Legalize / United Kingdom / Public General Act

Local Government and Housing Act 1989

Type Public General Act

Publication 1989-11-16

Last updated 2026-03-26

State In force

Department Statute Law Database

Source legislation.gov.uk

articles Not indexed

Reform history JSON API

(b) an attendance allowance in relation to the carrying out by any such member of such duties as may be specified in or determined under the regulations; and

(c) a special responsibility allowance for any such member who has such special responsibilities in relation to the authority as may be so specified or determined.

(1A) In relation to a district council, county council, county borough council or London borough council, subsection (1) above shall have effect with the omission of paragraph (b).

(2) Regulations under this section may also authorise or require a scheme made by a relevant authority under the regulations to include provision for the payment to appointed members of allowances in respect of such losses of earnings and expenses as—

(a) are necessarily sustained or incurred in the carrying out, in connection with their membership of the authority or any committee or sub-committee of the authority, of duties specified in or determined under the regulations; and

(b) are not of a description in respect of which provision is made for an allowance under any of sections 174 to 176 of the Local Government Act 1972 or sections 46 to 48 of the Local Government (Scotland) Act 1973.

(2A) Regulations under this section may authorise or require a scheme made by a district council, county council, county borough council or London borough council to include provision for the payment to members of the council of allowances in respect of such expenses of arranging for the care of children or dependants as are necessarily incurred in the carrying out of their duties as members.

(3) Without prejudice to the generality of the powers conferred by subsections (1) to (2A) above, regulations under this section may contain such provision as the Secretary of State considers appropriate for requiring a scheme made by a relevant authority under the regulations—

(a) to make it a condition of any payment by way of allowance that, in the financial year to which the payment would relate, the aggregate amount which the authority has paid out or is already liable to pay out under the scheme does not exceed such maximum amount as may be specified in or determined under the regulations;

(b) to make provision for different maximum amounts to be applicable, for the purposes of any such condition, in relation to different allowances or in relation to different members or members of different groups;

(c) to make provision in relation to claims which cannot be paid by virtue of any such condition and provision for the payment to members of the authority who are councillors of an amount by way of supplement to the basic allowance where, in any financial year, the aggregate paid out or owing under the scheme is less than an amount specified in or determined under the regulations;

(d) to provide that the amount authorised by virtue of subsection (2) above to be paid by way of allowance in any case shall not exceed such amount as may be so specified or determined;

(e) to contain such provision as may be so specified or determined with respect to the general administration of the scheme, with respect to the manner in which, time within which and forms on which claims for any allowance are to be made and with respect to the information to be provided in support of any such claim;

(f) to contain such provision as may be so specified or determined for avoiding the duplication of payments or of allowances, for determining the bodies by which payments of allowances are to be made and for the apportionment of payments between different bodies.

(3A) Regulations under this section may make provision for or in connection with—

(a) enabling district councils, county councils, county borough councils or London borough councils to determine which members of the council are to be entitled to pensions, allowances or gratuities,

(b) treating the basic allowance or the special responsibility allowance as amounts in respect of which such pensions, allowances or gratuities are payable.

(3A) Regulations may be made by the Welsh Ministers to make provision for or in connection with—

(a) enabling county councils or county borough councils to determine which members of the council are to be entitled to gratuities,

(b) treating such payments relating to relevant matters (within the meaning of Part 5A of the Democracy and Boundary Commission Cymru etc. Act 2013) as may be specified in the regulations as amounts in respect of which such gratuities are payable.

(3B) Regulations under this section may make provision for or in connection with requiring a district council, county council, county borough council or London borough council to establish and maintain a panel which is to have such functions as may be specified in the regulations in relation to allowances, or pensions, allowances or gratuities, payable to members of the council.

(3C) Regulations under this section may make provision for or in connection with enabling a panel established by a body specified in the regulations to exercise such functions as may be specified in the regulations in relation to allowances, or pensions, allowances or gratuities, payable to members of such district councils, county councils or London borough councils in England as may be specified in the regulations.

(3D) Regulations under this section may make provision for or in connection with the establishment by the National Assembly for Wales on a permanent or temporary basis of a panel which is to have such functions as may be specified in the regulations in relation to allowances, or pensions, allowances or gratuities, payable to members of county councils and county borough councils in Wales.

(3E) Regulations under subsection (3B) above may include provision—

(a) with respect to the number of persons who may or must be appointed to the panel of a council,

(b) with respect to the persons who may or must be appointed to the panel of a council,

(3F) Regulations under subsection (3C) may include provision—

(a) with respect to the number of persons who may or must be appointed to a panel mentioned in that subsection,

(b) with respect to the persons who may or must be appointed to such a panel.

(3G) Regulations under subsection (3B), (3C) or (3D) may include provision—

(a) for or in connection with enabling a panel mentioned in that subsection to make recommendations to a council on the level of allowances payable to members of the council,

(b) for or in connection with enabling such a panel to make recommendations to a council as to which members of the council are to be entitled to pensions, allowances or gratuities,

(4) Regulations under this section may—

(a) prohibit the payment, otherwise than in accordance with sections 174 to176 of the Local Government Act 1972 or sections 46 to 48 of the Local Government (Scotland) Act 1973 or in such other cases as may be specified in the regulations, of any allowance to a member of a relevant authority who is a councillor or to any appointed member of a relevant authority;

(b) impose requirements on a relevant authority with respect to the publication, in the minutes of that authority or otherwise, of the details of amounts paid in pursuance of a scheme made under the regulations;

(ba) make provision with respect to the amendment, revocation or replacement of a scheme made by a relevant authority under the regulations; and

(c) contain such incidental provision and such supplemental, consequential and transitional provision in connection with the other provisions of the regulations as the Secretary of State considers appropriate.

(5) In this section “relevant authority” means—

(a) a local authority of any of the descriptions specified in any of the paragraphs of section 21(1) below, other than paragraphs (d), (g) and (j), or insection 21(2) below;

(b) any body on which a body which is a relevant authority by virtue of paragraph (a) above is represented and which is designated as a relevant authority for the purposes of this section by regulations made by the Secretary of State; or

(c) any appeal committee so designated which is constituted in accordance with paragraph 2 or 3 of Schedule 33 to the Education Act 1996;

and references in this section to an appointed member, in relation to a relevant authority, are references to any person who is a member of the authority without being a councillor or who is a member of one or more of the authority’s committees or sub-committees without being a member of the authority.

(5A) In making or operating any scheme authorised or required by regulations under this section, a district council, county council, county borough council or London borough council shall have regard to any guidance for the time being issued by the Secretary of State.

(6) In this section any reference to a councillor includes a reference to a member of the authority concerned who, in accordance with regulations under this section, is to be treated as if he were a councillor.

Members’ interests

Members’ interests.

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Duty to adopt certain procedural standing orders

Duty to adopt certain procedural standing orders.

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(1) The Secretary of State may by regulations require relevant authorities, subject to such variations as may be authorised by the regulations—

(a) to incorporate such provision as may be prescribed by the regulations in standing orders for regulating their proceedings and business; and

(b) to make or refrain from making such other modifications of any such standing orders as may be so prescribed.

(2) Without prejudice to the generality of subsection (1) above, regulations under this section may require such standing orders as are mentioned in that subsection to contain provision which, notwithstanding any enactment or the decision of any relevant authority or committee or sub-committee of a relevant authority, authorises persons who are members of such an authority, committee or sub-committee—

(a) to requisition meetings of the authority or of any of their committees or sub-committees;

(b) to require a decision of a committee or sub-committee of the authority to be referred to and reviewed by the authority themselves or by a committee of the authority;

(c) to require that a vote with respect to a matter falling to be decided by the authority or by any of their committees or sub-committees is to be taken in a particular manner.

(3) Regulations under this section may contain such incidental provision and such supplemental, consequential and transitional provision in connection with their other provisions as the Secretary of State considers appropriate.

(4) In this section “relevant authority”—

(a) in relation to England and Wales, means a local authority of any of the descriptions specified in paragraphs (a) to (jc) or (n) of section 21(1) below , a corporate joint committee or any parish or community council; and

(b) in relation to Scotland, means a local authority.

Interpretation of Part I

Interpretation of Part I.

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(1) Any reference in this Part to a local authority is, in relation to England and Wales, a reference to a body of one of the following descriptions—

(a) a county council;

(aa) a county borough council;

(b) a district council;

(d) the Common Council of the City of London in its capacity as a local authority, police authority or port health authority;

(e) the Council of the Isles of Scilly;

(f) a fire and rescue authority constituted by a scheme under section 2 of the Fire and Rescue Services Act 2004 or a scheme to which section 4 of that Act applies;

(g) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(ga) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(h) an authority established under section 10 of the Local Government Act 1985 (waste disposal authorities);

(i) a joint authority established by Part IV of that Act (fire and rescue services and transport) ...;

(j) any body established pursuant to an order under section 67 of that Act (successors to residuary bodies);

(ja) an economic prosperity board established under section 88 of the Local Democracy, Economic Development and Construction Act 2009;

(jb) a combined authority established under section 103 of that Act;

(jba) a combined county authority established under section 9(1) of the Levelling-up and Regeneration Act 2023;

(jc) a sub-national transport body established under section 102E of the Local Transport Act 2008;

(k) the Broads Authority;

(l) any joint board the constituent members of which consist of any of the bodies specified above; . . .

(m) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . and

(n) a joint planning board constituted for an area in Wales outside a National Park by an order under section 2(1B) of the Town and Country Planning Act 1990.

(1A) In section 7 references to a local authority include a fire and rescue authority created by an order under section 4A of the Fire and Rescue Services Act 2004.

(1B) In the application of section 1(1) to a fire and rescue authority created by an order under section 4A of the Fire and Rescue Services Act 2004 by virtue of subsection (1A) the reference to being or remaining a member of a local authority is to be read as a reference to becoming or remaining such an authority.

(1C) In the following provisions of this Part references to a local authority include the London Fire Commissioner—

(a) section 7 (all staff to be appointed on merit), and

(b) section 10 (limit on paid leave for local authority duties).

(1D) In the application of section 1(1) to the London Fire Commissioner by virtue of subsection (1C) the reference to being or remaining a member of a local authority is to be read as a reference to becoming or remaining the London Fire Commissioner.

(2) Any reference in this Part to a local authority is, in relation to Scotland, a reference to a council constituted under section 2 of the Local Government etc. (Scotland) Act 1994 or a joint board within the meaning of section 235(1) of the Local Government (Scotland) Act 1973.

(3) In this Part—

“chief executive” means the person appointed under section 54 of the Local Government and Elections (Wales) Act 2021 as the chief executive of a council of a county or county borough in Wales;

“contravention” includes a failure to comply;

“corporate joint committee” means a corporate joint committee established by regulations under Part 5 of the Local Government and Elections (Wales) Act 2021;

“council manager”, “executive”, “executive arrangements” and “mayor and council manager executive” have the same meaning as in Part II of the Local Government Act 2000;

“modifications” includes additions, alterations and omissions;

“proper officer”—in relation to a local authority in England and Wales or a corporate joint committee, has the same meaning as in the Local Government Act 1972; andin relation to a local authority in Scotland, has the same meaning as in the Local Government (Scotland) Act 1973; and

“subordinate legislation” has the same meaning as in the Interpretation Act 1978.

(4) References in this Part to an officer of a local authority or to a paid office under a local authority do not include references to, or to the office of, the chairman or vice-chairman of the authority (whether referred to as such, as mayor, Lord Mayor, deputy mayor, as Lord Provost or otherwise or a member of any executive of the authority (other than a council manager)).

Part II — Local Government Administration

Advisory Commissioners.

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(1) Section 23 of the Local Government Act 1974 (constitution and functions of Commissions for Local Administration) shall have effect with the amendments specified in subsections (2) to (4) below.

(2) In subsection (1), at the end, there shall be added the words “ but each of the Commissions may include persons appointed to act as advisers, not exceeding the number appointed to conduct investigations." ”

(3) In subsection (3), after the words “Parliamentary Commissioner” there shall be inserted the words “ or an advisory member" ”.

(4) In subsections (4), (5) and (6) the word “Local” shall be omitted.

(5) In Schedule 4 to the said Act, in paragraph 3 (remuneration), at the end there shall be inserted the following sub-paragraph–

(3) Sub-paragraphs (1) and (2) above apply in relation to Commissioners who are advisory members of the Commission as they apply in relation to Local Commissioners.

Advice and guidance by Commissions for Local Administration and ScottishCommissioner.

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(1) In section 23 of the Local Government Act 1974 (appointment and functions of Commissions for Local Administration) there shall be inserted, after subsection (12), the following subsections—

(12A) Each of the Commissions may, after consultation with the representative persons and authorities concerned, provide to the authorities or any of the authorities to which this Part of this Act applies such advice and guidance about good administrative practice as appears to the Commission to be appropriate and may arrange for it to be published for the information of the public. (12B) The representative persons and authorities concerned are— (a) for the purposes of subsection (12) above, such persons appearing to the Commission to represent authorities in England or, as the case may be,authorities in Wales to which this Part of this Act applies, and in the case of such authorities as are not so represented, those authorities; and (b) for the purposes of subsection (12A) above, such of those persons and authorities as the Commission think appropriate.

(2) In section 21 of the Local Government (Scotland) Act 1975 (appointment and functions of Commissioner for Local Administration in Scotland) there shall be inserted, after subsection (4), the following subsection—

(4A) The Commissioner may, after consultation with such associations of local authorities as appear to him to be appropriate, provide to the authorities to which this Part of this Act applies such advice and guidance about good administrative practice as appears to him to be appropriate and may arrange for it to be published for the information of the public.

Expenses of Commissions for Local Administration.

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(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2) Anything done before the passing of this Act which corresponds to a thing authorised or required to be done by any provision of the paragraphs 6(2) and (3), 7 and 8 substituted by subsection (1) above and done for the purposes ofsections 78 and 79 of the Local Government Finance Act 1988 shall be treated as validly done under that provision and those sections shall have effect accordingly.

(3) The foregoing provisions shall have effect for the financial years beginning on or after 1st April 1990.

Annual reports of Commissions: new provisions.

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(1) The representative body for England and the representative body for Wales designated under section 24 of the Local Government Act 1974 are hereby dissolved and accordingly that section shall cease to have effect.

(2) After section 23 of that Act there shall be inserted the following section—

(23A) (1) For the financial year ending in 1990 and for each subsequent financial year, each of the Commissions shall prepare a general report on the discharge of their functions and shall submit it— (a) to such persons as appear to the Commission to represent authorities in England or, as the case may be, authorities in Wales to which this Part of this Act applies, and (b) in the case of such authorities as are not so represented, to those authorities. (2) The report shall be submitted as soon as may be after the Commission have received the reports for the year from Local Commissioners under section 23(11) above, and each Commission shall submit copies of those reports, together with their own report. (3) Each Commission shall arrange for the publication of the report submitted by them under subsection (1) above and of the reports of which copies are submitted by them under subsection (2) above. (4) Before arranging for the publication of a report under subsection (3) above the Commission concerned shall give a reasonable opportunity for the representative persons and authorities to whom the report was submitted to comment on it. (5) Without prejudice to the generality of subsection (4) above, comments made by the representative persons and authorities by virtue of that subsection may relate to particular classes of authorities to which this Part of this Act applies. (6) Where the Commission for Local Administration in Wales consist of only one Local Commissioner, section 23(11) above and subsection (2) above shall have effect with the necessary modifications.

Implementation of recommendations of Commissioners for Local Administration in England and Wales.

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(1) In section 31 of the Local Government Act 1974 (action to be taken in relation to adverse reports), the following subsections shall be substituted for subsections (1) to (2A)—

(1) This section applies where a Local Commissioner reports that injustice has been caused to a person aggrieved in consequence of maladministration. (2) The report shall be laid before the authority concerned and it shall be the duty of that authority to consider the report and, within the period of three months beginning with the date on which they received the report, or such longer period as the Local Commissioner may agree in writing, to notify the Local Commissioner of the action which the authority have taken or propose to take. (2A) If the Local Commissioner— (a) does not receive the notification required by subsection (2) above within the period allowed by or under that subsection, or (b) is not satisfied with the action which the authority concerned have taken or propose to take, or (c) does not within a period of three months beginning with the end of the period so allowed, or such longer period as the Local Commissioner may agree in writing, receive confirmation from the authority concerned that they have taken action, as proposed, to the satisfaction of the Local Commissioner, he shall make a further report setting out those facts and making recommendations. (2B) Those recommendations are such recommendations as the Local Commissioner thinks fit to make with respect to action which, in his opinion, the authority concerned should take to remedy the injustice to the person aggrieved and to prevent similar injustice being caused in the future. (2C) Section 30 above, with any necessary modifications, and subsection (2)above shall apply to a report under subsection (2A) above as they apply to a report under that section. (2D) If the Local Commissioner— (a) does not receive the notification required by subsection (2) above as applied by subsection (2C) above within the period allowed by or under that subsection or is satisfied before the period allowed by that subsection has expired that the authority concerned have decided to take no action, or (b) is not satisfied with the action which the authority concerned have taken or propose to take, or (c) does not within a period of three months beginning with the end of the period allowed by or under subsection (2) above as applied by subsection (2C) above, or such longer period as the Local Commissioner may agree in writing, receive confirmation from the authority concerned that they have taken action,as proposed, to the satisfaction of the Local Commissioner, he may, by notice to the authority, require them to arrange for a statement to be published in accordance with subsections (2E) and (2F) below. (2E) The statement referred to in subsection (2D) above is a statement, in such form as the authority concerned and the Local Commissioner may agree,consisting of— (a) details of any action recommended by the Local Commissioner in his furtherreport which the authority have not taken; (b) such supporting material as the Local Commissioner may require; and (c) if the authority so require, a statement of the reasons for their having taken no action on, or not the action recommended in, the report. (2F) The requirements for the publication of the statement are that— (a) publication shall be in any two editions within a fortnight of a newspaper circulating in the area of the authority agreed with the Local Commissioneror, in default of agreement, nominated by him; and (b) publication in the first such edition shall be arranged for the earliest practicable date. (2G) If the authority concerned— (a) fail to arrange for the publication of the statement in accordance with subsections (2E) and (2F) above, or (b) are unable, within the period of one month beginning with the date on which they received the notice under subsection (2D) above, or such longer period as the Local Commissioner may agree in writing, to agree with the Local Commissioner the form of the statement to be published, the Local Commissioner shall arrange for such a statement as is mentioned in subsection (2E) above to be published in any two editions within a fortnight of a newspaper circulating within the authority’s area. (2H) The authority concerned shall reimburse the Commission on demand any reasonable expenses incurred by the Local Commissioner in performing his duty under subsection (2G) above.

(2) This section shall not have effect in relation to a report made before the coming into force of this section.

Implementation of recommendations of Commissioner for Local Administrationin Scotland.

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(1) In section 29 of the Local Government (Scotland) Act 1975 (action to be taken in relation to adverse reports), the following subsections shall be substituted for subsections (1) to (2A)—

(1) This section applies where the Commissioner reports that injustice has been caused to a person aggrieved in consequence of maladministration. (2) The report shall be laid before the authority concerned and it shall be the duty of that authority to consider the report and, within the period of three months beginning with the date on which they received the report, or such longer period as the Commissioner may agree in writing, to notify the Commissioner of the action which the authority have taken or propose to take. (2A) If the Commissioner— (a) does not receive the notification required by subsection (2) above within the period allowed by or under that subsection, or (b) is not satisfied with the action which the authority concerned have take nor propose to take, or (c) does not within a period of three months beginning with the end of the period so allowed, or such longer period as the Commissioner may agree in writing, receive confirmation from the authority concerned that they have taken action, as proposed, to the satisfaction of the Commissioner, he shall make a further report setting out those facts and making recommendations. (2B) Those recommendations are such recommendations as the Commissioner thinks fit to make with respect to the action which, in his opinion, the authority concerned should take to remedy the injustice to the person aggrieved and to prevent similar injustice being caused in the future. (2C) Section 28 of this Act, with any necessary modifications, and subsection (2) above shall apply to a report under subsection (2A) above as they apply to a report under that section. (2D) If the Commissioner— (a) does not receive the notification required by subsection (2) above as applied by subsection (2C) above within the period allowed by or under that subsection or is satisfied before the period allowed by that subsection has expired that the authority concerned have decided to take no action; or (b) is not satisfied with the action which the authority concerned have taken or propose to take; or (c) does not within a period of three months beginning with the end of the period allowed by or under subsection (2) above as applied by subsection (2C) above, or such longer period as the Commissioner may agree in writing, receive confirmation from the authority concerned that they have taken action, as proposed, to the satisfaction of the Commissioner, he may, by notice to the authority, require them to arrange for astatement to be published in accordance with subsections (2E) and (2F) below. (2E) The statement referred to in subsection (2D) above is a statement, in such form as the authority concerned and the Commissioner may agree, consisting of— (a) details of any action recommended by the Commissioner in his further report which the authority have not taken; (b) such supporting material as the Commissioner may require; and (c) if the authority so require, a statement of the reasons for their having taken no action on, or not the action recommended in, the report. (2F) The requirements for the publication of the statement are that— (a) publication shall be in any two editions within a fortnight of a newspaper circulating in the area of the authority agreed with the Commissioner or, indefault of agreement, nominated by him; and (b) publication in the first such edition shall be arranged for the earliest practicable date. (2G) If the authority concerned— (a) fail to arrange for the publication of the statement in accordance withsubsections (2E) and (2F) above, or (b) are unable, within the period of one month beginning with the date on which they received the notice under subsection (2D) above, or such longer period as the Commissioner may agree in writing, to agree with the Commissioner the form of the statement to be published, the Commissioner shall arrange for such a statement as is mentioned insubsection (2E) above to be published in any two editions within a fortnight of a newspaper circulating within the authority’s area. (2H) The authority concerned shall reimburse the Commissioner on demand any reasonable expenses incurred by the Commissioner in performing his duty under subsection (2G) above.

(2) In section 32 of the Local Government (Scotland) Act 1975 (interpretation of provisions about investigations by the Commissioner) the following subsection shall be inserted after subsection (2)—

(2A) Except in the case of a joint board or joint committee, references in this Part of this Act to the authority concerned are, in relation to action taken by or on behalf of an authority to whom this Part of this Act applies (whether by virtue of subsection (1) or (2) of section 23 of this Act), references to that authority.

(3) This section shall not have effect in relation to a report made before the coming into force of this section.

Consideration of adverse reports: England and Wales.

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(1) The following section shall be inserted after section 31 of the Local Government Act 1974—

(31A) (1) Subject to subsection (3) below, any power of an authority to have their functions discharged by any person or body of persons acting for the authority shall, as respects the consideration of a further report of the Local Commissioner under section 31(2A) above, be subject to the restriction that, if it is proposed that the authority should take no action on, or not the action recommended in, the report, consideration of the report shall be referred to the authority. (2) Consideration of a further report of the Local Commissioner under section 31(2A) above by any such committee of a local authority as is referred to in an enactment specified in section 101(9) of the Local Government Act 1972 or by any appeal committee constituted in accordance with paragraph 1 of Schedule 2 to the Education Act 1980 shall be subject to a corresponding restriction. (3) The restriction imposed by subsections (1) and (2) above does not apply where the report recommends action to be taken by— (a) a joint committee established under the said section 101, or (b) any committee referred to in an enactment specified in paragraph (c), (d) or (h) of the said section 101(9). (4) If an authority considering a further report of the Local Commissioner under section 31(2A) above take into consideration a report by a person or body with an interest in the Local Commissioner’s report, they shall not conclude their consideration of the Local Commissioner’s report without also having taken into consideration a report by a person or body with no interest in the Local Commissioner’s report. (5) No member of an authority to which this Part of this Act applies or of a committee mentioned in subsection (2) or (3) above shall vote on any question with respect to a report or further report under this Part of this Act in which he is named and criticised by a Local Commissioner. (6) Section 25(4) and (5) above do not apply to this section.

(2) This section shall not have effect in relation to a report made before the coming into force of section 26 above.

Consideration of adverse reports: Scotland.

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(1) The following section shall be inserted after section 29 of the Local Government (Scotland) Act 1975—

(29A) (1) Subject to subsection (3) below, any power of an authority to have their functions discharged by any person or body of persons acting for the authority shall, as respects the consideration of a further report of the Commissioner under section 29(2A) of this Act, be subject to the restriction that, if it is proposed to take no action on, or not the action recommended in, there port, consideration of the report shall be referred to the authority. (2) Consideration of a further report of the Commissioner under section 29(2A)of this Act by— (a) any such committee as is mentioned in section 23(2) of this Act; or (b) an education committee appointed under section 124 of the Act of 1973; shall be subject to a corresponding restriction. (3) The restriction imposed by subsections (1) and (2) above does not apply where the report recommends action to be taken by a joint committee— (a) established under section 56 of the Act of 1973 or under paragraph 7 of Schedule 10 or paragraph 6 of Schedule 20 to that Act (local authority, education and social work joint committees); or (b) referred to in paragraph (a), (b), or (e) of section 23(2) of this Act (fire, police and local government and teachers’ superannuation joint committees). (4) If an authority considering a further report of the Commissioner under section 29(2A) of this Act take into consideration a report by a person or body with an interest in the Commissioner’s report, they shall not conclude their consideration of the Commissioner’s report without also having taken into consideration a report by a person or body with no interest in the Commissioner’s report. (5) No member of an authority to which this Part of this Act applies or of a committee mentioned in subsection (2) or (3) above shall vote on any question with respect to a report or further report under this Part of this Act in which he is named and criticised by the Commissioner.

(2) This section shall not have effect in relation to a report made before the coming into force of section 27 above.

Declaration of acceptance of office of councillor etc.

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(1) Before section 34 of the Local Government (Scotland) Act 1973 there shall be inserted the following section—

(33A) (1) A person elected to office as a councillor of a local authority shall not, unless— (a) he has made a declaration of acceptance of office in a form prescribed by an order made by the Secretary of State; and (b) the declaration has within two months from the day of the election been delivered to the proper officer of the local authority, act in the office except for the purpose of taking such a declaration. (2) If such a declaration is not made and delivered to the proper officer within the appointed time, the office of the person elected shall at the expiration of that time become vacant. (3) The declaration shall be made before either— (a) two members of the local authority to which the declarant is elected; or (b) the proper officer of the local authority; or (c) the sheriff; or (d) a justice of the peace. (4) Any person before whom a declaration is authorised to be made under this section may take the declaration.

(2) In section 83 of the Local Government Act 1972 (declaration of acceptance of office) in subsection (1) and subsection (4), for the words “rules under section 42 above” there shall be substituted the words “ an order made by the Secretary of State ”.

National Code of Local Government Conduct.

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Anonymity in reports on investigations.

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(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Part III — Economic Development and Discretionary Expenditure by Local Authorities

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34

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35

Amendments of existing power to incur discretionary expenditure.

36

(1) Section 137 of the Local Government Act 1972 (power of local authorities to incur expenditure for certain purposes not otherwise authorised) shall be amended in accordance with subsections (2) to (8) below and, accordingly, after the coming into force of this section, shall have effect as set out in Schedule 2 to this Act.

(2) In subsection (1), after the words “in the interests of” there shall be inserted “ and will bring direct benefit to ”; after the words “incur any expenditure” there shall be inserted “ (a) ” and at the end there shall be added the words

nor (b) unless the direct benefit accruing to their area or any part of it or to all or some of the inhabitants of their area will be commensurate with the expenditure to be incurred

(3) After subsection (1) there shall be inserted the following subsection—

(1A) In any case where— (a) by virtue of paragraph (a) of subsection (1) above, a local authority are prohibited from incurring expenditure for a particular purpose, and (b) the power or duty of the authority to incur expenditure for that purposeis in any respect limited or conditional (whether by being restricted to a particular group of persons or in any other way), the prohibition in that paragraph shall extend to all expenditure to which that power or duty would apply if it were not subject to any limitationor condition.

(4) Subsections (2A) and (2B) (which relate to the giving of financial assistance to persons carrying on commercial or industrial undertakings) shall cease to have effect and, in subsection (2C), paragraph (a) (which relates to publicity on the promotion of the economic development of the authority’s area) shall also cease to have effect.

(5) In subsection (3) (contributions permitted to charitable and public service funds etc.),—

(a) for the words “as aforesaid” there shall be substituted “ to the following provisions of this section ”;

(b) in paragraph (b) after the words “public service” there shall beinserted “ (whether to the public at large or to any section of it) ”; and

(c) at the end of paragraph (c) there shall be added “ or by such a person or body as is referred to in section 83(3)(c) of the Local Government (Scotland) Act 1973 ”.

(6) In subsection (4) (expenditure not to exceed the product of a 2p rate) for the words following “not exceed” there shall be substituted

the amount produced by multiplying— (a) such sum as is for the time being appropriate to the authority under subsection (4AA) below, by (b) the relevant population of the authority’s area

;and subsection (8) (which relates to the computation of a 2p rate) shall cease to have effect.

(7) After subsection (4) there shall be inserted the following subsections—

(4AA) For the purposes of subsection (4)(a) above, except in so far as the Secretary of State by order specifies a different sum in relation to an authority of a particular description,— (a) the sum appropriate to a county council or the council of a non-metropolitan district is £2.50; (b) the sum appropriate to a metropolitan district council, a London borough council or the Common Council is £5.00; and (c) the sum appropriate to a parish or community council is £3.50. (4AB) For the purposes of subsection (4)(b) above the relevant population of a local authority’s area shall be determined in accordance with regulations made by the Secretary of State; and a statutory instrument containing such regulations shall be subject to annulment in pursuance of a resolution of theHouse of Commons.

(8) In subsection (4B) (amounts deductible in determining expenditure under the section) for paragraph (a) there shall be substituted the following paragraph—

(a) the amount of any expenditure which forms part of the authority’s gross expenditure for that year under this section and in respect of which any grant has been or is to be paid under any enactment by a Minister of the Crown, within the meaning of the Ministers of the Crown Act 1975 (whether or not the grant covers the whole of the expenditure)

(9) In section 83(3) of the Local Government (Scotland)Act 1973 (contributions permitted to charitable and public service funds etc.), at the end of paragraph (c) there shall be added “ or by such a person or body as is referred to in section 137(3)(c) of the Local Government Act 1972 ”.

Conditions of provision of financial assistance.

37

After section 137 of the Local Government Act 1972 there shall be inserted the following section—

(137A) (1) If in any financial year a local authority provides financial assistance— (a) to a voluntary organisation, as defined in subsection (2D) of section 137above, or (b) to a body or fund falling within subsection (3) of that section, and the total amount so provided to that organisation, body or fund in that year equals or exceeds the relevant minimum, then, as a condition of the assistance, the authority shall require the organisation, body or fund, within the period of twelve months beginning on the date when the assistance is provided, to furnish to the authority a statement in writing of the use to which that amount has been put. (2) In this section “financial assistance” means assistance by way of grant or loan or by entering into a guarantee to secure any money borrowed and, in relation to any financial assistance,— (a) any reference to the amount of the assistance is a reference to the amount of money granted or lent by the local authority or borrowed in reliance on the local authority’s guarantee; and (b) any reference to the date when the assistance is provided is a referenceto the date on which the grant or loan is made or, as the case may be, on which the guarantee is entered into. (3) The relevant minimum referred to in subsection (1) above is £2,000 or such higher sum as the Secretary of State may by order specify. (4) It shall be a sufficient compliance with a requirement imposed by virtue of subsection (1) above that there is furnished to the local authority concerned an annual report or accounts which contain the information required to be in the statement. (5) A statement (or any report or accounts) provided to a local authority in pursuance of such a requirement shall be deposited with the proper officer of the authority. (6) In this section “local authority” includes the Common Council.

Information etc. on individuals’ rights.

38

(1) Section 142 of the Local Government Act 1972 (provision of information, etc.) shall be amended as follows.

(2) There shall be inserted after subsection (2)—

(2A) A local authority may assist voluntary organisations to provide for individuals— (a) information and advice concerning those individuals’ rights and obligations; and (b) assistance, either by the making or receiving of communications or by providing representation to or before any person or body, in asserting those rights or fulfilling those obligations.

Part IV — Revenue Accounts and Capital Finance of Local Authorities

Introductory

Application of Part IV.

39

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Capital purposes.

40

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Charge of expenditure to revenue accounts

Expenditure to be charged to revenue account.

41

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Expenditure excluded from section 41(1).

42

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Borrowing

Borrowing powers.

43

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Borrowing limits etc.

44

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The authority’s own limits.

45

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Register of loan instruments and certain existing loans.

46

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Security for money borrowed etc.

47

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Credit arrangements

Credit arrangements.

48

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Initial and subsequent cost of credit arrangements.

49

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Limits on powers to enter into credit arrangements.

50

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Variation of credit arrangements.

51

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Transitional credit arrangements.

52

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Credit approvals

Basic credit approvals.

53

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Supplementary credit approvals.

54

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Criteria for issuing credit approvals.

55

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Use of credit approvals by local authorities.

56

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Effect of certain capital grants on credit approvals.

57

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Capital receipts

Capital receipts.

58

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The reserved part of capital receipts.

59

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The usable balance of capital receipts.

60

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Capital receipts not wholly in money paid to the authority.

61

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Aggregate credit limit

Aggregate credit limit.

62

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Amounts set aside to meet credit liabilities

Duty to set certain amounts aside as provision to meet credit liabilities.

63

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Use of amounts set aside to meet credit liabilities.

64

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Supplementary

Information.

65

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Interpretation of Part IV.

66

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Part V — Companies in which Local Authorities have interests

Application of, and orders under, Part V.

67

(1) Any reference in this Part to a company is a reference to a body corporate of one of the following descriptions—

(a) a company limited by shares;

(b) a company limited by guarantee and not having a share capital;

(d) an unlimited company;

(da) a registered society within the meaning of the Co-operative and Community Benefit Societies Act 2014; and

(e) a society registered or deemed to be registered ... under the Industrial and Provident Societies Act (Northern Ireland) 1969.

(2) Expressions used in paragraphs (a) to (d) of subsection (1) above have the same meaning as in the Companies Acts (see section 1174 of, and Schedule 8 to, the Companies Act 2006).

(3) Any reference in this Part to a local authority is a reference to a body of one of the following descriptions—

(a) a county council;

(aa) a county borough council;

(ab) a corporate joint committee established by regulations under Part 5 of the Local Government and Elections (Wales) Act 2021;

(b) a district council;

(bb) the Greater London Authority;

(bc) a functional body, within the meaning of the Greater London Authority Act 1999;

(d) the Common Council of the City of London in its capacity as a local authority, police authority or port health authority;

(e) the Council of the Isles of Scilly;

(f) a parish council;

(g) a community council;

(ga) the Greater London Magistrates’ Courts Authority;

(h) a fire and rescue authority constituted by a scheme under section 2 of the Fire and Rescue Services Act 2004 or a scheme to which section 4 of that Act applies;

(i) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(j) an authority established under section 10 of the Local Government Act 1985 (waste disposal authorities);

(k) a joint authority established by Part IV of that Act (fire and rescue services and transport);

(l) any body established pursuant to an order under section 67 of that Act (successors to residuary bodies);

(m) the Broads Authority;

(ma) a National Park authority;

(n) any joint board the constituent members of which consist of any of the bodies specified above;

(o) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(oo) a joint planning board constituted for an area in Wales outside a National Park by an order under section 2(1B) of the Town and Country Planning Act 1990; and

(p) a Passenger Transport Executive.

(4) Any power to make an order under this Part shall be exercisable by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament; and under any such power different provision maybe made for different cases and different descriptions of cases (including different provision for different areas).

(5) The power under subsection (4) above to make differential provision includes, in particular, power to make different provision for different local authorities or descriptions of local authority.

Companies controlled by local authorities and arm’s length companies.

68

(1) For the purposes of this Part, unless the Secretary of State otherwise directs, a company is for the time being under the control of a local authority if—

(a) the company is at that time a subsidiary (as defined in section 1159 of the Companies Act 2006) of the local authority; or

(b) paragraph (a) above does not apply but the local authority have at that time power to control a majority of the votes at a general meeting of the company as mentioned in subsection (3) below; or

(c) paragraph (a) above does not apply but the local authority have at that time power to appoint or remove a majority of the board of directors of the company; or

(d) the company is under the control of another company which, by virtue of this subsection, is itself under the control of the local authority;

and, for the purposes of paragraph (d) above, any question whether one company is under the control of another shall be determined by applying the preceding provisions of this subsection, substituting a reference to the other company for any reference to the local authority.

(2) A direction under subsection (1) above—

(a) may be limited in time and may be made conditional upon such matters as appear to the Secretary of State to be appropriate; and

(b) may be made with respect to a particular company or a description of companies specified in the direction.

(3) The reference in subsection (1)(b) above to a power to control a majority of votes at a general meeting of the company is a reference to a power which is exercisable—

(a) in the case of a company limited by shares, through the holding of equity share capital in any one or more of the following ways, namely, by the local authority, by nominees of the local authority and by persons whose shareholding is under the control of the local authority; or

(b) in the case of any company, through the holding of votes at a general meeting of the company in any one or more of the following ways, namely, by the local authority, by a group of members of the company the composition of which is controlled by the local authority and by persons who have contractually bound themselves to vote in accordance with the instructions ofthe local authority; or

(4) Paragraph 3 of Schedule 6 to the Companies Act 2006 (right to appoint or remove a majority of a company's board of directors) and the following paragraphs of that Schedule as they have effect in relation to paragraph 3 apply for the purposes of subsection (1)(c) above with the substitution for the word “right”, wherever it occurs, of the word “power”.

(5) For the purposes of subsection (3)(a) above, a person’s shareholding is under the control of a local authority if—

(a) his right to hold the shares arose because of some action which the authority took, or refrained from taking, in order to enable him to have the right; and

(b) the local authority, alone or jointly with one or more other persons can require him to transfer his shareholding (or any part of it) to another person.

(6) Notwithstanding that, by virtue of the preceding provisions of this section, a company is for the time being under the control of a local authority, the company is for the purposes of this Part an “arm’s length company”, in relation to any financial year if, at a time before the beginning of that year, the authority resolved that the company should be an arm’s length company and, at all times from the passing of that resolution up to the end of the financial year in question, the following conditions have applied while the company has been under the control of the local authority,—

(a) that each of the directors of the company was appointed for a fixed term of at least two years;

(b) that, subject to subsection (7) below, no director of the company has been removed by resolution under section 168 of the Companies Act 2006;

(d) that the company has not occupied (as tenant or otherwise) any land in which the authority have an interest otherwise than for the best consideration reasonably obtainable;

(e) that the company has entered into an agreement with the authority that the company will use its best endeavours to produce a specified positive return on its assets;

(f) that, except for the purpose of enabling the company to acquire fixed assets or to provide it with working capital, the authority have not lent money to the company or guaranteed any sum borrowed by it or subscribed for any securities in the company;

(g) that the authority have not made any grant to the company except in pursuance of an agreement or undertaking entered into before the financial year (within the meaning of the Companies Act 2006) of the company in which the grant was made; and

(h) that the authority have not made any grant to the company the amount of which is in any way related to the financial results of the company in any period.

(7) If the Secretary of State so directs, the removal of a director shall be disregarded for the purposes of subsection (6)(b) above; but the Secretary of State shall not give such a direction if it appears to him that the director was removed with a view to influencing the management of the company for other than commercial reasons.

Companies subject to local authority influence.

69

(1) For the purposes of this Part, unless the Secretary of State otherwise directs, a company which is not at the time under the control of a local authority is for the time being subject to the influence of a local authority if it is not a banking or insurance company or a member of a banking or insurance group and at that time there is such a business relationship between the company and the authority as is referred to in subsection (3) below and either—

(a) at least 20 per cent. of the total voting rights of all the members having the right to vote at a general meeting of the company are held by persons who are associated with the authority as mentioned in subsection (5) below; or

(b) at least 20 per cent. of the directors of the company are persons who are so associated; or

(c) at least 20 per cent. of the total voting rights at a meeting of the directors of the company are held by persons who are so associated.

(2) A direction under subsection (1) above—

(a) may be limited in time and may be made conditional upon such matters as appear to the Secretary of State to be appropriate; and

(b) may be made with respect to a particular company or a description of companies specified in the direction.

(3) For the purposes of this section there is a business relationship between a company and a local authority at any time if the condition in any one or more of the following paragraphs is fulfilled—

(a) within a period of twelve months which includes that time the aggregate of the payments to the company by the authority or by another company which is under the control of the authority represents more than one-half of thecompany’s turnover, as shown in its profit and loss account for the most recent financial year for which the company’s auditors have made a report on the accounts or, if there is no such account, as estimated by the authority for the period of twelve months preceding the date of the estimate or for such part of that period as follows the formation of the company;

(b) more than one-half of the company’s turnover referred to in paragraph (a) above is derived from the exploitation of assets of any description in which the local authority or a company under the control of the authority has an interest (disregarding an interest in land which is in reversion on a lease granted for more than 7 years);

(i) grants made either by the authority and being expenditure for capital purposes or by a company under the control of the authority, and

(ii) the nominal value of shares or stock in the company which is owned by the authority or by a company under the control of the authority,

exceeds one-half of the net assets of the company;

(d) the aggregate of—

(i) grants falling within paragraph (c)(i) above,

(ii) loans or other advances made or guaranteed by the authority or by a company under the control of the authority, and

(iii) the nominal value referred to in paragraph (c)(ii) above,

exceeds one-half of the fixed and current assets of the company;

(e) the company at that time occupies land by virtue of an interest which it obtained from the local authority or a company under the control of the authority and which it so obtained at less than the best consideration reasonably obtainable; and

(f) the company intends at that time to enter into (or complete) a transaction and, when that is done, there will then be a business relationship between the company and the authority by virtue of any of paragraphs (a) to (e) above.

(4) In subsection (3) above—

(a) the reference in paragraph (c) to the net assets of the company shall beconstrued in accordance with section 677(2) and (3) of the Companies Act 2006; and

(b) “fixed assets” means assets of a company that are intended for use on a continuing basis in the company's activities, and “current assets” means assets not intended for such use;

and in either case, the reference is a reference to those assets as shown in the most recent balance sheet of the company on which, at the time in question, the auditors have made a report or, if there is no such balance sheet, as estimated by the local authority for the time in question.

(5) For the purposes of this section, a person is at any time associated with a local authority if—

(a) he is at that time a member of the authority;

(b) he is at that time an officer of the authority;

(c) he is at that time both an employee and either a director, manager, secretary or other similar officer of a company which is under the control of the authority; or

(d) at any time within the preceding four years he has been associated with the authority by virtue of paragraph (a) above.

(6) If and to the extent that the Secretary of State by order so provides, a person is at any time associated with a local authority if—

(a) at that time he is, or is employed by or by a subsidiary of, a person who for the time being has a contractual relationship with the authority to provide—

(i) advice with regard to the authority’s interest in any company (whether existing or proposed to be formed), or

(ii) advice with regard to the management of an undertaking or the development of land by a company (whether existing or proposed to be formed) with which it is proposed that the authority should enter into any lease, licence or other contract or to which it is proposed that the authority should make any grant or loan, or

(iii) services which facilitate the exercise of the authority’s rights in any company (whether by acting as the authority’s representative at a meeting of the company or as a director appointed by the authority or otherwise);

(b) at any time within the preceding four years, he has been associated with the authority by virtue of paragraph (b) or paragraph (c) of subsection (5)above;

(c) he is at that time the spouse or civil partner of, or carries on business in partnership with, a person who is associated with the authority by virtue of subsection (5)(a) above; or

(d) he holds a relevant office in a political association or other body which, in the nomination paper of a person who is an elected member of the authority, formed part of that person’s description.

(7) For the purposes of subsection (6)(d) above, an office in a political association or body is relevant to a local authority in the following circumstances—

(a) if the association or body is active only in the area of the local authority, any office in it is relevant; and

(b) in any other case, an office is relevant only if it is in a branch or other part of the association or body which is active in the area of the local authority.

(8) In relation to a company which is a registered society within the meaning of the Co-operative and Community Benefit Societies Act 2014, any reference in this section to the directors of the company is a reference to the members of the committee of management.

(9) Subject to subsections (4) and (8) and section 67 above, expressions used in this section have the same meaning as in the Companies Acts (as defined in section 2 of the Companies Act 2006).

Requirements for companies under control or subject to influence of localauthorities.

70

(1) In relation to companies under the control of local authorities and companies subject to the influence of local authorities, the Secretary of State may by order make provision regulating, forbidding or requiring the taking of certain actions or courses of action; and an order under this subsection may—

(a) make provision in relation to those companies which are arm’s length companies different from that applicable to companies which are not; and

(b) make provision in relation to companies under the control of local authorities different from that applicable in relation to companies under the influence of local authorities.

(2) It shall be the duty of every local authority to ensure, so far as practicable, that any company under its control complies with any provisions made by order under subsection (1) above which are for the time being applicable to it; and if a local authority fails to perform that duty in relation to any company, any payment made by the authority to that company and any other expenditure incurred bythe authority in contravention of any such provisions shall be deemed for the purposes of the Audit Commission Act 1998 and Part 2 of the Public Audit (Wales) Act 2004 to be expenditure which is unlawful.

(3) In order to secure compliance, in relation to companies subject to the influence of a local authority, with provisions made by virtue of subsection (1) above, an order under that subsection may prescribe requirements to be complied with by the local authority in relation to conditions to be included in such leases, licences, contracts, gifts, grants or loans as may be so prescribed which are made with or to a company subject to the influence of the local authority.

(4) It shall be the duty of a local authority to comply with any requirements for the time being applicable to it under subsection (3) above; and if a local authority fails to perform that duty, any expenditure which is incurred by the local authority under the lease, licence, contract, gift, grant or loan in question shall be deemed for the purposes of the Audit Commission Act 1998 and Part 2 of the Public Audit (Wales) Act 2004 to be expenditure which is unlawful.

(5) Without prejudice to the generality of the power conferred by subsection (1) above, an order under that subsection may make provision requiring acompany or local authority to obtain the consent of the Secretary of State, or of the Audit Commission for Local Authorities and the National Health Service in England or of the Auditor General for Wales, before taking any particular action or course of action.

(6) An order under subsection (1) may be made in relation to—

(a) all local authorities,

(b) particular local authorities, or

Control of minority interests etc. in certain companies.

71

(1) In relation to a local authority, subsection (2) below applies to any company other than—

(a) a company which is or, if the action referred to in that subsection is taken, will be under the control of the local authority; and

(b) a company of a description specified for the purposes of this section by an order made by the Secretary of State;

and in this section an “authorised company” means a company falling within paragraph (b) above.

(2) Except with the approval of the Secretary of State, in relation to acompany to which this subsection applies, a local authority may not—

(a) subscribe for, or acquire, whether in their own name or in the name of a nominee, any shares or share warrants in the company;

(b) become or remain a member of the company if it is limited by guarantee;

(d) exercise any power to appoint directors of the company;

(e) permit any officer of the authority, in the course of his employment, to make any such nomination or appointment as is referred to in paragraph (c) or paragraph (d) above; or

(f) permit an officer of the authority, in the course of his employment, to become or remain a member or director of the company.

(3) Any approval of the Secretary of State under subsection (2) above may be general or relate to any specific matter or company.

(4) A local authority may not take any action, or refrain from exercising any right, which would have the result that a person who is disqualified from membership of the authority (otherwise than by being employed by that or any other local authority or by a company which is under the control of a local authority) becomes a member or director of an authorised company or is authorised, in accordance with section 323 of the Companies Act 2006, to act as the authority’s representative at a general meeting of an authorised company (or at meetings of an authorised company which include a general meeting).

(5) In any case where,—

(a) in accordance with section 323 of the Companies Act 2006, a local authority have authorised a member or officer of the authority to act as mentioned in subsection (4) above, or

(b) a member or officer of a local authority has become a member or director of an authorised company as mentioned in subsection (7) below,

the authority shall make arrangements (whether by standing orders or otherwise) for enabling members of the authority, in the course of proceedings of the authority (or of any committee or sub-committee thereof), or, where a local authority is operating executive arrangements under Part II of the Local Government Act 2000, for enabling members of the executive, in the course of proceedings of the executive (or of any committee of the executive), to put to the member or officer concerned questions about the activities of the company.

(6) Nothing in subsection (5) above shall require the member or officer referred to in that subsection to disclose any information about the company which has been communicated to him in confidence.

(7) Any member or officer of a local authority who has become a member or director of an authorised company by virtue of—

(a) a nomination made by the authority, or

(b) election at a meeting of the company at which voting rights were exercisable (whether or not exercised) by the authority or by a person bound to vote in accordance with the instructions of the authority, or

(c) an appointment made by the directors of another company, the majority of whom became directors of that company by virtue of a nomination made by the authority or election at a meeting of the company at which voting rights were exercisable as mentioned in paragraph (b) above,

shall make a declaration to the authority, in such form as they may require, of any remuneration or re-imbursement of expenses which he receives from the company as a member or director or in respect of anything done on behalf of the company.

(8) Subject to section 67 above, expressions used in this section have the same meaning as in the Companies Acts (as defined in section 2 of the Companies Act 2006).

Trusts influenced by local authorities.

72

(1) The Secretary of State may by order made by statutory instrument adapt theprovisions of section 69 above so as to make them applicable to trusts which are not charitable; and, subject to subsection (2) below, this Part shall apply in relation to trusts which are subject to local authority influence by virtue of that section as so adapted as it applies in relation to companies which are subject to local authority influence.

(2) In the exercise of the power conferred by section 70 above, as applied in relation to trusts by subsection (1) above, the Secretary of State may make different provision for trusts as compared with companies.

Authorities acting jointly and by committees.

73

(1) In any case where—

(a) apart from this section a company would not be under the control of anyone local authority, but

(b) if the actions, powers and interests of two or more local authorities were treated as those of one authority alone, the company would be under the control of that one authority,

the company shall be treated for the purposes of this Part as under the control of each of the two or more local authorities mentioned in paragraph (b) above.

(2) In any case where, apart from this section, a company would not be treated as being subject to the influence of any one local authority, it shall be treated as being subject to the influence of each of a number of local authorities (in this section referred to as a “group”) if the conditions in subsection (3) below are fulfilled with respect to the company and the group of authorities.

(3) The conditions referred to in subsection (2) above are—

(a) that at least one of the conditions in paragraphs (a) to (e) of subsection (3) of section 69 above would be fulfilled—

(i) if any reference therein to the company being under the control of a local authority were a reference to its being under the control of any one of the authorities in the group or of any two or more of them taken together; and

(ii) if any other reference therein to the local authority were a reference to any two or more of the authorities in the group taken together; and

(b) that at least one of the conditions in paragraphs (a) to (c) of subsection(1) of section 69 above would be fulfilled if any reference therein to the local authority were a reference to those local authorities who are taken into account under sub-paragraph (i) or sub-paragraph (ii) of paragraph (a) above taken together; and

(c) that if the condition (or one of the conditions) which would be fulfilled as mentioned in paragraph (b) above is that in subsection (1)(a) of section 69 above, then, so far as concerns each local authority in the group, at least one person who, in terms of subsection (5) of that section, is associated with that authority has the right to vote at a general meeting of the company; and

(d) that, if paragraph (c) above does not apply, then, so far as concerns each local authority in the group, a person who, in terms of section 69(5) above, is associated with the authority is a director of the company.

(4) For the purposes of this Part, anything done, and any power exercisable,by a committee or sub-committee of a local authority, or by any of the authority’s officers or, where a local authority is operating executive arrangements under Part II of the Local Government Act 2000, by the authority’s executive, any committee of the executive, or any member of the executive, shall be treated as done or, as the case may be,exercisable by the authority.

(5) For the purposes of this Part, anything done, and any power exercisable,by a joint committee of two or more local authorities or by a sub-committee of such a joint committee shall be treated as done or, as the case may be, exercisable by each of the local authorities concerned.

Part VI — Housing Finance

Housing accounts

Duty to keep Housing Revenue Account.

74

(1) A local housing authority shall keep, in accordance with proper practices, an account, called the “Housing Revenue Account”, of sums falling to be credited or debited in respect of—

(a) houses and other buildings which have been provided under Part II of the Housing Act 1985 (provision of housing);

(b) land which has been acquired or appropriated for the purposes of thatPart;

(c) houses purchased under section 192 of that Act (purchase of house foundon appeal against repair notice to be unfit and beyond repair at reasonable cost);

(d) dwellings in respect of which a local authority have received assistance under section 1 or section 4(2A) of the Housing (RuralWorkers) Act 1926;

(e) any property which—

(i) with the consent of the Secretary of State given under section 417(1) of the Housing Act 1985,

(ii) with the consent of a Minister given under section 50(1)(e) of the Housing (Financial Provisions) Act 1958, or

(iii) by virtue of section 50(2) of that Act (houses vesting in local authority on default of another person),

was brought within the corresponding account kept under Part XIII of the Housing Act 1985 for years beginning before 1st April 1990; and

(f) such land, houses or other buildings not within the preceding paragraphsas the Secretary of State may direct.

(2) References in subsection (1) above and the other provisions of this Part to provisions of the Housing Act 1985 include, where the context so admits, references to the corresponding provisions of earlier enactments; and the reference in paragraph (b) of that subsection to land acquired for the purposes of Part II of that Act includes—

(a) land which a local authority were deemed to have acquired under Part V of the Housing Act 1957 by virtue of section 57(6) of that Act (land acquired for re-development in pursuance of re-development plan) before the repeal of that section on 25th August 1969; and

(b) any structures on such land which were made available to a local authority under section 1 of the Housing (Temporary Accommodation) Act 1944 (prefabs).

(3) Paragraphs (a) to (e) of subsection (1) above shall not apply to—

(a) land, houses or other buildings disposed of by the authority;

(b) land acquired by the authority for the purpose of disposing of houses provided, or to be provided, on the land, or of disposing of the land to a person who intends to provide housing accommodation on it or facilities which serve a beneficial purpose in connection with the requirements of persons for whom housing accommodation is provided;

(d) such land, houses or other buildings as the Secretary of State may direct;

and paragraph (a) of that subsection shall not apply to houses and other buildings provided on or before 6th February 1919.

(4) A local housing authority not possessing property to which subsection (1)above applies shall nevertheless keep a Housing Revenue Account unless the Secretary of State consents to their not doing so and they comply with such conditions (if any) as may be specified in the consent.

(5) In this Part—

(a) references to the houses or other property of an authority within the authority’s Housing Revenue Account are references to the houses, dwellings or other property to which subsection (1) above for the time being applies;and

(b) references (however expressed) to a disposal are references to a conveyance of the freehold, or a grant or assignment of a lease (other than a shared ownership lease) which is a long tenancy within the meaning given by section 115 of the Housing Act 1985 or which is a long tenancy within the meaning given by paragraph 8 of Schedule 2 to the Renting Homes (Wales) Act 2016 (anaw 1).

(6) Sections 417 to 420 of, and Schedule 14 to, the Housing Act 1985 (which are superseded by this section, sections 75 to 78 below and Schedule 4 to this Act) shall cease to have effect.

The keeping of the Housing Revenue Account.

75

Schedule 4 to this Act shall have effect with respect to the keeping of a local housing authority’s Housing Revenue Account, as follows—

Duty to prevent debit balance on Housing Revenue Account.

76

(1) This section applies where for any year (“the relevant year”) a local housing authority who are required to keep a Housing Revenue Account possess any houses or other property within the account.

(2) The authority shall, during the months of January and February immediately preceding the relevant year, formulate proposals which satisfy the requirements of subsection (3) below and relate to—

(a) the income of the authority for the year from rents and other charges in respect of houses and other property within their Housing Revenue Account;

(b) the expenditure of the authority for the year in respect of the repair,maintenance, supervision and management of such property; and

(c) such other matters connected with the exercise of the authority’s functions in relation to such property as the Secretary of State may direct.

(3) Proposals formulated by the authority under subsection (2) above satisfy the requirements of this subsection at any time if, on the assumption that thefollowing will prove correct, namely—

(a) the best assumptions that they are able to make at that time as to all matters which may affect the amounts falling to be credited or debited to their Housing Revenue Account for the relevant year; and

(b) the best estimates that they are able to make at that time of the amounts which, on those assumptions, will fall to be so credited or debited,

implementation of the proposals will secure that the account for that year does not show a debit balance.

(4) No assumptions shall be made under subsection (3) above as to the exerciseby the Secretary of State of any power except on the basis of information published by him or on his behalf or supplied by him to the authority.

(5) Subject to subsections (6) and (7) below, the authority shall implement the proposals formulated by them under subsection (2) above.

(6) The authority shall from time to time determine whether the proposals formulated under subsection (2) above satisfy the requirements of subsection(3) above; and—

(a) termine that question in the affirmative, they may make such revisions of the proposals as they think fit, so long as the proposals (as so revised) continue to satisfy those requirements;

(b) if they determine that question in the negative, they shall make such revisions of the proposals as are reasonably practicable towards securing that the proposals (as so revised) satisfy those requirements.

(7) Where the proposals formulated under subsection (2) above are revised under subsection (6) above, subsections (3) to (6) above shall apply inrelation to the proposals as so revised as they applied in relation to the proposals as originally formulated.

(8) The authority shall, within one month of formulating their proposals under subsection (2) above, or of revising those proposals under subsection (6)above, prepare a statement setting out—

(a) those proposals as so formulated or so revised;

(b) the estimates made by them under subsection (3)(b) above on the basis of which those proposals were so formulated or so revised; and

and a direction under paragraph (c) above may specify the manner in which the particulars are to be set out in the statement.

(9) The authority shall, until the end of the year next following the relevant year, keep copies of the statement which is for the time being the latest statement prepared by them under subsection (8) above available for inspection by the public without charge at all reasonable hours at one or more of their offices; and any person shall be entitled to take copies of, or extracts from,that statement when so made available.

Power to keep Housing Repairs Account.

77

(1) A local housing authority who are required to keep a Housing RevenueAccount may also keep, in accordance with proper practices, an account called the “Housing Repairs Account”.

(2) An authority who keep a Housing Repairs Account shall carry to the credit of the account for any year—

(a) sums transferred for the year from their Housing Revenue Account; and

(b) sums receivable by the authority for the year in connection with the repair or maintenance of houses or other property within their Housing Revenue Account (either from their tenants or from the sale of scrapped or salvaged materials).

(3) The authority shall carry to the debit of the account for any year—

(a) all expenditure incurred by them for the year in connection with therepair or maintenance of houses or other property within their Housing Revenue Account;

(b) such expenditure incurred by them for the year in connection with the improvement or replacement of houses or other property within their Housing Revenue Account as may from time to time be determined by the Secretary of State; and

(4) The authority shall secure that sufficient credits are carried to the account to secure that no debit balance is shown in the account for any year.

(5) The authority may carry some or all of any credit balance in the account for any year to the credit of their Housing Revenue Account.

(6) So much of any credit balance shown in an authority’s Housing Repairs Account at the end of the year beginning 1st April 1989 as is not carried tothe credit of their Housing Revenue Account for that year shall be carried forward and credited to some other revenue account of theirs for the year beginning 1st April 1990.

Directions to secure proper accounting.

78

The Secretary of State may give directions as to the accounting practices (whether actual or prospective) which are to be followed by a local housing authority in the keeping of their Housing Revenue Account or Housing RepairsAccount.

Directions as to treatment of service charges, &c.

78A

(1) The Secretary of State may give directions as to what items or amounts are to be regarded as referable to property within a local housing authority’s Housing Revenue Account where one or more parts of a building have been disposed of but the common parts remain property within that account.

(2) Any such direction also has effect for the purposes of any Housing Repairs Account kept by the authority.

(3) Directions under this section may give the authority a discretion as to whether items or amounts are accounted for in the Housing Revenue Account or any Housing Repairs Account or in another revenue account.

(4) In this section “common parts” includes the structure and exterior of the building and common facilities provided, whether in the building or elsewhere, for persons who include the occupiers of one or more parts of the building.

Directions as to accounting for work subject to competitive tendering.

78B

(1) This section applies where work is carried out by a local housing authority which has successfully bid for the work on a competitive basis.

(2) The Secretary of State may give directions—

(a) to secure that the amount debited to the Housing Revenue Account or any Housing Repairs Account of the authority in respect of the work reflects the amount of the authority’s successful bid for the work rather than expenditure actually incurred;

(b) allowing an authority to credit to its Housing Revenue Account any surpluses reasonably attributable to work undertaken on or in connection with property within that account.

(3) Directions under subsection (2)(a) may make provision for determining the amount to be treated as the amount of the authority’s successful bid.

References in this Part to expenditure shall be construed as references to the amount falling to be debited in accordance with the directions.

(4) Directions under subsection (2)(b) may make provision as to the ascertainment of the surpluses referred to and the circumstances in which a surplus is or is not to be taken to be attributable to property within an authority’s Housing Revenue Account.

Housing subsidies

Housing Revenue Account subsidy.

79

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