Localism Bill

Memorandum submitted by Birmingham City Council (L 166)

A. Executive summary:

This submission has been the subject of consultation with the relevant Political Groups represented on the City Council, via the Council Business Management Committee, and as such has cross-party support. Council Business Management Committee comprises leading members of the Executive, Overview & Scrutiny Committee and the Opposition . In addition, with regard to the Ethical Governance Framework, this Submission has also been the subject of consultation with the City Council’s Standards Committee.

Whilst it is accepted the Submission is on the long side, t he purpose of this Submission has been to help the Parliamentary Committee to understand some of the operational difficulties in the Localism Bill , as presently drafted, so that the Bill can be changed, at this stage, to avoid implementation difficulties. Accordingly, t his Submission sets out detailed drafting amendments and will need to be cross-referenced to the actual Clauses and P aragraphs of the Localism Bill laid before Parliament in December 2010 . The Submission also makes a number of general comments and suggestions , for completeness , so that Parliament can sati sfy itself over the value added, or not, of some of the Clauses and the Paragraphs to be introduced by the Bill.

By way of a summary , the key points of this Submission are as follows:

1. General Power of Competence – A need to tidy up and remove the various restrictions and limitations appearing in the Bill which might detract from the operational effectiveness of the proposed general power of competence, which should also be extended to cover all the public bodies so that they are required to collaborate with each other and local authorit ies and thereby help to secure communit y based budgeting in a locality. The proposed limits on charging and company structures may prove quite prohibitive in operational terms;

2. New Standards R egime – A need to remove the proposed criminalisation of Elected and Co-opted Members for failing to register / declare registerable interests and/or taking part in meetings when prevented from doing so because of such interests . Such proposals may also, indirect ly, discourag e new Elected and Co-opted Members from coming forward or standing at local elections ;

3. Local Referendums – A need to add specific grounds for rejecting requests for referendum on the basis of costs, repetitiveness or otherwise , if the same was not in accordance with good governance principles or likely to be detract from Council functions;

4. Assets of community value & unsuccessful community nominations A need to clarify the purpose and application of the provisions so as to be more meaningful and ones that will add value to local governance;

5 . Overview & Scrutiny Committees – A need to consider whether the powers of O&S committees should be extended over other public bodies and relevant local authorities so that member s /officers of the same can be questioned and reports/recommendations of O&S committees are acted upon by such public bodies and relevant local authorities ;

6 . Elected Mayor as ‘most senior o fficer , Shadow Mayor s , Election of Mayor, Committee System and changing Governance A rrangements A need to clarify the applicability of these provisions so as to a void legislative uncertainty;

7. Assets of Regional Development Agencies A need to ensure such assets are retained by local a uthoritie s (i.e. for the benefit of the R egion) instead of being transferred to the Crown; and

8. Planning c oncerns – A need to ensure the Council’s Planning Policies are fully taken into account and had regard to by any Neighbourhood Forums (however defined or created) in any Neighbourhood Development Plan, so as to ensure the economic viability of the City is not jeopardised and being fully cognisant of city-wide, not just local, environmental sustainability issues; and

9. Housing concerns – A need for regulations to be pragmatic and to ensure City Council homeless duties are extended over the private and Housing Associations sectors, along with ensuring appropriate financial concerns are addressed.

Annexes A & B to this Submission set out specific details on the Planning and Housing specific aspects covered by the Localism Bill.

March 2011

B. Drafting specific comments:

1. Chapter 1: General Power of Competence (Clauses 1-7)

(a) Whilst this is a welcome development within Local Government, the extensive restrictions of Clauses 3 and 4 appear to be unnecessary as the "limitations" and "restrictions" are already adequately addressed in Clause 2 of the Bill. Clause 1 could also be simplified to read:-

"Subject to Sub-clauses (2)-(4), a Local Authority has the power to do anything that an individual, with full capacity, may do".

(b) Furthermore, it would be far easier, with regard to charging, if the Bill simply stated:

"Where a Local Authority is under a statutory duty to provide services free of charge, it cannot charge for such services. Otherwise, a Local Authority is empowered to charge for services on a best value (or commercial) basis".

(c) The rationale for limiting charges to "not exceed the cost of provision" – Clause 3(3) refers – in today’s harsh economic and budgetary reality facing Local Government is not only unnecessary, but would work against the Government’s stated intention of reducing Central Government controls over Local Government. Furthermore, linking innovation and creativity in Local Government, however "limited" under the new General Power of Competence, to just a "company structure" (as defined in the Bill) is far too restrictive and unnecessary from an operational perspective.

(d) In terms of omissions from the Bill, a golden opportunity is in danger of being missed by the Government if it fails to make the General Power of Competence available to all public bodies that work with or seek to work in partnership with local authorities. In addition, all public bodies should be placed under statutory duty to work collaboratively with each other and Local Government, in particular, to ensure that all public resources allocated to the Local Authority’s area (and in partnership with any neighbouring Authority areas) is spent in a more cost effective and efficient manner, as a whole. Such a provision is essential for community based budgeting and will also help to further the Shared Services Agenda within Local Government and the wider public sector.

2. Chapter 5: Standards

(a) Clause 13 of the Bill: Pre-determination – this is welcome, as the prior indication of a view of a matter by a Member will not amount to predetermination or bias – i.e. a closed mind – and, as such, would permit a Member to speak and vote on lobby issues that s/he may have spoken strongly about or been elected for;

(b) Clause 15: Duty to promote High Standards of Conduct - imposes a duty on a Local Authority to promote and maintain high standards of conduct. It is difficult to see how a Local Authority could do so if it chose not to have a Local Code of Conduct for Members and Co-opted Members. In addition to Members and Co-opted Members, it might be useful to include a reference to officers of the Authority, as officers should also be under a statutory duty to promote and maintain high standards of conduct.

(c) Clause 16: Voluntary Codes of Conduct for Local Authority: Whilst it is accepted that the Local Authority, once this Localism Bill becomes law, will not be required to have a Code of Conduct for Members, there is clear recognition within Clause 16(3) that the Authority "must" consider whether it is appropriate to investigate any allegation(s) made against Elected Members as it thinks fit.

(d) There is a recognition, therefore, that where an Authority has resolved to have a voluntary local Code of Conduct for Members, it must establish an appropriate mechanism - i.e. a dedicated committee or have the matter considered by a relevant officer. Accordingly, it would be far better to make an explicit reference to such mechanism within Clause 16(3) instead of leaving it to an implication. Furthermore, where a local authority chooses to maintain a Standards Committee (or combines the ethical governance functions with, for example, a Governance and / or an Audit Committee), this should be a matter for local determination and not central prescription.

(e) Equally, it would be up to each Authority to consider whether or not a committee would be the most appropriate mechanism for dealing with complaints against Members. A Local Authority could, for example, put in place an ‘initial filtering system’ by delegating to, say, the Monitoring Officer to consider (after appropriate consultation with designated Independent Member(s) of the Council), whether an investigation needs to be carried out. Results of any actual investigation will, of course, be considered by an appropriate committee as opposed to just the Monitoring Officer or by relevant Independent Member(s) consulted under the "initial filtering system". This would avoid the need for costly and time consuming organising of Sub-Committees, and associated costs/paper, for dealing with simple complaints against Members.

(f) Birmingham City Council’s Standards Committee supports the continuation of a Local Code of Conduct of Members (suitably revised) and the "initial filtering system" indicated as a way of ensuring complaints are addressed, locally and appropriately, so as to continue to give confidence to the public that the City Council maintains high ethical and corporate governance standards.

(g) Clause 17: Disclosure and Registration of Members Interests: There is a reference in Clause 17(2)(d) to the Authority granting dispensations and the relevant Schedule to the Bill proposes to delegate such powers to the Head of Paid Service. Such powers are currently dealt with by Standards Committees or, as per my Clause 16 suggestions above, could be dealt with by the relevant Governance and / or Audit Committees of the Council. Equally, it should be a matter for the Local Authority to consider whether to delegate (or not) the granting of dispensations to the Monitoring Officer, in consultation with the relevant Independent Member(s) of the Council, or to the Head of Paid Service. It should not be a matter of prescription in the Bill.

(h) Clause 18: Offence of Breaching Regulations under Section 17: This Clause will be of great concern to Elected and Co-opted Members, as it appears to be unduly draconian and wrong in principle. There are a number of examples of members, up and down the country, who have "forgotten" to either register a financial or other registerable interest, failed to disclose a registerable interest at a relevant meeting or taken part in some business of the Authority when they had a prejudicial interest in the matter being discussed at the meeting.

(i) Human nature, being what it is, a number of Members do, from time to time, forget such matters and, since ignorance of the law is no defence, such forgetfulness (or repeated forgetfulness) – no matter how genuine and sincerely held - would not, if this Bill becomes law, be considered to be a "reasonable excuse".

(j) Accordingly, many decent, hardworking Members may find themselves, inadvertently, facing criminal sanctions and having criminal records imposed upon them, with fines up to the maximum level 5 on the Standard Scale. In addition, the courts will have the added discretion to disqualify such Members for up to five years, with associated costs of litigation and reputational harm.

(k) Criminalisation of elected members for a breach of Clause 17 requirements appears to the City Council to be totally (i) unnecessary and (ii) disproportionate to the circumstances. It would not surprise us, therefore - if this Section comes into law, unamended - that a number of Members, who find themselves on the receiving end of such criminal proceedings, will challenge such provisions under, for example, the Human Rights Act and, ultimately, take matters to the European Court for determination.

(l) The Government is asked, therefore, to urgently review the need for the criminalisation of such "basic" operational matters. A far better approach would be as per the current arrangements – i.e. where a failure to register, a failure to disclose a registerable interest at a meeting or taking part in a meeting relating to a prohibition or restriction in respect of a registerable interest, is the subject of a formal complaint under the Code of Conduct (Clause 16 above) and dealt with as a local matter by the relevant investigation / enforcement procedure envisaged by Clause 16. Such behaviour should not be criminalised. As an alternative, other civil remedies could be granted to the Standards Committee – perhaps some form of financial penalty or requirement to recompense the complainer - which go beyond a simple censure of the Member.

3. Clause 21: Senior Pay Statements:

(a) These will need to be produced on an annual basis – most likely, with the Annual Budgets - indicating a Council’s policy on Chief Officer remuneration, performance related pay and bonuses, along with publication of actual pay of Chief Officers on an annual basis – including details relating to a Chief Officer who may have left during the year.

(b) These provisions, if implemented, may raise potential conflicts of laws with, for example, the Freedom of Information and Data Protection Acts, as many of these arrangements are likely to be personal data, the subject of confidential information or be based upon confidential compromise arrangements. The Government should be asked to revisit these aspects so as to avoid potential operational difficulties.

4. Clauses 27 and 28: Whilst these provisions propose to repeal the statutory duties placed on local authorities relating to the promotion of democracy and handling petitions, it should be noted that most good local authorities, such as Birmingham City Council, will continue to promote democracy and handle - electronic or written – petitions, as a matter of best practice, even though the statutory prescription will be removed.

5. Clauses 30-34: EU Fines:

(a) Accordingly to the Local Government Association, these provisions are likely to concern great concern to local authorities, despite Clause 32(1), which seeks to limit payment to those local authorities that "caused or contributed to the infraction of EU law for which that financial sanction was imposed". The Government should, therefore, in the Bill or statement to Parliament be asked to clearly state that a local authority simply following Regulations established by Parliament or targets established by Governments - when relevant Governments have not provided them with the necessary resources to meet such targets - will not be the subject of such fines mechanism.

(b) The "polluter pays principle", whilst appropriate, needs to recognise that the alleged polluter may be placed in an unacceptable position by relevant Governments, if it is not given the resources to perform such duties.

6. Part 4, Chapter 1: Local Referendums:

(a) Clause 44 (Grounds for Determination of Local Referendums): Only 4 grounds for not holding a referendum are being allowed under the Bill:-

(i) referendum question would contravene an enactment or a rule of law;

(ii) it was not on a ‘local matter’ as defined;

(iii) it relates to an Order of Secretary of State; and / or

(iv) it was vexatious or abusive.

(b) The fourth ground set out in Clause 44(7) is restricted to a petition being "vexatious or abusive". No definition of these words are given in the Bill and the Clause should be extended to include "frivolous or costly", as to do so otherwise may impose unnecessary cost and administrative burdens on local authorities.

(c) In addition, the Local Authority should be permitted to reject a request for referendum which has been the subject of a petition, during the past 12 months, "on the same, associated or similar matter", so as to avoid public funds being wasted on unnecessary referendums. Unless amended, as suggested, there is a danger of creating paralysis for Local Government through the industrious use of petitions, with little or no regard to the impact on Local Authority finances or in-house processes associated with the same.

(d) Local authorities should also be allowed to reject petitions and requests for a referendum that might cause disharmony within the local community / area or otherwise detract from or work against (but do not quite contravene) the statutory requirements imposed upon the Local Authority. Such matters would, currently, be considered "appropriate" under the Bill as the current 4 grounds set out in Clause 44 are quite limited. Whilst some petitions may be cleverly drafted so as to avoid contravention of an enactment or a rule of law, some petitions / referendums may still cause harm to the social, economic and environmental well-being of a community and, otherwise, impact on the good governance of an area – including community relations / cohesion.

(e) Accordingly, the fourth (or a new fifth) ground should be sufficiently broad enough to allow a Local Authority to reject the request for a local referendum on matters that "may harm, be contrary to the public interest or otherwise adversely impact on the democratic accountability or responsibility of Local Authority functions".

(f) The Local Authority should also be given a power to consider charging the petitioner(s) an appropriate fee to cover a proportion, if not all, of the cost of a local referendum, if a Local Authority felt the petitioner’s request was "without merit". This would have the effect of discouraging unmeritorious referendums.

(g) Clause 45 and 46: Whilst it is appropriate for a Local Authority to give reasons for its determination, Clause 45(4)(b) makes it clear that the Authority "must" publish those reasons when it publishes the determination; whereas at Clause 45(5) it goes on to say that the Local Authority is not obliged to publish those reasons if it thinks that in all the circumstances it would be inappropriate to do so.

(h) As a point of legislative construction, it would be far simpler if Clause 45(4)(b) simply said the Authority "may" - as opposed to "must" - and then there would be no need to insert a negative stipulation of Clause 45(5). These comments on legislative construction apply equally to Clauses 46(5) and (6).

(i) In addition, Clauses 46(2) and (3) should be reviewed by the Government as it is highly unlikely that a Council would want to have a "second meeting" to determine a resolution for the Local Referendum. Experience shows that such matters can usually be dealt with in the build up to a Council Meeting and it is highly ineffective and inappropriate to build into legislation any unnecessary bureaucracy or "delaying mechanism" of one Council Meeting to facilitate the determination of "a resolution".

(j) Clause 48 – Question to be asked in Local Referendum: The whole of this section could have been easily drafted along the following lines:-

"The Local Authority must, after appropriate consultation with the lead petitioner, organiser or member(s) who made the request, determine the appropriate question to be asked in the referendum".

Save for Clause 48(5), the other sub-clauses would not, then, be needed.

(k) Chapter 2: Duty to Hold a Council Tax Referendum in relation to "excessive" increases of Council Tax to be determined in accordance with principles established by the Secretary of State. The referendum must be held by no later than the 1st Thursday in May of the relevant financial year. A simple majority of those voting must approve the "excessive" Council Tax; otherwise the substrate calculations become relevant Council Tax for that year. Accordingly, any Council Tax Demand in relation to excessive increases, sent out in March / April, could only be indicative and subject to the outcome of the referendum. This may cause increased costs, operational and financial difficulties for local authorities during the Referendum years.

7. Chapter 3: Community Right to Challenge (Clauses 66-70): A Local Authority will have a statutory duty to consider expressions of interest from relevant community organisations to operate local services. This would also permit 2 or more employees to undertake such services after an appropriate procurement exercise. Local authorities will need to establish appropriate procedures for dealing with such applications and they will, therefore, incur expenditure in so doing. Accordingly, the local authority should be given the power to charge a fee for the application to recover such expenditure.

8. Chapter 4: Assets of Community Value (Clauses 71-88):

(a) Whilst the purpose for having such "Lists of assets of community value" and "lists of land nominated by unsuccessful community nominations", may appear to be acceptable, in principle, the practical value of having the same appears to be questionable. This aspect of the Localism Bill, therefore, is hardly robust or likely to encourage localism.

(b) The Government should, therefore, revisit the wording of the Bill so as to ensure the Bill correctly addresses what it intends so that when the legislation is in place the value to be added through such provisions are clear for all to see and apply. The interaction of such lists with, for example, village green applications should also be made clearer, if ‘double’ opportunities and jurisdictions to delay the development of community assets are to be avoided.

(c) From a general reading of the proposed provisions, it could be argued that places of worship, community halls, bingo halls and other entertainment establishments – whether owned by the Council or not – could find themselves on the "lists" for five years and thereby serve only to restrict the ability of private owners to deal with the same without first obtaining consents for removal from the relevant Authority. It is doubted if the intention of the Government was to frustrate private enterprise in this way and, as such, it is important that these aspects are reconsidered, clarified and the Bill amended accordingly so as to avoid uncertainty in application.

(d) As these provisions currently stand, there is a real danger of stifling local innovation, building in inertia / local bureaucracy into the system and, as such, the provisions would appear to run counter to the Government’s stated objectives of reforming public services provision.

9. As respects Regional Development Body assets, the Government should ensure such assets are transferred to local authorities instead of, as proposed, being transferred to ‘the Crown’ so as to encourage regional assets to be best used, locally, for the region. As respects LEPs, Birmingham City Council is keen to ensure that LEPs should play a strategic role here, but we are concerned to avoid the top-down and bureaucratic definition of LEPs that this could bring. We suggest a small amendment, as follows, to require engagement with the business community. This would enable Planning Authorities to work through their LEPs to meet this condition and is in any case a desirable stipulation.

Amendment - Clause 90, subsection (1) insert after (b) in line 8 "and engage with the business community of the area".

10. Schedule 2, Part 1, Chapter 1, Paragraph 9B and 9BA: It is difficult to see the need for there to be provision in the Bill for the Secretary of State to "prescribe arrangements" which were in addition to the "Executive Arrangements" or the "Committee System", as these two models will more than adequately cover most, if not all, eventualities in Local Government.

11. Schedule 2, Part 1, Chapter 2, Paragraph F Overview and Scrutiny Committees: Functions:-

(a) The Government could take the opportunity to extend the powers of Overview & Scrutiny Committees (at paragraph 9F(2)(e) and 9FA(9)) so that other public bodies in a locality comply with its recommendations, as currently required of Members and Officers of the Local Authority. This extension of Overview and Scrutiny powers will be of great help to local authorities working in local partnerships, and help to further the shared services and the Government’s Public Services Reform Agenda. If such a provision was included, this would assist with the community based budgeting aspects and would obviate the need for Paragraph 9F(2)(f) and Paragraph 9F(3) and (5).

(b) By way of clarification, the provisions proposed in (a) should be in addition to any statutory obligations placed on a public body to have its own overview & scrutiny committees, as the local authority overview & scrutiny arrangements proposed in (a) will be the only ones with the democratic legitimacy to look at all of the issues affecting the city, as a whole, and not just what is appropriate from the public body’s internal perspectives. Accordingly, there should be no duplication of effort or cost as the remits will be quite different and necessary for community based budgeting.

(c) Paragraph 9FA(8)(a) may also be extended to require Members of the Executive and "those in positions of managerial control in any of the relevant Local Authority or Public Body in relation to matters which affect the Authority’s area or the inhabitants of that area" to attend before Overview and Scrutiny Committees to answer questions.

(d) Likewise, Paragraph 9FA(9) could be amended to include those in positions of managerial control in other relevant Local Authority or Public Body in relation to matters which affect the Authority’s area or the inhabitants of that area.

(e) "Public Body" could mirror the definition for a "Local Public Service Function" or "Public Service" definition contained in Paragraph 9HF(9). Accordingly, Paragraph 9FA(9) would read as follows:

"It is the duty of any Member or Officer or those in positions of managerial control mentioned in Paragraph (a) or (b) of Sub-Section (8) to comply with any requirement mentioned in that paragraph and have regard to the recommendations of the relevant Overview and Scrutiny Committee."

(f) Paragraph 9FE would then need to be amended to reflect the insertions made at Paragraph 9F(2)(e), 9FA(8) and (9). Paragraph 9FE(1)(a) and (b) could then be deleted as there would be no need to make a specific reference to the Crime and Disorder matters as those would be covered within the proposed public body insertion for Paragraph 9F(2)(e), 9FA(8) and (9). Likewise, Paragraph 9FE(3), (4) and (5) could then be amended to reflect the insertion of the Public Body requirements.

(g) Paragraph 9FF would also appear to be unnecessary if the ‘Public Body’ insertion is accepted for Paragraph 9FE. Paragraph 9FG(1)(b)(ii) could also be deleted if Paragraph 9FF was deleted.

(h) Paragraphs 9FH and 9FI could also be deleted if the ‘Public Body’ insertion is accepted with regard to Paragraph 9FA and the definition of Public Body extended to include Risk Management Authority. Paragraph 9FJ could likewise be deleted.

12. Paragraph 9HA Mayoral Management Arrangements: Mayor to be Chief Executive Officer:

(a) Whilst the arrangements make it clear that the Authority’s Head of Paid Service would report to the Elected Mayor and that the Elected Mayor holds Office on such reasonable terms and conditions, including conditions as to remuneration, as the Authority thinks fit, it is unclear why the Elected Mayor would become "the most senior officer of the Local Authority" or what would be the legal impact of such a provision as the Mayor would still not be an ‘employee of the Council". Accordingly, this particular requirement could well be void for uncertainty, as a matter of legislative construction.

(b) There will also be no need for a separate, cross-party, Sub-Committee dealing with JNC Chief Officer issues as the centralisation of power in the hands of the Elected Mayor is further confirmed with the number and grades of staff required by the Authority for the discharge of its functions being the responsibility of the Elected Mayor.

13. Paragraph 9HB Mayoral Management Arrangements: Adoption of Mayor’s Proposals etc: This provision would have the effect of requiring the Mayor’s Proposal to be accepted unless the Authority passed a resolution of two thirds majority voting against the proposals. This is considered by Members as being undemocratic as, currently, the Council Budget and Framework Plans all require a simple majority for approval at Full Council Meetings. The Constitution (including Standing Orders) of local authorities will need amending to reflect a move to an Elected Mayor and Cabinet Model.

14. Paragraph 9HE Mayoral Management Arrangements: Advice etc for Members: This Clause will require a Local Authority to designate one of its officers to provide guidance and support to Members of the Authority. It is unclear whether such an officer would be the Head of Paid Service or some other to avoid potential conflicts of advice to the Elected Mayor and to the Council. The Government should be asked to clarify this point.

15. Paragraph 9HF Power to Confer / Transfer Functions in relation to Public Services to Elected Mayors: This would allow a local public service function of any person or body to be conferred or transferred to the Elected Mayor. These provisions could be useful and avoid the need for primary legislation with regard to transfer of public service responsibilities within a geographical area covering the Elected Mayor’s jurisdiction.

16. Paragraph 9HI Mayoral Management Arrangements: Failing Councils: This provision would permit the Secretary of State to give a direction requiring the Local Authority, if it was failing, to make alternative arrangements as the Secretary of State considers appropriate. Whilst this might be a useful one in theory, it is difficult to see how any Secretary of State would prescribe an "alternative arrangement" which was not an "Executive Arrangement" or a "Committee System" mentioned earlier. This provision may, therefore, be of little or no effect in practice.

17. Chapter 3 – The Committee System: Under these provisions, the Secretary of State has the power to prohibit delegation of functions. This is not felt to be necessary under Localism and each Local Authority should determine its own objectives with regard to the Committee System. Likewise, it should be a matter for those Authorities to determine the type of Overview and Scrutiny arrangements that they want and it should be left to those local authorities to determine within the broad parameters of the powers prescribed to Overview and Scrutiny Committees under the Executive - Leader and Cabinet and Elected Mayor and Cabinet - Models.

18 Chapter 4 – Changing Governance Arrangements:

(a) These provisions require the Local Authority to publish in one or more newspapers circulating in its area an appropriate notice. Publication of notices should be left to the determination of the local authorities and not prescribed with regard to local newspapers as adverts in the same are quite costly and do not reach all sections of the local community.

(b) The Impact Assessment "creating Executive Mayors in the 12 largest English cities" on page 9 at sub-paragraph (h) gives a clear steer that the Government "now proposes to reduce, by regulations, the petition threshold for instigating mayoral referendums from 5% to 1% of the electorate". The Government is asked to resist such a move, as the 5% limit has stood the test of time and continues to be appropriate to avoid unnecessary public expenditure.

19. Paragraph 9N – Shadow Mayors:

(a) From an operational and, perhaps, democratic point of view, it would make more sense to avoid making changes to Constitutional documents if the Executive Leader remained an Executive Leader – instead of a Shadow Mayor - until any Elected Mayor was duly elected for the relevant Authority.

(b) The Bill is silent with regard to who will pay the cost of the referendum although it is recognised in the relevant Impact Assessment that the costs will be picked up by the relevant local authorities. This statutory imposition will be a ‘new burden’ on local government and, as such, the Government should pay for the first referendums for Elected Mayors..

(c) In terms of Metropolitan districts, the relevant Elected Mayor Elections currently anticipated under the Bill will be held in 2014, and every fourth year afterwards. In reality, for Birmingham, if the Localism Bill becomes law and a Shadow Mayor is appointed, by operation of the law, after the May 2012 local elections, the election for Elected Mayor could be held in 2013, which happens to be a fallow year for local elections. The Bill should, therefore, be amended so as to recognise that the election for Elected Mayor, in Birmingham, could be held in 2013.

20. The remaining Schedules also make clear that the Code of Conduct adopted by a Council will cease to have effect, as will any Declarations of Acceptance of Office, along with the requirement to have Standards Committees and the associated Initial Assessment Review and Hearing Sub-Committees / processes. Other aspects in relation to the Ethical Governance regime are as follows:-

(a) A possible option for Birmingham - if we chose to have a Code of Conduct for Members - would be a more streamlined ‘filtering’ process; whereby the Monitoring Officer, in consultation with one of the Independent Members (list will have to be drawn up), would filter cases, on a case by case basis, to determine if the complaint required a formal investigation and before bringing the results of any such investigation(s) to be determined by a relevant Hearing Committee;

(b) Hearing Committee(s) need not be stand alone and could be amalgamated with other existing Committees of the Council (for example, the Audit Committee) or a new one created, perhaps, called a Governance Committee covering Audit, Finances and Standards business;

(c) In terms of sanctions, under the Bill, for a breach of any Code of Conduct established by a local authority, the Authority would only have the power to censure a Member (including, perhaps, the withholding of remuneration under the Members Allowance Scheme and, perhaps, the withdrawing of Council facilities for a limited period) and not have the power to suspend or disqualify Members for a breach of the Code of Conduct;

(d) The Bill retains the declaration and registration of financial and other interests requirements but with the Secretary of State prescribing such matters by Order (as yet unpublished);

(e) The Magistrates Court will also have the power to disqualify a Member for up to 5 years in relation to that local authority or any other relevant authority, i.e. – the disqualification may not be ‘universal’ and may "allow" a "disqualified Councillor" to stand at a neighbouring authority, unless the disqualification specifically prevented such behaviour. It is understood the Government intend to review Section 80 of the Local Government Act 1972 in relation to the general disqualification of Members from becoming or remaining Councillors. The Government should, therefore, make any disqualifications universally applicable as discreditable behaviour should not be avoided by a person simply standing to become an elected member at another local authority.

ANNEX A : Planning Aspects


The principles of Localism, in terms of empowering local communities, is welcomed along with the continued emphasis on the value of the planning system and the important role that local authorities play in coordinating the future development of local areas. The Bill does however present some key challenges in terms of implementation of neighbourhood planning and ensuring that an efficient and effective planning system remains to deliver sustainable development.

Proposed Amendments

- Implementation

One of the key challenges of the Bill is the ability of Local Planning Authorities to resource the introduction of neighbourhood planning whilst still meeting the existing requirements and pressures. The Bill proposes a range of procedural changes but these are minimal in their actual lifting of the burden on Local Planning Authorities or for freeing up resources. There is a need to be mindful of the limited impact of those changes at the same time as an additional requirement for neighbourhood planning presents pressures on the resources and ability of Local Planning Authorities to ensure delivery of an efficient and effective service.

With neighbourhood development plans forming part of the statutory development plan there is a strong emphasis on technical assessments (SEA/SA and EINA) and suitable evidence to support policies in those documents and any independent examination. There is already a significant burden on council resources due to the requirements of producing statutory development plan documents and the Localism Bill underplays the requirements of neighbourhood plan production. Similarly neighbourhood development orders also present a challenge for Local Planning Authorities in assessing, mediating but also enforcing implementation.

Amendment - The Bill needs to emphasis the ability of the Local Planning Authorities to manage the number of neighbourhood plans and orders they support in any given year.

Rationale – To give Local Planning Authorities the ability to marshal resources and reflect complexity that plans present. Also need to ensure that all areas have the ability to put forward plans and these are targeted toward those areas that could potentially need the most support, particularly in regeneration areas.

National planning policy framework –

In order to deliver the wider social, economic and environmental objectives for the country in the absence of Regional Strategies the local tier of planning requires coordination and guiding principles that have weight in decision making. The emphasis on a concise and clear national planning policy framework (as distinct from policy statements related to particular infrastructure developments) should enable the local level to operate without significant top down pressure but provide clarity and leadership on the national interest and the wider sustainability aims including economic growth, housing and climate change.

Amendment - An amendment should be made with the affect that a national planning policy framework will be produced and be subject to Parliamentary approval.

Climate change is the greatest long-term challenge facing human development. It is one of our biggest economic, social and environmental challenges. The planning system has a central role in meeting the challenges presented by Climate Change. Given the importance of Climate Change it is vital that this duty is effective on all aspects of the planning process. This amendment is set to be put forward by the Town and Country Planning Association.

Amendment - After Clause 90 in the Localism Bill:

‘(1) In Part 3 of the Planning and Compulsory Purchase Act 2004 insert-

"39A Climate Change

(1) This section applies to any person who or body which exercises any


(a) under Part 2 in relation to local development documents;

(b) under Part 4 in relation to development control;

(c) under Part 6 in relation to the Wales spatial plan or a local development plan; and

(d) under Schedule 4 of the Planning Act 1990 in relation to neighbourhood development plans and neighbourhood development orders.

(2) The person or body must demonstrate that the development and use of land under consideration has taken into account the implications for climate change and includes appropriate mitigation and adaptation’.

Neighbourhood Forums

1. Involvement of businesses

Amendment – Including reference to businesses as part of the neighbourhood forum either as a collective through a Business Association or Forum, which could include a BID or individually where they have a clear stake in the local area. A possible amendment to this affect has already been proposed by David Ward MP (amendment 207) as follows:

Schedule 9 Part 1 Section 61F (5) (a) Insert after individuals living, ‘or businesses registered’

Schedule 9 Part 1 Section 61F (5) (b) Insert after individuals living, ‘or businesses registered’

Rationale – Neighbourhoods can manifest themselves in many ways and businesses play an important role in many local areas through their investment and job creation. The role of businesses is perhaps intrinsic in the social and economic well being of an area and as such their role needs to be properly acknowledged in determining the future planning of the local area.

2. Membership of Forums

Amendment – Remove reference to those "wanting to live" in an area being able to form a neighbourhood forum.

Schedule 9 Part 1 Section 61F (5) (a) Delete reference to ‘or wanting to live’

Schedule 9 Part 1 Section 61F (5) (b) Delete reference to ‘or wanting to live’

Rationale - It is unclear how prospective residents who do not have a stake in the area through land or property would be best placed to understand the needs of an area or represent the interests of others living in the area. There is an issue as to how legitimacy of a desire to live in area can be assessed.

3. Accountability of Neighbourhood Forums

Amendment – Inclusion of reference and emphasis on the need for forums to demonstrate legitimacy and accountability to the wider area. A referendum on the setting up of a neighbourhood forum should be included.

Rationale – It is unclear how three members from a neighbourhood setting up a forum would be in a position to represent the needs of the whole community. Provision needs to be made to ensure that those members of the forum represent the wider interest and are best placed to serve the neighbourhood.

Various amendments have been proposed which provide for an increase in the requirement for there to be three members of a forum or the use of mechanisms such as parish or community councils. The government should consider these carefully as well as the option of requiring a forum to be legitimised through a referendum (which would be consistent with the requirement to endorse a neighbourhood plan in this way). In addition we would urge the Government to consider how forums can work together with other aspects of local democracy such as elected ward councillors or ward (area based) committees.

Neighbourhood Development Orders

Amendment – Include wording setting out that the principles of neighbourhood development orders are tested and set out through the neighbourhood development plan or Local Plan and detail then comes forward in the order.

Schedule 9 Part 1 Section 61E. Insert new sub-section after (2): ‘A neighbourhood development order may only be made where the area and proposal is subject of an adopted neighbourhood development plan or Local Plan’

Rationale – having clear link between the different levels of planning will assist in creating a more consistent and transparent system. Impacts of neighbourhood development orders could be wider ranging than the immediate locality of the order. The neighbourhood development plan presents the opportunity to test the idea of relaxing planning controls for a neighbourhood or part of one and link into broader principles for how development should happen in an area.

Neighbourhood Plans

Amendment - The Bill should give local authorities the power, in conjunction with neighbourhood forums, to determine whether a Neighbourhood Development Plan should be a supplementary planning document or a development plan for the area.

Rationale - Producing plans at the most local of levels is important to ensure communities get a much greater say in the way their area develops. In giving communities this power consideration also needs to be given to the appropriate method by which this can be implemented. The level of work, including technical requirements and examination of producing a development plan document, need to be considered against the outputs and coverage they provide. Where a neighbourhood plan is being produced to allocate sites for development then the only option is for a development plan document to be produced. However there will also be cases were no new land over and above the Local Plan is identified and the neighbourhood plan focuses on policies to direct how the area develops. In this case a development plan document would not be the most time and resource efficient means to provide this detail for both the local community and the local planning authority. In such instances a supplementary planning document would be the most appropriate format providing a planning document that is a material consideration whilst being proportionate to the scale of the task in terms of resources, time and technical input.


Welcome any approach that streamlines the enforcement process

Pre-application consultation

Amendment – The Bill needs to clarify the threshold at which pre-application consultation takes place to cover schemes that are likely to have an impact on the neighbourhood in which they are proposed. Reference Local Planning Authorities being advised of the undertaking of pre-application consultation with communities should be made and with opportunity to input to the process.

Rationale – The need for transparency is important. The involvement of the Local Planning Authority upfront in the process will ensure that schemes are not presented to communities that may not have been fully considered against the Local Plan and other material considerations. LPAs should also be able to determine the types of development that should undergo pre-application consultation to reflect the fact that one scale of development in one part of the country may not be as significant as in another part.

ANNEX B : Housing Aspects

CHAPTER 1 – Homelessness (Clause 125)

As well as being able to discharge our statutory homelessness duties into the private sector we would welcome extending the statutory duty to meet homelessness needs to extend to Housing Associations. This will become particularly important following the introduction of flexible tenancies (see below).

CHAPTER 2 - Tenancy strategies (Clause 127)

We are very positive about the local housing authority taking a strategic view of tenure reform in their area. However, at a time when local authorities are having to prioritise their resources it is important that this is meaningful. There should be a regulatory requirement for social housing providers in the area to comply with the strategic tenancy policy. Without this requirement it is not clear how the introduction of flexible tenancies will meet its aim of making a better use of social/affordable housing stock to meet housing need.

- Flexible tenancies

It is important, to avoid residualisation of council housing and increased management costs, that councils have the power to vary rents. Rather than requiring tenants to move, as they take up employment or improve their economic circumstances, we would also wish to have the flexibility to be given to local authorities to increase existing social housing rents. This could help retain more economically active tenants, increase income to fund development or reinvestment and aid the aim of a wider mix of household types living side by side.

We would also envisage using flexible tenancies as an additional form of tenancy rather than a replacement for existing introductory or probationary tenancies.

Whilst we are aware there is no specific proposal to amend current Homeless Legislation we believe that any duty to re-house a tenant in the housing association sector who loses their flexible tenancy should rest with the individual Registered Provider that ends the flexible tenancy, and not fall directly to the local authority (see chapter 1 above)

CHAPTER 3 - Settlement Payments in April 2012

The abolition of the current national system and the reallocation of debt will result in major transfers of cash between central/local government (in excess of £13.2billion of payments and refunds of £5.6billion).

These are substantial cashflows and the settlement period needs to take due account of the availability of resources in the capital markets and the implications on interest rates (the latter in respect of the PWLB have already been increased as part of the GSR October 2010).

The regulations need to be pragmatic to ensure that unnecessary costs are minimised.

- Reopening of Settlement (Clause 142)

The provisions relating to the potential reopening of the debt settlement by the Secretary of State need to be considered carefully (as this retains an ongoing level of local uncertainty in the future).

Consideration should be given to specifying the specific conditions under that would require a reopening of the settlement e.g. change in national rent policy, interest rates.

- National Capital Receipts Pooling

The GSR proposes to retain the current national capital receipt pooling system to 2014/15.

This system would undermine the self financing proposals and would not promote prudent long term asset management.

The retention of the system should be specifically time limited to 2014/15 to provide certainty and long term investment planning.

The local evidence suggests that the 25% of RTB receipts that would be retained locally would be insufficient to cover the debt outstanding on the properties that are sold. This will not promote long term sustainability and jeopardises investment.

The current local RTB valuation (after application of qualifying discounts) for our properties sold in 2010/11 is estimated at £65,000. This implies a local retention of £16,000 and would not be sufficient to cover the average debt outstanding per property of £17,000 following the debt settlement. This position is unlikely to improve given the current national housing conditions and the declining property values.

As a minimum the provisions should allow the repayment of all specific debt associated with the property prior to pooling the receipt between the CLG (75%) and local authorities (25%).

- Limits on Indebtedness

The establishment of a maximum ceiling of debt is prudent from a public finance perspective.

The proposals imply that this debt limit would be subject to annual/periodic review and the limit adjusted downwards to reflect debt repaid.

This framework would continue to maintain present inequities between local authorities and other registered social providers.

The local authority debt is secured against an asset and it would be preferable for the debt levels to be controlled by introducing two key ratios relating to affordability and long term sustainability e.g. debt should not exceed 50% of the value of the asset.