Parish and Town Council Precepts

Lee Rowley Excerpts

Tuesday 18th April 2023 Westminster Hall

[The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Lee Rowley)]

It is a pleasure to serve under your chairmanship, Mr Hosie. I am grateful to my hon. Friend the Member for Morecambe and Lunesdale (David Morris) for raising this issue and organising the debate. This is an important subject. Those of us who have parish and town councils in our patches, or those of us, like me, who have had the opportunity to work with parish and town councils in a ministerial role, know how important they are for local communities. I know what a difference they can make and how much work goes into ensuring that parish and town councils and councillors make a difference in, and improve, their local areas. There are over 9,000 councils in the country, and I am grateful for the work they do, including in my own patch of North East Derbyshire.

This is also an important subject because it is important for my hon. Friend who secured this debate. He is a champion for Morecambe. We hear him in the Chamber week in, week out, being that extremely strong voice for his constituency. I congratulate him on his recent successes, which he outlined—in particular, Eden Project North, which will be transformative for the area that he has the privilege to represent. In the time that I have, let me briefly go through the legal position that town and parish councils operate under. I will then comment on the points my hon. Friend has made.

My hon. Friend speaks passionately and clearly about the challenge of a council tax increase driven by the increase in a precept from Morecambe Town Council. As he is aware, council tax is set by local authorities—in this instance that includes a town council—and they decide what level of council tax they need to raise. The Government set referendum principles for some, but not all, councils each year. Where councils set excessive increases, they have to go to referendum. Increases are usually within the bounds of around 5% for other council tiers.

We have not traditionally applied referendum principles to town and parish councils, but we have said very clearly that all tiers of council should exercise restraint when they are setting council tax increases. This was made clear in the consultation for the local government finance settlement for 2023 to 2024. We stated that the Government continuing to not set referendum principles was contingent on town and parish councils taking all available steps to mitigate the need for council tax increases and the Government seeing clear evidence of restraint. It is the case that the thousands of town and parish councils will face different challenges and perform different functions, but it is also the case—I want it to be clearly noted in this debate—that we expect town and parish councils to be restrained in their council tax increases.

My hon. Friend raises points about powers and in particular the disclosure of information. He references the local government transparency code of 2015. The code is a statutory instrument that contains two elements: a mandatory section and a section of recommendations. The requirement to publish invoices over £500 and to publish procurement card transactions is mandatory. Where that is not done, or where there is a concern that it is not done, we recommend in the first instance that the authority is contacted, following their complaints procedure, and then the monitoring officer of the principal authority is contacted. Finally, there is the opportunity to go to the local government ombudsman if there remain concerns.

A number of points were raised about the approach of the town council to its precept raising and decisions that it is making about how to utilise that precept. Ultimately, because there needs to be enough flexibility in the system, decisions about how precepts are set, how much they rise by and how they are applied is mainly down to the town or parish council itself. However, it is important that restraint is shown. My hon. Friend has made important points, and I agree, having had a superficial look at the budget—which he has kindly provided—that there are a number of relatively odd things happening here. It is a question of fact, which all residents of Morecambe will be able to see by accessing the documentation, that there are significant increases in the amount of spending expected here and the amount of precept being raised. There is an opportunity to comment on that at the ballot box in a couple of weeks. There are also opportunities through the complaints procedures that I have referenced and the principal authorities, which can also be pursued by residents and those who are interested in this matter.

As my hon. Friend indicates, we have spoken several times about this. As a Minister for local government, I know that the Secretary of State for Levelling Up, Housing and Communities has also taken an interest in this. We will take back all the points from this debate and consider them from a policy perspective. We must ensure that parish councils work going forward. I would be very happy to talk to my hon. Friend about any specifics outside this debate if that would be helpful.

The vast majority of town and parish councils do incredible work, as do councils of all tiers, day in, day out, to ensure that local residents and communities thrive and improve. In any system with thousands of different entities, that cannot always be the case, and where there is challenge, problems and poor behaviour, that absolutely should be raised. It is absolutely the case that light should be shone on it and that transparency ultimately wins the day. I wish my hon. Friend well in the work he is doing to highlight the challenges he sees. I am happy to continue the conversation and thank him for the opportunity to be able to contribute today.

Motion lapsed (Standing Order No. 10 (6)).