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Draft Local Government (Organisation and Standards) Bill Appendices to the Minutes of Evidence - First Report


Memorandum by Wandsworth Borough Council

  Report by the Chief Executive and Director of Administration on a proposed response to the Government White Paper "Local Leadership, Local Choice".


  This report summarises proposals in the Government's White Paper on requirements to change the organisation of councils, and the ethical framework. It sets out the proposal to divide councils into executive and non-executive portions, and to adopt new constitutions including executives on one of three models: elected Mayor plus cabinet, elected Mayor and Council Manager, or Leader plus cabinet. The proposals involve non-executive members adopting a role of scrutinising executive decisions, providing advice to the executive, developing policy and carrying out regulatory functions. Although full professional etc advice on all executive decisions would be published under these proposals ( in contrast to the Mayor for London) no early notice of business, advance publication, or public access to or debate on decisions is required. The proposed ethical framework reflects earlier White Papers, and includes locally-approved codes of conduct for councillors derived from a national model, local standards committees, a National Standards Board to investigate cases of alleged impropriety and an Adjudication Panel to hear cases and settle punishments. The report includes comments from the Leader of the Council in which he recommends that the Council's response should follow previous policy in rejecting the prescriptive and untested executive models, which he regards as divisive and much poorer in terms of access to information and transparency of decision-making.

1.   Recommendations

  The Committee are recommended to recommend to the Council:

    (a)  that the proposals in the White Paper be generally rejected for the reasons previously stated by the Council and in particular because of their divisive nature, lack of openness and transparency, and the absence of any practical experience or evidence that they would work;

    (b)  that the Leader's views, as set out in paragraphs 22 to 36 in this report, be accepted as the Council's detailed comments and sent to the Secretary of State for the Environment, Transport and the Regions;

    (c)  that the Secretary of State's attention should be particularly drawn to the deficiencies in openness, public accessibility to information and the decision-making process and the lack of early information for the public on decisions being taken that are all implied by the proposals; and

    (d)  that the significant inconsistency between the GLA/Mayor for London proposals on published information on Mayoral decisions, and those included for these arrangements be drawn to the Secretary of State's attention, and that he be urged to enhance and stardardise both, in order to reflect the current standards on openness and access to information for all decisions.

2.   Introduction

  In January 1998 the Government published the first of four Green Papers on local government reform: "Modernising Local Government, Local Democracy and Community Leadership". This set out several proposals for reform, including the possibility of introducing executive mayors and cabinet structures for councils and dividing councillors into executive and non-executive classes. The Council responded to this following a report by the Leader of the Council to the Policy and Finance Committee on 18 March 1998 (Paper No 98/279). Subsequently, in April 1998, a further Green Paper in the series was received—"A New Ethical Framework", proposing a new National Code of Conduct for Councillors for local adoption, and a network of local authority standards committees, and independent National and Regional Standards Boards. The Council responded to this following a report from the Leader to this Committee on 1 July 1998 (Paper No 98/491). A White Paper—"Modern Local Government—In Touch with the People" was subsequently issued in July 1998, and this represented many features from the previous four Green Papers. A response to this was presented to the 23 September 1998 Policy and Resources Committee (Paper No 98/681).

  3.  Last month the Government issued a further White Paper containing more detailed proposals on Chapter 3 (New Political Structures) and Chapter 6 (A new ethical framework) of the July 1998 White Paper. This was entitled "Local Leadership—Local Choice", and was accompanied by a draft Bill—the Local Government (Organisation and Standards) Bill.

4.   Timetable

  The White Paper talks of the legislation being introduced "when Parliamentary time allows", with no indication of when that might be. Comments are invited on the White Paper and the draft Bill by 21 May 1999. Copies of the White Paper and draft Bill have been placed in the Members' Room and provided to both Leaders. The Department of the Environment, Transport and the Regions (DETR) have also produced a summary of the paper and a copy of this is included with this distribution for all Committee Members.

5.   Proposed response

  The Leader of the Council has been consulted on the details set out in the current White Paper and has consulted his colleagues. His views are broadly that Council policy—generally opposing these initiatives for a variety of reasons—should remain broadly unchanged and that the Council should be recommended to respond accordingly. The Leader's detailed views are included later in this report.


  6.  Full details of the proposals are included in the Government's summary version and are therefore not reported here: paragraphs below highlight the main features.

7.   New Council organisations

  Chapter 3 of the White Paper outlines plans for all councils to be split into executive and scrutiny functions under a new constitution. Three optional models for the executive are proposed:

    (a)  a directly-elected Mayor plus a cabinet;

    (b)  a directly-elected Mayor plus a Council manager; and

    (c)  a Leader plus a cabinet.

8.   A new Council constitution

  A new Constitution would be required whereby the full Council would be responsible for approving:

    (a)  capital and revenue budgets;

    (b)  appointment (or confirmation of the Chief Executive and Chief Officers);

    (c)  any departure from approved budgets and strategies;

    (d)  the Council's constitution (and amendments to it) and appointments to such Committees and Sub-Committees that exist; and

    (e)  all strategies and key plans (such as the education development plan and the local transport plans).

9.   Non-Executive Councillors

  Non-executive councillors would have a scrutiny and regulatory role under these proposals. They would

    (a)  investigate broad policy issues;

    (b)  consider budget plans;

    (c)  provide advice;

    (d)  review the executive decision-making and policies (via scrutiny and overview committees);

    (e)  manage expanded community dialogue, involving devolved consultative arrangements;

    (f)  provide advice to the executive; and

    (g)  sit on such regulatory committees as exist such as planning and licensing, from which the executive would be excluded.

  10.  The arrangements are theoretical and are not in full operation anywhere, although some authorities such as Hammersmith and Fulham attempt to operate an executive/scrutiny division within current legislation. The Leader comments on these experiments below.

11.   Size of Executive

  The executive would have a maximum size prescribed of 15 per cent of the full Council, rounded down, or 10 Councillors whichever is the smaller (this would be nine for Wandsworth at present). The executive councillors cannot sit on regulatory committees such as planning (an important division which does not exist under present ad hoc cabinet models), but must take responsibility for all Council decisions other than those mentioned above as reserved for the full Council. This would require the current statutory status of certain committees, such as Social Services, to be abolished. Whereas the party balance is to be maintained on the scrutiny and overview committees and regulatory committees, the executive is envisaged as a single-party entity or a coalition.

12.   Election of Mayor

  Any Mayor is planned to be elected by a supplementary vote (SV) system whereby a voter records a second preference vote for use if no candidate gets an absolute majority on the first vote. This is the same projected method as the Mayor for London. If the Mayor presides over a Council Manager structure, it is not envisaged that the Council Manager would also be elected: this is seen as an officer appointment made by the full Council, typically the Chief Executive.

13.   Meetings and Access to Information

  Under the proposed arrangements, regulatory committees such as planning, and new scrutiny and overview committees will be subject to current arrangements for access to information and (presumably) public access to meetings. This would also apply to the full Council and any other committees and sub-committees. It is stated that political advice to the executive would remain private and that the executive must be free to determine a political view on an issue and weigh that in private, although local people and councillors outside the executive would need access to information on the decisions being taken by the executive. The proposals, therefore, include (rather tentatively) for advice from officers to be fully recorded with decisions and published, and for the Council's monitoring officer to ensure that all members of the executive comply with this. In addition, the overview and scrutiny committees would be able to ask for factual information to support their work and would need a "regular and open" dialogue with the executive. To the extent, however, that many decisions now taken after public debate in service committees would be taken in private by executive members and not be later raised by scrutiny committees or at full Council, the open character of the current arrangements would clearly be largely lost. It is noteworthy, however, that even these requirements for openness, recording and publication of all officers' professional advice differ from those proposed for the Mayor of London and are slightly less opaque.

14.   Mayoral veto over the Council

  It is suggested that an elected Mayor might enjoy an American-style ability to veto Council decisions, for one week after they have been notified to him or her. This would only be a potentially delaying tactic, however, since the decision would be presented to the next full Council for a final and binding decision. It is suggested that such mechanisms would be a matter for local discretion and design as part of the local constitution.

15.   Budget-setting and approval

  The budget-setting arrangements would change under an executive-type Council organisation. Whilst the timetable and general statutory requirements would remain, the executive would draft up a budget in the light of recommendations from scrutiny, etc committees and then put it to full Council for approval. Conflicts could be resolved in a variety of ways—to be decided locally as part of the constitution. These could for example be similar to those proposed for the Mayor/GLA budgets (two-thirds majority of the GLA needed to over-ride a Mayor's budget) or could be parallel with general veto procedures to defer for one cycle and refer back to the next Council meeting.

16.   Arrangements for Local Referendums on Council Organisation

  The White Paper sets out (in Chapter 2) proposed arrangements whereby local people would be able to decide on a new form of local council organisation by way of a referendum, which would be binding on the council. Detailed statutory guidance on these referendums and suitable regulations is awaited.

  17.  The Government considers that there should be local consultation on the issue of local organisation, which it sees as key to its "modernisation" agenda for local government. It does not, therefore, favour single options. There would be two main opportunities to test local views with a referendum:

    (a)  a council could propose, after consultation, the form of local governance it considers appropriate, draw up a new constitution and hold a referendum on this; and

    (b)  if 5 per cent or more voters (around 10,000 electors in Wandsworth) petition the Council to hold a referendum for a directly-elected Mayor option, again the Council would draw up a suitable constitution and hold a referendum on the matter.

  18.  If a referendum proposition is not supported, no further referendum on the matter is allowed for five years, and a council would continue as it was.

  19.  A significant difference from previous consultation papers is the limited range of options available. A council cannot continue as it is unless a referendum proposition is rejected. The Secretary of State plans to take powers to require an authority to hold a referendum if it is neither petitioned to do so, nor comes forward with its own proposals. However, provided a council is willing to move to one of the three prescribed models (ie including a Leader with cabinet) it would appear that a referendum would not be enforced. It would appear therefore, at present, traditional ways of council working could only continue in the five years following a failed referendum proposition.


  20.  The Government state (in Chapter 4 of the White Paper) that the proposals in their previous White and Green Papers for a new framework have been broadly welcomed by local government. They therefore propose to proceed on these general lines suggested, including:

    (a)  the current National Code of Conduct will be replaced by local codes of conduct to be adopted by all councils and based on a model code to be developed by the Local Government Association (the LGA), which would in turn be based on a set of principles approved by Parliament. Certain parts will be mandatory;

    (b)  all principal authorities will set up Standards Committees which will be required to advise on the local adoption of a code of conduct, supervise advice and training for Councillors on ethical matters, and investigating and dealing with less serious allegations of impropriety referred from the national Standards Board. This Committee must have at least one independent co-opted member and not more than one member of the executive;

    (c)  establishment of a new national quango, the Standards Board, responsible for receiving, investigating and reporting on allegations of breaches of the Code of Conduct. The Secretary of State will appoint investigating officers (Ethical Standards Officers or ESO's) to this body together with a Board of non-executive members. As part of these new arrangements a separate Quango, the Adjudication Panel, will be set up to hear individual cases referred across from the Standards Board and, if appropriate, impose a suitable penalty;

    (d)  introducing a statutory Code of Conduct for local authority employees, to be approved by Parliament after consultation; and

    (e)  repeal of surcharge provisions and creation of a new offence of Misuse of Public Office are being pursued, but these provisions are not included in the draft Bill.

  21.  In presenting more detailed suggestions on some of the above features, the White Paper admits that some concern was expressed in response to earlier consultation on the dangers of the new organisational proposals in that they concentrate decision-making in the hands of a few executive councillors. These concerns extended to the risks of greater secrecy with the new elected Mayor and cabinet models and an increased chance of unethical conduct. These were concerns strongly voiced by this Council. The Government does not believe that this will happen and believes that the reporting arrangements on decisions and the new ethical framework will minimise the change of unethical behaviour.


  22.  The Leader's views are as follows:

  None of these new proposals rectify any of the earlier defects—in fact in many respects they are worse. In earlier responses this Council has made it clear that it does not agree with the Government's analysis of the lack of performance by some authorities nor the suggested remedies. There are ample flexibilities in the present arrangements to permit innovation without the risks, bureaucracy and costs of referendums, scrutiny committees and new Quangos now proposed.

23.   Organisation options

  It is particularly worrying that the Government now proposes only three options for organisational structures, none of which have ever been piloted. A much greater local flexibility should be allowed, including the "no change" option. It is naive to think that the majority of councillors will be content with a scrutiny role. As this Council has pointed out, the whole thrust of the Government's proposals is divisive, likely to discourage high calibre councillors from coming forward, and based on academic and untested notions that "scrutiny" can be detached effectively from decision-making.

  24.  The virtue of the current system is that it offers flexibility, known procedures and accessibility. It links back-bench councillors into live involvement with all major decisions and plans via operational or service committees. Without detailed briefings, officer presentations and full reports on open public agendas, back bench members will be neither motivated or enabled to get involved in the detail of policies and decision-making. Reports from Hammersmith and Fulham suggest this is exactly what is happening there—a disenchanted, less well-informed back bench caucus with an impossible task of monitoring a high volume of decisions via scrutiny arrangements with inadequate prior notice of key issues that are coming forward. This replaces the clear focus and expertise built up by service-oriented committees.

25.   Secrecy

  From one point of view, the Government have made a partial recognition of the dangers of the new system by differentiating them from those provided for disclosure of information on Mayoral decisions in the GLA Bill. They have at least acknowledged the dangers of behind-closed-doors decision-taking by an executive without a requirement to record and make available officers' reports on each decision. This Council has stated that professional legal and financial assessments from officers tendered to executive councillors should be part of the published information on all decisions. The requirement for the Monitoring Officer to ensure that all this happens is welcome. Similar arrangements must be written into the GLA Bill immediately, and I suggest that this point be specifically endorsed by the Committee and drawn to the Secretary of State's attention.

  26.  However, these attempts to bolster up the transparency and probity of any new executive-style arrangements still represent a major deficit in terms of openness and accessibility in comparison with the current tried, tested and well known system. The Mayor and Cabinet will not meet in public or publish papers and agendas in advance. Who will know what decisions are coming up? How can local residents and press know what is imminent and send in petitions, letters or seek deputations?

  27.  Publication of decisions will be after the event and the "scrutiny" portion of the Council will have to comb through long (and completely unstructured, if Hammersmith is typical) lists of business and quickly make a forlorn attempt to promote a real and open debate on something they will have typically had little briefing or information on. This represents a huge deficit on the rights of access to information for not only the press and public, but the back-bench councillors as well, even in relation to matters which affect their wards. The new proposals, therefore, undermine the very foundations of effective ward representation inherent in the current arrangements.

  28.  The Government must radically revise these half thought-out ideas if they are to replicate the safeguards of the existing system. The decisions of the Mayor and executive must be based on full reports, published in advance, and containing all information from professional officers. The reports should be debated and agreed by the executive in public, so that interested parties could attend and make representations, as now.

29.   Committees

  The White Paper, as previous ones, attacks the committee system as an evil and prime cause of poor council performance. Ironically, now more details are mapped out about how the new arrangements might work, we see the committee is actually back with a vengeance! Far from being streamlined, the new arrangements will have:

    (i)  Regulatory committees (at least for Planning and Licensing functions);

    (ii)  Overview and/or scrutiny committees;

    (iii)  Standards committees;

    (iv)  Area committees/or neighbourhood forums;

    (v)  Joint committees with other bodies;

    (vi)  Special (Access to Personal Files Act) Review Committees;

    (vii)  Advisory committees to Mayor/Council Manager;

    (viii)  Committees of the Executive;

    (ix)  Independent committees (eg advisory on Members allowances etc); and

    (x)  Sub-committees, appointed by full Council.

  This is, of course, without mentioning appeals, staff management, housing benefit reviews and other routine matters, partnership committees, town centre committees or other possibilities reflecting local circumstances. It is quite clear from (i) to (x) above that even at this stage the new arrangements have worse potential for exactly the time-wasting, "talking shop" type of committees the Government say they are trying to get away from.

30.   Referendums to test public views

  The Government's tactic here is based on tests carried out by friendly Labour councils and no doubt focus groups. It assumes that the public will like the sound of elected Mayors and vote for them, largely on the assumption that they cannot be worse than most poorly performing councils. However, it is quite unrealistic to expect the public to understand the full implications of the new system—after all it has never been tried. They probably have expectations that the Government will not be suggesting options that involve curtailing access and openness in the severe manner outlined above. The public cannot be expected to understand the procedural and organisational details of a complex multi-functional agency like a modern council, with a gross annual revenue stream of perhaps £0.5 billion. It is quite ridiculous to suggest that the whole range of varied implications, from loss of openness, to the sweeping away of statutory social services committees, etc. could be encapsulated in a single referendum question.

  31.  Quite apart then from the fundamental con trick of mounting a referendum on something the public cannot reasonably be expected to know about (or in fact speculate about, since there is no experience), there are many practical concerns about the referendum.

  32.  Until regulations on the referendums, etc are available it is not possible to comment in detail. However, concerns must be expressed about:

    (a)  the likely costs of referendums;

    (b)  rules about publicity: will councils seek to influence local public opinion and hence invalidate the results?

    (c)  difficulties in vetting petitions. Presumably petitioners will need to be identified by their electoral register number, but even then the labour of checking 10,000 names (or many more for an authority like Birmingham) must be questionable. Even then impersonation or fraud cannot be ruled out, since the referendum returning officer would be unable to readily authenticate 10,000 signatures (unless features such as national identity cards are introduced).

33.   Proposed Ethical Framework

  The proposals for Standards Committees and a Standards Board and Adjudication Panel represent a development of the Government's previous thinking, which the Council has criticised as being bureaucratic and over-complex. The undesirable feature of a multiplicity of local codes of conduct is still included, whereas the Council has supported the idea of a clear single national code that could be universally applied and understood.

  34.  The Government's argument that the apparently tougher and more extensive regimes for monitoring ethics will prop up and make acceptable the weakness and risks of the executive model is not valid. No bureaucracy is likely to be at all effective in minimising the much greater risks of "closed doors" decision taking by executives and Mayors, simply because so much more will be invisible.

  35.  I propose that the Council should welcome the positive features of the ethical framework as before, but continue to argue for a single code and local flexibility to decide whether ethical matters require a separate local standards committee (likely to marginalise these issues) or could be dealt with as high priority at Policy and Resources Committees.

  36.  Clearly the Council will need to establish a standards committee at an appropriate time if the proposals go through—meanwhile the Council should continue to give the highest level consideration to ethical matters via the Policy and Resources Committee, as it has always done.

37.   Conclusions

  The Leader of the Council proposes that the views expressed by him in paragraphs 22 to 36 above form the basis of the Council's response to the Secretary of State for the Environment, Transport and the Regions. The Committee should also note in particular that the Leader of the Council considers that his comments on the inconsistency between the proposed arrangements for publishing professional officers' advice on Mayoral decisions under the GLA Bill for the Mayor for London, and those for elected Mayors in the draft Organisation and Standards Bill (paragraph 25) should be specifically endorsed and drawn to the Secretary of State's attention. It is further proposed that the Leader of the Council's suggestion that all matters of ethics continue to be dealt with by the Policy and Resources Committee for the time being, but that steps be taken to set up a Wandsworth Standards Committee as soon as clear guidance and a timetable for these new arrangements is issued.

23 June 1999

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Prepared 11 August 1999