Local Government (Transparency) (Descriptions of Information) (England) Order 2015

Lord Kennedy of Southwark Excerpts

Tuesday 24th February 2015 Grand Committee

[The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Lord Ahmad of Wimbledon) (Con)]

My Lords, this order was laid before the House on 12 January 2015. It is about transparency and accountability in smaller authorities. I welcome noble Lords’ support for local authority transparency in previous debates. The order adds to the categories of information about which the Secretary of State may require authorities to publish information more frequently than annually.

On 17 December, under Section 2 of the Local Government, Planning and Land Act 1980, the Secretary of State issued a code of recommended practice on the publication of information by smaller authorities—the Transparency Code for Smaller Authorities. This applies to bodies including parish councils, internal drainage boards, charter trustees and port health authorities with an annual turnover not exceeding £25,000.

It is the Government’s intention to make it a legal requirement for smaller authorities to comply with the code. This will include a requirement to publish certain information relating to all formal meetings. However, the Secretary of State may require authorities to publish information more frequently than once a year only if it falls within a description of information to which Section 3(4) of the 1980 Act applies. In short, legislation needs to set out which categories of information the Secretary of State can require to be published more frequently than annually. This order adds to those descriptions of information, information relating to the meetings of a relevant authority, including the agendas, minutes and any other information concerning matters discussed at meetings. This will enable us to require the publication of meeting papers, agendas and minutes more frequently than annually.

The Local Audit and Accountability Act 2014 introduces a new local audit framework for public bodies, under which smaller authorities with an annual turnover not exceeding £25,000 will no longer be subject to routine external audit on an automatic annual basis, although they will still have an auditor nominated to field any complaints from local electors. This is a more proportionate approach to the country’s smallest public bodies and the amount of public money they handle. In place of an external audit, these authorities will be subject to the requirements set out in the Transparency Code for Smaller Authorities. Since the requirements of the code will represent a substitute for external audit under the new regime, the Government believe that requiring compliance through regulations is necessary. This will ensure that accountability is maintained and will increase the ability of local taxpayers to see how their hard-earned money is being spent and their services delivered.

Central to local people holding their local authority to account is having timely access to information about how the authority spends its money and the goods and services it buys and provides. It is clear that once-yearly publication of minutes and papers would limit proper local accountability. Local people would be made aware of decisions only long after they had been made and the opportunity to participate or influence the process had passed. The publication of meeting agendas and papers three days in advance of meetings and of meeting minutes no later than a month after the meeting will give the local electorate a clear picture of the activities of these bodies and enable local people to participate properly in the local democratic process. Alongside the other publication requirements in the code, this represents real accountability and transparency to the communities these bodies serve.

Local agencies and people want the publication of key financial and governance data to be mandatory, as was clear from the broad support shown in consultation responses for the Government’s intention to increase transparency. To questions about making the code mandatory, 76% and 88% of respondents explicitly supported our proposals. Nevertheless, we are keen to support these authorities to meet the code’s requirements. We intend to deliver a programme of funding through the sector to assist these bodies in getting online and publishing the relevant information. This is currently being developed with the sector.

To conclude, the code is crucial to ensure that accountability and transparency under the new audit regime is not just maintained but increased. Now that we have reduced the audit burden, these authorities need to make sure that they are transparent to those who matter most: the local people they seek to serve. The publication of meeting minutes, agendas and papers is crucial for local people to see how the council is being run and how their taxes are being spent. Limiting the access to this information to just once a year would severely restrict local accountability. I am sure that most of us can relate to the conviction that greater transparency helps secure better services and greater accountability. Consultation responses have demonstrated broad support for increased transparency and for making the code mandatory. We should listen to these messages—and, based on them, I commend the order to the Committee.

[Lord Kennedy of Southwark (Lab)]

My Lords, as the noble Lord, Lord Ahmad of Wimbledon, explained, the purpose of this order is to expand the description of information that the Secretary of State may require authorities to publish more frequently than annually. It affects a number of smaller public bodies, of which 5,300 have a turnover of less than £25,000 per annum. They will be exempt from routine external audit but will instead be required to publish information as specified for the benefit of local residents and others to see what has been spent, by whom and to what effect.

I agree that it is important to make this code mandatory. It is a substitute for external audit, and there will be benefits for the authorities concerned, because a considerable amount of information that they would be required to provide under FOI requests will be published routinely. That is welcome. It is also important that people are able to get access to information about what their authority is doing and to get that information in a timely manner; the point about the production of papers such as minutes and so on is therefore very welcome.

I have only a couple of points for the noble Lord. Can he confirm what the complaint process will be after expenditure details are published? If a resident has a complaint, what will that process be? Will it be, in effect, the same system that we have at present, or will it be something different? Can he outline that for the benefit of the Grand Committee? Can he also outline the process if an external audit is thought necessary? In such cases, how would it actually be triggered? With that, I am content with the order.

[Lord Ahmad of Wimbledon]

My Lords, on the first point, certainly nothing changes in terms of looking into complaints and raising those issues. The matters here are ones of transparency; if anything, the existing procedures and processes will be used more readily because of the fact that more information is available more readily.

The noble Lord raised an important and valid point on replacing the audit requirement with a requirement of greater transparency. If I may, I will write to him; we need to ensure that we provide a detailed answer because it will be relevant to local authorities. I look to my officials on this, and will ensure that that forms part of the code in terms of any exceptions that might arise. With those assurances, I commend the order.

[Lord Kennedy of Southwark]

Perhaps I may add that that is important in relation to the odd case among these very small authorities. I know from my time in local government that every now and again one does get problems that need to be dealt with. I would be grateful if the noble Lord would come back to me on that point.

Motion agreed.