Local Audit and Accountability Bill [HL]
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Lord Wallace of Saltaire
““(1A) The Chief Inspector may do anything the Chief Inspector thinks appropriate to facilitate the carrying out of an inspection under section 10 of the Local Government Act 1999 (inspection of best value authorities).”, and”
Lord Wallace of Saltaire
My Lords, these amendments refine the provisions in the Bill that enable existing inspectorates to co-operate with an inspector, appointed by the Secretary of State, to inspect a best-value authority under Section 10 of the Local Government Act 1999, as amended by this Bill. Clause 33 and Schedule 10 to the Bill give a similar power to the Secretary of State’s existing power to ask for an inspection of a best-value authority. This is intended for use as a last resort in very serious cases, such as the ongoing intervention in Doncaster.
Paragraphs 2, 25, 36, 38, 54 and 72 of Schedule 12 amend existing legislation to enable existing inspectorates to co-operate with such a corporate governance inspection, as they sometimes do at present. The relevant bodies and inspectors are Ofsted, the Care Quality Commission, Her Majesty’s Chief Inspector of Constabulary, Her Majesty’s Chief Inspector of Prisons, Her Majesty’s Inspector of Probation, and Her Majesty’s Chief Inspector of the Crown Prosecution Service. The amendments to each of these paragraphs of Schedule 12, which take the same approach in each case, achieve this policy intention more cleanly. They remove the provision suggesting that a chief inspector may be appointed under new Section 10 as an inspector by the Secretary of State to inspect a local authority. This is because it is unlikely that it would be the chief inspector himself or herself who would undertake the inspection. Instead, it simply states that the chief inspector—or the commission, in the case of the Care Quality Commission —may do anything they think appropriate to “facilitate” such an inspection. This could include releasing staff to form part of an inspection team. All these amendments allow bodies to co-operate; they do not compel them to do so. We believe that these amendments simplify and clarify our approach without significantly affecting the impact of the Bill. I beg to move.
Lord McKenzie of Luton
My Lords, I am grateful to the noble Lord for that explanation. I was puzzled by what the substantive difference was between some of the clauses in the Bill and those that replaced them, but I believe the noble Lord’s explanation has helped me in that regard and I am happy to support his amendments.
Lord Wallace of Saltaire
“(1) Section 22 (other local authority capital controls in England and Wales) is amended as follows.
(2) For subsection (5) substitute—
“(5) In a case where the controlling authority of a public airport company are—
(a) a county council or county borough council in Wales, or(b) a composite authority of which both or all the constituent councils are county councils or county borough councils in Wales,it shall be the duty of the controlling authority to exercise their control over the public airport company so as to ensure that the company appoints as auditors of the company only persons who, in addition to meeting the requirements of Part 42 of the Companies Act 2006 (statutory auditors), are approved for appointment as such auditors by the Auditor General for Wales.(5A) In any other case, it shall be the duty of the controlling authority of a public airport company to exercise their control over the company so as to ensure that the company appoints as auditors of the company only persons who meet the requirements of Part 42 of the Companies Act 2006 (statutory auditors).”
(3) In subsection (6), after “(5)” insert “or (as the case may be) (5A)”.”
Lord Wallace of Saltaire
My Lords, this is another group of government amendments. It includes Amendments 49, 50, 54 and 55, 57 to 62 and 64, which remove redundant references to the Audit Commission and make clarifications to related provisions in existing legislation.
Amendment 49 is a consequential amendment to the Airports Act 1986. Amendment 50 makes a similar amendment to the Education Reform Act 1988. Amendment 54 repeals sections of the Public Audit (Wales) Act 2004, which place duties on the Auditor-General for Wales and the Audit Commission to co-operate with each other when necessary in undertaking value-for-money studies, et cetera.
Amendment 55 amends the Public Audit (Wales) Act 2004 to remove provisions which enable a transfer scheme of property, assets and liabilities from the Audit Commission to the Auditor-General for Wales.
Amendments 57 to 61 deal with the National Health Service Act 2006. Amendments 57 and 60 are tidying-up amendments, which simply clarify how an auditor may be appointed to a clinical commissioning group and other NHS bodies under the Bill. These bodies may not always appoint their own auditors; the appointment may be made on their behalf in certain circumstances by the commissioning body or the Secretary of State.
Amendments 58 and 61 replace the references to the Audit Commission Act in Schedule 4 to the National Health Service Act 2006 with the relevant provisions from this Bill which relate to reports and other information in respect of NHS trusts in England. Amendment 59 amends paragraph 23 of Schedule 7 to the National Health Service Act 2006 so that an NHS foundation trust can appoint an auditor who is eligible under this Bill, thus replacing the reference to the Audit Commission Act 1998.
Amendment 62 inserts an amendment to the National Health Service (Wales) Act 2006 to remove the reference to the Audit Commission Act 1998. The audit of Welsh health service bodies is now within the remit of the Auditor-General for Wales. Amendment 64 removes provisions in the Public Audit (Wales) Act 2004 which amend other legislation but which are now superfluous, given other amendments to those Acts made by this Bill. I beg to move.
Lord Wallace of Saltaire
“Education Reform Act 1988 (c. 40)The Education Reform Act 1988 is amended as follows.
In section 124B, omit subsection (5) (duty of certain higher education corporations to consult Audit Commission before appointing auditor in respect of first financial year).
In paragraph 18 of Schedule 7 (higher education corporations)—
(a) omit sub-paragraph (4) (duty of certain higher education corporations to consult Audit Commission before appointing auditor in respect of first financial year),(b) in sub-paragraph (5) for “that sub-paragraph” substitute “sub-paragraph (3) above”, and(c) in sub-paragraph (6) omit the definition of “the first financial year” and the “and” which follows it.”
Lord Wallace of Saltaire
“Section 20(2A) (general duties of auditors of accounts of health service bodies) is to be read as if—
(a) for “accounts of special trustees for a hospital” there were substituted “accounts of a health service body other than a clinical commissioning group”, and(b) in paragraph (c)— (i) for “the special trustees have” there were substituted “the body has”, and(ii) for “their” there were substituted “its”.”
Lord Wallace of Saltaire
Lord Wallace of Saltaire
My Lords, in response to the Delegated Powers and Regulatory Reform Committee report on the Bill, we have amended Clause 38. Provisions for compliance with the code now include the power for the Secretary of State to make a direction requiring individual authorities to comply with some or all of the code, and that the exercise of the power to ensure compliance with the publicity code in relation to classes of, or to all, local authorities should be made by an affirmative statutory instrument. As a consequence of this, we are required to amend the Long Title of the Bill to accurately reflect that a requirement to comply may not be the result solely of a direction. Our amendment makes this clear in the Long Title of the Bill. I beg to move.
Lord Beecham
My Lords, we have spent some time debating the requirements on local authorities to comply with the code of practice. I suppose this is our last opportunity to comment before Third Reading and the eventual passage of the Bill to the House of Commons. It is an opportunity to reiterate the problems that many of us envisage in the Government’s approach.
I suppose we ought to be grateful to the Government for clarifying the Title of the Bill, but the Title is almost irrelevant to the substance with which councils will have to contend. The further accretion to the Secretary of State of powers to direct individual councils is not a concession from the original proposition that a direction can be given to all councils. In replying to this short debate, will the Minister indicate exactly how the Secretary of State intends to go about giving his directions, whether to individual local authorities or to categories of local authorities? Would he envisage doing so after consultation and, if so, with whom: individual authorities or the Local Government Association?
Who else might the Secretary of State involve in the consultation process? For example, before making any direction, would he consult the local print media, which he purports to be most concerned about? How would he do that, particularly if he is issuing a general direction? Has the Secretary of State consulted at all, with anybody, about this proposal, thus far? It would be interesting to know whether he has had meetings with, for example, the Newspaper Society, if that is the correct name of the outfit in question, assuming that it has time to indulge in such consultations while the Leveson report remains undetermined.
There is a fundamental problem with the Government’s approach, which largely depends on what I have described —accurately, I think—as an obsession of the Secretary of State and has very little to do with the reality on the ground. I had the opportunity today of a brief conversation with representatives of the National Union of Journalists who were ensconced in Portcullis House. I do not know whether any other Members of your Lordships’ House were invited to meet them, but they stressed again their opposition, as members of a union that represents journalists both in local government and in the print media—
Lord Beecham
I certainly do, but it would be more relevant to know whether the Minister will accept that point. In a moment or two, I shall give him the opportunity to make his position clear.
As I said, the National Union of Journalists, representing journalists across the piece, feels very strongly that the Government’s stance on this is entirely unjustified. Having said that, it would be remiss of me not to point out to the noble Lord, Lord Tope, that the NUJ has great reservations about the amendment that he moved. However, I will be interested to hear what the Minister says in reply before the debate ends.
Lord Wallace of Saltaire
My Lords, I thank the noble Lord for those points. Many of them deserve further conversation in the Corridors and elsewhere. The Bill is part of a long process by which we hope to devolve more power to the cities and local authorities of England—an objective that I know the noble Lord shares. There are many difficulties in doing so, particularly during a recession when there are insufficient funds to do everything that one would like to. However, that is the objective, which I hope is shared across the House, and which I hope we will have the opportunity to explore further in future debates.