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Power of general competence: a panacea?

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Much has been said and written about the need for a power of general competence to revive confidence in local government’s ability to lead their communities, address economic regeneration, social deprivation and environmental issues, and following the challenge to the use of the wellbeing power in the London Authorities Mutual Insurance (LAML) case.

The Conservatives were swift to act before the Court of Appeal Judgment in LAML case and included in their Control Shift, Green Paper, published in February 2009, a clear statement about their plans

It read: The Conservative Party “will introduce a new general power of competence which gives local authorities an explicit freedom to act in the best interests of their voters, unhindered by the absence of specific legislation supporting their action”.

No action - except raising taxes, which requires specific parliamentary approval - will any longer be “beyond the powers” of Local Government in England, unless the local authority is prevented from taking that action by the common law, specific legislation or statutory guidance”.

Competence

It is interesting to note that the Conservatives use the expression “General Power of Competence” not a “power of general competence”. 

A straw poll of colleagues seems to suggest that the most widely accepted expression is the latter.

No doubt lawyers will argue whether the expressions mean the same but, again, the stronger formulation appears to be the power of general competence rather than a more generic power to have competence to do something.

True to their word, the Conservatives sought to amend the Wellbeing Power to achieve their aims during the passage of the Local Democracy Economic Development & Construction Act 2009.

Benefit

They put forward amendments to wellbeing to read “Every local authority has full powers and capacity to carry on or undertake any activity or business, do any act, or enter into any transaction with full rights, powers and privileges for so doing” - authorities would still need to demonstrate benefit to the area or persons resident or present and have regard to the Council’s Sustainable Communities Strategy.

However, Rosie Winterton MP was not convinced by this.

She suggested that the amendment would not have covered the creation of a mutual insurance company and that arising from the government’s consultation on “Strengthening Local Democracy” the government would look again at powers for local authorities in due course.

The caveats placed upon the new power by the Conservatives recognised the general principles of public law - the twin pillars of the ultra vires doctrine.

Irrationality

When local authorities exercise a power they not only have to find one which covers what they would like to do, but they need to exercise it properly, for proper purposes, taking into account all relevant considerations and ignoring irrelevant considerations, following procedural requirements, exercising discretion appropriately and having regard to their best value, fiduciary and other relevant duties. 

This also covers the notion of irrationality, so not doing anything which no reasonable authority would do (ie the suggestion of singling out teachers with red hair for special treatment by Lord Denning).

Whilst Jack Straw suggested that adopting the Conservative’s proposals might not prevent Islington LBC from making an atom bomb (Hansard column 202 - 13 October 2009), many people may struggle to understand why this would not be irrational and/or unreasonable in the context of Islington.

Abolish

One way, perhaps, to give unlimited, unfettered discretion for local authorities to do absolutely anything would be to abolish the ultra vires rule altogether - this might support the making of an atom bomb, but is unlikely to be acceptable to Parliament (despite the ultra vires rule now having been abolished for private limited companies under the Companies Acts 1989 and 2006).

Many would say that the ability to challenge the actions of local authorities as being ultra vires by judicially reviewing them through the courts is an appropriate check and balance to be retained. 

Will any new government go as far as to abolish ultra vires altogether?

Judith Barnes is a partner and head of Local Government at Eversheds LLP

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Readers' comments (1)

  • Jack Straw should try harder if his key argument against Conservative plans for a general power of competence is that it could allow Islington LBC to ‘make an atom bomb’.

    The residents of Islington can sleep safely in the knowledge that the likes of the Radioactive Substances Act 1993 and the Nuclear Explosions (Prohibition and Inspections) Act 1998 would prevent their councillors using their newly granted powers to wage thermonuclear war.

    There is also a power of entry to inspect for weapons of mass destruction under the Anti-Terrorism, Crime and Security
    Act 2001, just in case the council leader attempts to pull a fast one under the nose of Islington’s monitoring officer.

    In short, Jack Straw shouldn’t be scared of localism.

    Bob Neill MP (Con), shadow minister for local government

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