The Local Government Association welcomed the inclusion in the Local Government Bill of a power to promote the social, economic and environmental well-being of the local area.
This was not in the draft Bill published in March, and the change follows intense LGA lobbying. 'It is a victory for local government putting pressure on central government,' said LGA chief executive Brian Briscoe.
The power provides protection against ultra vires, encourages councils to provide community leadership and may help cut down the maze of regulations restraining council actions.
The secretary of state will be able to force councils to hold a referendum on this issue, if a council appears to have done little to modernise its structures or consult local people on them.
It is still unclear whether the Bill will be flexible enough to allow smaller districts not to have an executive.
'We will continue to press for the flexibility that is required to make this Bill work,' Mr Briscoe said. The LGA is opposing measures in the Post-16 Education and Training Bill to give control of these services to 47 local quangos.
The Transport Bill will allow councils to introduce road use and workplace car park charges, and spend the money on improving local transport. The secretary of state will have to approve any plans to use these powers.
The Representation of the People Bill will allow councils to experiment with new electoral arrangements, such as changing voting days and using electronic voting.
LGA chairman Sir Jeremy Beecham cautioned that the government could not expect a blank cheque from the association in the new session of Parliament.
'We welcome the opportunity to demonstrate the commitment of local government to a reform and improvement agenda. However, we will still push for authorities to maintain as much local flexibility as possible so that they can deliver the highest standards for local communities,' he said.
Liberal Democrat environment spokesman Don Foster said more financial was needed. Shadow environment secretary John Redwood attacked the Local Government Bill, saying: 'Labour is bullying councils into change, robbing them of any local discretion or choice. We believe councils should be given more freedom to develop their own arrangements and should be able to keep their current arrangements if they wish.'
The Local Government Information Unit warned that councils will have to ensure the new power to promote the well-being of their communities is not 'strangled at birth'. LGIU director Dennis Reed said: 'The London-knows-best faction will be working hard to introduce restrictions.'