Reforming the law at a local level

A new White Paper will provide a plethora of work for local government solicitors, say Stephen Cirell and John Bennett. Stephen Cirell is a partner and John Bennett is a consultant with Eversheds Public Sector.

A new and eagerly-awaited White Paper, “Modern Local Government – In Touch With the People”, is being pored over by local government solicitors as they return from their summer break.

It had been promised that the paper would consolidate the Government's position on a number of key areas, themselves explored in a series of Green Papers published earlier in the year.

Bearing in mind the material on which it is based, this paper was always going to be a long document with a broad coverage of many crucial areas. Indeed, it proposes some of the most important and sweeping changes to local government for a generation.

Such is the detail included that it will take some time for the full effect of the proposed changes to sink in. Some proposals are still merely outlines and need much more flesh on the bones before comment can really be made.

Inevitably, most local government lawyers will be involved in new, challenging and innovative work. The modernisation of local government is a key manifesto commitment of New Labour, and nobody doubts that the political will is there to push through the changes. For those charged with the task of advising local authorities from within, the issue is how fast the pace of change will move and whether the resource levels will be there to meet the needs.

The White Paper contains proposals in respect of many fundamental areas of local government, such as the democratic structures in operation, the financial system and the ethical framework. In this short space it is impossible to do justice to these proposals. The following is a brief list of areas which are covered:

The ethical framework: The Nolan Committee reported on local government last year and made a number of important recommendations. This part of the White Paper illustrates that the Government has accepted most of those proposals. A new ethical framework is proposed, with national and local codes of conduct and the establishment of a standards board.

New forms of administration: The much-publicised possibility of introducing elected mayors with a cabinet of members now looks certain to come to fruition. The Government has also put forward two other models for consideration – an elected mayor and a city manager to discharge mayoral policies, and a council-elected leader with a “cabinet” of members with execu- tive powers.

Elections: The Government has long been concerned by the appallingly low numbers of voters who turn out in local elections. In the last elections, turnouts of 10 per cent were registered, fuelling the view that local government has lost touch with the people it is intended to serve. The Government now proposes changes to the electoral system to encourage more people to vote. Ideas include voting on different days and in different places.

Best value: The best value system is proposed to take over from the dreaded compulsory competitive tendering (CCT), but its exact form and content is still not exactly clear. The White Paper takes the process of developing best value a stage further.

The financial system: This is one of the most complex, indeed impenetrable, parts of local government. The new proposals offer more local influence on business rates and a single pot for capital expenditure.

Beacon councils: These new bodies will be created to offer guidance and support to other councils who suffer from lower standards.

So what does this all mean for the hard pressed in-house lawyer in local government? A great deal of new work. The changes will be made by legislation promised in the autumn, although there may be more than one Act needed to introduce all of the measures. This will need to be commented on in draft and Bill form if local government is to drive the changes rather than central government.

Each and every aspect of the changes has a legal implication, which will need advice and assistance. This may range from advising an authority on whether it can apply for beacon status to fending off government “hit squads” if services fall below acceptable standards.

The proposed changes to the democratic structures come too late for some and councils are already venturing down this road with full encouragement from the Government. In the interim, before legislation can be enacted, detailed legal advice will be sought on the exact powers of a council to have an executive body. Hammersmith and Fulham LBC has already found this to be a real issue.

Councils will also, no doubt, challenge the Government on some of these changes and we may even see a return to the days of the 1980s, when judicial review was embarked upon with monotonous regularity.

The other point to remember is that the very in-house legal departments which will have to render this advice are in some cases still subject to the CCT regime and in all cases will be required to observe best value.

This will be yet another obligation on a body of individuals already having difficulty coping with the de- mands made on them.

The Government has said that it wants to create a mixed economy of services and blur the distinction between public and private sector with more work being carried out jointly or in partnership.

As such, the proposed changes will offer excellent opportunities for the legal profession, as the vast majority of local authorities will simply not have the in-house resources necessary to deal with all of these changes.

Relationships with external lawyers and consultants can provide not only support and assistance to drive forward important policy initiatives of each council's choice but can also assist in providing a context in which best value can be demonstrated by the sharing of knowledge, procedures and business practice.

One thing is for sure. A very interesting few years awaits all those involved in local government law.