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Written Statements

Volume 702: debated on Monday 25 October 2021

Written Statements

Monday 25 October 2021

International Trade

Trade Remedies Authority: Call-in Powers

The Government are today announcing that they intend to make new powers to enable the Secretary of State for International Trade to call in certain investigations conducted by the Trade Remedies Authority (TRA).

These powers will ensure that the Secretary of State for International Trade has oversight for, and may direct, transition review investigations where she considers it is needed. The call-in power only applies to transition reviews and reconsiderations of transition reviews, and does not apply to new investigations. Where the call-in power is exercised, the Secretary of State for International Trade will set out her reasons for doing so in a statement to the House of Commons.

One of the advantages of being an independent trading nation is that we can adapt our domestic rules to UK economic circumstances.

The Government will always do everything in their power to defend UK industry and jobs and to allow our world-leading companies to compete on an equal footing.

The UK has always been a strong supporter of free trade. But free trade does not mean trade without rules. Rather than restricting free trade, trade remedies can help ensure that free trade is also fair trade. All major trading nations have a trade remedies system in place and many of these allow for greater ministerial involvement in decision making than the UK currently allows.

As announced on 30 June 2021, the Government will continue to consider whether wider changes might need to be made to the trade remedies framework to ensure it can consistently defend UK industry. DIT will continue to work collaboratively with the TRA on this process and in the application of the call-in power where the Secretary of State decides it is needed.

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Levelling Up, Housing and Communities

Homelessness Prevention Grant: One-off Payment

The Government have protected renters across the country throughout the pandemic, providing an unprecedented £400 billion support package for the economy, a six-month stay on possession proceedings to protect renters from eviction, and extended notice periods. Thanks to this support, the vast majority of private renters (93%) are up to date with their rent. We are spending almost £30 billion supporting people with their housing costs in 2020-21. With the UK economic recovery gathering pace, we are continuing to help people into work and increase their earning potential—the most sustainable route to financial security. We are investing billions through our plan for jobs and the lifetime skills guarantee.

We recognise, however, that some private renters have rent arrears built up as a result of the pandemic and vulnerable households may need additional support.

We have therefore announced an exceptional one-off payment of £65 million that will be made available to local authorities in 2021-22 through the homelessness prevention grant. The additional funding will support local authorities to help vulnerable households with rent arrears to reduce the risk of them being evicted and becoming homeless, including helping households to find a new home where necessary. Local authorities will target funding to those who need it most and help them to get back on their feet.

The investment builds on the £310 million in funding already available to local authorities through the homelessness prevention grant—a £47 million uplift on last year to help fully enforce the Homelessness Reduction Act 2017—which is part of the overall investment of more than £750 million this year to tackle homelessness and rough sleeping.

This announcement underlines the Government’s commitments to building back better from the pandemic, supporting renters and tackling homelessness and rough sleeping. The funding will ensure local authorities are given the resource they need to make this a reality in local areas. It will allow us to build upon the success we have had in tackling homelessness and rough sleeping with the number of families in temporary accommodation now at the lowest level since 2016 and a 37% decrease in rough sleeping recorded in the 2020 annual rough sleeping snapshot compared to 2019.

The £65 million funding is in addition to the recently announced £421 million household support fund to help vulnerable families in England with essentials over the coming months, which will be distributed by councils to those who need it most, including for example through small grants to meet daily needs such as food, clothing, and utilities. Further support is also available to renters through the welfare system. This includes £140 million in discretionary housing payments funding, which is available for local authorities this financial year to distribute to support renters with housing costs.

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Slough Borough Council

Our local councils play a vital frontline role in our communities and our democracy. Everyone in the House recognises what they do and the importance of making sure they are able to contribute to our levelling-up agenda. We need our councils to be able to make our towns and cities great places to live, where everyone, no matter what their circumstances, has the opportunity to thrive and can take advantage of effective and efficient service delivery. We need our councils to be able to support our most vulnerable citizens, for example through children’s services and adult social care. In doing so, we need councils to make the most of every penny they receive from hard-pressed taxpayers to secure better outcomes. This will build confidence and trust between local authorities, local councillors, and the communities they serve. That is why the situation at Slough Borough Council is of such concern.

Slough Borough Council was one of a small number of local authorities to request exceptional financial support during the covid-19 pandemic. The Government agreed in principle to this request subject to the outcome of an external assurance review. This review considered the council’s financial position and the strength of its wider governance arrangements, and provided an assessment of the council’s ability to achieve financial sustainability without further recourse to public funds.

The Chartered Institute of Public Finance and Accountancy (CIPFA) led on the financial aspects of the review. Jim Taylor, former chief executive of Salford City Council, Trafford Council and Rochdale Borough Council, led on governance. I would like to thank Jim Taylor and CIPFA for their hard work. Copies of the reports have been deposited in the Libraries of both Houses.

The reports paint a deeply concerning picture of mismanagement, of a breakdown in scrutiny and accountability, and of a dysfunctional culture at Slough Borough Council. The council’s internal controls and processes are inadequate, and the overview and scrutiny function is not equipped to operate effectively. Service delivery is hampered by ineffective core corporate functions such as IT and HR, and the residents of Slough are poorly served by the council’s struggling revenues and benefits service. The council’s contract management is weak and has resulted in rushed procurement, missed exit opportunities, and has delivered poor value for money. There is little evidence that the council understands the entirety of its commercial investments and their impact on its finances. The staffing structure lacks the capacity and capability to deliver on the challenges the council faces without external help. It is only very recently that senior members have grasped the seriousness and urgency of this situation and established it is not solely a result of financial accounting assumptions. The council cannot demonstrate a track record of making difficult decisions or of taking decisive action to bring about improvements. The reports confirm that, as indicated in the section 114 notice issued by the council earlier this year, the council’s expected requirement for additional financial support in 2021-22 has risen from £15.2 million to over £100 million.

The review shows unequivocally that Slough Borough Council has failed to comply with its best value duty of continuous improvement, as required by the Local Government Act 1999. The financial challenge is acute, and the review has concluded that the council cannot become financially self-sustaining without considerable Government support.

To quote the review:

“An authority struggling to comply with its best value duty displays the following characteristics:

an overreliance on interim officers

a lack of corporate capacity

many inadequate internal processes

signs of distrust among and between councillors and senior officers

the absence of effective scrutiny, transparency, and public consultation

insufficient capacity to achieve the change required

instances of poor-quality advice to members

a lack of understanding of how some meetings should be conducted ? In some cases, members not understanding their role

significant unknown past liabilities yet to be determined.

Slough Borough Council has been displaying these characteristics over past years until present day and has failed its best value duty despite the concerted efforts in the last few months. It is unable to resolve the difficulties on its own.”

Expressed in formal terms, the Secretary of State is satisfied that Slough Borough Council is failing to comply with its best value duty and he is considering exercising his powers of intervention to secure compliance with the duty. To that end, and in line with procedures laid down in the Local Government Act 1999, officials in my Department have today written to Slough Borough Council, asking for representations on the external assurance review and on the proposed intervention package. That letter also recognises the hard work of many of the staff at Slough Borough Council.

The proposed package is centred on the appointment of commissioners to exercise certain and limited functions as required, for a minimum of three years. The proposal is for the council—under the oversight of the commissioners—to prepare and implement an improvement plan, and report on the delivery of that plan to the commissioners every six months.

In detail, the council would be required to:

Complete, within three months, an assessment of the functional capability of all service areas to identify the gaps in capacity and capability.

Prepare and agree, within six months, action plans to the commissioners’ satisfaction to address any functional shortcomings.

Undertake any actions the commissioners require to avoid incidents of poor governance or financial mismanagement that would jeopardise the council’s ability to meet its best value duty.

Prepare and agree, within three months, a fully resourced improvement plan which should include action plans to deliver: financial sustainability; improvements in democratic services, including the audit and corporate governance functions; a scrutiny function that is fit for purpose; improvements in internal audit; properly functioning procurement and contract management functions; improvements in the council’s IT function; an officer structure and scheme of delegation which provide sufficient resources to implement the improvement plan.

It is also proposed that Slough Borough Council will:

Devise and implement a programme of cultural change to rebuild trust between officers and members within six months.

Following the review of Council companies, within six months consider the roles and case for ongoing operation of each subsidiary company—except Slough Children First.

Take steps to enable better and evidence-based decision making, including enhancing data and insight functions.

I hope and expect Slough Borough Council will take the lead on this path to improvement. Given the gravity of the review’s findings, the Secretary of State must consider what would happen if the council failed to deliver the necessary changes, at the necessary speed.

The Secretary of State is, consequently, proposing to direct the transfer to commissioners of all executive functions associated with:

The governance and scrutiny of strategic decision making by the council.

The strategic financial management of the council.

The oversight of collection of revenues and the distribution of benefits by the council.

All non-executive functions relating to the appointment and dismissal of statutory officers, and the designation of those persons as statutory officers at the council to the commissioners.

These powers are for use should the council not satisfy the commissioners in their improvement processes. I hope it will not be necessary for the commissioners to use these powers, but they must be empowered to do so if they consider the required improvement and reforms are not being delivered.

The commissioners will report to the Secretary of State at six monthly intervals on progress. They will also work closely with Trevor Doughty, the children’s services commissioner for Slough Borough Council already in place and reporting to the Secretary of State for Education.

This will ensure that the improvements that he has overseen to date through the Department for Education’s statutory intervention continue to be made, and that services for Slough’s vulnerable children and families continue to be delivered to an acceptable standard. Similarly, the commissioners will be mindful of the interests of the Secretary of State for Work and Pensions and the consultancy support available from the Department for Work and Pensions to improve the revenue and benefits service.

We are inviting representations from the council on the report and the Secretary of State’s proposals by Friday 5 November. Given the conclusion of the review that

“Improvement for Slough Borough Council will rely on stability in political leadership, and it would be advisable that the council moves towards a four yearly election cycle at the earliest opportunity”,

we are also seeking views on how best to achieve this.

We want to provide the opportunity for members and officers of the council, and any other interested parties, especially the residents of Slough, to make their views on the Secretary of State’s proposals known. Should the Secretary of State decide to intervene along the lines described here, he will make the necessary statutory directions under the 1999 Act and appoint commissioners. I will update the House in due course.

Government do not take these steps lightly and recognise and respect the role of local councils in our communities and our democracy. Slough Borough Council is a rare case of failure. Most local authorities in England have a good record of service delivery, transparency, probity, scrutiny, and accountability. It is a record worth protecting. We will take whatever steps are necessary to uphold the good name of local government and to root out practices that do it down.

Finally, I urge council leaders across the country to read these reports. I know the local government sector—officers and members—will be saddened by the news that a council is failing. I would encourage all to make sure that they are not making the same mistakes as those that are described in this review. Local people deserve better than this from their local councils.

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