31 August 2007
Last month, the government approved nine new unitary authorities. There is one problem though its powers to do this are languishing in a Bill before Parliament, and so one council has challenged it in court
The rate of change in the public sector is often commented on. New ministers bring new policies. But one aspect that is frequently missed is that ministers do not have unlimited power; they are subject to constitutional controls that place significant power in Parliament as an institution. This was highlighted recently when ministers' attempts to introduce a policy change for local government were challenged on the grounds that they lacked the legal authority to do this.
Many will be aware that the local government white paper of October 2006 marked a significant phase in the government's modernisation programme. It contained an initiative to replace some of the two-tier authorities that still exist in many rural areas with a limited number of unitary authorities. The legal foundation for this was included in the Local Government and Public Involvement in Health Bill, which was then expected to become law before Parliament's summer recess. But the ink was barely dry on the white paper when the secretary of state invited councils to apply for unitary status.
Several bids were received and local government minister John Healey announced the results on July 25, while the Bill was still chugging through Parliament. Healey gave the go-ahead to five counties Cornwall, Durham, Northumberland, Shropshire and Wiltshire and four borough and city authorities Bedford, Chester, Exeter and Ipswich.
One of the councils set to disappear as a result, Shrewsbury and Atcham Borough Council, took exception to the decision to award unitary status to Shropshire. After seeking legal advice on whether the government could to do this before the powers were in place, it called for the reorganisation process to be suspended and began judicial review proceedings.
When the review was heard in late June, Mr Justice King in the Administrative Court agreed that the council had an 'arguable case' and allowed the case to proceed to a full hearing. This will be held on September 12 and 13.
The council's case is simple. It is that any local government reorganisation must be legally authorised. The previous reorganisation had to follow the process laid down by the Local Government Act 1992, which included the establishment and reporting of a Local Government Commission and its recommendations for change. This work resulted in a host of new unitary authorities coming into being in 1996, 1997 and 1998.
Policy has, of course, moved on substantially in the intervening years and the new proposals for reorganisation are very much in line with modern thinking. For example, they take into account whether the change will be widely supported in a community sense and whether it will deliver substantial savings. Sadly, the law has not moved on at all and remains as legislated in 1992. To put it bluntly, the legal powers for reorganisation are rooted in the past.
This raises the question as to why the government did not seek to put the necessary powers in place before it determined that there should be another reorganisation exercise. This is probably because ministers wanted to see tangible change on the ground and fast while the parliamentary process is slower. Cynics might say that the government of the day knows that Parliament will eventually ratify whatever it does, so why wait?
The drafting of the new Bill expressly includes a provision designed to ratify earlier action. Clause 21 says that where the secretary of state has issued an invitation that could have been given under Clause 2 (Invitations and directions for proposals for single tier of local government), then it is 'immaterial that the invitation or guidance was given&. before rather than after the commencement of this chapter'.
It has been widely suggested that this means the government can act now without legal authority and wait for the cavalry to come over the hill in the form of new statutory underpinning.
But not everyone agrees with this legal interpretation. Leading counsel has squashed it as fanciful, arguing that it can at best relate only to the time between the passing of the Act and its commencement, not to any time before the passing of the Act itself. The High Court plainly thinks there is some merit in this argument.
The proper democratic process is designed to ensure that ministers cannot implement policy without the necessary legal foundations. This fundamental principle of public law seems likely to receive further support as other authorities now decide to challenge the reorganisation decisions.
It is also likely that the grounds of other challenges might differ, meaning that the government will have to fight the same battle on different fronts at the same time. There can be no doubt that it is the author of its own misfortune in this regard.
Stephen Cirell is head of local government and Professor John Bennett is a consultant solicitor with Eversheds. They are authors of Best Value: law and practice, published by Sweet and Maxwell
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