October - November 2020 #24 Your round-up of local authority related news and views
With climate emergencies already declared; common policy objectives about a cleaner and greener locality; community engagement stronger than ever through the pandemic; councils undertaking a reset and re-imagination of their future and that of their local communities and economies, the announcement of the Government’s 10 point plan has prompted more conversations about priorities to build back better, support green jobs, and accelerate our path to net zero.
As with many such announcements, questions will be asked as to the true extent of the commitment. For example, commentators have pointed out that many of financial commitments referenced are not new; allocation of money into pots is not necessarily best for “levelling up”; and there are other hurdles to be overcome. However, what it does is emphasise and build on some good existing practices within local government. The direction of travel is positive, and we are seeing local authorities making more decisions on decarbonisation and long term decisions.
We are particularly keen to hear for you if you are considering some of the Points we anticipate will feature in your short, medium and long term strategies especially:
Point 4: Accelerating the shift to zero emission vehicles
Point 5: Green Public Transport, Cycling and Walking
Point 7: Greener Buildings
Point 9: Protecting our Natural Environment
Point 10: Green Finance
A particular focus on local authority borrowing this month and much press over the basis upon which authorities have been able to rely on property investments.
Whilst there are significant concerns raised over the forthcoming Local Authorities (Borrowing and Investment) Bill, commercial investment in property is a relatively well established mechanism for raising revenue in the context of continued and crippling cuts to local authority funding. These financial pressures remain, however, the pandemic has exacerbated the need for sufficient core funding streams for front line and key statutory services.
Whilst authorities continue to look at alternative funding mechanisms and more favourable lending terms to the PWLB, there is still much scope for innovative investment. The widespread success of such projects requires central government input, working in partnership with local government to facilitate and promote sound investment policy.
LGA response: Local Authorities (Borrowing and Investment) Bill
Local Government Association | 21 October 2020
The LGA has significant concerns with the Local Authorities (Borrowing and Investment) Bill which seeks to restrict the acquisition of land and property by councils outside their own boundaries. The Bill also seeks to limit local authorities’ investment in “commercial risk-taking enterprises” and limit council borrowing for non-core activities.
Surge in lockdown recycling collection
Local Government Association | 17 October 2020
The amount of household recycling collected has soared as much as 100 per cent in some council areas during the COVID-19 pandemic hiking up costs to keep services running. Eight in ten councils saw an increase in the amount of recycling being collected since the outbreak and national lockdown. Half of councils reported that they were collecting up to 20 per cent more material for recycling than normal, with a third collecting up to 50 per cent more and some even reporting a 100 per cent rise. This increase in the amount of household waste and recycling to collect has increased costs to councils. The LGA says that these rates are not likely to return to normal any time soon. It is calling on the Government to use the Spending Review to ensure all extra cost pressures on waste and recycling services as a result of the pandemic are met.
Guidance for local authority children's services during the transition period and after 1 January 2021
Department for Education | 15 October 2020
Information to help local authority children's services prepare for the end of the transition period on 31 December 2020.
School and trust governance investigative report
Department for Education | 7 October 2020
The report provides an independent picture of various elements of school and trust governance, including:
Conclusions are drawn about the governance system as a whole, as well as about specific types of governing bodies. The report suggests potential areas for improvement for support and guidance to the sector.
Council to ‘fundamentally’ review services
Public Finance | 6 November 2020
Manchester City Council is set to fundamentally review its size and structure, warning that efficiency savings cannot not cover a forecast £135m funding gap next year.
Councils call for clear lockdown exit strategy
LocalGov | 4 November 2020
The Government has been urged to work with councils to develop a clear lockdown exit strategy by the Local Government Association (LGA). The LGA warned Whitehall must learn from the past seven months and ensure a clear strategy is developed for when national restrictions end on December 2 in partnership with local councils.
Thurrock Council borrows £125m from PWLB
Public Finance | 4 November 2020
Thurrock Council has taken out a £125m loan with a maturity of just two years from the Public Works Loan Board. The loan, set to mature in 2022 at a rate of 1.77%, was outlined in statistics compiled by the Debt Management Office. It is the first loan the council has taken out with the facility in 2020-21, after it borrowed £100m in March.
Mayor confirms relocation of City Hall
LocalGov | 3 November 2020
The Greater London Authority (GLA) will relocate to Royal Docks next year saving £61m over five years, the mayor has confirmed. Sadiq Khan said the move will save £6m more than originally forecast and will help protect frontline services.
Sutton £250m bond ‘cheaper than PWLB rate’
Public Finance | 3 November 2020
A bond totalling £250m, set to be issued by a London council has been priced at 1.7% – below the rate available from the Public Works Loan Board. London Borough of Sutton is set to undertake its first bond issuance to refinance short-term debt and finance projects within Sutton’s approved capital programme. An initial £100m was issued by Sutton yesterday with a 35-year maturity, with a further £150m of issuance earmarked for future sale. David Whelan, managing director of public sector treasury at Link Group, which advised on the deal, said: “The authority has successfully demonstrated that it is possible for local authorities to secure cheaper general fund borrowing from the institutional investor market, than that currently available from the PWLB.”
Covid-19 figures ‘hide mounting financial pressure’
Public Finance | 2 November 2020
The monthly financial impact of Covid-19 on councils in England has fallen below £1bn for the first time since the start of the crisis, running at 60% of the £1.5bn peaks in April and May. However, experts have suggested the seemingly downward trend does not tell the full story.
Council steps in to save pandemic-hit scheme
Public Finance | 30 October 2020
London Borough of Newham is to loan a further £4m to its own development company, after a leisure centre operator pulled out of a development project due to Covid-19. If approved, the funds will go to Populo Living, the council’s wholly-owned housing development company. The move will help offset the lost income from an agreement with investment and development company Helical Retail, which had been due to buy a commercial area for a gym and retail space, within the Brickyard mixed use development in East Ham.
Surrey looks to future with £20m LED conversion
LocalGov | 29 October 2020
Surrey County Council is to convert all of its 89,000 street lights to LEDs over the next three years at a cost of £20m. The council said the move will save £2m a year at February 2020 prices as LED lanterns use around 65% less energy, and could save more if energy prices continue to rise. The three-year programme has already started in Guildford borough, with lights in Surrey Heath and Waverley due to be converted in the coming months. Cabinet member for transport Matt Furniss said: ‘Investing in LED streetlights demonstrates our commitment to reducing our energy consumption. As well as supporting our aim of being net carbon zero by 2050, the reduced costs also benefit the taxpayer.'
Spelthorne councillors seize greater investment oversight
Public Finance | 28 October 2020
Councillors at Spelthorne Borough Council have voted to give themselves more control over the authority’s property investment decisions. Approval was given to an action plan tabled by audit committee chair Lawrence Nichols at a meeting last week, in response to a Public Accounts Committee report on local authority commercial investment in July.
Nearly half of councils in Great Britain use algorithms to help make claims decisions
The Guardian | 28 October 2020
Nearly half of councils in England, Wales and Scotland have used or are using computer algorithms to help make decisions about benefit claims, who gets social housing and other issues, despite concerns about their reliability. A Guardian freedom of information investigation has established that 100 out of 229 councils have used or are using automated decision-making programmes, many without consulting at all with the public on their use. This is despite one council admitting that results from one algorithm showed it was only 26% accurate in some instances. A range of private companies are selling machine-learning packages to local authorities that are under pressure to save money. The systems are being deployed to provide automated guidance on benefit claims, help decide who gets social housing, and allocate school places among a range of other uses.
London borough admits some services could be significantly disrupted “for some time” as it reels from cyberattack
Local Government Lawyer | 26 October 2020
Some services provided by Hackney Council may be significantly disrupted for some time as the London borough responds to a cyberattack that has impacted its ‘legacy’ and non-cloud based systems, Mayor Philip Glanville has warned. In a message to residents on Friday (23 October), Glanville said he was “incredibly angry that organised criminals have chosen to attack us in this way, and in the middle of dealing with a global pandemic. It is morally repugnant, and is making it harder for us to deliver the services you rely on.” The Mayor said the council had reported the incident to the Information Commisioner’s Office and was working very closely with the Government, National Cyber Security Centre, National Crime Agency and other experts to investigate the attack.
Tory leader’s £1bn office buying spree ‘leaves dangerous legacy’ for council
The Guardian | 25 October 2020
Ian Harvey reveals just how easy it was to borrow 100 times his austerity-hit borough’s budget to invest in property. Spelthorne’s debt-fuelled spree is just the most dramatic example of how councils have been encouraged to make commercial investments to offset budget cuts during a decade of austerity. Richard Watts, the chair of the Local Government Association’s resources board, said some councils are now faced with mounting losses: “Ten years of massive cuts to local government forced councils to look elsewhere for money, but as a result of the pandemic some of these new sources of income are drying up.
London council sets up own same-day Covid testing service
The Guardian | 22 October 2020
Barking and Dagenham council in east London is thought to be the first in the country to set up its own same-day Covid testing service for key workers, sidestepping the nationwide system over delays in getting tests and results. The council said it had acted because of concerns about delays in accessing tests at the NHS testing sites in the borough.
Lancashire plans third issue through bonds agency
Public Finance | 20 October 2020
Lancashire County Council has confirmed it plans to issue its third bond through the UK Municipal Bonds Agency. The move comes after Lancashire issued two bonds in January and August – covering long and short durations. The council said the new issue – pencilled in for next year – would complete its plans to issue three bonds from the facility in total, split equally into thirds for short, medium and long-term maturities.
Whiteman slams Plymouth's interest rate swap move
Public Finance | 19 October 2020
CIPFA chief executive Rob Whiteman has claimed that Plymouth City Council acted outside its legal powers by agreeing an interest rates swap deal. The authority had become the first council to agree an interest rates swap deal since a High Court ruling effectively killed off the practice 30 years ago.
Covid-19 halts council’s £180m property drive
Public Finance | 16 October 2020
Reading Borough Council is to its delay planned commercial investment strategy, valued at £180m over the next three years, due to the Covid-19 pandemic. The council had previously spent more than £70m on commercial infrastructure between 2016 and 2020, and had planned to invest up to £180m up to March 2023.
Borough council dismisses claim its commercial property purchases were unlawful
Local Government Lawyer | 15 October 2020
Spelthorne Borough Council has moved to defend its controversial commercial property purchases after a website published leaked material that purported to show auditor KPMG thought the council had acted unlawfully. The Bureau of Investigative Journalism said the documents showed Spelthorne had ignored rules that forbid councils borrowing purely to make a profit on subsequent investments and that KPMG could seek a court ruling that the council acted unlawfully. A ‘frequently asked questions’ sheet issued by Spelthorne said the council has since 2016 invested £914m in commercial assets from which it receives around £50m a year in rental income. It said that after deductions, this left the council £10m a year to spend on local services. Spelthorne’s overall budget is some £22m. Spelthorne said in a statement: “There is [a] suggestion that auditor KPMG will deem that Spelthorne has acted unlawfully by not following rules and regulations relating to financial borrowing and the proportion of borrowing and investments in pursuing this council's commercial property acquisition strategy.The council remains confident in the legal advice it has been given and can state it has fully complied with all legislation and guidance.” The council said KPMG had not yet issued its 2017-18 accounts statement nor stated its conclusions on any actions it might pursue. Spelthorne said it had complied with all relevant guidance, had regard to the Prudential Code, and denied that it had been forced to repay the Public Works Loan Board early or been required to sell any investment properties.
Council raises £1m through UK's first local government green bond
LocalGov | 14 October 2020
The UK's first local government green bond has reached its target of raising £1m for West Berkshire District council five days early. The Community Municipal Investment (CMI) attracted 640 investors in total, with 22% of funds raised from local residents. The bond, developed by ethical investment platform Abundance, will help fund green infrastructure such as installing solar panels on council buildings and creating new cycleways.
Council launches independent review of its companies
Public Finance | 8 October 2020
London Borough of Croydon has launched a review of the companies it owns, as part of its bid to receive more assistance from the government. The independent review was approved at a meeting last month, as part of the Croydon Renewal Plan, which sets out plans to create a balanced budget over the next three years.
Advisory firm PwC will look into the overall financial health of the council's wholly-owned property development company Brick by Brick, as well as the its governance arrangements and the viability of future projects.
Kent councils take back control of housing stock
LocalGov | 5 October 2020
Four councils in East Kent have taken back control of housing management services.
Canterbury City Council, Dover DC, Folkestone & Hythe DC and Thanet DC have now taken over the services and most staff provided by East Kent Housing (EKH). The move was taken after a series of health and safety failings were discovered at some of the properties that EKH was managing on behalf of the councils last year.
There is growing frustration among local authorities that while the number of homeless people remains stubbornly high, there are still thousands of homes lying unoccupied.
Latest statistics for England show the number of long-term empty properties – those that have been empty for six months or more – stands at 225,845 (source: MHCLG). Some authorities have said the problem is having a serious impact on the viability of communities, and have set aside money for enforcement action.
Authorities have a range of available powers to bring empty homes back into use. As a first step, housing departments may consider invoking Empty Dwelling Management Orders, but this route is now rarely used, mainly because a home now has to be empty for two years rather than six months before an EDMO can be issued.
Increasingly, therefore - especially when a property is dilapidated and the owner has refused to carry out renovations to bring it back into use - many local authorities’ preferred legal route is an enforced sale.
Many laws, including the Public Health Act 1936, allow a council to serve a notice on an owner of property demanding that the owner carry out repair or improvement works. If the owner refuses to comply, the council can carry out and pay for the work itself.
Any notices that have been served on an owner, which result in the local authority completing work on the property in default, will incur a land charge. If the incurred costs are not paid, the council may impose a local land charge and subsequently register a legal charge on the property.
In the event the owner of the property fails to pay for the costs of the works then the Law of Property Act 1925 enables local authorities to recover charges and debts owed to it through the sale of a property, just as a mortgagee in possession would do.
The local authority can also take advantage of the New Homes Bonus Scheme. Under the scheme, the Government matches the council tax raised for each property brought back into use for a period of four years.
For the local authority, this is a ‘win-win’ situation with both social and financial benefits. The local authority has repaired a derelict property and brought it back into use as a much needed dwelling; public money used for the repairs have been recovered; and the new owner will in most cases be paying council tax.
Non-Domestic Rating (Lists) (No. 2) Bill 2019-21
A Bill to make provision to change the dates on which non-domestic rating lists must be compiled; and to change the dates by which proposed lists must be sent to billing authorities, the Secretary of State or the Welsh Ministers. First reading took place on 21 October 2020. The Bill has now finished its stages in the Commons, and will pass to the Lords for their consideration.
The Community Infrastructure Levy (Amendment) (England) (No. 2) Regulations 2020/1226
This instrument amends the Community Infrastructure Levy Regulations 2010 (“the 2010 Regulations”) to provide for relief from the community infrastructure levy for First Homes. This instrument extends the existing relief for social housing to incorporate First Homes. Coming into force on 16 November 2020.
Operation of the Housing Revenue Account ring-fence
Ministry of Housing, Communities & Local Government | 10 November 2020
Guidance for local authorities on certain aspects of the Housing Revenue Account. This guidance updates and replaces Circular 8/95 published by the former Department of the Environment. This guidance restates ministers’ established policy for the HRA and introduces no new issues of principle. However, it does highlight the need to be fair to both tenants and council taxpayers and that there should be a fair and transparent apportionment of costs between the HRA and General Fund.
Homes for all: Putting council housing at the heart of local recovery
Royal Institute of British Architects | 6 November 2020
England may be on the cusp of a new era of public sector housebuilding. For the first time in decades, councils looking to build new homes have funds available and a favourable political climate. This new report examines what councils must do to get building again and do so in a way that raises standards of design, quality and sustainability across the built environment. The report explores the challenges and opportunities that have faced councils that have already begun building. It then looks at the early successes in this new period of council house building to establish a blueprint for how the public sector can build quality housing at scale.
National non-domestic rates collected by councils in England: forecast for 2020 to 2021 (Updated)
Ministry of Housing, Communities & Local Government | 5 November 2020
In April data was published on the additional reliefs announced as part of the COVID-19 support package to businesses. The statistical release and all other tables continue to reflect the position as at 31 January. Updated 5 November 2020: Updated National non-domestics rates 2020 to 2021: additional reliefs for 2020 to 2021, with additional data from September to October.
Consultation on proposed amendments to the Architects Act 1997
Ministry of Housing, Communities & Local Government | 4 November 2020
This consultation considers amendments to the Architects Act 1997 to promote and maintain standards of competence amongst architects registered in the UK in relation to Building Safety. It builds on provisions in the draft Building Safety Bill, which takes forward the government’s commitment to fundamental reform of the Building Safety system. Consultation closes at 11:45pm on 22 January 2021.
Boost for families wishing to build their own home
Ministry of Housing, Communities & Local Government | 30 October 2020
A review to make it easier for people to build their own home has been announced by Housing Secretary Robert Jenrick today. Currently there are around 15,000 of these types of homes built every year – an increase of 50% in 2 years. But there is still more to be done to support the self and custom build industry, last estimated be worth almost £4.5bn to the UK economy. Councils are currently required to keep a register of those who wish to build in their local area. And by 30 October each year – ‘Right to Build’ day – councils should have granted planning permission to enough suitable plots to match the demand on their register. The review announced today will examine how effectively these arrangements support self and custom building, including whether they increase land available to support these homes.
DCN response: Business rates review (tranche two)
District Councils’ Network | 30 October 2020
Districts are already seeing the impact of Covid-19 on business rates collection, and expect this to be significant and ongoing. In August the Institute for Fiscal Studies projects a real terms decline in retained business rates of 6.6% overall by 2024/25 against 2019/20 levels – and this was before the introduction of local lockdowns, rising caseloads and before the impact is felt of the end of the furlough scheme. Meanwhile districts face increasing demand, rising costs, and reduced income, only partially offset by government support. Against this backdrop, it is important that any changes in legislation or policy, including replacement of business rates with other taxes, should not diminish funding for local government. Full response.
First Town Deals worth almost £180m announced
Ministry of Housing, Communities & Local Government | 27 October 2020
Communities in seven areas across England are set to benefit from up to £178.7m in new Town Deals, Communities Secretary Robert Jenrick has announced today. Barrow-in-Furness, Blackpool, Darlington, Peterborough, Norwich, Torquay and Warrington are the first of 101 places to be offered a Town Deal and work will now begin with these areas to confirm final funding. These areas will have the opportunity to invest in their local economies at this critical time, implementing proposals submitted to the government’s £3.6bn Towns Fund, which is designed create jobs and drive growth across the country.
Independent research on the impacts of neighbourhood planning
Ministry of Housing, Communities & Local Government | 26 October 2020
The report provides the findings of independent research commissioned by the Ministry of Housing, Communities and Local Government (MHCLG) into the impacts of neighbourhood planning in England. The research was conducted by the University of Reading between September 2019 and March 2020.
Councils forced to ‘prop up’ bus operators during pandemic
LocalGov | 26 October 2020
Local authority leaders have accused the Department for Transport of forcing councils to keep private bus companies afloat at the expense of local taxpayers. Councils have a statutory duty to administer the concessionary bus travel scheme in England, which provides older and disabled people with free off-peak travel on all local bus services in England. Local authorities reimburse bus operators for all journeys made by people with a concessionary pass. However, since the outbreak of the pandemic, the Government has asked councils to make these payments to bus providers based on pre-COVID-19 concessionary travel levels. This is despite bus usage having dropped by 67% since March with many of those eligible for a concessionary pass being forced by the pandemic to remain at home. The Local Government Association (LGA) is calling on the Department for Transport to end this emergency measure.
Green Homes Grant Local Authority Delivery scheme, Phase 1B: entering a bid
Department for Business, Energy & Industrial Strategy | 23 October 2020
Phase 1B has been launched. Local authorities can bid for funding under this scheme to improve the energy efficiency of low-income households in their area. In this second phase (1B), LAs, working with their local partners, are invited to apply for funding.
Mayor urges ministers to back council home building for Covid recovery
Mayor of London | 21 October 2020
The Mayor of London, Sadiq Khan, has urged ministers to back his ambition to address London’s inequalities in health, wealth and happiness by empowering boroughs to build more council houses. Launching a major new report, he has called on the Government to “stop blocking the aspiration of London’s councils to build”, and to give the capital the funding and powers needed to build large numbers of new council homes. Increasing the number of genuinely affordable homes – particularly council homes and homes at social rent – has been the Mayor’s number-one housing priority. Last year 3,300 new council homes were started in London – the highest number since 1983 – but the Mayor has warned that achieving his ambitious targets will only be possible if ministers back him, and councils, to deliver. Building London's future: The next generation of council homes
Supported housing: national statement of expectations
Ministry of Housing, Communities & Local Government | 20 October 2020
Guidance setting out good practice in planning, commissioning and delivery of supported housing. The national statement of expectations (NSE) sets out the government’s vision for the planning, commissioning and delivery of supported housing for the first time. It is aimed at local authorities, providers and other local partners. The guidance is non-statutory, but the intention is the NSE will consolidate ‘what good looks like’ and empower local authorities to ensure provision is good quality and value for money.
Impact of Covid-19 on tenants, landlords, rough sleepers relaunched
Housing, Communities and Local Government Committee | 16 October 2020
The Housing, Communities and Local Government Committee issues a further call for evidence on the impact of Covid-19 on tenants, landlords, rough sleepers and homelessness. In an interim report published in May, the Committee found that successful efforts to tackle rough sleeping during the Covid-19 pandemic risked being squandered if the Government failed to implement and fund a comprehensive exit strategy. It called for dedicated funding of at least £100m a year in long term housing support to prevent thousands of people currently in temporary accommodation returning to the streets. The Committee further warned of a looming homelessness crisis as private sector renters currently unable to pay rent, face building up debt or losing their homes when the current ban on evictions expires. The deadline for submissions is Friday 27 November
£3bn affordable housing guarantee scheme to be operated by Ara Venn
Housing, Communities and Local Government Committee | 16 October 2020
Investment management firm ARA Venn to deliver £3bn scheme that will provide cost-effective long-term loans to registered providers of affordable homes. The new Affordable Homes Guarantee Scheme will help to finance affordable homes across England, including for social rent, affordable rent and shared ownership.
Local heritage list campaign: call for expressions of interest
Ministry of Housing, Communities & Local Government | 16 October 2020
This campaign encourages communities to nominate those locally important historic buildings which they value most for inclusion in their local authority’s local list.
Towns Fund: further guidance - updated
Ministry of Housing, Communities & Local Government | 12 October 2020
This guidance is intended to enable towns to finalise their Town Investment Plans and work with MHCLG to agree their Town Deals. Updated with confirmation of additional ‘cohort 2a’ with a Town Investment Plan submission deadline of 11 December 2020.
Greener Regeneration Scheme
Construction Leadership Council | 9 October 2020
The UK Government’s ambitions for levelling-up, improving social cohesion and accelerating the path to Net Zero could be shifted up a gear if alternative financing capability is made available to support local regeneration, according to construction industry leaders. The Construction Leadership Council (CLC) has developed the Greener Regeneration Scheme, showing how the Government could empower local authorities, and their development partners, to take the lead in the post-COVID revitalisation of towns and cities.
New inquiry: The Planning System
The Housing, Communities and Local Government Committee | 8 October 2020
The Housing, Communities and Local Government Committee has launched a new inquiry to investigate Government proposals to reform the planning system. The inquiry will examine how well the proposed reforms would support the Government’s wider building strategy, including its target to build 300,000 new homes a year, as well as ensuring high quality construction that is fit for purpose. It will also examine how well the new proposals protect existing buildings or localities, and provide mechanisms for local engagement in the planning system.
Planning for the Future: planning policy changes in England in 2020 and future reforms
House of Commons Library | 8 October 2020
The Planning for the Future white paper published in August 2020, setting out the Government's proposals for "once in a generation" reform of England's planning system, has proved controversial. This briefing examines those proposals and the other planning changes already made during the Covid-19 pandemic. Full report.
Long-term delivery of social and affordable rented housing: government response to the Select Committee report
Ministry of Housing, Communities & Local Government | 7 October 2020
A response by the government to the Housing, Communities and Local Government Committee's report on long-term delivery of social and affordable rented housing.
Thousands of affordable home would have been lost under planning reforms
Local Government Association | 7 October 2020
Communities could have missed out on nearly 30,000 affordable homes in the past five years if proposed government planning reforms were in place, new analysis by the LGA reveals.
Business rates: general information
Ministry of Housing, Communities & Local Government | 2 October 2020
The Ministry of Housing, Communities & Local Government has published the eighth business rates information letter of 2020. The letter covers the 2023 revaluation of non-domestic property, rate relief for public lavatories, the fundamental review of business rates, New Burden payments (including for Council Tax Hardship Fund) and underestimates of business rates reliefs for 2020–2021—additional data collection and payments.
Improving local bus services in England outside London
National Audit Office | 2 October 2020
This report from the National Audit Office finds that, despite the Department for Transport’s long stated aim to increase bus use, passenger numbers have fallen. The Department will need greater clarity on what it wants to achieve and how it will measure success, if its forthcoming national strategy for improving bus services is to succeed.
Hollywood firm agrees deal to build Dagenham studio
LocalGov | 4 November 2020
Barking and Dagenham Council has signed a deal with a Hollywood developer to build a film and TV production centre in Dagenham. Eastbrook Studios London will be the capital’s largest studio campus and is expected to create 1,200 jobs and contribute £35m per year to the local economy.
Homes England funding rule undermines ‘levelling-up agenda’
LocalGov | 2 November 2020
A disproportionate amount of Government funding for housing is being given to the UK’s most affluent areas, a property consultancy firm has calculated. New research by Knight Frank has revealed that 80% of Homes England funding goes to the least affordable – and often most affluent – areas of the country, which represent only about 43% of the population. The most affordable – and often poorest – areas of the country (57% of the population) only receive 20% of Homes England funding.
Business rate appeals average ‘1,000 per day’
Public Finance | 29 October 2020
Councils face a massive rise in business rates appeals, which have reached around 1,000 a day as a result of Covid-19, according to real estate firm Colliers. Over the last six months, more than 180,000 “check challenge appeal” business rates appeals were filed with the Valuation Office Agency, Colliers said. The firm said this was significantly higher than the 158,930 appeals lodged in the three years to 31 March 2020.
Oldham Council buys shopping centre to 'kickstart' town centre recovery
LocalGov | 20 October 2020
Oldham Council has bought the Spindles Town Square Shopping Centre to provide a catalyst for town centre recovery. The purchase will enable the Tommyfield Market to be relocated to a more prominent location as part of the refurbished shopping centre. The council said the purchase would safeguard an important town centre building and help release brownfield sites across the town centre.
Council to ‘fundamentally’ review services
Public Finance | 6 November 2020
Manchester City Council is set to fundamentally review its size and structure, warning that efficiency savings cannot not cover a forecast £135m funding gap next year.
Councils call for clear lockdown exit strategy
LocalGov | 4 November 2020
The Government has been urged to work with councils to develop a clear lockdown exit strategy by the Local Government Association (LGA). The LGA warned Whitehall must learn from the past seven months and ensure a clear strategy is developed for when national restrictions end on December 2 in partnership with local councils.
Thurrock Council borrows £125m from PWLB
Public Finance | 4 November 2020
Thurrock Council has taken out a £125m loan with a maturity of just two years from the Public Works Loan Board. The loan, set to mature in 2022 at a rate of 1.77%, was outlined in statistics compiled by the Debt Management Office. It is the first loan the council has taken out with the facility in 2020-21, after it borrowed £100m in March.
Mayor confirms relocation of City Hall
LocalGov | 3 November 2020
The Greater London Authority (GLA) will relocate to Royal Docks next year saving £61m over five years, the mayor has confirmed. Sadiq Khan said the move will save £6m more than originally forecast and will help protect frontline services.
Sutton £250m bond ‘cheaper than PWLB rate’
Public Finance | 3 November 2020
A bond totalling £250m, set to be issued by a London council has been priced at 1.7% – below the rate available from the Public Works Loan Board. London Borough of Sutton is set to undertake its first bond issuance to refinance short-term debt and finance projects within Sutton’s approved capital programme. An initial £100m was issued by Sutton yesterday with a 35-year maturity, with a further £150m of issuance earmarked for future sale. David Whelan, managing director of public sector treasury at Link Group, which advised on the deal, said: “The authority has successfully demonstrated that it is possible for local authorities to secure cheaper general fund borrowing from the institutional investor market, than that currently available from the PWLB.”
Covid-19 figures ‘hide mounting financial pressure’
Public Finance | 2 November 2020
The monthly financial impact of Covid-19 on councils in England has fallen below £1bn for the first time since the start of the crisis, running at 60% of the £1.5bn peaks in April and May. However, experts have suggested the seemingly downward trend does not tell the full story.
Council steps in to save pandemic-hit scheme
Public Finance | 30 October 2020
London Borough of Newham is to loan a further £4m to its own development company, after a leisure centre operator pulled out of a development project due to Covid-19. If approved, the funds will go to Populo Living, the council’s wholly-owned housing development company. The move will help offset the lost income from an agreement with investment and development company Helical Retail, which had been due to buy a commercial area for a gym and retail space, within the Brickyard mixed use development in East Ham.
Surrey looks to future with £20m LED conversion
LocalGov | 29 October 2020
Surrey County Council is to convert all of its 89,000 street lights to LEDs over the next three years at a cost of £20m. The council said the move will save £2m a year at February 2020 prices as LED lanterns use around 65% less energy, and could save more if energy prices continue to rise. The three-year programme has already started in Guildford borough, with lights in Surrey Heath and Waverley due to be converted in the coming months. Cabinet member for transport Matt Furniss said: ‘Investing in LED streetlights demonstrates our commitment to reducing our energy consumption. As well as supporting our aim of being net carbon zero by 2050, the reduced costs also benefit the taxpayer.'
Spelthorne councillors seize greater investment oversight
Public Finance | 28 October 2020
Councillors at Spelthorne Borough Council have voted to give themselves more control over the authority’s property investment decisions. Approval was given to an action plan tabled by audit committee chair Lawrence Nichols at a meeting last week, in response to a Public Accounts Committee report on local authority commercial investment in July.
Nearly half of councils in Great Britain use algorithms to help make claims decisions
The Guardian | 28 October 2020
Nearly half of councils in England, Wales and Scotland have used or are using computer algorithms to help make decisions about benefit claims, who gets social housing and other issues, despite concerns about their reliability. A Guardian freedom of information investigation has established that 100 out of 229 councils have used or are using automated decision-making programmes, many without consulting at all with the public on their use. This is despite one council admitting that results from one algorithm showed it was only 26% accurate in some instances. A range of private companies are selling machine-learning packages to local authorities that are under pressure to save money. The systems are being deployed to provide automated guidance on benefit claims, help decide who gets social housing, and allocate school places among a range of other uses.
London borough admits some services could be significantly disrupted “for some time” as it reels from cyberattack
Local Government Lawyer | 26 October 2020
Some services provided by Hackney Council may be significantly disrupted for some time as the London borough responds to a cyberattack that has impacted its ‘legacy’ and non-cloud based systems, Mayor Philip Glanville has warned. In a message to residents on Friday (23 October), Glanville said he was “incredibly angry that organised criminals have chosen to attack us in this way, and in the middle of dealing with a global pandemic. It is morally repugnant, and is making it harder for us to deliver the services you rely on.” The Mayor said the council had reported the incident to the Information Commisioner’s Office and was working very closely with the Government, National Cyber Security Centre, National Crime Agency and other experts to investigate the attack.
Tory leader’s £1bn office buying spree ‘leaves dangerous legacy’ for council
The Guardian | 25 October 2020
Ian Harvey reveals just how easy it was to borrow 100 times his austerity-hit borough’s budget to invest in property. Spelthorne’s debt-fuelled spree is just the most dramatic example of how councils have been encouraged to make commercial investments to offset budget cuts during a decade of austerity. Richard Watts, the chair of the Local Government Association’s resources board, said some councils are now faced with mounting losses: “Ten years of massive cuts to local government forced councils to look elsewhere for money, but as a result of the pandemic some of these new sources of income are drying up.
London council sets up own same-day Covid testing service
The Guardian | 22 October 2020
Barking and Dagenham council in east London is thought to be the first in the country to set up its own same-day Covid testing service for key workers, sidestepping the nationwide system over delays in getting tests and results. The council said it had acted because of concerns about delays in accessing tests at the NHS testing sites in the borough.
Lancashire plans third issue through bonds agency
Public Finance | 20 October 2020
Lancashire County Council has confirmed it plans to issue its third bond through the UK Municipal Bonds Agency. The move comes after Lancashire issued two bonds in January and August – covering long and short durations.The council said the new issue – pencilled in for next year – would complete its plans to issue three bonds from the facility in total, split equally into thirds for short, medium and long-term maturities.
Whiteman slams Plymouth's interest rate swap move
Public Finance | 19 October 2020
CIPFA chief executive Rob Whiteman has claimed that Plymouth City Council acted outside its legal powers by agreeing an interest rates swap deal. The authority had become the first council to agree an interest rates swap deal since a High Court ruling effectively killed off the practice 30 years ago.
Covid-19 halts council’s £180m property drive
Public Finance | 16 October 2020
Reading Borough Council is to its delay planned commercial investment strategy, valued at £180m over the next three years, due to the Covid-19 pandemic. The council had previously spent more than £70m on commercial infrastructure between 2016 and 2020, and had planned to invest up to £180m up to March 2023.
Borough council dismisses claim its commercial property purchases were unlawful
Local Government Lawyer | 15 October 2020
Spelthorne Borough Council has moved to defend its controversial commercial property purchases after a website published leaked material that purported to show auditor KPMG thought the council had acted unlawfully. The Bureau of Investigative Journalism said the documents showed Spelthorne had ignored rules that forbid councils borrowing purely to make a profit on subsequent investments and that KPMG could seek a court ruling that the council acted unlawfully. A ‘frequently asked questions’ sheet issued by Spelthorne said the council has since 2016 invested £914m in commercial assets from which it receives around £50m a year in rental income. It said that after deductions, this left the council £10m a year to spend on local services. Spelthorne’s overall budget is some £22m. Spelthorne said in a statement: “There is [a] suggestion that auditor KPMG will deem that Spelthorne has acted unlawfully by not following rules and regulations relating to financial borrowing and the proportion of borrowing and investments in pursuing this council's commercial property acquisition strategy.The council remains confident in the legal advice it has been given and can state it has fully complied with all legislation and guidance.” The council said KPMG had not yet issued its 2017-18 accounts statement nor stated its conclusions on any actions it might pursue. Spelthorne said it had complied with all relevant guidance, had regard to the Prudential Code, and denied that it had been forced to repay the Public Works Loan Board early or been required to sell any investment properties.
Council raises £1m through UK's first local government green bond
LocalGov | 14 October 2020
The UK's first local government green bond has reached its target of raising £1m for West Berkshire District council five days early. The Community Municipal Investment (CMI) attracted 640 investors in total, with 22% of funds raised from local residents. The bond, developed by ethical investment platform Abundance, will help fund green infrastructure such as installing solar panels on council buildings and creating new cycleways.
Council launches independent review of its companies
Public Finance | 8 October 2020
London Borough of Croydon has launched a review of the companies it owns, as part of its bid to receive more assistance from the government. The independent review was approved at a meeting last month, as part of the Croydon Renewal Plan, which sets out plans to create a balanced budget over the next three years.
Advisory firm PwC will look into the overall financial health of the council's wholly-owned property development company Brick by Brick, as well as the its governance arrangements and the viability of future projects.
Kent councils take back control of housing stock
LocalGov | 5 October 2020
Four councils in East Kent have taken back control of housing management services. Canterbury City Council, Dover DC, Folkestone & Hythe DC and Thanet DC have now taken over the services and most staff provided by East Kent Housing (EKH). The move was taken after a series of health and safety failings were discovered at some of the properties that EKH was managing on behalf of the councils last year.
This month has seen continued focus on local authority finances. Starting with auditor Grant Thornton’s public interest report on London Borough of Croydon amid spending pressures within both children’s and adult social care and low levels of reserves, at the same time the Housing, Communities and Local Government Committee launched its inquiry into the spending review and local government finance.
The report on Croydon Council follows the public interest report into Nottingham City Council by its external auditors. Croydon Council have however gone on to issue a section 114 notice banning all non-essential spending, due to the “severe ongoing financial challenges” facing the authority, including a potential budget shortfall of £66m this year.
There’s little doubt that successive one-year funding settlements from the Government have done little to help councils to protect services and agree sustainable medium-term financial strategies, even without the pressures of a global pandemic to factor in. Indeed the LGA have urged the Government to publish this spending review as soon as possible in an attempt to mitigate the impact of a last minute, short-term budgeting from Whitehall.
The Housing, Communities and Local Government Committee’s inquiry may come too late for Croydon but what can other councils hope to take from it? The Committee will investigate the current financial health of local authorities and their ability to deliver services, including the additional pressures caused by the Covid-19 pandemic. In light of continued delays to the multi-year spending review, the Committee will also examine the impact of single year settlements on the ability of councils to plan and deliver services in the long-term. Evidence can be submitted until Friday 27 November 2020.
With increasing data pointing to the fragility of local authority coffers - including a £900m drop in reserves across England since last year - are more section 114 reports only a matter of time?
The Local Authorities (Capital Finance and Accounting) (England) (Amendment) Regulations 2020/1212
This instrument amends the Local Authorities (Capital Finance and Accounting) (England) Regulations 2003 (S.I. 2003/3146) by establishing new accounting practices in relation to the treatment of local authorities’ schools budget deficits. The new accounting practice has the effect of separating schools budget deficits from local authorities’ wider finances for a period of three financial years. This instrument applies only to accounts produced by local authorities relating to the financial years beginning on 1st April 2020, 1st April 2021 and 1st April 2022. These Regulations come into force on 29th November 2020.
The Restriction of Public Sector Exit Payments Regulations 2020/1122
These Regulations will restrict prescribed public sector bodies from making exit payments above £95,000 in connection with a person leaving employment or vacating office. Coming into force on 4 November 2020.
Local authority capital expenditure and receipts in England: 2019 to 2020 final outturn
Ministry of Housing, Communities & Local Government | 5 November 2020
Statistics on the final outturn figures of local authority capital expenditure and receipts in the financial year April 2019 to March 2020.
Local authority capital expenditure and receipts in England: 2019 to 2020 individual local authority data
Ministry of Housing, Communities & Local Government | 5 November 2020
Data for compiling the final outturn figures of local authority capital expenditure and financing for 2019 to 2020.
Government confirms rapid review into Nottingham City Council
Ministry of Housing, Communities & Local Government | 2 November 2020
A rapid non-statutory review will be conducted into Nottingham City Council, the Local Government Secretary Robert Jenrick has confirmed today. The review will look into the serious governance and risk management issues associated with the council’s private energy company Robin Hood Energy. The council has agreed to this short, informal review to identify the issues it is facing and make recommendations for action that should be taken. The decision to carry out the review was taken following a number of issues raised in a Public Interest Report published in August by Grant Thornton. And also Lead Review appointment letter
Government confirms rapid review into London Borough of Croydon
Ministry of Housing, Communities & Local Government | 29 October 2020
A rapid non-statutory review will be conducted into the London Borough of Croydon, the Local Government Secretary Robert Jenrick has confirmed today. The review will focus on Croydon Council’s overall governance, culture and risk management following the Council’s announcement that it would seek exceptional financial support from MHCLG. The council has agreed to this short, informal review to identify the issues the council is facing and make recommendations after a number of serious concerns around the council’s governance and risk management identified by MHCLG were underlined in a Public Interest Report published last week by Grant Thornton. The report was highly critical of the Council’s financial management and scrutiny of its spending and investments. The rapid review does not rule out a more formal, statutory intervention from the Government in the future – a decision on which will be informed by this work.
Restriction of Public Sector Exit Payments: How restrictions of public sector exit payments are implemented.
HM Treasury | 29 October 2020
HM Treasury has published guidance and a direction on the restriction of public sector exit payments. The guidance and direction set out the obligations on individuals and employers and the waiver process for payments over £95,000.
Press Release on LLG's Position to the Exit Payment Cap Regulations
Lawyers in Local Government | 27 October 2020
It is with reluctance that LLG has had to write to the government, along with colleagues at SOLACE and ALACE, to seriously question the flawed approach to legislation with respect to the imposition of the Exit Payment Cap. LLG President, Quentin Baker said "Given the increased likelihood of redundancy in the sector the timing of this seems particularly pernicious. The implementation of the regulations is rushed and has created a genuine problem as the statutory instrument does not trump the pension scheme".
A rushed approach has meant that the legislation has come into force before the consultation on the LGSS pension scheme has even closed, leaving councils in a complex scenario where two regulations directly clash. Worse still, the Act does not allow retrospective changes, raising questions of lawfulness. And Local Government Lawyer comment
New Inquiry: The Spending Review and Local Government Finance
The Housing, Communities and Local Government Committee | 27 October 2020
In this new inquiry, the Housing, Communities and Local Government Committee will consider what approach the Government should take to funding local government as part of the 2020 spending review. It will investigate the current financial health of local authorities and their ability to deliver services, including the additional pressures caused by the Covid-19 pandemic. In light of continued delays to the multi-year spending review, the Committee will also examine the impact of single year settlements on the ability of councils to plan and deliver services in the long-terms. Evidence can be submitted until Friday 27 November 2020.
England’s patchwork quilt governance is not strong enough for a crisis like coronavirus
Institute for Government | 26 October 2020
England’s ad hoc governance structures are too reliant on politicians muddling through. The coronavirus crisis has highlighted the need for a change in mindset from central government, says Alex Thomas
Returns show £900m drop in council reserves last year
Public Finance | 23 October 2020
Levels of reserves for councils in England dropped by £900m in 2019-2020 to £23.7bn, according to outturn figures published by the Ministry for Housing, Communities and Local Government. More than half of local authorities (58%) recorded a net usage of reserves last year, compared to 37% the previous year, with the proportion highest among unitary authorities, among which 75% reported net usage. Overall, unitary authorities’ net reserves spending was recorded at £444m last year, compared to a surplus of £188m in 2018-2019.
Local authority revenue expenditure and financing England: 2019 to 2020 individual local authority data – outturn
Ministry of Housing, Communities & Local Government | 22 October 2020
Provisional outturn data of local authority revenue expenditure and financing for the financial year April 2019 to March 2020.
Local authority revenue expenditure and financing England: 2019 to 2020 provisional outturn
Ministry of Housing, Communities & Local Government | 22 October 2020
Provisional outturn estimates of local authority revenue expenditure and financing for 2019 to 2020.
Jenrick confirms allocations of £1bn funding for councils this winter
Ministry of Housing, Communities & Local Government | 22 October 2020
Local Government Secretary Robert Jenrick has today confirmed allocations for individual councils from the £1bn of additional support announced by the Prime Minister earlier this month. Over £900m of this funding will be provided to councils for their ongoing work to support communities during the pandemic, and it brings the total funding provided directly to councils during the pandemic so far to £6.4bn. This includes £4.6bn in unringfenced funding, £1.1bn from the Infection Control Fund, £300m to support Test and Trace as well as funding allocated to councils from the new Local Alert Level system and a number of grants to support communities and vulnerable people. Councils can also claim funding through a compensation scheme for lost income from sales, fees and charges. See also Local Government Association response.
“Docking-in”: making traditional governance fit for purpose in a hyper-localist world
Centre for Governance and Scrutiny | 22 October 2020
More councils are starting to experiment with different forms of decision-making. The emergence of mutual aid networks at the outset of the pandemics – agile, highly local, groups of neighbours getting together at street level to offer immediate help to the vulnerable, contrasts unfavourably with the lumbering setup of the national, NHS-led volunteering scheme. This reflects a continuation of the pre-existing trend towards more community-focused decision-making in local government.
New era of ‘People Power’ in Newham to boost democracy and participation
Newham Council | 22 October 2020
Plans to accelerate participatory democracy through people power in Newham, and a referendum which could change how the borough is governed for the first time in a generation, were passed last night (Wednesday 21 October) by Newham Council. The proposals – in line with Mayor Rokhsana Fiaz’s manifesto commitment to extend democracy, transparency and accountability and hold a referendum on the current Mayoral model – have been developed under a new ‘People Power Participation and Co-Production Framework’. Measures will include the country’s first ever standing citizens’ assembly, building on other innovative approaches already underway. As part of the plans, Councillors also voted to commit the authority to hold a referendum on the future governance model for Newham, including the directly elected Mayoral model, which has been in place since 2002. The decision means Newham voters will have the opportunity to choose between two distinct models for the council – the currently directly elected “Mayor Model” and a “Committee Model” – at a referendum on May 6, 2021.
LGA responds to Treasury one-year Spending Review announcement
Local Government Association | 21 October 2020
Responding to the Treasury announcement that it will conduct a one-year Spending Review in November, Cllr James Jamieson, Chairman of the Local Government Association, said: “It is hugely disappointing that councils will only get a one-year funding settlement for the third year in a row. This makes it incredibly difficult for them to plan how to provide the local services our communities rely on and which have proved so vital during the pandemic, including public health, adult social care, children’s services, homelessness support, and help for those in financial hardship. This is a missed opportunity for the Government to draw a line under inefficient short-term budgeting that leads to higher costs to the public purse and to allow councils to set reliable medium-term financial strategies. Only with sustainable and certain long-term funding can councils protect and improve services and play a leading role in addressing the stark inequalities the pandemic has exposed, developing a green recovery, tackling skills gaps and rebuilding the economy so that it benefits everyone. We urge the Government to publish this Spending Review as soon as possible as the end of November is incredibly late for councils to find out how much money they will have to provide services next year. Councils will face a £4bn funding gap next year just to keep services running at today’s levels and need urgent certainty about how to set budgets and to plan any measures they may be forced to take to cut spending.”
Government confirms one-year Spending Review
Public Finance | 21 October 2020
The Treasury has confirmed the Comprehensive Spending Review will only set departmental budgets for next year, due to the economic disruption caused by Covid-19. The Spending Review had been due to set spending totals for three years, and capital budgets for a further year. However, due to the economic disruption caused by the pandemic, the Treasury has opted to make the review a single year, and will focus on employment support and helping public services through the pandemic. And comment also from LocalGov.
Public Sector Exit Payment Cap
House of Commons Library | 16 October 2020
This Commons Library Briefing Paper discusses the new public sector exit payment cap that comes into force in November 2020. In particular, it considers how the cap could impact lower-income workers and the circumstances in which the cap can be relaxed. Full report
Fixing the Plumbing: Resetting the Framework of Local Government Funding
Tony Blair Institute for Global Change | 15 October 2020
The Covid-19 pandemic has highlighted the dysfunctional relationship between central and local government. A cycle of constrained autonomy and reduced resources for local government has undermined local government’s capacity to respond to emerging policy challenges. As a result, policy formulation becomes “central by default”, further exacerbating the problem. Policy outcomes for citizens and taxpayers deteriorate. How local government is funded lies at the heart of the problem. Beyond simply a distribution of resources, the funding framework underlies the entire relationship between central and local government, but also between local government and its citizens. The source of the problem is more fundamental than something that can be solved simply through a slightly more generous funding round for town halls. Instead, the sustainable solution lies in fixing the plumbing of local government finance. This means clearly distinguishing between the two roles of local government and reforming funding to drive accountability and autonomy. Full report.
Changes to local authority powers and duties
Local government Association | 12 October 2020
Health protection, adoption and fostering, early years, children’s homes and postponed elections resulting from Coronavirus Regulations 2020. This is a guide to the provisions of the Adoption and Children (Coronavirus) (Amendment) (No 2) Regulations 2020, Early Years Foundation Stage (Learning and Development and Welfare Requirements) (Coronavirus) (Amendment) (No. 2) Regulations 2020, Health Protection (Coronavirus, Collection of Contact Details etc and Related Requirements) Regulations 2020, Health Protection (Coronavirus, Restrictions) (England) (No.2) Regulations 2020, Health Protection (Coronavirus, Restrictions) (Obligations of Hospitality Undertakings) (England) Regulations 2020, Health Protection (Coronavirus, Restrictions) (Self-Isolation) (England) Regulations 2020, Postponed Elections and Referendums (Coronavirus) and Policy Development Grants (Amendment) Regulations 2020 and to new, modified or suspended local government powers and duties applicable to local authorities in England only up to 30th September 2020.
Government invites Cumbria, North Yorkshire and Somerset to submit locally-led proposals for unitary local government
Ministry of Housing, Communities & Local Government | 9 October 2020
The government has invited councils in Cumbria, North Yorkshire and Somerset to submit locally-led proposals for unitary local government, responding to requests from these areas. Councils in these 3 areas now have the opportunity to develop and submit their proposals for how they want to restructure local government in their area to establish unitary local government. This would mean moving from a two-tier system of county and district councils, to a system where there is a single tier for any given area.
COVID-19: Local authority compliance and enforcement grant
Ministry of Housing, Communities & Local Government | 8 October 2020
Information and guidance on the £30m grant to local authorities for compliance and enforcement activities. And comment from Local Government Lawyer.
Intimidation in public life continues to threaten democracy
Committee on Standards in Public Life | 8 October 2020
Since the publication of the Committee’s report on Intimidation in Public Life in 2017, it is evident that much has happened to tackle threats to those in public life, but there remains more to do.
Intimidation is not just a problem for national politicians and public figures, but is unfortunately the reality for local councillors, and all those holding public appointments, such as headteachers. It is completely unacceptable that individuals and, in some cases, their families, should be subject to threats and abuse for doing their job. The Committee will be publishing an update on progress made against the recommendations in Intimidation in Public Life in December, the third anniversary of the report.
Effective Complaint Handling for local authorities
Local Government & Social Care Ombudsman | 8 October 2020
The Local Government and Social Care Ombudsman is today issuing new guidance on effective complaint handling for local authorities. Based on previous documents, the new guide offers practical, real-world advice and guidance on running a complaints system to ensure it is effective and helps improve services.
Croydon Council issues section 114 notice
Public Finance | 11 November 2020
Croydon Council has issued a section 114 notice banning all non-essential spending, due to the “severe ongoing financial challenges” facing the authority. In a letter to councillors, Croydon's finance director Lisa Taylor outlined the issues facing the council, including a potential budget shortfall of £66m this year.
Government launches review into council’s governance
Public Finance | 2 November 2020
The government has launched a 'rapid review' into governance at Nottingham City Council, its second review of this kind announced in under a week. The new review will focus on governance and risk management issues associated with the council’s formally wholly-owned energy company Robin Hood Energy. The probe will scrutinise the robustness of any forward-looking commercial strategies or plans and the council’s longer-term approach to borrowing and investment.
Council tax support bill to exceed funding
Public Finance | 30 October 2020
Council tax support is expected to cost councils an additional £586m this year, 7% more than the £500m allocated through a dedicated fund announced in March, according to the LGA. Analysis by public sector consultants LG Futures for the association found more than 2.5m working aged people in England have applied for council tax support in the first quarter of 2020-2021. The LGA said this was an increase of 9% from the same quarter in 2019, and the highest number for any quarter since records began in 2015/16.
Public interest report accuses council of “collective corporate blindness” over finances and business ventures
Local Government Lawyer | 29 October 2020
The London Brough of Croydon suffered “collective corporate blindness” when it lost control of its finances and involved itself with business ventures it did not properly understand, an audit report has found. Auditor Grant Thornton took the rare step of issuing a public interest report on the council, whose borrowings exceed reserves. Grant Thornton said in its report that while the Covid-19 pandemic had worsened Croydon’s financial plight, it had been in difficulties long before that, which it had failed to scrutinise or address properly.
It made some 20 recommendations and said the council must act urgently on these. And comment from Public Finance.
Judicial review “necessary for effective and consistent decision-making”: Centre for Governance and Scrutiny
Local Government Lawyer | 26 October 2020
The overall objective of the Independent Review of Administrative Law (IRAL) is based on a misapprehension, the Centre for Governance and Scrutiny (CfGS) has claimed in its response to a call for evidence. The IRAL was set up in July this year and is chaired by former government minister Lord Faulks QC.
The CfPS noted that the terms of reference for the Review state that it “should bear in mind how the legitimate interest in the citizen being able to challenge the lawfulness of executive action through the courts can be properly balanced with the role of the executive to govern effectively under the law”.
In its response, which can be viewed here, the Centre said: “Judicial review of executive action is an intrinsic part of the overall framework of governance in the UK at both national and local level. Describing the right of individuals or groups withstanding to bring action as ‘balanced’ with the business of effective government is a misapprehension, because judicial review is a mechanism to ensure government is effective, by striking down those decisions which are significantly flawed for reasons of process.”
The CfGS argued that, along with other areas of law and policy, judicial review had evolved in recent years to keep pace with the evolution and development of modern local and national Government.
Mayors are a force for good. And it's time Johnson recognised that
The Guardian | 25 October 2020
Although regional mayors have been highly capable in this Covid crisis, the government has treated us like the enemy. We are uniquely well placed to help. As mayors, our focus is exclusively on the city regions we run. But the Westminster Punch and Judy show struggles to relate to this more grown-up and pragmatic “place before party” approach.
District councils hit out at prospect of creation of new unitaries
Local Government Lawyer | 14 October 2020
District councils have said that moves to create county-scale unitary authorities would be “the greatest act of municipal vandalism in living memory”. The District Councils Network (DCN) made this claim after Communities Secretary Robert Jenrick this week invited councils in Cumbria, North Yorkshire and Somerset to submit unitary reorganisation proposals. According to DCN this would mean local government there “would cease to exist”, and bring neither better nor cheaper services. DCN report Bigger is not better: the evidenced case for keeping ‘local’ government
City council poised to lose 617 posts due to COVID-19
LocalGov | 14 October 2020
The executive board of Leeds City Council meets next week to consider cutting the workforce by 617 posts amidst a 'stark budget shortfall' due to the costs of COVID-19. Leader of the council Cllr Judith Blake said the council would continue to talk to the Government to press for more assistance with the additional coronavirus cost pressures. The overall anticipated workforce cut for 2021-22 is based on proposals approved at the September executive board meeting and those being considered next week. The council has emphasised it will ‘make every effort’ to avoid any compulsory redundancies. At next Wednesday’s meeting, members will look at how the council proposes to identify further savings to try to meet the £118.8m shortfall estimated for the 2021-22 budget.
Luton Council unable to take action against councillors breaching lockdown rules
LocalGov | 13 October 2020
Luton council has expressed its ‘disappointment’ after it was unable to formally sanction three councillors who broke coronavirus lockdown rules in July. The mayor of Luton - who subsequently resigned - and two other councillors were pictured attending a garden party during lockdown. However, the council’s local adjudication panel has now said it was unable to take further action as the councillors attended the party in a personal capacity
BCP Council leader announces ‘cabinet plus’
LocalGov | 7 October 2020
The leader of BCP Council has announced a ‘cabinet plus’ approach to decision-making and policy development for the local authority. Cllr Drew Mellor, the leader of the local authority representing Bournemouth, Christchurch and Poole, has appointed nine councillors ranging from a new deputy leader to a new COVID resilience, schools and skills lead. The Conservative group leader Cllr Mellor was elected as the new leader of BCP Council five days ago after a vote of no confidence in former leader Cllr Vikki Slade, a Liberal Democrat.
Fragmented council funding risks to value for money, report warns
LocalGov | 5 October 2020
The increasing fragmentation in council funding ‘undermines central government’s understanding of service delivery’ and ‘risks impeding value for money,’ a report has warned.
Research for the Local Government Association (LGA) found at least 448 unique grants were issued to the sector between 2015/16 and 2018/19, with more than 50 worth less than £1m – less than 0.25% of the budget for a typical metropolitan district or London borough. The increasing number of grants comes as the total amount of grant funding from central government decreases – falling by 16% from £83.1bn in 2015/16 to £69.9bn in 2018/19. Researchers TRL Insight also found almost a third of grants were competitive - which the LGA said placed ‘additional stress on an over-stretched system’ - and more than a third were discontinued from one year to the next.
The Cabinet Office published Procurement Policy Note 07/20 – Taking account of a bidders approach to payment in the procurement of major government contracts on 29th October 2020. This procurement policy note sets out how payment approaches can be taken into account in the procurement of major government contracts. This note applies to all central government departments, their executive agencies and non-departmental public bodies. In-scope organisations must take action to apply the provisions of this Procurement Policy on all procurements above £5m per annum, advertised on or after 1 April 2021.
PPN 07/20 updates and replaces PPN 04/19, with effect from 1 April 2021. It deals with the inclusion of additional questions in the standard Selection Questions (or PAS 91 in the case of works contracts) used to assess a bidder’s payments systems to demonstrate it has a reliable supply chain.
Two supporting documents are published with PPN 07/20:
The Guidance explains that the key update from PPN 04/19 is the increase to the threshold bidders have to meet to demonstrate they have effective payments systems in place. Under PPN 04/19, the measure of “overall payment promptness” is payment of 95% of invoices within 60 days, with a “Fail” when the bidder does not pay 75% of all supply chains invoices in 60 days in one of two previous six month reporting periods. Under the new PPN 07/20, that “Fail” threshold increases to 85%.
The new Guidance also further clarifies the handling of call-off contracts from framework agreements. Bidders are required to confirm whether they intend to use a supply chain to deliver any call off under a framework agreement. The Guidance covers the situation where a bidder initially says that is does not intend to use a supply chain, but that position subsequently changes. The Guidance advises that, where such a change is permissible, the bidder is asked to complete the supply chain payment selection questions and provide relevant payment data. The authority should then carry out the assessment of the responses in the usual way. The Guidance notes that if bidders provide false or misleading information, they may face sanctions, including the possibility of exclusion, rescission of contract, damages and criminal prosecution.
You can access the PPN and supporting documents from the PPN website.
Our article which outlines PPN04/19, will continue to apply until 31 March 2021.
State Aid (Revocations and Amendments) (EU Exit) Regulations 2020, SI 2020/Draft
The purpose of this instrument is to disapply EU law relating to State aid that is retained in the UK by the European Union (Withdrawal) Act 2018 (the Withdrawal Act). The overall effect is to ensure that EU State aid law does not form part of UK domestic law as retained EU law after the end of the transition period. This instrument does not affect the application of the State aid provisions in the Northern Ireland Protocol.
The Public Procurement (Amendment etc.) (EU Exit) Regulations 2020, SI 2020/Draft
The purpose of this instrument is to address deficiencies in retained EU law in relation to public procurement arising from the withdrawal of the United Kingdom (UK) from the European Union (EU) and to give effect to Title 8 of Part 3 of the Withdrawal Agreement and Title 5 of Part 3 of the EEA EFTA Separation Agreement (together, the relevant withdrawal provisions), to ensure that retained EU law in the field of public procurement operates effectively after the Implementation Period ends on 31 December 2020. This instrument revokes the Public Procurement (Amendment etc.) (EU Exit) Regulations 2019 (2019/560) (the 2019 EU Exit Regulations) and the Public Procurement (Amendment etc.) (EU Exit) (No. 2) Regulations 2019 (2019/623) (which amends the 2019 EU Exit Regulations) before they come into force. Those Regulations were made before the UK and EU had entered into the Withdrawal
Public-sector procurement from 1 January 2021
Cabinet Office | 10 November 2020
Information for public authorities, businesses and other organisations on the outcome for public procurement policy from 1 January 2021. You will need to publish public procurement notices through Find a Tender. This service will go live on 1 January 2021. It will replace the requirement to publish notices in the Official Journal of the European Union. If you use a third party ‘eSender’ to manage your procurement notices, you will be able to continue to use them provided that they have confirmed they can publish notices to Find a Tender.
Latest Updates on UK Government COVID-19 Contracts and Spending
Tussell | 3 November 2020
Tussell has been tracking UK Government contracts and spending in response to COVID-19 since the beginning of the pandemic to provide the latest insights. The total value of contracts awarded by the UK Government in respond to Covid-19 is now £17.1bn. Roughly two thirds of this value has been awarded for products and supplies, and a third of it was dedicated to procuring services.
Cross-departmental Memorandums of Understanding: Using Memorandums of Understanding for cloud services
Crown Commercial Service | 6 October 2020
A Memorandum of Understanding (MoU) is a non-legally binding agreement between two parties, which shows intended common actions. During cross-departmental working initiatives, Crown Commercial Service identified a need for a new cross-departmental cloud MoU as part of the One Government Cloud Strategy (OGCS). This MoU is a commercial tool for maximising the value of total government spend with any cloud service provider (CSP). Crown Commercial Service have negotiated a common MoU cloud procurement process with multiple CSPs and continue to roll this out to additional providers. This MoU aims to set out special terms and pricing for CSPs products and services which the provider will then make available to all public sector organisations.
Public Procurement Review Service Progress Report 2019 -2020
Public Procurement Review Service | 2 October 2020
The Progress Report highlights the main trends that the service has seen from 6 April 2019 to 5 April 2020. It includes a comparison of procurement issues within the different sectors. It also addresses the outcome of feedback provided from user surveys and has a forward look for the financial year 2020/21.
New Inquiry: Spending Review and Local Government Finance
Housing, Communities and Local Government Committee | 27 October 2020
The Housing, Communities and Local Government Committee has launched a new inquiry into the spending review and local Government Finance.
On 21 October, the Treasury announced its intention to carry out a spending review to set departmental and capital budgets for 2021-22 and provide the financial resources to respond to Covid-19. The review will include the allocation of resources to support public services and investment in infrastructure.
In this new inquiry, the Housing, Communities and Local Government Committee will consider what approach the Government should take to funding local government as part of the 2020 spending review. It will investigate the current financial health of local authorities and their ability to deliver services, including the additional pressures caused by the Covid-19 pandemic. In light of continued delays to the multi-year spending review, the Committee will also examine the impact of single year settlements on the ability of councils to plan and deliver services in the long-terms. The predecessor Committee carried out an inquiry into local government finance and the spending review in 2019. More information about its findings is available here.
Shared legal service moves to shut its ABS as appetite for outsourcing in local government wanes
Local Government Lawyer | 5 November 2020
HB Public Law has given notice of its intention to dissolve its alternative business structure (ABS) following the move in the local government sector away from outsourcing. The ABS, HB Public Law Limited, was granted a licence from the Solicitors Regulation Authority (SRA) in 2014 and started trading the following year. It was set up so that the shared legal service could continue to carry out legal work for outsourced clients that it would otherwise have been prevented from undertaking by the SRA’s professional conduct rules.
MPs and Good Law Project launch legal action against Government over “repeated failure” to publish details of contract awards during pandemic
Local Government Lawyer | 12 October 2020
The Good Law Project and three cross-party MPs – Debbie Abrahams (Labour), Caroline Lucas (Green Party) and Layla Moran (Liberal Democrats) – have issued legal proceedings challenging the Government’s failure to publish details of contracts awarded in connection with the COVID-19 pandemic response.
The claimants accuse the Secretary of State for Health and Social Care of a “widespread systemic failure” to comply with his duty under regulation 50 of the Public Contracts Regulations 2015 to publish, within 30 days, contract award notices. The Government’s policy is to publish the contracts themselves as well, if they have a value of over £10,000, they said, adding that the Government was “routinely failing to do both”.
Procurement body unveils plans for legal services dynamic purchasing system
Local Government Lawyer | 5 October 2020
A procurement organisation is to set up a 60-month dynamic purchasing system (DPS) for legal services and suggested that the value of the contract could reach £75m. The contract start date will be 23 November 2020 and the contract end date will be 30 September 2025. The closing date is 12 pm on 2 November 2020. Procurement Assist said the DPS would be accessible by all of its current and future clients.
Emergency Low Traffic Neighbourhood (LTN) schemes implemented across the country, as a response to Covid-19 with the intention of keeping socially distanced pedestrians safe and to encourage walking and cycling, have come under considerable attack in recent weeks, with local authorities administering such schemes in Ealing, Islington and Croydon facing legal challenge. Residents in Ealing were recently granted permission by the High Court to pursue a judicial review challenge of the council’s LTN schemes.
We understand that it is LB Ealing’s position that each LTN scheme has been introduced using experimental traffic orders and on the basis that it will be monitored and consulted on over a minimum period of six months before any decision is taken as to whether it should be made permanent. Nevertheless, those that oppose the schemes are arguing that the council has acted in breach of its statutory duty to “secure the expeditious, convenient and safe movement of vehicular and other traffic (including pedestrians) and the provision of suitable and adequate parking facilities on and off the highway” and in breach of the public sector equality duty which requires public bodies to consider how their policies and decision affect people protected by the Equality Act 2010, including people with disabilities.
Last week the Government announced a further £175m to create safe spaces for cycling and walking. However, in recognition of the backlash encountered in a minority of the earlier schemes, councils will be required to ensure schemes are properly consulted upon. More specifically, they must:
We regularly advise local authorities on the legal requirements relating to consultation and how to mitigate the risk of challenge. As to what constitutes ‘appropriate consultation’ will vary from council to council; however, careful attention should be given to the updated statutory guidance recently issued which should inform the level of engagement required at the design stage.
Campaigners launch judicial review challenge over decision by council that petition on changing governance arrangements was invalid
Local Government Lawyer | 28 October 2020
A London borough is facing a judicial review challenge over its decision that a petition calling for a referendum on changes to its governance arrangements was invalid. In September campaigners said they had reached the required number of signatures – 11,100 or 5% of the Newham electorate – on the petition, which calls for a move from the current directly elected mayor and cabinet model to a leader and cabinet model. However, the council decided that amendments made by Coronavirus legislation to the regulations governing petitions required it to invalidate the petition as it was received between 16 March 2020 and 5 May 2021. The amendments to the petition regulations prohibited the presentation of petitions in this period, it argued. At its meeting last Wednesday (21 October) full council at Newham voted to commit the authority to a referendum on 6 May 2021 when voters will be offered a choice between the directly elected mayor model and a committee model.
Law Society response to the Independent Review of Administrative Law call for evidence
The Law Society | 26 October 2020
The Law Society has responded to the government’s independent review of administrative law. Judicial review has a vital place in the UK constitution, giving the rule of law and parliamentary sovereignty practical effect. It encourages good governance, improves the quality of decision-making and promotes a culture of accountability that protects individual rights and is attractive to international business investment. We do not believe that there is a need for fundamental reform of judicial review. The evidence shows that it is working well and achieving its purpose.
Council in Northern Ireland wins battle with HMRC over sports and leisure services and VAT
Local Government Lawyer | 22 October 2020
Councils’ sports and leisure services in Northern Ireland are not liable for value added tax (VAT), the First-tier Tax Tribunal has ruled. Sample cases were taken for England and Wales, Scotland and Northern Ireland after complaints from councils that HM Revenue & Customs had improperly charged them VAT on these services.
Monckton Chambers, whose Melanie Hall QC and Harry Gillow acted for Mid Ulster District Council, said that the decision for Northern Ireland would “potentially have far-reaching implications for all UK local authorities providing services pursuant to any statutory duties and powers which can be classified as a special legal regime”. This was because the Northern Ireland tribunal found local authorities were not in competition with private providers of sports and leisure services. “The question whether the same is true for the rest of the UK will be determined on the evidence at a further hearing if the parties so request,” Monckton said.
Council offers to plant trees equivalent to legal costs if protesters end action
Local Government Lawyer | 22 October 2020
The London Borough of Islington has offered to plant trees to a value equivalent to the legal costs it would incur in moving protesters if they voluntarily stop occupying a copse due to be felled. Islington wants to build 27 council homes adjacent to its Dixon Clark Court tower block, but protesters have occupied the site’s trees to try to prevent them being felled.
Judge gives permission for judicial review challenge over suitability of NASS accommodation for unaccompanied asylum-seeking children
Local Government Lawyer | 21 October 2020
The High Court has agreed to hear a judicial review challenge over the suitability of NASS [National Asylum Support Service] accommodation for unaccompanied asylum-seeking children, it has been reported. Doughty Street Chambers said Mrs Justice Lang had granted permission for the judicial review and interim relief in the cases of R (KM, AL and NG) v London Borough of Hillingdon, which involve claims brought on behalf of three unaccompanied asylum-seeking children. It is said to be the first case on the suitability of NASS accommodation. Doughty Street said: “In each case, it was accepted by the local authority that the claimants must be treated as children pending age assessments, and that they were children in need under CA 1989 [Children Act 1989], however the local authority contended that they were not in need of accommodation such that no duty under section 20 arose, on the basis that they were being provided with accommodation by the Home Office in NASS temporary accommodation in a hotel in Hillingdon’s area and that such accommodation was suitable to meet their needs.”
Response to Independent Review of Administrative Law
Centre for Governance and Scrutiny | 20 October 2020
CfGS’s response to the Government’s Independent Review of Administrative Law (IRAL), which is considering whether action is needed to change the operation of judicial review in English law.
Supreme Court rejects application for permission to appeal ruling on allotments appropriation and ministerial consent
Local Government Lawyer | 19 October 2020
The Supreme Court has refused permission to appeal a Court of Appeal ruling that land used for allotments for more than 80 years had not been subject of an appropriation for that use and so a council could dispose of the land without the consent of the Secretary of State.
Leisure trust drops procurement challenge against park authority
Local Government Lawyer | 16 October 2020
Lee Valley Leisure Trust has dropped its legal action in a bitter dispute with the Lee Valley Regional Park Authority after entering administration last month. The Trust maintains it was driven into administration by the authority not awarding it a contract and then failing to agree a management fee for its remaining work within a reasonable time, but the authority denies both claims. Joseph Barrett of 11KBW acted for the authority in “successfully defending a substantial claim under the Public Contracts Regulations 2015” brought by the trust in which it challenged the award of a new long-term contract for the management and operation of the authority’s leisure facilities in and around the London Olympic Park. The trust had previously managed these but the work went to a rival bid from Greenwich Leisure.
City council apologises after Ombudsman criticises lack of openness during tree removal programme
Local Government Lawyer | 16 October 2020
Sheffield City Council has issued an apology after the Local Government and Social Care Ombudsman issued a report accusing the local authority of not, at times, acting with openness and transparency when removing trees across the city, and when dealing with people’s complaints about that work. The LGO said a man had complained after Sheffield removed eight trees in his street during November 2016, despite specialists and the council’s own independent tree panel recommending only one of the trees needed removing. The LGO’s investigation found Sheffield at fault "for the way it corresponded with the man about his complaints, the delay and the sometimes misleading responses he received". The investigation also found fault with the way the council placed information in the public domain surrounding the tree removal, and the selective detail of that information. It found the council misrepresented advice received from specialists about the viability of one tree they assessed. The investigation went on to criticise the council for making public a version of its strategy that did not follow earlier versions, and that did not reflect its policy in practice. It listed solutions to retain trees that were never part of the contract with Amey, and therefore would never have been used. LG&SCO report.
Owner of stadium built for London Olympics sues law firm over advice on West Ham concession agreement
Local Government Lawyer | 7 October 2020
The London Legacy Development Corporation (LLDC) and E20 Stadium have launched a professional negligence legal action against Allen & Overy (A&O) over the concession agreement entered into with Premier League club West Ham for the stadium used in the London Olympics. The 99-year agreement was signed in 2013 and allowed the club to use the stadium from 2016/17 onwards. LLDC owns the stadium, while E20 Stadium is the body set up to manage it. An LLDC spokesperson said: “We are in dispute with A&O over the drafting of the West Ham United concession agreement and despite our attempts to resolve this dispute with A&O we have been unable to do so. “We have a responsibility to protect taxpayers’ interests and so have had no alternative but to seek redress through the courts.”
Mayor and Burgesses of the Royal Borough of Kingston-upon-Thames v Moss [2020] EWCA Civ 1381
The Court of Appeal has ruled that the Borough council was a re-seller of water and its tenants had been overcharged because the council had not passed on the discounts agreed with Thames Water Utilities. See comment from Local Government Lawyer
R (on the application of Z and another) (AP) (Appellants) v Hackney London Borough Council and another (Respondents) [2020] UKSC 40
Whether the Second Respondent can lawfully restrict the provision of its social housing to members of the Orthodox Jewish community. Whether the First Respondent can lawfully maintain its housing nomination arrangements with the Second Respondent. The Supreme Court has upheld the practice of a London local authority and a local housing association of restricting allocations of social housing stock to members of the Orthodox Jewish community. See comment in Local Government Lawyer.
Mayor and Burgesses of the Brent London Borough Council v Johnson (claiming to be a trustee of Harlesden Peoples Community Council) [2020] EWHC 2526
The High Court has found in favour of Brent Council in a long running dispute over the ownership of a community centre site. Judge Green ruled that the council is the “sole legal and beneficial owner” of Bridge Park Community Leisure Centre. The court rejected the claims that the acquisition by a local authority of property intended to be used for charitable purposes did not automatically conclude that the local authority held the property on a charitable trust. Evidence of an intention to create a trust was required. See comment in Local Government Lawyer.
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