Clauses 86 and 87: Welfare services

201. Clause 86 creates powers for the Secretary of State, with the consent of Treasury, to determine and pay a grant to local authorities to enable them to contribute to the cost of welfare services. Similar powers are given to the NAW.

202. Other powers in this clause include powers to determine the purpose of the grant, to attach terms and conditions to the grant, and to provide guidance and directions to local authorities. The clause defines which local authorities will receive the grant.

203. Clause 87 enables entitlement to housing benefit in respect of certain support services to be withdrawn. This clause will apply to Scotland as well as England and Wales.

204. The new well-being powers in Part I facilitate these new arrangements both by ensuring that local authorities have broader powers to provide support services for people who may need them, and by creating a framework for community planning.

205. It is intended that the commencement orders under clause 95 for the welfare services provisions will allow for the new funding arrangements to be brought into force for different geographical areas at different times, i.e. to be phased in.

Clauses 88 and 89: Allowances and pensions for local authority members

206. Clause 88 amends section 18 of the Local Government and Housing Act 1989 to provide for carers' allowances, and for pensions for members of local authority executives. Regulations to be made under the amended s.18 may also require councils (other than parish councils) to establish an independent panel which will make recommendations on allowances etc. Clause 89 enables the Secretary of State to make regulations on allowances for members of parish councils and, for members of all authorities, allowances for travel and subsistence, including travel by bicycle; allowances for attending conferences; and reimbursement of expenses.

Clause 90: Social services functions

207. Clause 90 removes the requirement in the Local Authority Social Services Act 1970 that local authorities discharge their social services functions through social services committees, where they adopt one of the new forms of executive in Part II of the Bill. The requirement that an authority appoint a director of social services remains but the requirement that the Secretary of State's approval first be obtained if a director of social services is to be appointed to any non-social services post is repealed.

208. Clause 90(1) removes the statutory requirement for a local authority to discharge its social services functions through a social services committee (s.2 to 5 of the 1970 Act) where the authority adopts one of the forms of executive in or under Part II of the Bill. Clause 90(2) removes the requirement that an authority's director of social services cannot discharge non-social services functions without the prior approval of the Secretary of State (section 6(5) of the 1970 Act). Clause 90(3) inserts a definition of social services functions and replicates the order-making power in section 2(2) of the 1970 Act which applies to authorities which have adopted one of the forms of executive in or under Part II of the Bill and therefore to whom s.2 to 5 of the 1970 Act no longer apply.

Clause 91: Prohibition on promotion of homosexuality: bullying

209. Section 2A of the Local Government Act 1986 (inserted by section 28 of the Local Government Act 1988) prohibits local authorities from intentionally promoting homosexuality, or from promoting the teaching in their schools of the acceptability of homosexuality as a "pretended family relationship". Clause 91 amends section 2A by clarifying that it does not prevent maintained schools from taking steps to prevent any form of bullying.

PART VI: SUPPLEMENTAL

Commentary

Clause 92: Orders and regulations

210. Clause 92 makes general provision for the exercise of orders and regulations under the other Parts of this Bill. It provides for orders or regulations made under clauses 3(3) (limit on powers to promote well-being), 5 (power to amend or repeal enactments), 6 (power to modify enactments concerning plans etc), 11(6) (local authority executives), 29 (alternative arrangements), 40 (power to make provision about elections), 41 (provisions with respect to referendums), 43 (powers to modify enactments) or 45 (principles governing conduct of members of relevant authorities) to be bound by the affirmative resolution procedure in both Houses of Parliament, and for all other statutory instruments, other than commencement orders under clause 95, to be subject to the negative resolution procedure in either House.

FINANCIAL EFFECTS OF THE BILL

Part I: Promotion of economic, social or environmental well-being

211. The provisions in Part I specifically preclude local authorities from using the new power of well-being to raise finance. No impact on public sector finance is expected to arise from these provisions. Nor is any significant financial effect from the power to prepare community strategies expected. Where this is exercised, authorities may incur some short-term costs, but it is expected that these costs will be absorbed within existing budgets, and lead to longer-term efficiency savings.

Part II: Arrangements with respect to executives

212. The intention behind the new arrangements is to bring about more effective and efficient use of resources by local authorities. Savings arising are expected to offset, or more than offset, any additional costs that may fall to local authorities as a result of adopting new decision-making arrangements—in particular the costs associated with the holding of referendums on the question of the introduction of a directly-elected mayor, and with the conduct of elections for the office of directly-elected mayor.

Part III: Conduct of local government members and employees

213. Any increased costs for local government associated with the introduction of the new ethical framework should be offset by savings arising from the introduction of new decision-making arrangements. Budgetary provision of £7 million a year has already been made available by the DETR for the cost of establishing and running the new Standards Board. This is comparable to the cost of funding the local government Ombudsman.

Part IV: Elections

214. Expenditure on the conduct of local government elections would increase in any area where the overall frequency of such elections is increased as a result of an order made under the provisions of clause 58. If these provisions were used to alter the frequency of elections to elections by thirds in all single-tier authorities and elections by halves in all two-tier authorities, there would be an increase in total local government expenditure in England of some £8 million a year on average.

Part V: Miscellaneous

Surcharge

215. Repeal of surcharge should have minimal impact on public sector expenditure. As at present, local authorities will still be able to pursue losses arising through criminal misconduct through the courts.

Welfare services

216. There are no direct costs arising from these provisions. However, while the new policy and funding framework for support services is intended to improve the management of resources and maximise value for money, there will be some administrative costs involved in the new arrangements. These will fall particularly on local authorities. Central government will use the current Comprehensive Spending Review to consider how best these costs might be met.

EFFECTS OF THE BILL ON PUBLIC SERVICE MANPOWER

217. Parts I, II and IV of the Bill will not result in any significant impact on manpower levels in either central or local government.

218. To implement the new arrangements on welfare services, local authorities will require additional staff to carry out work (with other agencies, service users and service providers) to assess support needs in the community, develop joint commissioning processes, and plan, fund and monitor support services. This will be the main element in the administrative costs being considered in the current Comprehensive Spending Review.

219. In addition, although no significant impact on the manpower levels of local government is expected as a result of the introduction of the new ethical framework or changes in audit arrangements, the Bill also establishes a new NDPB. The Standards Board will need to recruit sufficient staff to allow it to carry out its function of upholding the principles which govern the codes of conduct of local authority members; as mentioned above, budgetary provision has already been made for this.

SUMMARY OF THE REGULATORY APPRAISAL

220. None of the measures under Parts I-IV of the Bill will impose any burden on business, charities or voluntary bodies.

221. The provisions on welfare services in Part V will not in themselves impose any direct burden on such organisations, but the new arrangements for funding welfare services that the Government intends to implement through the new provisions will have implications for service providers. Elements of the new arrangements to scrutinise value for money more closely and which will separate the funding of accommodation and support services to improve service flexibility are likely to involve additional management and administration for some service providers. This will be a factor that will need to be taken into account both locally—in decisions about the appropriate level of funding for each service—and centrally, in the Comprehensive Spending Review.

222. A copy of the Regulatory Impact Assessment is available from DETR¹⁷.

EUROPEAN CONVENTION ON HUMAN RIGHTS

223. Section 19 of the Human Rights Act 1998 requires the Minister in charge of a Bill in either House of Parliament to make a statement, before second reading, about the compatibility of the provisions of the Bill with the Convention rights (as defined by section 1 of that Act). The Deputy Prime Minister made the following statement:

I am unable to make a statement that in my view the provisions of the Local Government Bill are compatible with the Convention rights, but the Government nevertheless wishes the House to proceed with the Bill.

¹⁷ Contact Melanie Hollinshead (telephone: 0171 890 3663 or e-mail: melanie_hollinshead@ detr.gsi.gov.uk).