asked Her Majesty's Government:Whether they have anything to add to the proposals in the White Paper,
Streamlining the Cities, Cmnd 9063, in respect of actions by the Greater London Council and the metropolitan county councils which would create problems for successor authorities.
The Government are aware that there is some concern about the possibility that action by the Greater London Council and the metropolitan county councils could adversly affect successor authorities and ratepayers. We are sure that the councillors concerned will be concerned to obey the law, to act responsibly, and to have regard to their responsibilities to the ratepayers. Moreover, the existing legal framework imposes some constraints on the actions of authorities; and we propose three further measures.
At present a London borough or metropolitan district council can itself seek to question the actions of the GLC or the metropolitan county council that precepts upon it by applying for judicial review. Applications can also be made by any person with an interest—for example, councillors, ratepayers, and non-ratepayers resident in the area concerned. If the court accepts that the application is well founded and considers it in the public interest to do so, it will issue an order prohibiting the action or make a declaration that it is illegal. In addition, under Sections 19 and 20 of the Local Government Finance Act 1982, the auditor, acting on an objection by an elector or on his own initiative, may seek a declaration from the court that expenditure is unlawful or that there has been a loss due to wilful misconduct. It would then be open to the court to surcharge the local authority members responsible and to disqualify them from membership of a local authority. An elector for the area may also bring surcharge action if the auditor decides not to act following an objection by that elector. To meet the concerns expressed by some of the successor authorities, we propose to include in the Bill to be introduced this Session a provision requiring the GLC and the metropolitan county councils to consult the borough and district councils in their areas before fixing their budgets and precepts for 1985–86. These will, of course, be implemented by the proposed transitional councils; and it is appropriate that the boroughs and districts who will appoint the members of these councils should be given an opportunity to express views on the financial situation which they will inherit. We propose also to give the London borough councils and the metropolitan district councils the same rights as electors have to object at the audit of the accounts of the GLC or the appropriate metropolitan county council. The borough and district councils will also be empowered to take action in the courts if the auditor decides not to do so. Such action could lead to surcharge and disqualification. These extended rights will apply only to the audits of the accounts for the years 1983–84 to 1985–86. Finally, we shall include in the main abolition Bill, to be introduced next Session, two provisions concerning staff contracts. The first will ensure that any fixed-term contract of employment with the GLC or an MCC which is entered into after 1st March 1984 and which is to expire on or after 1st April 1986, will have effect as a contract which will terminate on 31st March 1986. The second will ensure that any terms which are incorporated into existing or future contracts of employment after 1st March 1984 and which relate to compensation for redundancy or detriment will have no effect where they would entitle an employee to an amount greater than that provided for, in due course, in the main abolition legislation. These provisions will not affect the terms of existing contracts of employment. Thus, where staff have already been given fixed-term contracts with the reasonable expectation that they would run their full term, we shall provide for them to be compensated if they do not get jobs with the successor bodies. Similarly, any provision relating to compensation for redundancy or detriment already included in an existing contract of employment will be honoured. We believe that members of the GLC and the metropolitan county councils will recognise that it is in the interests of their ratepayers and of their staff that they should act responsibly. But the measures outlined, together with the existing legal constraints, provide safeguards should any of the authorities concerned consider taking irresponsible action.