Office of Public Sector Information
381.The amendments made by subsection (1) provide that all authorities which are currently “best value authorities in Wales” for the purposes of Part 1 of the Local Government Act 1999 will be “Welsh best value authorities”, apart from police authorities (since responsibility for policing is generally not devolved to Wales). Welsh best value authorities will be subject to subordinate legislation and guidance made or issued by the Welsh Ministers under that Part.
382.Part 8 of the Act makes provision about the inspection and audit of local services. In particular, sections 147 and 148 of and Schedule 10 to the Act provide for the merger of the inspection functions of the Benefit Fraud Inspectorate (in relation to English local authorities) with the Audit Commission. The intention is that this will avoid duplication of effort and reduce inspection burdens on local authorities.
383.Sections 149 and 150 and Schedule 11 make provision about the interaction between the Audit Commission and other authorities. Sections 153 to 158 and 165 amend the Commission’s powers to produce and publish studies and reports. Sections 159 to 163 update and amend several of the Commission’s powers relating to audit. Section 164 relaxes the restrictions on disclosure of information obtained by the auditor or the Audit Commission.
384.Sections 166 and 167 make provision about the Auditor General for Wales and auditors.
385.This section reduces the number of members of the Audit Commission. At present the Commission must comprise 15 to 20 members. The Act reduces this requirement to 10 to 15 members.
386.This section removes the reference to Wales in the Audit Commission’s official legal title. As of 1st April 2005 the Audit Commission ceased to operate in Wales, with the exception of a very limited residual power relating to its national studies function. Its core functions in Wales are now carried out by the Auditor General for Wales.
387.This section relates to the inspection of the administration of housing and council tax benefit by local authorities in England, which will be taken over by the Audit Commission, following its merger with the Benefit Fraud Inspectorate.
388.This section amends the Local Government Act 1999 to provide that if, following a best value inspection, the Audit Commission has concerns about the administration of housing and council tax benefit by a local authority it is required to send a report on its findings to the Secretary of State, who can then take action if appropriate.
389.This section enables the Secretary of State to make transfer schemes transferring to the Audit Commission property, rights and liabilities relating to the inspection of the administration of housing benefit and council tax benefit by the Benefits Fraud Inspectorate.
390.A transfer scheme under this section may only transfer employees if the employee and the Audit Commission consent to the transfer. Schedule 10 to the Act makes further provision about transfer schemes.
391.This section introduces Schedule 11 to the Act, which inserts a new Schedule 2A in the Audit Commission Act 1998, which makes provision about the functions of the Audit Commission in relation to inspections and about the Audit Commission’s interaction with other inspection authorities, public bodies and others.
392.The new Schedule 2A includes provision enabling the Audit Commission to provide advice and assistance to public authorities whether within or outside the UK (see paragraph 9 of the new Schedule). It replaces the existing provision in section 37 of the Audit Commission Act 1998 (power to provide advice and assistance to certain inspection authorities).
393.This section relates to persons who are authorised by the Secretary of State under section 139A of the Social Security Administration Act 1992 to carry out inspections of the administration of housing benefit and council tax benefit. The Secretary of State is not expected to use the power to authorise such people often once the Audit Commission takes on the bulk of such inspections.
394.This section requires such persons to produce documents setting out what inspections they expect to carry out and how they expect to carry them out, after consultation with the Audit Commission. It requires them to send copies of the final documents to the Audit Commission and the Secretary of State. It requires such persons to co-operate with the Audit Commission. It also enables them to act jointly with the Audit Commission. These new powers and duties reflect the new powers and duties of the Audit Commission in new Schedule 2A to the Audit Commission Act 1998 inserted by Schedule 11 to the Act.
395.This section clarifies the powers of auditors and the Audit Commission to obtain access to documents and information, under section 6 of the Audit Commission Act 1998 (financial audit) and section 11 of the Local Government Act 1999 (best value inspections). In particular, it enables them to inspect computers on which documents are held.
396.This section clarifies the Audit Commission’s existing power to inspect best value authorities’ compliance with their duties under Part 1 of the Local Government Act 1999 (best value). It enables the Audit Commission to carry out general inspections of the performance of best value authorities.
397.Section 153 adds to the list of bodies that the Audit Commission must consult on its proposals for national studies under sections 33 and 34 of the Audit Commission Act 1998. The amendment requires the Audit Commission to consult the Secretary of State to ensure relevant Government Departments are consulted on proposed national studies. The Audit Commission retains a limited residual power in Wales in relation to national studies. The amendments also provides that where a proposed study relates to a body in respect of which the Welsh Ministers may exercise functions, the Audit Commission must also consult Welsh Ministers
398.Sections 35 and 35A of the Audit Commission Act 1998, which allowed the Audit Commission to carry out and charge for consultancy studies at the request of audited bodies, are repealed by this section. Those powers are replaced by the Audit Commission’s new power to provide advice and assistance to public authorities (see paragraph 9 of new Schedule 2A to the Audit Commission Act 1998 inserted by Schedule 11 to the Act).
399.Section 155 confers on the Audit Commission power to provide advice and assistance to all registered social landlords in England, without needing to consider whether they are public authorities.
400.Section 156 of this Act repeals sections 44 to 47 of the Audit Commission Act 1998. Those sections gave the Audit Commission power to require local authorities to publish information about their performance.
401.This section inserts a new section 47A in the Audit Commission Act 1998. It enables the Audit Commission to produce three types of reports on English local authorities: (a) reports on the risk that authorities may fail to perform their functions; (b) reports on the rate at which authorities’ performance is improving; (c) reports on authorities’ use of resources.
402.This section includes a power to report on all English local authorities, individual authorities or groupings of authorities. By virtue of subsection (3) the report can apply to a specific function or functions. English local authorities are defined in subsection (5). This section does not confer any new information-gathering powers on the Audit Commission.
403.The Secretary of State may by order amend the list of bodies which are subject to the reporting power in this section by removing a body from the list or by adding a body which is a best value authority. The Secretary of State may not add to the list a body which is a Welsh best value authority or a police authority for a police area in Wales.
404.Section 158 amends the requirement in section 99 of the Local Government Act 2003 for the Audit Commission to produce reports on its findings on local authorities’ performance in exercising their functions which categorise the authorities. This section provides that the Audit Commission will only need to produce a report if directed by the Secretary of State.
405.This section amends section 3(6) of the Audit Commission Act 1998 which disbars a firm from being appointed as an auditor by the Audit Commission unless each of its members is a member of one or more of the qualifying professional accountancy bodies. The provision is amended so that the Audit Commission may appoint a firm provided that those persons carrying out or supervising the audit belongs to one of the qualifying bodies.
406.Under section 15 of the Audit Commission Act 1998 an interested person can inspect the accounts to be audited and all books, deeds, contracts, Acts, vouchers and receipts relating to them. These rights are wide enough to allow access to the personal information of service users which would otherwise be covered by data protection legislation. This section amends section 15 to provide that personal information is not disclosed if the auditor considers appropriate.
407.This section amends section 16 of the Audit Commission Act 1998 (which gives local government electors the right to attend in person before the auditor to make objections) so that all objections are to be made in writing.
408.This section amends section 29 of the Audit Commission Act 1998 (which provides that the Audit Commission can undertake the audit of any body connected with local government or the National Health Service, subject to the consent of the Secretary of State and the agreement of the body concerned) to clarify the fact that the Audit Commission is entitled to appoint auditors to undertake audits under section 29, as well as doing so itself.
409.The aforementioned section 29 of the Audit Commission Act 1998 is further amended to allow the Secretary of State to give consent to a class of body to be audited e.g. where there are a large number of bodies of the same type.
410.This section amends the restrictions on the disclosure of information obtained by an auditor or the Audit Commission in the exercise of functions under the Audit Commission Act 1998 or Part 1 of the Local Government Act 1999.
411.The amended provision enables-
a public authority (within the meaning of the Freedom of Information Act 2000) to disclose information except where the disclosure would prejudice the effective performance of that authority’s functions;
an auditor to disclose information except where the disclosure would prejudice the effective performance of his functions;
any other person to disclose information with the consent of the Audit Commission or an auditor, such consent to be given unless the disclosure would prejudice the effective performance of the functions of an auditor or the Audit Commission.
412.This section allows the Audit Commission to publish any information provided the publication will not prejudice the effective performance of its functions or those of an auditor.
413.Section 166 confers on the Auditor General for Wales power to provide advice and assistance to all registered social landlords in Wales, without needing to consider whether they are public authorities.
414.This section makes provision for the Auditor General for Wales and an auditor under the Public Audit (Wales) Act 2004 equivalent to provision made by section 164 for the Audit Commission and an auditor under the Audit Commission Act 1998.
415.The Commission for Local Administration, more commonly known as the Local Government Ombudsmen, is an independent body established under Part 3 of the Local Government Act 1974. The Commission comprises a body of Commissioners, consisting of the Local Commissioners themselves, any advisory Commissioners who have been appointed, and the Parliamentary Commissioner for Administration.
416.The Local Commissioners may conduct investigations into complaints from members of the public that they have sustained injustice in consequence of maladministration by certain authorities. The Local Commissioners may also give advice and guidance to authorities on good administrative practice. The Local Commissioners’ jurisdiction covers all local authorities (excluding town and parish councils); police authorities; education appeal panels; and a range of other bodies providing local public services.
417.Part 9 of this Act clarifies and updates the Local Commissioners’ jurisdiction to reflect modern means of local service delivery. It also clarifies and modifies their powers of investigation. It provides for changes to the appointment and removal of the Commissioners, greater flexibility in how complainants access the Commissioners’ service, and wider powers for the Commissioners to delegate their functions. It also amends the funding and reporting requirements on the Commission, and clarifies the Commissioners’ power to issue and publish reports and statements.
418.This section amends section 23(4) of the Local Government Act 1974 to remove the requirement for the Secretary of State to consult with representatives of authorities in England in advance of making recommendations to the Crown for the appointment of new Commissioners (including advisory Commissioners).
419.New provisions are substituted for section 23(5) of the Local Government Act 1974, which provided for appointments as Commissioners to be full-time or part-time. The new subsection (5) makes it clear that a Commissioner’s terms of appointment can be changed with his or her consent from full-time to part-time, or vice versa. New subsections (5A), (5B) and (6A) provide for Commissioners to be appointed for a non-renewable fixed term of not more than seven years.
420.Section 23(6) is amended to remove the requirement for the Commissioner to vacate office at the age of 65. This brings the position of the Commissioners into line with the position of other similar office-holders.
421.Section 23 of the Local Government Act 1974 provides that each Local Commissioner must be given responsibility for cases relating to a particular geographic area or areas. Section 169 amends section 23 to give the Commission greater flexibility to allocate matters between the Local Commissioners.
422.The requirement for the Commission to prepare an annual report is amended so that, in future, the Commission will be required to lay a copy of the report before Parliament. This section also repeals the requirement for the Commission to give authorities and bodies representing authorities the opportunity to comment on the report and on the reports of individual Commissioners.
423.This section inserts a new section 24A into the Local Government Act 1974, which sets out the circumstances in which a Local Commissioner may investigate a matter. The Local Commissioners will continue to have a wide discretion to decide whether to initiate, continue or discontinue an investigation. In particular, section 24A(7) makes it clear that a Local Commissioner may decide not to investigate, or to discontinue an investigation, where he is satisfied with the action that the authority concerned has taken or proposes to take.
424.This section amends section 25 of the Local Government Act 1974. The amendments clarify which bodies are to be treated as an ‘authority’ to which Part 3 of the Local Government Act 1974 applies, i.e. an authority whose actions may be investigated by the Commissioners. In particular, the amendments make clear that services delivered under partnership arrangements with such authorities fall within the Commissioners’ jurisdiction.
425.This section amends section 26 of and Schedule 5 to the Local Government Act 1974 to provide that a Local Commissioner can investigate an alleged or apparent failure in a service which it is an authority’s function to provide, and an authority’s alleged or apparent failure to provide such a service, in addition to his existing powers to investigate maladministration. It also removes the general restriction on a Local Commissioner’s power to investigate contractual and commercial transactions, replacing it with a number of narrower restrictions.
426.This section inserts new sections 26A to 26D into the Local Government Act 1974. Sections 26A to 26C clarify the process for making or referring a complaint to the Local Commissioners, with some amendments. In particular, although a complaint must usually be made in writing, sections 26B(3) and 26C(4) amend the 1974 Act to allow a Local Commissioner to disapply this requirement at his discretion.
427.Section 26D provides a Local Commissioner with a new discretionary power to initiate an investigation into possible maladministration or service failure affecting persons other than the original complainant (if any) where this has emerged in the course of an investigation.
428.This section amends section 30 of the Local Government Act 1974, which deals with the requirements for a Local Commissioner to prepare and send a report or statement of reasons in relation to a matter. In particular, it clarifies and amends what a Local Commissioner can include in a report made under section 30(1). It provides that a Local Commissioner may include recommendations in the report. Where the report relates to maladministration, those recommendations are recommendations with respect to what actions a local authority should take to remedy or prevent injustice.
429.It also clarifies and amends the circumstances in which a Local Commissioner can issue a statement of reasons rather than a full report. It provides that a Local Commissioner must issue a statement of reasons where he has decided not to investigate a matter or to discontinue an investigation of a matter; and may issue a statement of reasons where he has completed an investigation but the local authority takes or proposes to take satisfactory action to resolve it, and it would not be appropriate to prepare and send a full report.
430.Where a Local Commissioner produces a report, section 31 of the Local Government Act 1974 requires the authority concerned to consider the report and, within 3 months, to notify the Local Commissioner of the action which it proposes to take. If the Local Commissioner is not satisfied with the authority’s response, he is required to make a further report recommending action to be taken.
431.At present, section 31 only applies where a Local Commissioner reports that injustice has been caused to a person. Subsection (2) of section 176 extends section 31 so that it applies where a Local Commissioner reports that there has been maladministration, or a failure in, or to provide, a service, even if no injustice has resulted.
432.Subsection (3) of this section extends a Local Commissioner’s existing powers to make recommendations for action which an authority should take to remedy a matter and prevent its recurrence to cover recommendations about a failure in a service or a failure to provide a service, in line with the changes to the Commissioners’ jurisdiction made in section 173.
433.This section inserts a new section 31B into the Local Government Act 1974 to provide an express power to publish reports, statements and summaries of reports and statements, or part of a report or statement, and to supply a copy of all or part of a report, statement or summary, at a reasonable charge, to anyone who requests this. It also provides that a summary supplied in accordance with section 31B should not identify any person apart from the authority or authorities concerned, unless it is in the public interest for it to do so (except if the person identified is the Mayor of London or a member of the London Assembly).
434.This section clarifies that complaints to the Commissioners may be made in ways other than on paper, by providing that references in the legislation to doing something in writing include it being done in writing electronically, for example by e-mail or text message.
435.The new section makes one exception to the ability to communicate electronically. A Minister of the Crown or an authority subject to investigation by the Commissioners may give notice to the Commissioners to prevent them from disclosing information where they consider that it is in the public interest to do so. Any such notice must be given in traditional hard copy form.
436.This section clarifies and updates the restrictions in Schedule 4 of the Local Government Act 1974, which disqualify a person in some circumstances from:
becoming or being a Local Commissioner;
once appointed as a Local Commissioner, from investigating certain matters;
from taking up certain posts at the end of their term of office as a Local Commissioner.
437.The restrictions apply, for example, where there would be a risk of a conflict of interest. The amendments take account of the reorganisation of the Commission’s work under new section 23(8A) of the 1974 Act, and reflect the fact that a person may have taken action on behalf of an authority without having been a member of that authority.
438.This section changes the mechanism for funding the Commission. Instead of being funded through the local government funding mechanism, the revenue support grant, this section provides for the Commission to be paid each year such amount as the Secretary of State determines is required for the discharge during that year of the Commission’s functions, subject to the approval of the Treasury.
439.The existing power for the Local Commissioners to delegate to an officer of the Commission is replaced with a wider power for any Commissioner (including an advisory Commissioner) to delegate their functions.
440.This section inserts Schedule 12 to the Act which contains minor amendments to Part 3 of the Local Government Act 1974 and consequential amendments arising from Part 9 of the Act.
441.These sections give effect to the Government’s proposals for the reform of the regime relating to standards of conduct for local government. Proposals for amendments to the regime were included in the Government’s discussion paper Standards of Conduct in English Local Government: The Future, issued in December 2005. Decisions on action to be taken were then announced in the Local Government White Paper.
442.The proposals are aimed at devolving most decision-making on the conduct regime for local authority members to local authorities, with a revised, regulatory role provided for the Standards Board. The measures provide for local standards committees to make initial assessments of misconduct allegations and for review arrangements for those assessments which lead to no action being taken. The provisions also give powers for the Standards Board to suspend a standards committee’s role in making initial assessments of allegations, and for the Board to issue guidance to standards committees and ethical standards officers.
443.In addition, provision is made for decisions in respect of local authority posts subject to political restrictions to be undertaken by standards committees rather than, as now, by the Independent Adjudicator, and to enable the Secretary of State to issue an order to allow the maximum pay of political assistants to be linked to a point on a relevant pay scale specified by the order.
444.This section amends sections 49, 50, 51 and 52 of the Local Government Act 2000 in relation to the principles that govern the conduct of members and co-opted members of relevant authorities in England and police authorities in Wales, the provisions of the code of conduct they are required to follow and the provisions which such authorities may add to the code of conduct they adopt. The effect is that such principles and provisions may apply to a member when he or she is acting in an official capacity, but the only principles and provisions which may apply to members outside their official capacity are those which prohibit conduct that would (if engaged in) constitute a criminal offence.
445.This section makes amendments to sections 37, 52 and 54 of the Local Government Act 2000. The effect of the amendment to section 37 is that authorities which have not adopted a code of conduct will be under a duty to include a copy of the mandatory provisions of the model code in their constitutions. The effect of the amendment to section 52 is that a person who becomes a member of an authority which has not adopted a code of conduct will be required to undertake that he will observe the mandatory provisions of the model code. The amendment to section 54 will provide for standards committees to assist members and give advice and training to them on following the mandatory provisions of the model code. The amendment to section 54 will also provide for standards committees to monitor the operation of the mandatory provisions of the model code.
446.This section inserts section 57A of the Local Government Act 2000 which provides for individual local standards committees of authorities to undertake the role currently exercised by the Standards Board for England of conducting the initial assessment of allegations of misconduct which relate to authorities’ members or co-opted members.
447.It sets out the courses of action open to a standards committee where such an allegation is received. The options are: to refer the allegation to the authority’s monitoring officer for consideration; to refer the allegation to the Standards Board; or to take no action in respect of the complaint.
448.It also provides that a standards committee has discretion, where the subject of the allegation is no longer a member or co-opted member of the authority in question and has moved to another relevant authority, to refer the allegation to the monitoring officer of the member’s current local authority.
449.The section requires that, if a standards committee decides to take no action over an allegation, it should write to the person who made the allegation informing them of the decision and the reasons for this.
450.The section also makes provision for the Standards Board to issue guidance and give directions to a standards committee with respect to the exercise of these procedures.
451.The section also inserts section 57B of the Local Government Act 2000, to provide, where a standards committee of an authority has made a decision that no action should be taken regarding an allegation, for the person who made the allegation to be able to ask the standards committee to review its decision. The request for review must be made in writing within 30 days of the date of the notice of the original decision. Following receipt of such a request, the standards committee must undertake a new assessment of the allegation and reach a decision within three months of the date it received the request for a review of its original decision.
452.The section also inserts section 57C into the Local Government Act 2000 which provides that where a person makes an allegation of misconduct to a standards committee it must take reasonable steps to give a written summary of the allegation to the person who is the subject of the allegation. Where the standards committee makes a decision that no action should be taken, it must also take reasonable steps to give notice of this and the reasons for the decision to the subject of the allegation. In addition, where the standards committee receives a request to review a decision to take no action, it must take reasonable steps to give notice of this to the subject of the allegation. A power is also included for the Secretary of State to make regulations which may prescribe circumstances in which the duty to give a summary of the allegation to the subject of it should not arise at the time the standard committee receives the allegation but at another time.
453.The section also inserts section 57D of the Local Government Act 2000, to enable the Standards Board to direct that a standards committee’s power to undertake initial assessments of misconduct allegations should be suspended, and to direct that any allegations the standards committee receives must be referred either to the Standards Board or to a specified standards committee of another authority. The section provides a power for the Secretary of State to make regulations concerning the circumstances in which the Standards Board can exercise this power. Subsection (7) of new section 57D provides the Standards Board with a power to issue guidance in connection with section 57D or in connection with any direction under that section.
454.The section also inserts a new section 58 of the Local Government Act 2000 setting out the courses of action open to the Standards Board when an allegation is referred to it for consideration. The Standards Board must either refer the allegation for investigation to one of the Board’s ethical standards officers, or decide that no action should be taken, or refer the matter back to the relevant local standards committee. Where it decides to take no action, it should give notice of the decision and the reasons for it to the person who made the allegation and to a person who was the subject of the allegation.
455.This section requires a relevant authority to furnish the Standards Board with periodic information on the allegations of misconduct its standards committee has received, any requests received to review its standards committee’s decisions to take no action in respect of allegations, and the exercise of functions by the standards committee or the monitoring officer. The authority must comply with the request for information by such date as the Standards Board may specify.
456.Section 53(4) of the Local Government Act 2000 is amended to provide that standards committees of authorities should be chaired by a person who is neither a member nor an officer of a relevant authority.
457.This section has the effect that a standards committee of a relevant authority in England may appoint a sub-committee to undertake any of its functions, including any functions concerning parishes.
458.This section inserts section 56A into the Local Government Act 2000 to empower the Secretary of State to make regulations under which two or more relevant authorities may establish a joint committee and arrange for functions otherwise exercisable by their standards committees to be exercisable by the joint committee.
459.This section amends section 57(5) of the Local Government Act 2000 and Schedule 4 of that Act to provide that the Standards Board may issue guidance to ethical standards officers with respect to the exercise of their functions, and to enable the Board to be able to take action to facilitate the functions of standards committees or monitoring officers.
460.This section makes amendments to sections 59 and 62 of the 2000 Act, amending the description of two of the findings which an ethical standards officer can make and providing that his access to documents will not be limited, as now, to documents relating to a relevant authority. It also extends section 63 to provide that information obtained by an ethical standards officer in the course of an investigation may be disclosed where the disclosure is made to allow the monitoring officer to carry out his duties or it is made to the Commissioner for Local Administration or to the Electoral Commission for the purpose of their functions. An order making power is also provided for the Secretary of State to allow for such disclosures to be made to other people.
461.This section amends sections 64 and 65 of the Local Government Act 2000 to provide that an ethical standards officer’s report on the outcome of his investigation or an interim report on his investigation can be passed to the relevant standards committee in order to assist it in carrying out its functions.
462.It also provides a power for the Secretary of State to make regulations concerning the withdrawal of a reference by an ethical standards officer of matters which are the subject of either his report or his interim report to the Adjudication Panel.
463.This section inserts section 65A into the Local Government Act 2000 to allow a monitoring officer to inform any member or officer of an authority of the outcome of an ethical standards officer’s investigation into an allegation, and also to furnish them with a copy of the report or any part of it where this will help to promote high standards of conduct by members and co-opted members of the authority.
464.This section amends section 66 of the Local Government Act 2000, to provide for regulations to enable a monitoring officer to refer back cases referred to him by a standards committee and set out the circumstances in which such a referral back may be made. Regulations may make provision with regard to access to and disclosure of information.
465.This section inserts section 66A, which allows regulations to be made in respect of the referral by standards committees of a case to the Adjudication Panel where it considers the sanction available to it would be insufficient. The Adjudication Panel’s members will then decide what sanction, if any, should be imposed against the person.
466.This section extends to standards committees the provisions in section 67 of the Local Government Act 2000 to provide that the Local Government Ombudsman or the Public Services Ombudsman for Wales may consult the standards committee (as well as the Standards Board) about a case if he believes that the complaint he is considering relates partly to a matter which may be of concern to the committee.
467.This section amends section 78 of the Local Government Act 2000 to provide that, where an interim case tribunal decides that a member should be suspended, the effect of the tribunal’s notice is to suspend or partially suspend the member, rather than, as currently, requiring that the authority should take action to put the notice into effect. In addition, new provision is made for an appeal to the High Court against a decision by an interim case tribunal only to be possible where the permission of the High Court has been given.
Local Government and Public Involvement in Health Act 2007