regulation-making powers.

39.  The first, at subsection (4), allows the Secretary of State to make regulations where an authority wants to change its alternative arrangements set out in regulations under amendment 72. The purpose of this power is to enable authorities to make such changes.

40.  The second power, in subsection (5), relates to a decision by an authority to move from these alternative arrangements to a form of executive arrangements under section 10. It would allow the Secretary of State to make any provisions necessary to facilitate such a move relating to such matters as the drawing up of proposals, consultation, publicity requirements etc.

41.  Such regulations will only be made as a consequence of any authority operating alternative arrangements approved by the Secretary of State in line with regulations under amendment 72 and will be procedural in nature. The Government therefore believes that the negative resolution procedure is appropriate.

Petitions (Clause 22)

42.  Amendments 75, 79, 80, 91 and 92 make substantive amendments to clause 22, and modify the regulation making power in the clause.

43.  The purpose of this power remains the same, however, in that it requires a local authority to hold a referendum where it receives a petition signed by at least 5% of the local electorate requesting a directly elected mayor. However, the proposed amendments will make the provision more flexible with respect to the petition proposition and the calculation of the 5% figure and associated steps such as publicity. This power was foreshadowed in paragraphs 104-106 of the earlier memorandum.

44.  The power of the Secretary of State to specify the minimum number of electors who must support a petition cannot be used to provide for a number greater than 5% of local government electors.

45.  The amendment also enables these regulations to specify a form of petition which does not involve a paper-based petition, as foreshadowed in paragraph 107 of the earlier memorandum. The Government appreciates that appropriate technology is not yet available and therefore does not, in the short term, intend to make regulations allowing petitions to be collected in this way but wishes to have the flexibility to do so when the technology becomes available.

46.  The Regulations will also allow the Secretary of State, in effect, to act in the place of the authority with respect to requirements placed upon them by virtue of those regulations, where they are failing or refusing to act on a valid petition. This is necessary as an authority is, under this clause of the Bill, being required to take steps involuntarily and in the absence of this power, the only recourse would be through the courts.

47.  These provisions will require amendment in future, once rolling electoral registration is in place, for example. They are also primarily procedural and technical. The Government therefore believes that regulations subject to negative resolution are appropriate.

Directions (Clause 23)

48.  Amendment 94 enables the Secretary of State, in circumstances specified in regulations, to direct an individual authority to hold a referendum on any of the forms of executive specified in or under the Bill. This was foreshadowed in the Department's original Memorandum to the Committee (paragraphs 120 to 122).

49.  The Government considers that directions are the most appropriate way of requiring referendums, because such an action is necessarily specific to an individual authority. The power to direct an authority will be constrained in the circumstances set out in the regulations and the provisions on timing of referendums, and action to be taken before and after a referendum will continue to be made in regulations and have general, rather than selective, effect.

50.  Amendments 105 and 106 make substantive amendments to clause 23, and modify the regulation making power in the Bill. The amendments will allow the Secretary of State, in effect, to act in the place of the authority with respect to requirements placed upon them by virtue of those regulations, where they are failing or refusing to act on a direction from the Secretary of State. This is necessary as an authority is, under this clause of the Bill, being required to take steps involuntarily and in the absence of this power, the only recourse would be through the courts.

51.  Given that the power is to ensure that authorities comply with an existing statutory duty or the statutory guidance issued under this Part (clause 24) by setting a date, the Government believes that regulations subject to negative resolution is appropriate.

Secretary of State's power to require referendums

52.  Amendment 107 introduces a new clause which provides the Secretary of State with a power to make orders requiring all authorities, or authorities of a description or class specified in the order, to hold a referendum on any form of executive specified in or under the Bill (as specified in the order).

53.  This power was foreshadowed in paragraphs 123-126 of the original memorandum. This power is intended to allow the Government to implement its policy as set out in paragraph 2.23 of its response to the Joint Committee report where it stated that it:

    "recognises that it might also be appropriate for local people in a number of council areas to be able in a co-ordinated way to express through referendums their support for a form of new constitution for their councils.".

54.  An order under this provision could also allow the Secretary of State, in effect, to act in the place of an authority with respect to requirements placed upon them by virtue of that order, where they are failing or refusing to act in accordance with that order. This may be necessary as an authority may be required, under this clause of the Bill, to take steps involuntarily and in the absence of this power, the only recourse would be through the courts.

55.  Unlike the power in clause 23 it is not constrained by circumstances. However, it is intended to be capable of being used only in respect of all authorities or a description or class of authorities and not directly to individual authorities. It can also only be used to require a referendum; not the implementation of a particular form of executive arrangements in or under clause 10. The Government therefore believes that an order subject to negative resolution is appropriate.

Information on constitutions

56.  Amendment 108 introduces a new clause which requires local authorities to bring together documents describing their executive arrangements with certain other information into a constitution. Subsection (1)(a) of the clause gives the Secretary of State a power to make directions as to what information regarding the discharge of functions must be included.

57.  The purpose behind this provision is to ensure that publicly available documents from each authority contain standard core information to give local people clear knowledge of how their local authority is making its decisions. This is primarily a matter of good administrative practice and due process. The Government therefore believes that the use of powers of direction is appropriate.

Guidance (Clause 24)

58.  Amendment 109 modifies the power of the Secretary of State to issue guidance.

Elected mayors (Clause 25)

59.  Amendment 111 provides that elected mayors are to be treated as councillors for the purpose of local government legislation. This means that all the normal provisions relating to the office of councillor (such as qualification, disqualification, conduct etc.) will apply to elected mayors. However, there may be some instances in existing legislation where it will not be appropriate to treat the mayor as a councillor. The amendment therefore includes a power for the Secretary of State to make regulations to provide for those circumstances where the "mayor as councillor" principle should not apply.

60.  In view of the technical nature of this provision, the Government believes that the negative resolution procedure provides the most appropriate form of Parliamentary scrutiny.

Allowances (Clause 66)

61.  Amendment 121 introduces a new clause in place of clause 66. Clause 66 was included in the Bill as introduced, as a "placeholder" for more detailed provisions to follow by Government amendment. This was anticipated in the Department's original Memorandum to the Committee (paragraphs 230 to 232). The new clause makes amendments to the Local Government and Housing Act 1989, including amendments to regulation making powers in those provisions.

Assistants

62.  Amendment 135 introduces a new paragraph into schedule 1 about assistants for elected mayors. This includes a power for the Secretary of State to make regulations governing the appointment of assistants and matters such as their terms and conditions. The Government believes that regulations subject to negative resolution are suited to this purpose.

January 2000


 
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