Political and Constitutional Reform CommitteeWritten evidence submitted by the Local Government Association

The LGA is a voluntary membership body and our 422 member authorities cover every part of England and Wales. Together they represent over 50 million people and spend around £113 billion a year on local services. They include county councils, metropolitan district councils, English unitary authorities, London boroughs and shire district councils, along with fire authorities, police authorities, national park authorities and integrated transport authorities.

In our submission we answer the questions put forward in the call for evidence that we believe are applicable to our overall response.

1. Should the relationship between central and local government be codified? Should codification of the relationship between central and local government be considered in the context of a wider constitutional codification?

Written statements of the relationship between central and local government are already in existence; namely the UK’s ratification of the European Charter of Local Self Government in 1998 and the Central-Local Concordat (2007). In light of this further work to codify the relationship is unnecessary. Previous attempts to codify the relationship between central and local government have not resulted in a whole-scale change in the powers available to local government and central local relations and have had limited practical impact on the powers available to councils and relationship between central and local government.

More important is that action to put the aspirations of both documents into practice in a way not previously achieved to date. Enactment of a general power of competence for local government would enable a redefinition of the relationship between central and local government through bottom up action. We talk more about the importance of such a power in our response to question 8.

Codification of the relationship between central and local government would also sit uncomfortably if it were not accompanied in the context of a wider constitutional codification.

In light of our answer to question 1, questions 2–6 are not applicable to our response.

2. If codification is appropriate, what degree of independence from central government and what powers should local government be given?
3. How, if at all, should the status of local government be entrenched, or protected from change by central government?
4. What consequences should codification or other change in the relationship between central and local government have on the accountability of local authorities to elected local politicians, local people and central government?
5. Does the devolution settlement provide a relevant model for a possible codification of the status of local government?
6. Are there examples of constitutional settlements between central and local government in other countries that are relevant to an appropriate model for the UK?
7. What is the value of existing attempts to codify the relationship between central and local government, through: Central-Local Concordat or the European Charter of Local Self-Government? Should this Charter be placed on a statutory footing?

The Chairman of the LGA and the Secretary of State signed the Central-Local Concordat in 2007; both parties intended the Concordat to signal a significant change in the central/local relationship.

The Concordat was signed against the backdrop of the Government having unconditionally ratified the Council of Europe’s Charter of Local Self-Government in 1998. That document provides a benchmark for central-local relations where it is widely accepted, that the UK government had not, at the time the Concordat was negotiated, fully implemented. Indeed, a 2006 Council of Europe review of central control over local government placed the UK in the “control/supervision increasing” category, alongside Azerbaijan.

The Concordat established a useful set of operating principles. In a number of cases the policy landscape has changed significantly so as to render parts of the agreement no longer relevant—for example the role of LAAs in aligning central and local government actions. There have also been a number of suggestions that the Concordat was breached. In particular occasions have been cited where the government has apparently failed to consult councils or the LGA about proposed changes in the way the Concordat envisaged.

The role of the Concordat in setting out operating principles must now be accompanied by action to turn these principles into reality. As referred to in our answer to question one we feel further codification is unnecessary but we suggest four key actions which would take forward the relationship between central and local government:

1.Providing local authorities with increased flexibility through the Local Government Resource Review. The review is an opportunity to provide local government with the necessary powers to raise revenue through more flexibilities to levy fees and charges and to determine the rate of local taxes. In the context of the recent significant front loaded cuts to local government, providing local authorities with these flexibilities and powers is more crucial than ever.

2.Providing local government with the powers and confidence to act ambitiously through a general power of competence. Further information on the importance of the power is provided in our answer to question 8.

3.Consolidating local government legislation to provide clarity and confidence to local authorities. Whether centralising, devolving or simply regulating parliament produces hundreds of pieces of legislation each year that need to be implemented by local government. Recent research indicates that in the last ten years parliament passed 4,000 pieces of legislation, statutory instruments were passed relating to local government1. The volume of legislation impacts on councils’ ability to respond to the needs of local people by creating uncertainty about their powers. Providing clarity and confidence is key; this is best achieved through a consolidation of local government legislation.

4.Involvement of local government in pre scrutiny of legislative proposals with an implication for local government. Of course some of this legislation and policy-making is justified and helpful to local government. Some however is not well constructed and leads to unintended consequences which necessitates yet more action on behalf of parliament to resolve. Local councillors can add value to the legislative process by bringing to bear their experience on the ground. The LGA’s publication One Country Two Systems2 proposes that parliament should set up a “committee” charged with pre-scrutinising legislative proposals with local government implications and should involve local government leadership in this. Such a committee already exists in the House of Lords to scrutinise “whether the provisions of any bill inappropriately delegate legislative power, or whether they subject the exercise of legislation to an inappropriate degree of parliamentary scrutiny”. An arguably similar arrangement is set up on an ad-hoc basis when the government publishes draft bills. Sometimes they are scrutinised by Joint Committees of both Houses, and sometimes by existing departmental Select Committees.

8. How would the “General Power of Competence” for local authorities proposed by the current Government affect the constitutional relationship between central and local government

“Through a new general power of competence councils will be able to do whatever they like as long as it’s legal—creating solutions to local problems without getting permission from the centre” David Cameron, The Guardian, 25 May 2009

A General Power of Competence for local government has long been advocated by the LGA. There is widespread agreement that the current legal arrangements provide an unsatisfactory combination of detailed legal prescription about specific services, and uncertainly about a general power. A power of first resort would support the role of councils as government and not simply administration, taking distinctive decisions to provide for the needs of the place the council represents, and not simply administering the decisions of central government. In summary the power has the potential to redefine the relationship between local government and central government through practical action.

The Well Being power enacted through the Local Government Act 2000 encouraged some councils to introduce new activities. There has however been uncertainty about its exact scope. This concern was much amplified by 2009 Court of Appeal judgement in the Brent LBC v Risk Management Partners. It upheld the position of the High Court, that the London Borough of Brent did not have the power to participate in the Local Authorities Mutual Limited (LAML), a jointly owned company, set up to provide insurance and risk management services to London borough councils. The judgement has created wide concern within local government about the scope of the well being power, Section 2 Local Government Act 2000, and Section 111 Local Government Act 1972.

A clear power of first resort and a framework to simplify and remove restrictions from existing statute, where these create a barrier is in this context critical to give councils the confidence to act ambitiously without fear of legal redress. We need, as far as possible, to create a power which will not be interpreted in the courts in restrictive way.

The LGA wants to work with government to enact through the Localism Bill a general power of competence that delivers on the promise of a power of first resort. The LGA has published a draft bill which we intend as a helpful contribution to this debate3.

2 December 2010

1 Delivering more for less II, Transparency in Action, Local Government Association, 2010

2 One Country, Two Systems?, Local Government Association, 2008

3 Draft Local Government (Power of General Competence) Bill, Local Government Association, 2010

Prepared 28th January 2013