House of Commons Public Bill Committee Proceedings

Session 2013 - 14
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Other Bills before Parliament

435

SUPPLEMENT TO THE VOTES AND PROCEEDINGS

Tuesday 17 December 2013

Report Stage Proceedings

Local Audit and Accountability Bill [Lords]

New Clauses

Integrated audit

Andy Sawford

John McDonnell

Withdrawn  NC1

To move the following Clause:—

‘(1)
Before section 1 of this Act is brought into force, the Secretary of State shall, by

regulations, put into effect arrangements for integrated audit which enables

auditors to work across authorities and with the National Audit Office, where

national and local funding is being used jointly.’.

Transparency of audit

Andy Sawford

John McDonnell

Alex Cunningham

Not called  NC2

To move the following Clause:—

‘(1)
A local auditor has a right of access at all reasonable times to audit documents

from private companies to whom the local authority has contracted significant

services during the last financial year.

(2)
Local auditors only have a right of access to audit documents from private

companies, under subsection (1), that relate to the service provided to the local

authority by that company.

(3)
A local auditor must make available on request any audit documents, obtained

under subsection (1), subject to the provisions of the Freedom of Information Act

2000.

(4)
In this section “private company” shall be interpreted to mean any legal entity,

including joint ventures, not-for-profit organisations, mutually-held

organisations and charities.

Report Stage Proceedings: 17 December 2013
436

Local Audit and Accountability Bill-[Lords], continued

(5)
Five years after the coming into force of this section, the Secretary of State must

commission and publish a review of the effectiveness of subsections (1) to (3) and

of the costs to local auditors, private companies and local authorities arising from

it.

(6)
The meaning of “significant” and “terms of qualification” shall be set out by

regulations.’.

Confidential proceedings

John McDonnell

Not selected  NC3

To move the following Clause:—

‘Before section 1 of this Act is brought into force, the Secretary of State shall

prepare and lay before each House of Parliament a report into the appropriateness

of—

(a)
use made of the power conferred by regulation 4 (relating to the

exclusion of the public from meetings for certain items of business), and

(b)
compliance with the requirements of regulation 5 (relating to procedures

prior to private meetings),

by relevant local authorities under Part 2 of the Local Authorities (Executive

Arrangements) (Meetings and Access to Information) (England) Regulations

2012, No. 2089.’.

Scrutiny

John McDonnell

Not called  NC4

To move the following Clause:—

‘Before section 1 of this Act is brought into force, the Secretary of State shall

prepare and lay before each House of Parliament a report on the effectiveness,

efficiency and economy of the structures and procedures put in place by relevant

local authorities, under section 21 of the Local Government Act 2000 (Overview

and scrutiny committees), to review the decisions made, or other action taken, by

the executives of such local authorities.’.

Fraud investigation

John McDonnell

Not called  NC5

To move the following Clause:—

Report Stage Proceedings: 17 December 2013
437

Local Audit and Accountability Bill-[Lords], continued

‘Before section 1 of this Act is brought into force, the Secretary of State shall

prepare and lay before each House of Parliament a report on the adequacy of the

resources, staffing, structures and procedures put in place by authorities to detect

and investigate fraud within the authority effectively.’.

Compromise agreements

John McDonnell

Not called  NC6

To move the following Clause:—

‘Before section 1 of this Act is brought into force, the Secretary of State shall

prepare and lay before each House of Parliament a report into the extent and

appropriateness of the use of compromise agreements, incorporating

confidentiality clauses, as provided for by section 203 of the Employment Rights

Act 1996, to effect the exit of members of staff from employment by local

authorities.’.

Secretary Eric Pickles

Agreed to  1

Clause  8,  page  6,  line  43,  at end insert—

‘(ba)
specifies the period for which the local auditor has been appointed,’.

Andy Sawford

John McDonnell

Not called  13

Clause  20,  page  15,  line  24,  at end insert—

‘(7)
A person providing commercial or consultancy services to an authority may not

audit those services.

(8)
The audit of any commercial or consultancy services provided by a person

appointed as a local auditor must be subcontracted to a different local auditor.’.

Andy Sawford

John McDonnell

Withdrawn  14

Clause  39,  page  26,  line  11,  leave out ‘one or more specified local authorities’ and

insert ‘a local authority’.

Report Stage Proceedings: 17 December 2013
438

Local Audit and Accountability Bill-[Lords], continued

Andy Sawford

John McDonnell

Alex Cunningham

Negatived on division  15

Clause  39,  page  26,  line  25,  leave out subsection (4) and insert—

‘(4)
A direction can only be made by the Secretary of State if—

(a)
evidence of a breach of a code has been published by the Secretary of

State to the local authority;

(b)
a local authority, on receipt of a letter from the Secretary of State

notifying them of evidence which purports to demonstrate a breach of the

code has made a response to the Secretary of State within 28 days; and

(c)
upon receiving any response the Secretary of State has published a report

detailing his conclusions.’.

Andy Sawford

John McDonnell

Not called  16

Clause  39,  page  27,  leave out lines 1 to 29.

Stephen Barclay

Not moved  17

Clause  41,  page  30,  line  18,  at end add—

‘(c)
save that any amount levied to provide for the activity of an internal

drainage board shall be disregarded for the purposes of calculating an

excessive council tax rise.’.

Secretary Eric Pickles

Agreed to  6

Clause  41,  page  30,  line  32,  at end insert—

‘(13A)
Subsections (14) to (16) apply (and subsections (18) to (20) do not apply) if, in

accordance with section 49(2A), this section comes into force on the day on

which this Act is passed.’.

Secretary Eric Pickles

Agreed to  7

Clause  41,  page  30,  line  37,  after ‘may’, insert ‘, in particular,’.

Secretary Eric Pickles

Agreed to  8

Clause  41,  page  31,  line  2,  at end insert—

‘(17)
Subsections (18) to (20) apply (and subsections (14) to (16) do not apply) if this

section comes into force on a day appointed by the Secretary of State by order

under section 49(2A).

(18)
Section 52ZC of the Local Government Finance Act 1992 applies with the

following modifications to the determination of a set of principles for the

financial year beginning with 1 April 2015.

(19)
The Secretary of State may, in particular, determine categories of authority for

that financial year—

(a)
on the basis of whether an authority’s relevant basic amount of council

tax for the financial year beginning with 1 April 2013 would have been

Report Stage Proceedings: 17 December 2013
439

Local Audit and Accountability Bill-[Lords], continued

excessive if that amount for that year and for the immediately preceding

financial year had been determined under section 52ZX of the Local

Government Finance Act 1992 as amended by this section,

(b)
on the basis of whether an authority’s relevant basic amount of council

tax for the financial year beginning with 1 April 2014 would have been

excessive if that amount for that year and for the immediately preceding

financial year had been determined under that section as so amended, or

(c)
on the basis set out in paragraph (a) and on the basis set out in paragraph

(b).

(20)
In subsection (3)(b) of section 52ZC the reference to an authority’s relevant basic

amount of council tax for the financial year immediately preceding the year under

consideration is to the amount that would have been calculated by the authority

for that year under section 52ZX of the Local Government Finance Act 1992 if

the amendments made to it by this section had been in force for that year.’.

Andy Sawford

John McDonnell

Negatived on division  18

Clause  41,  page  31,  line  2,  at end insert—

‘(17)
The Secretary of State may, by Order, exempt from the calculation of an

authority’s basic amount of council tax any levies agreed as part of a City Deal

signed prior to this Act receiving Royal Assent.’.

Secretary Eric Pickles

Agreed to  2

Clause  44,  page  34,  line  19,  at end insert—

‘(2A)
References in this Act to provision made under it include provision made under

Part 42 of the Companies Act 2006 as it has effect by virtue of Schedule 5.’.

Secretary Eric Pickles

Agreed to  9

Clause  49,  page  36,  line  3,  leave out ‘and’ and insert ‘to’.

Secretary Eric Pickles

Agreed to  10

Clause  49,  page  36,  line  5,  at end insert—

‘(2A)
If this Act is passed before 5 February 2014, section 41 comes into force on the

day on which this Act is passed; otherwise that section comes into force on such

day as the Secretary of State may by order appoint.’.

Secretary Eric Pickles

Agreed to  11

Clause  49,  page  36,  line  8,  leave out paragraph (a).

Report Stage Proceedings: 17 December 2013
440

Local Audit and Accountability Bill-[Lords], continued

Secretary Eric Pickles

Agreed to  3

Schedule  2,  page  42,  line  36,  leave out paragraphs (a) and (b) and insert ‘that is

wholly in England’.

Andy Sawford

John McDonnell

Not called  12

Schedule  2,  page  43,  line  8,  at end insert—

‘30
A Local Enterprise Partnership.’.

Secretary Eric Pickles

Agreed to  4

Schedule  4,  page  47,  line  5,  after ‘authority’, insert ‘other than a health service

body’.

Secretary Eric Pickles

Agreed to  5

Schedule  5,  page  58,  line  3,  leave out sub-paragraph (3) and insert—

    ‘(3)
For paragraph 6 (holding of appropriate qualification) substitute—

“Holding of appropriate qualification

6    (1)
The body must have rules to the effect that an individual is not

eligible for appointment as a local auditor unless the individual—

(a)
holds an appropriate qualification,

(b)
is an EEA auditor who has passed an aptitude test in

accordance with sub-paragraph (3), unless an aptitude test

is not required (see sub-paragraphs (4) and (5)), or

(c)
has been authorised to act as a local auditor by the body

pursuant to the European Communities (Recognition of

Professional Qualifications) Regulations 2007 (SI 2007/

2781), and complies with the requirements of those

Regulations that apply to a person acting as a local auditor.

      (2)
The body must have rules to the effect that a firm is not eligible for

appointment as a local auditor unless—

(a)
each individual responsible for local audit work on behalf

of the firm is eligible for appointment as a local auditor, and

(b)
the firm is controlled by qualified persons (see paragraph 7

below).

      (3)
The aptitude test—

(a)
must test the individual’s knowledge of subjects—

(i)
that are covered by a recognised professional

qualification,

Report Stage Proceedings: 17 December 2013
441

Local Audit and Accountability Bill-[Lords], continued

(ii)
that are not covered by the professional

qualification already held by that individual, and

(iii)
the knowledge of which is essential for the pursuit

of the profession of local auditor;

(b)
may test the individual’s knowledge of rules of

professional conduct;

(c)
must not test the individual’s knowledge of any other

matters.

      (4)
No aptitude test is required if—

(a)
the individual is to provide services consisting of local

audit work on a temporary and occasional basis, or

(b)
the subjects that are covered by a recognised professional

qualification and the knowledge of which is essential for

the pursuit of the profession of local auditor are covered by

the professional qualification already held by the

individual.

      (5)
Whether the provision of services is on a temporary and occasional

basis is to be assessed on a case by case basis and in particular by

reference to its duration, its frequency, its regularity and its

continuity.

      (6)
A firm which has ceased to comply with the conditions mentioned

in sub-paragraph (2) may be permitted to remain eligible for

appointment as a local auditor for a period of not more than three

months.”

    (3A)
In paragraph 7 (meaning of control by qualified persons)—

(a)
in sub-paragraph (1) (introductory), for “paragraph 6(1)(b)” substitute

“paragraph 6(2)(b)”, and

(b)
in sub-paragraph (2)(b)(i), (requirement for firm to be eligible for

appointment as statutory auditor), for “statutory auditor” substitute

“local auditor, or as a statutory auditor in accordance with this Part of

this Act as it has effect apart from its application by virtue of Schedule

5 to the Local Audit and Accountability Act 2013.”’.

Bill read the third time and passed, with Amendments.



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