local budget

Uncle Eric’s Parish Precept Pickle


scheming eric pickles

It’s that time of year again — all across the country, local authorities are setting their budgets for 2013/14. From the big county councils and unitary boroughs, right down to the tiniest of parish councils, and Wargrave is no exception.

Last week, I and the other councillors on Wargrave Parish council debated and discussed our own budget. Decisions were made on the rates charged for services like the youth centre, and spending on upkeep of areas within our remit. We also made a decision on the precept, the element of council tax set at parish level.

Now, Uncle Eric (Secretary of State for Communities and Local Government, Eric Pickles) has already said that local authorities of city, borough and council level have to hold a referendum if they want to raise their council tax by more than 2% (a blog will be forthcoming in the near future on that, believe me). This doesn’t yet apply to parish level, but there are fears it will do  next year.

Anyway, in the course of setting the precept for the next financial year, an interesting problem has come to light in the drafting of the Localism Act.

Almost all parish councillors will live in the parish. Most will pay council tax in the parish. Some may even own property in the parish. Thus, they all have a personal and pecuniary interest in the level of the precept.

In the normal course of parish council business, if I have an interest in a matter under discussion (say, a planning application by my neighbour, which will potentially impact upon the value of my own house) I must declare it and leave the room for the duration that it is under discussion.

The old parish council code of conduct, under schedule 1, paragraph 10 of the Local Authorities (Model Code of Conduct) Order 2007, contained an exemption from the declaration rules in the case of setting the precept:

You do not have a prejudicial interest in any business of the authority where that business — … (c) relates to the functions of your authority in respect of— … (vi) setting council tax or a precept under the Local Government Finance Act 1992.”

However, that code of conduct was replaced under the Localism Act 2011. Now the provision dealing with declarations of interest is as follows:

(2) If the interest is not entered in the authority’s register, the member or co-opted member must disclose the interest to the meeting, but this is subject to section 32(3).

The member or co-opted member may not — (a) participate, or participate further, in any discussion of the matter at the meeting, or (b) participate in any vote, or further vote, taken on the matter at the meeting — but this is subject to section 33.

As you may notice, the exemption for setting precepts is gone. But it does mention s33 of the act, so what does that say?

(1) A relevant authority may, on a written request made to the proper officer of the authority by a member or co-opted member of the authority, grant a dispensation relieving the member or co-opted member from either or both of the restrictions in section 31(4) in cases described in the dispensation.

(2) A relevant authority may grant a dispensation under this section only if, after having had regard to all relevant circumstances, the authority — (a) considers that without the dispensation the number of persons prohibited by section 31(4) from participating in any particular business would be so great a proportion of the body transacting the business as to impede the transaction of the business…

So an exempting disposition can be granted, but it has to be done so specifically. Hence the Wargrave Parish Council clerk rushing around forms for us to sign so that we could decide the budget, last week. So when we approve the new budget tomorrow, it will be entirely legal — but how many parish budgets across the country won’t be?

Most people won’t have read the Localism Act, and won’t notice this change. Indeed, the lack of comment on it suggests that it might have escaped the notice of many who really ought to know.

To me it looks like either Uncle Eric has laid a cruel and unusual trap for parish councils, or he has no idea what effect his flagship piece of legislation has. Neither of which is encouraging…