Local Audit (Public Access to Documents) Bill

Jim McMahon Excerpts

2nd reading: House of Commons
Friday 25th November 2016 Commons Chamber

[Jim McMahon (Oldham West and Royton) (Lab)]

Thank you for calling me to speak, Madam Deputy Speaker; I was beginning to think that the time would never come. I refer Members to my entry in the Register of Members’ Financial Interests; I am a serving member of Oldham Council. I thank the hon. Member for Aldridge-Brownhills (Wendy Morton) for bringing the Bill forward for debate.

We share the same end: when spending public money and making decisions, public bodies need to be accountable to the public. We need to make sure that information is easily accessible, and that people can access it in more ways than by viewing it in the cold reception of a council office; we need to do something about making it available electronically for people to view.

We should also explore why the Bill narrows down the definition of journalist. That point has come out slightly in the debate, but I am not sure that we have quite got to the spirit of what the Bill is trying to achieve—namely that anyone with a legitimate interest in finding information should have the right to access it. We should not predetermine the motives of an organisation or individual; a spirit of openness should be the foundation for providing information. We can imagine a situation in which an academic might want to carry out legitimate research into how public money is spent, and might require that deep dive into the accounts. We can also imagine a situation in which a resident of a neighbouring or similar authority, investigating his local authority’s spend and wanting a comparator, would like to be able to look at such information. We can see that a wider group of people than just journalists might legitimately want that information.

I am not sure that it is necessary for this place to judge the motives of journalists, or to debate the quality of journalism. I often go into the Members’ Tea Room and question why we waste money on some of the newspapers on the rack, but it is right that people have access to information, and that journalists put that information out in the right way. However, journalism is changing very quickly and we need to review this issue. Rather than being prescriptive, perhaps the answer is to offer it out to a wider group of people and let them access it, and to recognise that what people choose to do with it is a matter for them; it is public information. That is how it should be dealt with. The Bill has the support of the Government, which is good to see. It is also good to see that it has the support of the Local Government Association, which is a champion of transparency and open government.

It is a shame that we have been so busy today that the private Member’s Bill promoted by my hon. Friend the Member for Birmingham, Selly Oak (Steve McCabe) has not been debated. It is on a very important issue that affects many communities. Family homes are being amended for a use that may not be in keeping with local neighbourhoods, taking away vital family housing and having a negative impact on the community. I pay tribute to him for at least putting this very important issue high up on the list of private Members’ Bills.

The Local Audit (Public Access to Documents) Bill appears to be quite technical, but I fully recognise that it is very important, in terms of the spirit of democracy and transparency.

--- Later in debate ---

[Mr Jones]

I thank my hon. Friend. The overarching objective here is to enable a journalist who might not be an elector in a particular area to uncover that sort of information and bring it to the public’s attention, so that the public can then question the auditor. There are a number of examples of where that has happened to positive effect, with changes having to be made by a local authority as a result.

The overarching objective of external public audit must be the proper use of public money, and if an elector objects and it results in investigations by the auditor, he is doing his job and any resulting delay in completion of the audit or additional cost to the body must be seen as a secondary consideration.

[Jim McMahon]

Will the Minister give way?

[Mr Jones]

I apologise, but I will not because I want to make sufficient progress so that the Bill receives its Second Reading.

It might be helpful here to illustrate the difference between this provision and the powers provided by the Freedom of Information Act 2000, which my hon. Friend the Member for Dover (Charlie Elphicke) mentioned. The ability to inspect and make copies of the most recent accounting information from a local authority during a specific period could provide compelling and timely evidence of poor spending decisions in the last accounting period that would enable a journalist to bring them to the attention of local electors by publishing the evidence uncovered. That would provide electors with the opportunity to ask the auditor about the issue or raise an objection so that the auditor can investigate the matter further, and it would potentially enable action to be taken to investigate poor spending, potential fraud or maladministration within a local public body. FOI requests, while being subject to timing constraints in terms of providing a response, do not have the same capability for potentially engendering swift action that could have the effect of stopping illegal activity.

As we heard from my hon. Friend the Member for Aldridge-Brownhills, the smallest parish councils—those with an annual turnover of £25,000 or less—will not be subject to the Bill, because they are subject to separate provisions under the 2014 Act. They must follow a different transparency code, which we believe works for them.

I know that some stakeholders have expressed reservations about the value of the Bill, and about whether the potential costs will outweigh the benefits, but I firmly believe that enabling journalists to inspect the accounting records of a range of local authorities could uncover more poor spending decisions by councils, which in turn would lead to more potential objections from electors. Although the existing rights are not often exercised, this kind of transparency has, in the past, enabled illegal activity and poor governance in local authorities to be uncovered. My hon. Friend the Member for Dover gave a good example involving failings on the part of a local authority, but there are other examples. In the event of poor decision making and maladministration in councils, it is entirely reasonable for local electors to be able to obtain information and shine a light on what is going on. They may not be financial experts, but the Bill will add another tool to the box, and enable them to hold their local authorities to account.

I stress that the timescale for action would be limited, and that the window of opportunity, and thus the additional cost that Members have mentioned, would be restricted to the 30-day period in which the previous year’s accounts would be available and the inspection rights could be exercised. Any questions or objections would also have to be received within that period to enable an investigation to take place.

The measures in the Bill are proportionate and they could help to uncover poor practice so that people could hold their local councils to account. I am delighted to be able to support the Bill, and I am grateful to my hon. Friend the Member for Aldridge-Brownhills for introducing it.

Question put and agreed to.

Bill accordingly read a Second time; to stand committed to a Public Bill Committee (Standing Order No. 63).