Between the lines

Graeme Creer analyses what the Localism Act 2011 has to say on local authority governance and explains which changes will have the most impact.

The Localism Act 2011 recasts the local authority governance arrangements in the Local Government Act 2000, but makes few real changes. The pure governance changes only apply in England. Much of the detail depends on regulations which have not yet been published, but let us assume for now that the regulations contain no surprises. There will also be statutory guidance. Key points include:

  • The only forms of governance are “executive arrangements” (leader and cabinet or elected mayor and cabinet) and the pre-2000 “committee system”. The “mayor and council manager” option is dropped. Local authorities can propose different systems, which can be introduced by regulations.
  • Authorities of any size will be able to move to the committee system after the next annual council meeting, or in future years if they wish. If they do, they may have one or more overview and scrutiny committees, but this is not obligatory.
  • Leader and cabinet executive arrangements keep the “strong leader” features, but the option for a “super strong leader” who cannot be removed from office by resolution is dropped.
  • The provisions about changing forms of governance or executive arrangements took effect on 15 January 2012.
  • Area committees can discharge executive functions even if they cover less than two-fifths of the authority’s area and population.
  • A change in the governance system prevents another change for the next five years unless there is a referendum.
  • The clauses in the original Bill making it possible for elected mayors to become “chief executive officers”, and to have additional powers, have disappeared.
  • The Secretary of State (“SoS”) may by Order require individual authorities to hold a referendum about changing to an elected mayor system, and is in the process of doing so for 12 cities. They cannot make other changes until the referendum happens.
  • District Councils wanting to move to “whole council” elections every four years may do so at any time, not just in “permitted resolution period” windows, but then cannot make another change for five years.
  • The duties to promote democracy and adopt petition schemes are repealed, along with unimplemented provisions relating to charge-and-reward waste reduction schemes, but permissive powers remain.
  • The SoS can by order transfer functions from other public bodies to local authorities, economic prosperity boards and combined (transport and EPB) authorities, and can amend legislation and authority constitutions for the purpose. Any Minister can transfer functions to the same bodies. This could be a way of giving elected mayors new powers.
  • The English Local Government Ombudsmen can share services with other ombudsmen, and delegate functions to officials.

Executive arrangements and overview and scrutiny

Executive arrangements will take one of two forms: (elected) mayor and cabinet, or leader and cabinet. They are much like the current executive arrangements, with “strong leader” features, although the option for a “super strong leader” who cannot be removed from office by resolution is dropped. Most of what follows will be very familiar.

We deal with elected mayors later. Leaders are elected by the authority, and can be removed by resolution or in circumstances specified in regulations. Their term of office will be agreed by the council subject to prescribed limits. They remain councillors during their term of office as leader.

The elected mayor or leader appoints his or her cabinet. The chairman (or non-elected mayor, or whatever he or she is called) and the vice-chairman cannot be executive members. There cannot be fewer than two or more than ten executive members.

Functions will be executive functions unless regulations say otherwise. They may only be discharged by the executive, or by an individual member in his or her ward. The elected mayor or leader determines the scheme of delegation of executive functions and the ability to sub-delegate cascades down the executive hierarchy. Executive functions may be exercised by area committees but the requirement that they should cover more than two-fifths of the authority’s area and population has been dropped (a change to the original Bill). Executive functions can be delegated to other local authorities or under joint arrangements, and there will be access to information rules. Neither cabinet nor cabinet committees need be politically balanced.

More detailed provisions are set out in Schedule A1, covering the appointment of cabinet members and a deputy mayor or leader, how meetings will work and the appointment of a mayor’s assistant.

Likewise, overview and scrutiny (O&S) remains, as before. Authorities operating executive arrangements must appoint one or more O&S committees to discharge scrutiny powers, including health and crime and disorder. They may not discharge other functions, apart from crime and disorders scrutiny. They may not include executive members. They may include co-opted members but (with exceptions for education) they may not vote. There are limited powers to appoint joint committees.

O&S Committees can require executive members and officers, and ward members who have exercised delegated powers, to attend to answer questions. Top and single tier authorities must designate a “scrutiny officer” to support them.  The “Councillor Call to Action” remains, although there is a minor drafting change. The provisions about reports to partner authorities are now in the Act itself, and are recast.

Elected mayors

As before, elected mayors are different. They are directly elected under the supplementary vote system. The election timetable is set out, and they hold office for four years. They are entitled to be called “Mayor”.  Much of the legislation about councillors and members does not apply to them. If a councillor becomes the elected mayor, he or she vacates his or her office as councillor, and an elected mayor can only stand for election as a councillor if there is a simultaneous mayoral election.

Some of the more startling features of the original Bill disappeared during its progress through Parliament. These include clauses prohibiting holders of the key statutory offices within the authority becoming elected mayors, enabling elected mayors to become “chief executive officers” and to discharge some of the functions of the Head of Paid Service, and enabling the SoS to transfer other functions to elected Mayors by Order.

The committee system

This being the old Local Government Act 1972 system, the Localism Act has little to add. It does, though, give the SoS a new power to make regulations inhibiting the delegation of functions. It enables, but no longer obliges, a committee system authority to appoint an O&S committee and repeats the flood risk arrangements for O&S committees under the executive system, but without specifying how they are to be allocated. Changes to the NHS Act 2006 and the Police and Justice Act 2006 facilitate the discharge of health and crime and disorder scrutiny functions by committees that are not O&S committees, if none has been appointed.

Changing governance arrangements

A local authority can change from one form of governance to another. If it operates executive arrangements it can change from one form of executive to another (mayor and cabinet to leader and cabinet or vice versa). It can make other changes to the arrangements, but an elected mayor can veto them. Any change requires a full Council resolution followed by publicity. If an authority changes its basic form of governance, or its form of executive, it cannot change either again within five years unless the change is approved by a referendum.

A change to the form of governance or form of executive takes effect at a “relevant change time”. If the change is from leader and cabinet to committee system, or vice versa, the relevant time is three days after the next annual meeting, or a later annual meeting if specified in the resolution. This is different from the Bill, and means that authorities who wish to ditch the executive system can just get on with it. If the change is from mayor and cabinet to either of the other systems, the relevant time is three days after the date when the next mayoral election would have been held. If it is a change to mayor and cabinet, it is three days after the mayoral election (or the date the election would have happened, if there is only one candidate).

This is a simplified version of the current system. These provisions came into force on the 15 January. As before, every authority must maintain its constitution, and permit public access to it. The contents may be prescribed by direction by the SoS but must include its standing orders and any voluntary Code of Conduct. If it operates a committee system the constitution must say whether it has resolved to have an O&S Committee.

Referendums

Changes to the form of governance, or the form of executive, must be approved by a referendum if the existing form was itself approved in a referendum (before or after 2012) or if the authority so resolves. It will have to resolve to seek approval from a referendum if it wants to make a change during the five year moratorium.

The process is this. First, the authority draws up proposals, including a timetable, any transitional arrangements, a statement that there will be a referendum and details of any new executive arrangements. It must publicise the proposal. Then it must hold the referendum. Regulations will specify the details of the referendum process and registered electors in the area can vote. If the change is approved by the referendum, it must resolve to make the change at a special Council meeting held within 28 days.

Petitions, with a specified minimum number of signatures, will oblige the authority to hold a referendum into whether it should have a particular type of arrangement.

Regulations may give the SoS power to direct an authority to hold a referendum. In addition, the SoS may by Order require all authorities, or those of a particular description, to hold a referendum.

As well as the general power to compel referendums by Order, there is a new power permitting the SoS by Order to require individual authorities to hold a referendum. This is the power that will be used to require 12 English cities to hold referendums in May 2012. This government, like the last, thinks elected mayors are a good idea. The Bill originally obliged these authorities to jump the gun and appoint a “shadow mayor” subject to confirmation by the referendum, but this was dropped.

Unless and until the referendum rejects the change, the authority cannot change its form of governance or form of executive, and it cannot be required to hold a referendum by a petition, direction or Order.

If the referendum approves the change, mayoral elections will take place, as would be the case following approval by any other referendum.

If a referendum takes place, the authority must comply with the result. It cannot hold another referendum within a ten year period, unless the referendum takes place by Order of the SoS and rejects a proposal to install a mayor and cabinet system, or the subsequent referendum takes place by Order of the SoS. A pre-2012 referendum also triggers the ten year moratorium.

Registered electors can vote in the referendum, and the SoS can make regulations as to the conduct of referendums and has recently done so. Current regulations about petitions and referendums are preserved until replaced.

Comments

As with so many of the recent Local Government Acts, you have to plough through pages of detailed law to find out if anything has changed, before discovering that the changes are few. We are again reminded of Sam Weller senior’s thoughts (on marriage, as it happens) in the Pickwick Papers: “… vether it's worthwhile, goin' through so much, to learn so little, as the charity-boy said ven he got to the end of the alphabet, is a matter o' taste. I rayther think it isn't”.

Only two of the changes really matter. First, those authorities that never liked the executive system, mainly because of the way it disempowers non-cabinet members, will be able to turn the clock back. Secondly, local authorities’ lack of interest in elected mayors is to be given another slapping, with obligatory referendums and the possibility of additional infrastructure and transport powers, in 12 provincial cities. It might just work this time, and there is a chance that we can look forward to the prospect of London style governance outside the capital.

Local Government Acts appear every two years or so. Perhaps the localism principle will inhibit more tinkering for quite a long time. Or, then again, perhaps not?

Graeme Creer is head of the Local Government team at national law firm Weightmans LLP. He can be contacted by email at This email address is being protected from spambots. You need JavaScript enabled to view it..