Your browser is no longer supported

For the best possible experience using our website we recommend you upgrade to a newer version or another browser.

Your browser appears to have cookies disabled. For the best experience of this website, please enable cookies in your browser

We'll assume we have your consent to use cookies, for example so you won't need to log in each time you visit our site.
Learn more


  • Comment
By political correspondent Mithran Samuel ...
By political correspondent Mithran Samuel

Council representatives have hailed the Local Government Act 2003 as a significant step forward for council autonomy and a lobbying success.

The Local Government Association and CIPFA said the legislation - passed last week - was a strong platform for innovation.

Both cited the new power to borrow affordably without central consent - in accordance with a new CIPFA prudential code - as the headline freedom.

There was also praise for powers to charge for and trade discretionary services, though the latter will only be available to councils rated at least 'fair' in the comprehensive performance assessment.

Maureen Wellen, assistant director of local government finance and policy at CIPFA, said of the borrowing powers: 'This is a major new flexibility. It has the potential for making a huge difference.'

David Evans, project officer for economic and environmental policy at the LGA, echoed Ms Wellen's praise for the borrowing freedoms and said 'the more innovative authorities are likely to take full advantage of these'.

But he criticised the government for retaining reserve intervention powers.

LGA vice-chairman Sir Sandy Bruce-Lockhart (Con) described the act as a welcome start and a lobbying success.

Mr Evans added that LGA involvement in the white paper Strong local leadership: quality public services, and last year's 2002 draft legislation, had created a bill it could sign up to almost in its totality.

But he added the association opposed

a number of measures, including new government powers to impose minimum budgetary reserves on councils, and to centralise and redistribute housing capital receipts.

Fears the government would drop its commitment to business improvement districts to mollify opposition in the Lords proved unfounded, as the provisions went through unchanged.

LGA project officer David Maddison said there had already been a lot of interest in the districts from councils and businesses. He added: 'It has the pote ntial to be complex and unworkable, but where there's a will there's a way.'

Key reforms in the Local Government Act 2003

-- Gives councils the freedom to borrow without government consent under new CIPFA code, though ministers will hold reserve powers to intervene.

-- Provides the right to trade commercially - conditional on at least a 'fair' performance in CPA.

-- Introduces business improvement districts within which regeneration projects and environmental improvements can be financed by business rate supplements.

-- Abolishes s28 of the Local Government Act 1988, which prevented councils from intentionally promoting homosexuality.

-- Provides for councils to retain a capped proportion of business rate gains from economic growth. This is already under consultation and will be introduced in 2005.

-- Gives government the power to pool and redistribute housing capital receipts.

-- Brings forward the deadline for education budgets in a bid to give schools greater time to plan for the following financial year.

  • Comment

Have your say

You must sign in to make a comment

Please remember that the submission of any material is governed by our Terms and Conditions and by submitting material you confirm your agreement to these Terms and Conditions.

Links may be included in your comments but HTML is not permitted.