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Y Pwyllgor Cydraddoldeb, Llywodraeth Leol a Chymunedau

Equality, Local Government and Communities Committee

27/11/2019

Aelodau'r Pwyllgor a oedd yn bresennol

Committee Members in Attendance

Dawn Bowden AM
Huw Irranca-Davies AM
John Griffiths AM Cadeirydd y Pwyllgor
Committee Chair
Leanne Wood AM
Mark Isherwood AM

Y rhai eraill a oedd yn bresennol

Others in Attendance

Angharad Thomas-Richards Pennaeth Tîm Polisi Llywodraeth Leol ac Etholiadau, Llywodraeth Cymru
Head of Local Government Elections Policy Team, Welsh Government
Cath Wyatt Rheolwr Bil Llywodraeth Leol ac Etholiadau (Cymru), Llywodraeth Cymru
Local Government and Elections (Wales) Bill Manager, Welsh Government
Claire Germain Dirprwy Gyfarwyddwr Trawsnewid a Phartneriaethau, Llywodraeth Cymru
Deputy Director Transformation and Partnerships, Welsh Government
Julie James AM Y Gweinidog Tai a Llywodraeth Leol
Minister for Housing and Local Government
Lisa James Dirprwy Gyfarwyddwyr Democratiaeth Llywodraeth Leol, Llywodraeth Cymru
Deputy Director Local Government Democracy, Welsh Government

Swyddogion y Senedd a oedd yn bresennol

Senedd Officials in Attendance

Catherine Hunt Ail Glerc
Second Clerk
Osian Bowyer Ymchwilydd
Researcher
Stephen Davies Cynghorydd Cyfreithiol
Legal Adviser
Yan Thomas Dirprwy Glerc
Deputy Clerk

Cofnodir y trafodion yn yr iaith y llefarwyd hwy ynddi yn y pwyllgor. Yn ogystal, cynhwysir trawsgrifiad o’r cyfieithu ar y pryd. Lle mae cyfranwyr wedi darparu cywiriadau i’w tystiolaeth, nodir y rheini yn y trawsgrifiad.

The proceedings are reported in the language in which they were spoken in the committee. In addition, a transcription of the simultaneous interpretation is included. Where contributors have supplied corrections to their evidence, these are noted in the transcript.

Dechreuodd y cyfarfod am 09:00.

The meeting began at 09:00.

1. Cyflwyniad, Ymddiheuriadau, Dirprwyon a Datgan Buddiannau
1. Introductions, Apologies, Substitutions and Declarations of Interest

May I welcome everyone to this meeting of the Equality, Local Government and Communities Committee? The first item on our agenda today is introductions, apologies, substitutions and declarations of interest. We haven't received any apologies, but two Members—Leanne Wood and Caroline Jones—are likely to be a little late and will join us in due course. Are there any declarations of interest? No.

2. Bil Llywodraeth Leol ac Etholiadau (Cymru): Sesiwn Dystiolaeth 1
2. Local Government and Elections (Wales) Bill: Evidence Session 1

We will move on to item 2 on our agenda, which is the Local Government and Elections (Wales) Bill, and our first evidence session. As a committee, we launched a public consultation survey on the Bill on 22 November, and we will be taking oral evidence from a range of stakeholders over the coming weeks to inform our work.

So, for today's session, let me welcome Julie James, Minister for Housing and Local Government; Cath Wyatt, local government and elections Bill manager; Claire Germain, deputy director, transformation and partnerships; Angharad Thomas Richards, head of local government elections policy team; and Lisa James, deputy director of local government democracy. Welcome to you all. Perhaps I might begin, unless you wanted to say anything by way of introduction, Minister.

I just wanted to say two short sentences, which is just—. I've just been reminded that this Bill has been six years in January in the making. It's, as you see, a very comprehensive Bill, and I just wanted to pay tribute to the number of people, both past Ministers and officials, who have worked on the Bill. I think when we finally do get it through the Senedd, we're going to have to have a large party. Some people had babies who are going to school now, so it's been a long time coming, and I just wanted to pay tribute to the various teams of people over that six years who have worked on it so far. And I'm looking forward to working with the committee on it over the next year.

Absolutely. Okay, Minister. Thanks very much for that. I think all of us are probably fairly familiar with the history and would fully appreciate and understand what you say.

Let me begin with a question, Minister, on 16 and 17-year-olds and extending the franchise and, really, a general question just to ask you to explain the rationale and the benefits of that extension.

We're very excited to be able to extend the franchise to 16 and 17-year-olds; I personally have been a long-time advocate of doing that. Sixteen and 17-year-olds play a vital role in our society, they pay tax and they can join the army, and as we've seen very recently with the climate change demonstrations, they have the ability to change the world. It seems completely wrong to me that they have no say in how their local policies, councils, deliver things that are very important to them and, actually, of course, it will be more important to them going forward than it is to people at the other end of the age spectrum.

Do you see an issue in terms of the different franchises that will apply for different elections and referendums? Will there be potential for confusion, and is that something that 16 and 17-year-olds might find a problem, do you think?

I don't think that's a problem at all. Here in Wales, hopefully, we will pass the Senedd and Elections (Wales) Bill through this afternoon and so, in Wales, we will have the same franchise for 16 and 17-year-olds at both local authorities, if this Bill goes through, and the national Government of Wales. My hope would be that the UK Government would follow suit, and that would solve that problem. But, of course, electoral officials are very used to dealing with different franchises for different elections. That's the case now, and I don't see that this adds any level of complexity that we should be worried about.

Would you say something as well, Minister, about the personal and social education element in schools? I think there's been quite a lot of concentration on the importance of making sure that 16 and 17-year-olds are fully aware of the new responsibilities that they will have, the new opportunities that they will have, and, obviously, the more informed they are, the better they'll be able to contribute. Are you content?

Absolutely, and that's the case for the whole population, isn't it? It's not just specific for 16 and 17-year-olds, but as it happens, of course, most 16 and 17-year-olds are still in formal education. So, we are in the process, as the committee will know, of changing the entire curriculum for Wales, and one of the areas of learning and experience for that curriculum will be to make people good citizens of Wales and the world, so that's part of that educational process. But for the introduction of this Bill and for the Senedd Bill, we will be putting specific curriculum guidance into the schools in order to make sure that the first time we do this, the first-time voters have the possible start on that.

I have to say, I would very much like to see that material made more widely available in the population as well, because I don't think that we could possibly argue that 16 and 17-year-olds have a less good understanding of the electoral system than any other section of the population.

09:05

Okay. Thanks for that. That's quite clear. If we move on, again on the extension of franchise to foreign citizens legally resident in Wales, there's been some criticism in terms of lack of evidence in support of that extension and lack of exploration of the issues in terms of consultation and evidence gathering. How would you respond to those criticisms? 

At present, EU, Republic of Ireland and Commonwealth citizens can vote in Senedd elections and, indeed, we're in the middle of a parliamentary election now. I'm sure that members of the committee will have noticed on the doorstep that people are confused about who can vote in what election already. I personally have always felt, and this Government believes, that if you contribute to our society then you should have a say in how it's governed. And so, if you have the right to be here, then you are contributing to that society and you have the right to say how it's governed. 

I think it's a political conviction as much as anything else. I personally think that extending the franchise as widely as possible in a democracy is a good thing. The Government agrees with that position; that's why we're putting the Bill forward in this way. I don't know what other evidence we would want to see. So, I think that, in a democracy, everyone who contributes to the society should have a right to have a say in how that society is governed, and this Bill will accomplish that. Do you want to say something, Lisa? 

I was just going to mention that we did consult on local government electoral reform in 2017, and we did ask a specific question around foreign citizens being able to vote in local government elections, and 73 per cent of the respondents to that consultation supported the extension of the franchise to foreign citizens.  

There were 979. 

It was an open self-response. 

Okay. Section 4 of the Bill, Minister, on the duty to promote awareness and provide assistance, that duty doesn't extend to foreign citizens legally resident in Wales. Why is that? 

Well, specifically, local authorities have a duty of corporate social parenting towards a number of children. So, the extension of the franchise to young people is linked to that duty in respect of this duty to promote awareness. At Stage 2, the Minister will be bringing forward an amendment to just change that definition slightly to include care leavers as well, to bring that in line with some of our other legislation. 

But in terms of awareness raising, we've got quite a significant programme of awareness raising planned. We're currently conducting quite in-depth research with focus groups across the community in Wales, and we will be having a specific stream of work to look at how to engage with foreign citizens and raise their awareness of their enfranchisement in relation to local government elections. 

Okay. Is there anything you would wish to add to that, Minister? No. Yes, Dawn. 

Would this come about, then, as part of the wider duty on local authorities to promote public engagement, basically? Is it rooted in that? 

Yes, there are connections across the Bill. A theme running through the Bill, I think, is participation in democracy. So, local authorities will have that duty to promote that participation as well. 

Thank you. If I can turn now to voting systems, Minister, why have we got two options for voting systems here—single transferrable vote and first past the post—in this Bill? 

The other theme that's running through this Bill is about empowering local government, so it's very much devolving power to local government, and there's a theme running right through the Bill about the devolution of power. So, we think it's very important for local authorities to be able to come to that conclusion by themselves. We already have a myriad of voting systems, It's not as if we have a single system for everything. Those of us who've had experience of trying to explain the d'Hondt system to somebody on the doorstep in the pouring rain in the dark will know that some of our systems are very complex. So, we think that there won't be—. So, the whole of the council area will have to change, so you won't have different wards with different systems. But I don't think it's a problem to have two authorities side by side with two different systems; people are used to that sort of thing. And we very much want local authorities to embrace it. I don't want to be in a position where I'm telling them they have to do it. 

09:10

So, you've got no fears over neighbouring local authorities having different systems. 

No. At the moment, they're run very much as separate elections anyway. The authority runs its election, and you'll know that there are variances in how people do the counting and how they set up multimember wards and all the rest of it. It obviously does add a layer of complexity, but we don't think it's problematic. 

Have you picked up any appetite from any local authorities to actually put this in place?

Not yet, but I think, as we take the Bill through the Senedd, we will see a change in that. We've had a long consultation—'consultation' is not the right word, but a conversation with the Welsh Local Government Association around it, and they're very comfortable that it's in the Bill. We've been very specific about local authorities making that decision for themselves. 

I would love to see it being trialled, yes, very much so, personally. But I'm not wanting to impose that on our local authorities. 

Well, that's obviously the logical next question. If there's a will to see this somehow being pioneered somewhere in Wales, did you consider mandating this, or, alternatively, in the financial incentives there are for pilots under different areas of this Bill, why not put financial incentives towards trialling STV? With the two-thirds majority in a council, as it's set out and so on, would you consider that?

Yes, it's something we might consider, whether an incentive might help. But I really, very strongly, believe that local authorities need to be in control of their own destiny as much as possible, and they will know their own local population and their own areas best, and we think that they are in a better position than we are to say whether that is or isn't the right thing to do.  

That's great, thank you. Could I turn to electoral registration and ask you just to expand a little on the evidence in favour of the provisions you've got in here on automatic registration and an all-Wales database? What's your thinking behind that?

So, at the moment, we have a very complex system that people find very difficult to navigate. And we know that there's a wealth of data out there about who is where, but we have a system in which we're asking people—. And a lot of people don't understand this; we're sending them information and they don't understand whether they're supposed to confirm it or send it back or what. It's a really complex system. It's very intensive, paper based, and a lot of work for very little return on that. What we're moving this to—so, it's not automatic registration—is using the data to tell people what we think it should look like, and then getting them to confirm it back. So, that's a better use of existing data systems.

There's quite a complex set of issues around whether all of that is devolved at the moment and so on. So, various lawyers, if you want to ask about exactly where we are with that, will have to answer, but we are very keen—. And I personally have encountered this, and we've had this discussion at the WLGA as well, with the electoral administrators and so on, about people who don't understand why they're getting something to say, 'Are you there?' when they've already said they're there, and so on. So, we want a much simpler, clearer system that lines the data up and says, 'We think Julie James and the following five people live at this house; please—

So, that principle is very, very clear that you've outlined there. Does it then frustrate you that you're only able to access data currently that is devolved, within devolved competence? Will you be, for example, writing to Secretaries of State, the Department for Work and Pensions and others, to say, 'Do you mind if we share that data?' in order to extend and give rigour to that data?

So, we're having that conversation. I'm now going to go over to Angharad, who knows far more about the ins and outs of how the various bits of data work than I do. 

So, at the moment, the work we're doing on canvass reform with the UK Government is looking at local data matching, which would feed into provisions around automatic registration. That's being tested in the new year, and we would look to those results to see the accuracy of that data matching at a local level to see whether or not we would want to go further and discuss with the UK Government. 

Right. So, during the course of this Bill then, Minister or Angharad, depending on the outcomes of that, you may then be writing to Secretaries of State in the UK Government to say, 'We need authorisation to, based on the evidence that we've gathered—if it works, if it's effective—to actually access that database, to strengthen, give rigour to this.'

09:15

Yes. There's been a set of very complicated discussions going on at official level, about who owns what data, who's got the right to manipulate data. You will know that electronic data is a reserved matter, but elections are devolved, and so where the ragged edge of the devolution settlement is has been a long conversation. We've still got an issue with Privy Council consent to some parts of the Bill, around who can do what to who. So, it's been a very complex set of discussions, and that's an ongoing process. The UK officials are very keen on being able to sort the data issues out as well, and, clearly, it would be better for us if the whole UK did the same thing. So, I think that's where we are at the moment, but we'll have to see.

And can you just give us some assurances as a committee that you've considered all the aspects of data protection—individuals' data protection—on this?

So, you have good, sound legal advice that says you are protecting the privacy of the individual.

I think I'm accompanied currently by a bevy of lawyers, so I'm sure they'll be able to give you that.

No. We're very clear that the Bill does things that extend the franchise, that enable people to register to vote, without infringing on any kind of personal data issue.

Okay. Thank you very much. If I could move on to the issue of candidacy and the eligibility criteria, could you just expand a little bit on the provisions relating to eligibility criteria to stand for local government elections, including disqualification?

Sorry, I missed the first part of that, Huw, I beg your pardon.

So, the provisions in here on eligibility criteria to stand for local government elections, and disqualification criteria—if you could expand a little bit on your thinking about that.

So, again, I'm going to get one of my officials to expand, because that's been a long and ongoing—. I don't know quite which one—. Angharad, is that you?

Yes. Do you want me to start with the candidacy?

So, candidacy is, as it stands now, and we are adding in the opportunity for qualifying foreign citizens with indefinite leave to remain to stand. So, that accompanies the extension of the franchise. But we're also extending the right to stand to local authority employees who aren't in politically restricted posts, as well.

On disqualification, we are setting out the disqualification criteria—. We're updating what's in the 1972 Act and putting in a new section relating to Wales. So, we're adding in disqualification for people who are subject to bankruptcy restrictions, people who are subject to notification requirements in the Sexual Offences Act 2003, or a sexual risk order. And we are just simplifying the disqualification system there.

Okay. And, of course, one of the extensions within this Bill, in line with other provisions in the Bill, is that foreign citizens legally resident in Wales will also come under it. Your thinking on that is that that is just consistent with the wider thinking in the Bill—that if people are here legally, then they are entitled to vote and entitled to stand.

Yes. I stand to be corrected, but I think the only difference as to who can vote and who can stand is the issue about 16 and 17-year-olds, most of whom are in full-time education and would be unlikely to be able to undertake the duties of a councillor. I believe that's the only difference in terms of the—

The indefinite leave to remain.

Okay. Just one final question then, Chair, on the issue of electoral pilot schemes, which we touched on a moment ago. And I'm grateful for the clarification already that it's not out of your thinking that you could provide assistance for authorities that wanted, with a two-thirds majority, to pilot STV as well. Although in the Bill, of course, it says that that would need to be there for two electoral cycles, et cetera, et cetera, so it's not a short-term one-off. But can you just give us the assurance that you've already had those discussions with Ministers about the funding that will be made available for those pilots, because we're talking about financial assistance? So, is there going to be adequate funding and resource provided to those principal councils to do these pilots?

We're in a difficult position in terms of funding conversations in this committee, Chair, and I apologise, because, ordinarily, we would of course have released the local authority settlements by now. And because we haven't, I'm in a difficult position in terms of how much I can say to the committee at this point before we've discussed the budget. Certainly, we have considered the funding, but I'm not in a position to talk about the adequacy or otherwise of it, outside of the arrangements of the settlement, without going down a little bit of a rabbit hole about where we're going. So, apologies for that, but we've certainly considered what funding would be required. And in terms of what I said about STV earlier, just to be clear about what I said: I'm happy to look at incentives for an authority that wishes to look at putting STV in place. That's not to say that they would require to be incentivised to fund the electoral system for two cycles. That's a completely different thing, which I don't think I said. [Laughter.] And if I did say it, I retract it.

09:20

Do you anticipate, during the course of this committee's deliberations and the passage of this Bill, that we will be in a position—? You must have had those discussions about when you're likely to see some certainty around the financial settlement.

The current plan is that we will release both the draft budget and the draft local government settlement on 16 December, on the Monday immediately following the general election, and at that point, of course, we will be in a position to discuss the detail of it. But it's very difficult to have a general conversation without revealing more about the settlement than I think would be fair to local authorities, given that they don't know where they stand at the moment. So, apologies for that, Chair, because ordinarily, we'd be the other way around in the committee.

Okay, Huw? A couple of further questions from me then, Minister. Firstly, on returning officers: there was a change proposed so that returning officers would no longer be able to claim personal fees, but they would be limited to expenses only. Could you just tell the committee why that change is proposed?

Well, because the returning officer is almost always the chief executive or another highly paid official, and it seems extraordinary to me that something that's part of their everyday job should be paid for by some other arrangement. So, the current practice is that they claim an amount for services in the context of a council election. It's not in the legislation, and I just think that the public are baffled as to why that happens with highly paid officials and we're just correcting that situation. 

Okay. That's quite clear. 

If we move on to a question on process, really, Minister, and that is: what discussions and consultation have taken place with relevant partners in terms of this Part 1 of the Bill in relation to elections, such as the Local Democracy and Boundary Commission for Wales, local government and the Electoral Commission? And how has that consultation informed the provisions in Part 1?

So, I've met with the Electoral Commission and the Wales Electoral Coordination Board, which brings all the main players together in—just up the corridor from here actually—a long and lively meeting. Officials have had extensive discussions with all major stakeholders in the electoral community. Obviously we're continuing to do that. Officials meet monthly with the Local Democracy and Boundary Commission for Wales, because we're the sponsoring division for that. And I have also met with the Local Democracy and Boundary Commission for Wales, although we are in the position at the moment of looking for a new chair. I'm not sure whether we've publicly—. We have appointed a new chair, but I don't think that that's public yet. So, shortly, the committee will know that we've done that.

Thank you. Can I just ask one supplementary on the returning officers, and then go straight into my questions? How do you propose to ensure avoidance of conflict of interest between the chief executive and returning officer roles, if they apply? For example, if as a chief executive they wish to avoid reputational damage to their council, but as a chief executive or returning officer, to achieve that, they may feel that they want to intervene in the political content of candidates' campaigns, which they're not permitted to do?

No chief executive should be interfering in the political conduct of a campaign. It would be a breach of their code of conduct, so unless I've misunderstood your question, I don't see how that would arise. 

If a chief executive had, for some reason, a conflict of interest—so, they were related to a candidate, for example, or some such—then I would expect them to make arrangements for another senior officer in the authority to act, but such an occasion would be so rare as to be not worth—. So, it's just a normal conflict of interest process. But a chief executive is a politically neutral officer, so anybody who's interfering in the political conduct of an election is overstepping their code of conduct, if I understood the question right.

I won't name anybody, but when this arose previously, because of the ambiguity, we found no agency was able to pursue it. 

Okay, I think I understand what you're saying because I think it was argued previously that it was a separate emolument away from the office of chief executive, but this would make it very clear that it isn't, if that helps.

Okay. I'll move on to a quick question: what additional costs, do you believe, will fall on local government as a consequence of the Bill's provisions for the extension of the franchise?

09:25

Very marginal, actually, because in terms of what we've got to do already, we've got to do a large part of this. There will be marginal up-front costs for it, but once it's running, then we're not considering—. It doesn't have a dramatic impact on cost.

We have, I think, but I don't have them in front of me.

So, the figures are set out in the regulatory impact analysis [correction: regulatory impact assessment]. In terms of the elections, the key cost for local authorities during the transitional period of the first two years will be in respect of the awareness raising for young people, which we're saying will be approximately £1.7 million over two financial years—2020-1 and 2021-2.

Young people, and it will be care leavers following Stage 2 amendments to include those in there as well.

The costs related to the wider extension of the franchise are primarily to do with the registration, and they are covered off through the Senedd Bill because the registration of the additional franchise is subject to that going through this evening, obviously. And then we're saying the additional cost then would be additional electorate at the elections, which, during the election years, would be around about £260,000 extra for local authorities to cover off those additional individuals. So, there would be those costs.

Does that include raising awareness, for example, among foreign citizens legally resident, or offenders if there's a prison in the—

It doesn't include any costs for prisoners. Those would be covered off in the RIA when we expand it at Stage 2, when those amendments are brought forward. 

And finally, in that context, do you anticipate that the Welsh Government would compensate local authorities for those up-front costs, or will they just be taken from their revenue support grant?

I'm not in a position to say about the budget. I really apologise to the committee. 

Ordinarily, we'd be the other way around, but once we've got the local government budget set out in front of us, then we can discuss where the individual figures fall. But, again, I'm very keen not to be pulled into saying something that local authorities will try and interpret as what the settlement might look like. So, I apologise, we would normally be the other way around with this—I would normally have announced the draft budget by this stage.

I fully understand you can't state what it will be or how it will be distributed, but can you at this time—

As soon as I start saying that individual things are individually identified in the budget, then you start a series of hares running, which I'm very keen not to do. So, I deeply apologise. I'm very happy to discuss it with the committee. I think I'm coming to a budget scrutiny in early January, but I'm very keen not to be pulled into discussing things in the budget that I know local authorities watching will then try and extrapolate across into what the settlement might look like.

Some local authorities are raising concerns that additional, often unintentional or unfactored costs, following legislation here, are landing on them when they can't afford to pay them, and their concern is that they should not be landed with further costs for this, whatever their views on it. You're not able at this stage to provide that assurance.

That's the problem. So, if I say to you, 'Yes, I completely agree with that and we'll cover it off', people will assume that there's a line in the budget that says that, and if I say not, they'll assume there isn't. It's a very difficult question to answer when we haven't released the draft budget, so I hugely apologise. I understand entirely why you're asking it, but it's a very difficult thing to answer without starting to go into specifics about the budget, which are really—

There's a figure of £40,000 annually for the annual registration of newly enfranchised foreign citizens in the RIA, isn't there, on a yearly basis?

So, that was included in our RIA, because at that point foreign citizens weren't in the Senedd Bill, and obviously we did not wish to assume the intention of the Assembly. If the Senedd Bill does go through tonight with the foreign citizens still in there, then that cost will fall to the Senedd Bill. If the worst case scenario were to happen, then that cost would fall to this Bill. It's one of those grey areas in terms of that cost.

Moving on to another section about the general power of competence, to what extent does the general power of competence remove restrictions on qualifying councils, and to what extent does the Bill provide clarity as to the limitations of the power conferred on those qualifying councils? This includes the 22 local authorities, but community councils—I think the quote I have here says—would,

'need to achieve higher standards of governance and financial management, professional capability, and greater democratic accountability'.

So, the power of general competence is something that councils have been asking for for some time. It doesn't remove restrictions that exist in law at the moment, so it gives an authority the power to do anything that it's not specifically restricted from doing by existing legislation. It means they don't have to search for a power to do something, but if there is a power saying that you can't do something—. Sorry, I said 'power'. If there is a legislative provision saying you can't do something, then that stands. So, they're still prevented from doing anything they're specifically prohibited from doing, but you don't have to be casting around for a power to do something if it's not specifically prohibited, so that's the difference. It's something that councils have been asking for for a very long time.

They still have to have a transparent and robust decision-making process for why they're going to do that and why it benefits the local community and so on. They'd be expected to make those decisions properly, so within all of the normal terms of decision making—they'd have to be Wednesbury reasonable, as the saying goes. But, as long as they're not specifically prohibited they can do it.

In terms of community councils, we have a large number of community councils that, unfortunately, have qualified accounts and a number of other issues. We don't think that it would be right to give them the power to do anything that their local community might benefit from until they can prove that they've got good governance in place, so that they are making transparent and robust decisions based on the right kind of governance. Once they can do that, we're extremely happy for them to go ahead and do anything that they deem necessary for their local community.

09:30

What process will exist for them to prove that or, potentially, to disqualify themselves even if accredited in the first place?

So, there's a set of criteria that we're setting out. They have to have unqualified audits; they have to have more than two thirds of them standing for election, so not seconded or appointed; and they have to have a clerk who's got the right qualifications.

Okay. What evidence has the Welsh Government sought of the experience of local government in England using the general power? Have you seen or considered any signs of innovation across the border following its introduction?

Yes, several local authorities have used a power of general competence to do various things. I have an example here in Plymouth, for example. Plymouth City Council formed a community-interest company with the health service to integrate their health and social care. Obviously, it's different in England to the way we do it here. There's the Plymouth Energy Community, which is a co-operative to reduce fuel costs, and there's a school food co-operative in Plymouth. So, that's just one example from one council. 

I'm aware of others. Some London authorities set up insurance-based services, for example, that were previously very difficult to run. There are a large number of examples of things that councils can do as a result of this that they would have struggled to find a specific power to do previously.

That's helpful, because I think the explanatory memorandum provided examples that would only fall in the two years following the introduction under the Localism Act 2011 in England. No doubt we will be interested in looking more at that in committee ourselves.

Can you expand on the potential risks to qualifying authorities, and the residents living in those areas, associated with the use of the general power? Can you clarify what safeguards are proposed to minimise those risks?

As I said, it's very important to understand that it doesn't stop councils being limited by things that are limited already in statute. So, if an authority isn't allowed to do something now, it won't be allowed to do it after the commencement of a general power of competence. There are also constraints on the power. For example, you have to have a company structure if you want to use the power for commercial purposes. There are limitations on the discretionary service charges in it.

The local authority has to prepare a business case considering the cost-benefit risks and so on. They must make the decision correctly, as in they must consider all relevant matters and not consider irrelevant matters, and they must make it in an open and transparent fashion. 

So, there are plenty of safeguards, if you like, around what they should do. They've got to consider it inside all of the other guidance regimes. They've got to consider it inside the prudential borrowing regime, and that has separate guidance for it; there's separate guidance around the housing revenue accounts. There's a myriad of other sets of guidance that also bite on the power of general competence, so they still have to abide by all of those sets of guidance in exercising the power.

I think it's probably likely that councils in Wales will use it, for example, to set up energy companies, so I think that's quite a probable use. There'll be a process that they can go through in order to do that in order to bulk buy energy in order to make it cheaper for their inhabitants, for example. So, that's one example. They wouldn't, I don't think, be able to do that now because there's no specific power or duty to do that, but the Bill would enable them to do that. There's nothing to stop them doing that, but they'd have to go through a process in order to be able to do that. So, that's just one example.

09:35

You've indicated that the general power includes a power to do things for a commercial purpose and even to apply charges for that, so what views has the Welsh Government obtained from the sectors that might be affected by that general power? And what, if any, outcomes have you from that process?

Sorry, what do you mean by—? In terms of competing in trading terms, or something, is that what you mean?

Well, a commercial purpose. You gave the example of an energy company, but that could be applied more widely and it enables, as we understand it, for a charge or non-charge to be applied.

There are caps on the level of charges that can be applied and, as I said, there is guidance. So, the prudential borrowing and financial framework guidance also sets out a set of criteria for what local authorities can do, and we will be looking, obviously, to reissue the guidance in the light of the general power of competence. I would not be expecting councils to be doing risky commercial ventures with a view to getting a revenue stream. We are aware that some councils in England, for example, have gone into buying supermarkets and various things; we would not be looking for Welsh councils to be able to do that. And if there was any indication that they might, we would issue guidance under the financial regulations in order to prevent that from happening. So, what's happened is that people get a revenue stream from that and local authorities are very desperate for revenue, but we'd be very keen that authorities should not be making risky commercial decisions of that sort, but we'd do that through the prudential framework and not through the guidance on this.

I think the key point in this question is: what views of potentially affected sectors has the Welsh Government sought?

Well, we did consult on general powers of competence in 2015 as part of 'Power to Local People'. Bear with me a moment and I'll see if I've got that particular document with me. 

When we consulted on that, the view there was about giving general power of competence, so the majority of respondents to that were more from the local government sector—20 of the 22 principal councils were in support of it and a large number of community and town councils were also in support of it. It is the intention to give the power [correction: power to the Welsh Ministers] to make regulations and it is the intention to make regulations in respect of the general power of competence and using it for a commercial purpose, and that is where the Minister made the comment about requiring a business case that would be provided for in those regulations. Those regulations would be consulted on, and during that, we could look to consult with wider sectors as to what we wanted to provide for in those regulations.

I think, Mark, the general thrust of your question is: are we expecting local authorities to compete with local businesses in order to get revenue? And the answer to that is 'no'. We do not expect local authorities to set up big commercial arms and do things that displace local indigenous businesses. That isn't what this is about.

That isn't at all about that. So, if there's a community energy company existing in a local authority area, then it would be very hard to see why a local authority would want to step into that space. But they don't exist all over Wales and, in some local authority areas, that would be a good thing to do. And so we would expect that each local authority would take a pragmatic and sensible view about what exists in its local area and then use its power to supplement that and not to be displacing indigenous businesses and so on. So, if we had any evidence of that at all, then we would be setting out guidance saying, 'You can't do that.' But I've no evidence at all that local authorities are not aware that they shouldn't be doing that. They also have a power to promote the economic development of their area and so on, so, clearly, displacing indigenous businesses is not a particularly good thing to do in that regard. So, I understand the question you're asking, but I personally don't think local authorities will be in that space. If they were, then we would be in a position to issue guidance to prevent them from being there, if that was what you were concerned about.

I think we were interested in, and I think you've answered the question, what views of the sectors that could be affected had been obtained, but you've answered that.

To what extent do you believe the repeal of the well-being provision in the Local Government Act 2000 will impact on community councils that are not considered eligible in relation to the general power?

They'll still have some general powers that they can use. It doesn't prevent them from behaving in their normal way, but what we're trying to do is incentivise community councils to put their house in order, to be fair. We have some excellent examples around Wales of town and community councils that are exemplars in their field, but unfortunately we also have a range of community councils who aren't, who are having qualified accounts year after year and are having difficulty. This Bill is intended to incentivise people to put their house in order in order for them to be able to use the carrot, if you like, of the power of general competence. So, we're hoping very much that community councils will step up to that plate.

09:40

Thanks. I'd just like to move on now to promoting access in local government, and I wonder if you can expand on the provision that's included in section 46, which places a duty on principal councils to encourage participation in decision making. Notwithstanding what you've already said about the budget and the difficulties answering questions about that, is there anything that you can say about the cost associated with preparing and publishing a strategy?

So, at the moment we know that only about 19, 20 per cent of people agree in the surveys that we do that they could influence a local decision, which is very poor. So, we need to do a lot more work on how to make sure that people engage properly and understand that. This goes back to the original question around education—this isn't just about 16 and 17-year-olds, this is about educating our population in general about what tier of government does what. We know that principal councils already do a lot of work, so there are all kinds of youth councils and juries and consultations on specific issues, and all the rest of it, but we think that putting a duty on principal councils to encourage local people to participate will act as a focal point for that, or a sort of hub, if you like, for that, and just concentrate the mind, really, on what you're trying to do here.

So, what we want to do is publish a guide so that people understand much more plainly how this decision is made—the sorts of issues that people care about—and then understand how they can engage with that. So, when we consulted, 92 per cent of people supported a plain guide to the constitution, and 93 per cent supported the statement that local authorities should set out how they intend to build a relationship with their communities. So only 20 per cent of people felt they knew how it worked now, and 90-something per cent of people say that they would like more information about that, so this is pivotal to that. I think, for local authorities, they need a direct and straight set of guidance about how to do this—what works, what doesn't work—so that we can encapsulate that. There's a lot of work to be done in this field, isn't there?

And the costs—do you think that the estimated resource and cost required by local government to promote participation is sufficient?

There will be some cost to it, but, again, in terms of the local authority settlement overall, it's only marginal. They already do a lot of this; this is about pulling it together in a proper and focused sort of way.

But if they already do it, they're not doing it very effectively, if only 19 to 20 per cent of people—

Absolutely right, so they need to do it more effectively. I'm not sure that's more expensively. 'More effectively' doesn't necessarily mean 'more expensively'. I'm sure that the RIA sets out costs that, I'm sure, Cath would be able to—

There are a couple of strands to this work. In terms of the actual duty to promote, I've been working on the basis of—I've estimated a couple of local authority officers a couple of days a month, working with the rest of the council et cetera, identifying what needs to be done, giving presentations et cetera. It's costed in the RIA for the first four years after commencement, on the basis that, following that, we anticipate there would need to be a review and a look at, 'Have they been effective?', 'Is what they're doing making the biggest impact?', and change it around if necessary. So, I think we've got about £0.25 million a year for those two resources, and that's £0.25 million across the whole sector.

Then, the other element of it is the preparation of the strategy, so we've got £288,000 in for the preparation of the first strategy, and that's because of the assumption that it would be the large task, to make sure it is set up and running correctly, and then they are required to review that once in the electoral cycle. It would be an assumption that it would be in the year of the election, and we've got, I think, £45,000 in for that. Sorry, I've got so many different numbers here. Yes, £45,000 across the local government sector.

And just to say on that—and it's worth saying this across the Bill as a whole—that will have guidance developed for it, and we want to produce all the guidance in co-production with the WLGA. So, we do not want this to be seen as something that's a top-down, 'You must do it like this'. So, all the guidance and all the regulation through this Bill are being co-produced with the WLGA, so that local authorities are telling us in practical, real terms what they think would work, what they think wouldn't work. Too many times in the past we've layered on well-intentioned regulations and guidance and they just haven't had the effect that we wanted them to have, so we're very keen to—

I just wonder whether you need to go to citizens' groups as well, because there's a danger that these documents will be produced in Government speak, and they'll still be the same and have the same result as what you've got now. 

09:45

I completely accept that, Leanne, and absolutely we will be doing that as well. The guidance has got to be fit for purpose, it's got to be something that delivers. So, absolutely, we will be doing that. The guidance will be co-produced and consulted on, just to be clear.

Okay. Moving on to the abolition of community polls, which are going to be replaced by the petitions scheme, is there any way that those two could exist side by side? 

The issue with community polls is that they're expensive and they're only triggered following meetings with 10 per cent of local electors, so it's quite a high bar, it's quite disincentivising and so on. We would like to make that a bit easier, actually, so we think the petitions system is just easier for people to get to grips with and understand. A community poll I think is quite off-putting—the language of it is quite off-putting and so on. People are used to dealing with petitions these days. We're all used to the Government petitions—'Sign up to this', and all the rest of it—so I think it's just—

But would the impact be the same at the end of the process? 

Yes, we think it would, and we just think it's easier for people to engage with. Community polls are expensive and quite off-putting, which, I think, is our evidence. And so, I just think the petitions system is something that everybody understands—it's the way the Assembly does stuff as well. It's just a much simpler framework.

What kind of analysis—? Can you provide details of the analysis that you've undertaken in relation to petition schemes, and the potential to increase use by the public, for example, and the long-term implications of those for the principal councils?

I'm sure we can do that, but it's much more of a policy framework, really. There's no difference in the outcome. The community poll isn't binding now. The Bill requires that councils need to set out a petitions scheme, the steps the council will take in response to a petition, as well as how it will make that available, and all the rest of it. So, it's just swapping it to the system we use here in the Assembly, actually.

For consistency purposes, is it, more than anything, then?

Yes. It's just more transparent. People just understand it better. They understand what a petition is. I'm not sure if you stopped people in the street and say, 'What is a community poll?', they'd entirely get that. So, it's literally just substituting one system for another, because we think it's just a more open and transparent, easily understood system that the council can run easily. It's the way we do it.

If there's any more information, I'm happy to write to the committee. I'm not sure there is, though.

Okay. Just one final question from me now in this area. What support will the Welsh Government be offering to principal councils to ensure that the conditions around remote attendance is implemented consistently across the country? And have you sought any additional evidence in facilitating remote attendance within local government?

So, we're working with the WLGA and local authorities to trial remote attendance and update the guidance. And, again, I'm sorry I can't talk about financial assistance and all the rest of it, but we're very keen, obviously, that the systems are in place for that to be able to happen. We're not commencing the provisions until a year after the next local government elections, so we've got a year with the new councils to work on the guidance and what needs to happen so that we can co-produce it with the local authorities. We want people to be able to do it for a simple reason—that we think it will increase diversity and the ability of people to take part in local democracy. In particular, in rural bits of Wales, people are having to drive several hundred miles to go to a meeting. That is clearly not an acceptable system when they can remotely attend—the technology exists already. So, we're very keen that that happens.

And you will be providing support but you can't tell us how much. 

Yes. We will be looking to make sure that all the systems are in place in councils to enable it. But, again, I'm very sorry, but we're in this ridiculous budget situation. 

Thank you. Can I turn back to community councils for a moment? I'm interested in this explanatory note and clause 37 onwards and the Schedule that refers to eligible community councils. And the ambition in the explanatory note is that the idea here is to give them, eligible community councils, a general power of competence, significant power, allowing them to be more ambitious and innovative, and in your phrase earlier on, to incentivise community councils to put their house in order—two interesting and slightly different takes. Can I just ask you: what about those local community councils and town councils that choose not to step up?

Well, a community can decide not to have its community council; there is a process by which they can rise up and abolish it, which has happened twice, I think. Rhoose and Dunvant also did it, didn't they? And so, it's possible to do that. But if the community is happy with whatever level they're currently getting, then that's fine. We are—. Later in the Bill, we'll get on to performance appraisal and so on. There is an issue at the moment about whether there are any intervention powers in community councils. I'm sure the committee will get on to discussing that with us. That's something that I'm very interested in the committee's views on. At the moment, we have no intervention powers of any description whatsoever, so—. 

09:50

No, that's very interesting, because, certainly, the ambition in here for empowering community councils, and I've seen some very, very good ones—ones that have saved swimming pools, ones that don't simply put a park bench here and clean a path here, but go way beyond that. They're almost like old, mini local—the old sort of Ogwr borough council, the little local ones that people say, 'I'd love to see the old Maesteg town council.' Well, it's starting to happen in a way, but it's the other ones I'm worried about, and this oversight. I'm just wondering whether we're missing a trick here within this at the moment, whether you feel, whether you've had representations, to say, 'What about the monitoring, the scrutiny?', not simply the publication of the annual reports, which is within this, but, actually, who has the oversight here, because you must be aware of frustrations of people saying, 'We know what they're up to, but nobody can hold them to account'.

So, we're going to jump ahead to the performance stuff, if—. I'm happy to do that. At the moment, the Wales Audit Office has that oversight, and they can put audit arrangements in place. Currently, the Welsh Government has no intervention powers in community councils. There are in excess of 700 community councils in Wales, so we do have to be careful what we wish for. 

We don't want to be intervening in many hundreds of community councils all over Wales. So, there is an issue around size and capacity and so on. And the problem with community and town councils is that they cover—. Some community and town councils have big, big budgets, and are big councils in their own right, and they're doing an excellent job, and so on; others are very small—also many little ones doing an excellent job—and absolutely everything in between. So, it's a very complex sector, in which I'm not sure that one-size-fits-all type provisions really work. So, I don't want to interfere with local democracy. If a local community feels they want a community council, who am I to say different? But some of them have tiny, tiny budgets, which don't really warrant a full Government intervention arrangement and so on. So, I'm sure, when we get on to discussing performance, we'll discuss that, but it's very difficult, given the diversity of the sector in terms of size, budget, capacity and so on, to come up with a blanket approach to how on earth you would regulate it. 

Okay. I'm sure we'll come back to that. Can I just ask you for one of those implications for the eligible community councils, which are the cost implications through producing an annual report about its priorities, activities, achievements and so on? What assessment have you done of that?

So, I don't actually know the answer to that. Lisa's going to provide it. [Laughter.]

It's worth noting that the requirement will be on all councils to do annual reports, not just eligible councils. So, it's not linked to the general power of competence in that way. We're requiring all councils to prepare an annual report, but it will be a proportionate duty. So, recognising that variety that the Minister talked about, it may well be that a very small council has a very proportionate, newsletter-type annual report, up to those who prepare very formal documents. But we have estimated the costs that we imagine would be in that space. We're estimating that, in total, it would cost around £175,000 for the entire sector, but that's 735 councils. We estimate it's about £600 for the largest councils, down to about £60 for the very small councils, for the additional clerk time that will be involved in preparing it. There'd be no additional councillor cost, because it would be part of their normal business just to approve the annual report. 

And this has been run past people like—is it One Voice—the association for community councils, to test that against what they think it would cost as well.

In terms of the detailed costings, not so much, but, certainly, the proposal of the annual reporting requirement has been tested through the independent review that took place a year or so ago, and has been circulated as an idea for a number of years, and there's broad support. Most councils already do something akin to this of some kind, so kind of a newsletter through to a very formal annual report. So, it's not a new duty on them as such; it's more formalising it and making that a common expectation. 

And I'd just like to add as well—. I don't know how much the committee's had a chance to read some of the audit reports on community councils that have—

—recently come out. I don't want to say controversial things about the audit office either, but it does strike me with some of those councils that they set out with good intentions and they've made the decision in the wrong way. So, actually, if they had a qualified clerk who understood how to make a decision to subsidise something or whatever, then actually they wouldn't be getting an adverse audit report. It's actually not understanding how to make the decision correctly, rather than the actual decision, that's the problem. And it's trying to assist community councils to do things correctly, so that they can do the things they want to do, and that they take all the right things into consideration in making that decision.

I think quite a lot of the reports I've read recently strike me as, 'Well, actually, the authority set out to do something good here, but it's just inadequately made that decision.' And I think that's really sad, because they want to do the right thing for their community. So, we don't want them to have adverse audit reports, based on the fact that they've just failed to take everything into account, or they haven't been adequately advised. That's the issue for me. So, we haven't got a load of adverse authority reports, saying that people are doing all kinds of nefarious things—just to be clear for people watching this broadcast—it is much more around what capacity they have to understand how to make that decision in the first place and then take all the right things into account. So, I think most—I can't say all of them, but most—of the reports I've read lead you to that conclusion, that, given the right advice, this authority could have done this lawfully, correctly, and taken the right things into account.

09:55

Thank you. To what extent do you think the scrutiny functions detailed in section 60, relating to the performance management of a chief executive of a principal council, are sufficiently robust?

So, most authorities, obviously, have a performance management process in place, but there's no statutory provision for that. So, you don't have to do that if you don't want to. We don't think that's right, so this clarifies that the relationship should be between the leader and the chief executive, and the chief executive is responsible to the leader, who sets the strategic direction of the council, and these arrangements also make it clear that the chief executive serves the council as the whole as well as the executive—so not just the executive, but the whole arrangement of the council. And they, hopefully, work in harmony with all of the rest of the HR practices and so on that you'd want to see.

Chair, the committee will be aware that we've commissioned Peter Oldham QC to review the disciplinary arrangements following the situation in Caerphilly, so we're awaiting the outcome of Peter Oldham's review as well. And it may be that, as a result of his review, we want to do something in secondary legislation to change that provision, but I very much want to wait for the outcome of that review before we do anything in that field. I don't know if that fully answers the question, Mark.

Well, to an extent. How do you ensure fairness and transparency where chief exec and council leader may be overly close, or may not like each other, and may have grudges against each other? And how do you therefore ensure a degree of independence, and that this isn't just an annual snapshot, an annual appraisal, which shouldn't have any surprises, but is part of an ongoing dialogue, with agreed actions?

So, there will be a set of guidance arrangements around how this should work. And I think it is—. The point about the chief executive serving the whole council is a very important point as well. So, this is not an exclusive relationship between a leader and chief executive as a sort of duality. This is a relationship in which the chief executive reports to the leader, but is responsible to the whole council, and the system set up should reflect that. So, the disciplinary process in itself, we've got a separate piece of work going on about, as a result of what happened in Caerphilly. But, absolutely, there are arrangements that need—.

My personal view is that all the statutory officers who are employed by an authority, but their job is to give that authority bad news, and will have to say, 'I'm sorry, but you can't do that', they need to be in a position where they can't be arbitrarily sacked or denigrated. So, they need to have protections in place, but we've got somebody looking at exactly how that system should work—it has to be proportionate and all the rest of it. But also the leader has to have a proper way of holding the chief executive, and, as embodied by the chief executive, the entire workforce of the authority, to account in how they deliver the services that that political leadership was elected to deliver. So, you have to have both of those things, it seems to me.

So, we await the Peter Oldham review, which I hope will be in early January, and we'll be able to adjust accordingly. But you do need to have that dual track, don't you? So, you need to have somebody who's responsive and delivering proper, democratically elected leadership, executive, that looks after the interests of all of the council membership, and that delivers the services for the people. So, it's quite a complex set of things that that individual needs to be held to account for. 

10:00

Perhaps especially where the chief exec and senior officers advise the elected members, who generally will lack the specialist knowledge in the given areas and are dependent on the information they receive. 

The explanatory memorandum notes that the benefit of section 60—it says—is to ensure accountability, promote effective leadership and improve service delivery. However, subsection 3 of section 60 states that:

'A council may publish the report, or part of or a summary of the report'.

To what extent do you believe that provides accountability and transparency in the performance of senior officials?

Well, this is something, I think, that we'll want to go into in some guidance in more detail, because this is, again, a balance between an individual, and having their personal performance made public—so, hypothetically, if you're the chief executive and you go along to your leader and say, 'Look, leader, I would very much like to have additional training in x', I'm not sure that it would be terribly beneficial to the council or that individual if you then published a report saying, 'The chief executive requires to be trained in x.' That would be completely counterproductive. No chief executive would ever come forward and say that they require training in x if that's what was going to happen to them. So, it is about the balance, isn't it? 

On the other hand, reporting against framework provisions where the chief executive has agreed to deliver x, y and z and the authority requires to know that that's been delivered in terms of service provision and so on, clearly is in the best interests of taking the authority forward. So, it's about the balance between the personal appraisal that is necessary and the system and politics appraisal that is necessary. I think just getting the balance right is important. We do want people to come forward to be chief executives. These have to be doable and liveable jobs as well. Bear in mind that it's a very public job. People will know exactly what you're paid and all the rest of it. Lots of people don't like that. They don't want to put their family through that. So, it is about the balance. 

Well, in my experience, every employee at every level deserves performance management, because they're being let down if they don't receive it—

—because they don't have an opportunity to articulate their own views or frustrations, but also to put right what they might not be doing as best they could. But how then do you divide that line between the private human resources aspect of this, which might be a struggle for a chief executive, because they're not technically the line manager but they must comply with employment law nonetheless, and the internal operational matters that perhaps do merit public scrutiny?

Exactly right. So, this is about finding that balance. I think the example I used just demonstrates it nicely. We want, in a performance appraisal system, somebody to be able to be honest about themselves and say—I don't know—'I didn't handle that media stuff very well, perhaps I need some more media training.' You don't want the council, then, to be ridiculed in the local press because the chief executive wants media training. That's counterproductive. No chief executive will ever come forward and say that they need anything at all in those circumstances, so that's highly counterproductive. On the other hand, you might want to say, 'The authority hasn't done terribly well with its local media, here's a list of things that we could have done better, here's a list of things that need improvement' that are not specific to that individual that do need to be made public in terms of general service delivery. So, it's about getting that balance right and we need to get the guidance right and co-produce it alongside probably Society of Local Authority Chief Executives and Senior Managers, the WLGA and a number of other people.

Yes, absolutely. Through the various organisations, we will take the right advice about how to strike that very difficult balance between the public and the private. 

Okay. How will section 63, 'appointment of assistants to executive', and section 64, 'Job-sharing: executive leaders and executive members', support the policy aim of increasing diversity in local government? 

So, I think it provides opportunities for people who wouldn't necessarily come forward for a full-time role. It allows people with less experience of local government to work with those who have more experience and it allows for succession planning. So, I think it has a whole range of benefits that allow people to get experience they would not otherwise get in circumstances where you could, for example, easily appoint somebody with a lot of experience and somebody with much less experience to job-share a role, in which case they could mentor each other. So, I think there are lots of opportunities here to increase diversity and to get people more likely to come forward. 

The other thing is that they're full-time roles. So, if you are not able to undertake a full-time role but you're interested in that role, you would be able to undertake it on a part-time basis. So, that would certainly increase the number of people who might be prepared to do that. The committee will be very well aware that being an executive member of a local authority is a full-time job and therefore, if you are also trying to work, that can be very problematic, or if you have caring responsibilities or a whole myriad of other life issues. So, we're trying to make sure that as wide a set of people as possible can get that experience, and bring their experience to the decision-making process of the council.

10:05

Okay. What evaluation, if any, will you be undertaking on the impact of the provisions on diversity in the future? You're expressing your aspirations, but how that's working and whether it's manifesting the outcomes you seek? And to what extent have you considered publishing guidance, sharing good practice on this issue? 

We've got a range of things in this Bill around increasing diversity and participation. So, clearly, we'll want to evaluate those. I think it's going to be very difficult to pick a little bit of it out and say, 'What did this particular bit do?' but we will be evaluating the whole thing. We'll obviously be able to see how many people take up the job-sharing opportunities and so on, but we want to evaluate the whole thing. And, yes, of course we'll want to issue guidance, and we'll come on to the performance framework as well. I'm very keen that authorities peer review what they're doing in this regard to make sure that we get best practice spread across Wales as fast as possible.

I very much want—and we'll come on to the performance management, I'm sure. But, we were having a discussion, actually, only this morning, about how I very much want to be able to say to a local authority, 'If local authority X can do this, why can't you?' So, I very much want to be able to have that direct, 'If local authority X has got job-sharing executives and all the rest of it and they've increased diversity, local authority Y, why aren't you able to do it?' So, I want to get into a position where we can ensure that good practice spreads in Wales. It's going to be very hard, Mark, to evaluate a tiny bit of the Bill by itself, but we will be evaluating the entirety of the diversity and increased engagement provisions, of course. And where we have got individual data on individual bits, of course we'll evaluate that.

Staying with the same theme, the explanatory memorandum notes that provisions in section 67 may lead to the attraction and retention of a more diverse and representative membership, and that it could lead to fewer complaints being referred to the Public Services Ombudsman for Wales. How do these provisions, which relate to the duties of leaders of political groups in relation to standards of conduct, achieve that?

Behaviour is a big issue, isn't it? It sets a tone for how an entire authority might be. So, if you have a command-and-control culture in an authority leadership, it will reverberate right down. If you have a collaborative, open and transparent leadership, that will reverberate right down. What we're trying to do is make sure that political group leaders understand their role in setting the tone and content of what happens, and also, where an individual member of a group is perhaps behaving in a way that isn't optimal, that the group leader takes some responsibility about doing something about that. That won't cover off every councillor in Wales, because we have a large number of councillors who are independent, for example, and this doesn't take away from individual members being responsible for their own conduct.

But it is about setting that tone, I think, and so we do really want to get back to a place where people are treating each other with dignity and respect, and not in some of the ways that we have seen, unfortunately, in recent times. And I do hope that that will make a different culture in which we do not have so many complaints to the ombudsman about the treatment of various people, or language used or general style, which I don't think reflects well on local government or on politics in general.

Okay. Well, this is my final question in this section. Again, the explanatory memorandum notes that the powers in the 2011 Measure for joint overview and scrutiny committees have rarely been used. How, therefore, will the provision in the Bill to require local authorities to establish joint overview and scrutiny committees address this? And is this something that local authorities have called for? And we also note that there is no cost analysis included in the explanatory memorandum, therefore, what are the cost implications?

It's not something that we would look to have to do very often, but because, in this Bill, we're establishing the corporate joint committees, and they are mandatory regional arrangements for the four areas that are mandatory, and I think local authorities will rapidly start to use them for other things, then what we want to be able to do is ensure that every area that's delegated to a regional arrangement receives the right amount of scrutiny.

So, in discussing this with local authorities, what we've been saying is that we're not going to mandate a particular set of arrangements as long as every single area of the council that is delegated to a regional arrangement, for example, receives scrutiny. And at the moment, if you look at the way that the Cardiff city deal, the Swansea city deal, and the North Wales Economic Ambition Board have their scrutiny arrangements set up, they all achieve that, but they do it in very different ways. So, I'm not in the business of dictating to them how to do it. If it works, it works. What we do think, though, is that, if, for some reason, we have a failing authority or, for whatever reason, they aren't scrutinising everything, there should be a residual power for the Minister to say, 'No, you're not doing it, so we have to do it like this.' But I would think that was unlikely to be used. Why would local authorities put themselves into that position? 

Currently, we have three pretty different arrangements, but they're working. People are very happy with the arrangements. Again, we'll be reviewing it, we'll be working with a peer review system and the new performance management regime. So, if we have evidence that a system works much better than any other system—or a set of regional arrangements—and they aren't prepared to take it over, it would mean the Minister could interfere, but I'd be very surprised if we were using that on any regular basis.

10:10

How will that operate where statutory regional bodies established by Welsh Government have representatives that go beyond local government, and then the growth deal, as you mentioned, including the north Wales growth deal, are partnerships including the private sector and the third sector, alongside a range of public sector bodies? So, how do you focus on this, which is the local government element, when the regional bodies are far broader than that?

At the moment, the scrutiny arrangements for the various deals and so on have other people sitting on them, because they have an interest in that. The provisions for the corporate joint committees allow secondments and all sorts of arrangements for that, and we'd be very happy for that to happen. I just don't think there's a one-size-fits-all provision here. So as long as it's working, we're happy for it to work. Different communities require different kinds of scrutiny; rural communities will have very different requirements to big urban ones, and so on. So, again, I don't think it's a one-size-fits-all. This Bill is very much about empowering local authorities. It's about trusting them to know what their populations require, and so on. So, this is a residual power, I would say, and I don't imagine that we'll be using it very much. In terms of whether it will cost anything, I don't see why it would cost anything at all; they have to do the scrutiny now, this would just be about doing it differently. We certainly wouldn't be looking for that to be more expensive.

I just want to take that line of thinking on a little bit, Minister. What is your vision for using these powers around collaborative working with corporate joint communities on what local government will look like in five years' time?

We're saying that there are four areas in which local authorities must regionally collaborate. I don't have any hidden maps or anything else. So, we've asked local authorities to respond to us about how they would like to work with us as the Bill goes through, because I'm very keen to co-produce as much of this with local government as humanly possible. We've had responses back in about how we should work in partnership arrangements with local authorities, and I imagine that, at some point, it will morph into them writing back to us saying, 'We'd like the corporate joint committees to be formed on this footprint.'

That's really helpful. So, you're not going to get into this—[Inaudible.]—maps, so that's great, but you're imagining that maps will emerge.

Local authorities know already with whom they most co-operate and where they work most effectively So, we're asking them to tell us how that works. And as long as it's not obviously ludicrous, then we'll go with that. By 'obviously ludicrous', I mean that if Ynys Môn and Newport decide to run social services together and none of the intervening councils are in that arrangement, that would clearly be problematic. Any normal arrangement of people. And if Ynys Môn and Newport want to buy toilet roll together, that's perfectly fine, isn't it? So, it's all horses for courses, really. [Laughter.] Just to use two examples. 

I'm sure they're thinking about that at this moment. How soon do you think we will see something that is this collaborative, ground-upwards development of these maps? Sorry, 'maps' is a crude term, but there will be a—

There's no map, but there will be a picture. There will be a picture that local authorities themselves come forward with, as I say, unless we have some ridiculous outcome, but I don't have any anticipation of that. In all the conversations we've had with them, what's coming back is perfectly sensible and that's fine. We will commence the transport and strategic planning arrangements immediately because they are much needed and we're in a position to go ahead with that. We will commence the other two mandatory arrangements ASAP, once we've sorted ourselves out with various regulations and lists of things that are included and not included. 

After that, local authorities, it's a matter for them what else they put in. This is an arrangement that's worked elsewhere, and elsewhere, local authorities have rapidly understood that they own this vehicle; that it's theirs, it's not a top-down approach, it's devolving power to them if anything, and they have rapidly put other services in. But I have no view on that, Huw, because that will be different depending on where you are and how your particular region works. Some people will already have existing arrangements that work for joint working. There's no need to change them if they work. Others will not, and they will want to put things in. And I anticipate that that will be in areas, for example, where it's very difficult to recruit officers, so very specialist officers that are hard to recruit might well be recruited regionally in order to do that, in order to get a group of staff that are otherwise hard to get. There are a whole range, in local authority services, of people who are currently pretty hard to get hold of, so it will be a way to hold on to them. But I'm not imposing that. That's a matter for them. 

10:15

So, your thinking behind this, I think, is clear. Clearly, you anticipate there would be more effective delivery of services, were this to happen, in these areas, and also probably more efficiency of delivery of services as well. What happens to democratic accountability within this? Because you're describing what could be, to the average citizen, quite a complex arrangement, on top of public services boards, city regional partnerships, regional partnership boards, et cetera. Where's the democratic accountability and the clarity?

We expect the city regional partnerships, as a result of our conversations with local government, to morph into this arrangement, because everybody we've spoken to seems to think that's a good idea. So, I'd be very surprised, if, within a year of the Bill, they haven't all gone into that arrangement. This is a much simpler and more straightforward arrangement than anything else we've done. In the past, I don't think that we've always appreciated the complexity with which we've layered local government.

So, the planning and transport issues, for example, there already is a strategic arrangement in the planning Act, but it's different. We were consulting on joint transport authorities, which would be different again. What this does is it simplifies it; it takes all of that away and it puts one arrangement in place. And it means, for example, if you look at the city deals, the authorities took ages and ages; each individual authority's lawyers had to pore over the arrangements, and it took ages and ages to sort that out. What this does is it puts a simple mechanism in place, with a standard constitution and a standard way of paying for things. So, the authorities, exactly the same as normal constitutional arrangements in each individual authority, they can add to, but not derogate from the arrangements. So, we'll have a simple funding system, which will be the minimum funding. If they want to fund it more generously than that, that's a matter for them, but they will have to fund it at a particular level if they're going to put a service in. So, there'll be standard arrangements. You will not have to take two years to organise an arrangement between local authorities at great expense, and all the rest of it.

They're all really pleased with this, because it means that we can do things in a much more simple fashion. It's democratically accountable, the local authority leaders come together and form the committee. It's a legal entity in its own right, so if that service is being delivered by the corporate committee, and you, as a citizen, have a problem with that, then that is the entity that you sue or complain about, or whatever, because it's a thing, which joint committees are not at the moment, so you have to try and disaggregate back to the local authority. And so, it's much more democratically accountable.

And, then, it will have a system of sub-committees in place, which are subject to regulation. So, the planning, for example, we'll have all of the arrangements in the current planning Act around gender balance, and who should be consulted, and statutory consultees, and a great long list of stuff that goes with it. But they will be accountable to the democratically controlled central committee. So, it's a much simpler, more straightforward arrangement, and it will allow authorities to come together to do things regionally, in a much more straightforward and simple way than they have at the moment, where they have to negotiate each individual thing separately.

The other thing to say about it is that, once they've done it, it's difficult to come back out of it. So, we will not have a situation any longer where we have a big service set up regionally and one local authority can pull the plug and the whole thing falls over, because we've had that problem right across Wales. Everybody in this room will have encountered that kind of problem. So, it will stop that. It also prevents the Government from doing that. So, it means we also can't arbitrarily change our mind about a regional arrangement and pull the plug. 

I only have one other question, Chair. It builds on something in your response to Mark earlier. If there is such strength of feeling from local authority partners to take this forward, in all the ways that you describe, why do you need to take powers under sections 79 and 80 to have mandation from Welsh Government to actually impose a corporate joint committee?

10:20

So, the reason we have four areas that are mandated is because we want to get the simplicity. So, at the moment, we could implement the Planning (Wales) Act 2015 and we could put the joint transport authorities in place. There would be different arrangements—much more complex—for local authorities. So, we aren't giving ourselves things that we can do; we're just simplifying the arrangements.

But, we also don't want to have a long, drawn-out conversation with exactly who is going to do what and one of them decides not to, blah, blah. So, it's just a much more straightforward system that sets the system in place and then hands the power to local authorities. So—.

But as you made clear in a previous response, if there was a local authority that you thought wasn't playing ball in a particular area, this is quite a power for the Welsh Government to step in and say, 'We're going to make you do it.' 

So, that's at the end of a long series of performance management arrangements. So, it starts off with a soft support mechanism and improvement board and so on. I would be really surprised if any local authority arrived at the other end of that system and found themselves mandated. Why on earth would a local authority do that? We currently have two authorities with improvement boards in place. They're both co-operating with the improvement boards. We've put the support mechanisms in place; the authorities put their houses back in order—no problem. This is an escalated system at the end of, if a local authority willfully refuses all the way down an escalating system to do something. 

But just in case. Because if we really did have an authority that chose to do that, it would be failing its citizens and the people of Wales, and we want to be in a position to be able to put that right. I don't anticipate ever—any Minister ever—using that power. Why on earth would a local authority do that to itself?

Okay, Huw? Minister, moving on then to performance and governance of principal councils, which we've obviously touched on, would you begin perhaps by explaining the rationale and evidence that is in support of the need to introduce Part 6 relating to that governance of principal councils?

Yes. So, in the last consultation that we did on the White Paper in 2015 and the Bill in 2016, which is obviously not me as the Minister, responses were generally supportive of self-assessment as an appropriate mechanism, and considering strong support for peer reviews an appropriate mechanism for organisations to use to challenge the self-assessment. All the engagement events on the White Paper welcomed that as a means of understanding where an authority was in terms of its journey on self-improvement and built on good practice. 

The current improvement process through the 2009 Measure doesn't work. It had all the right intentions when it was put in place and I understand entirely why we thought it would work, but it doesn't. So, the audit process just doesn't drive the improvement that we want. We know that it doesn't. It's not robust enough. It doesn't tell the authority enough about what's happening inside the system. It just isn't working for a whole myriad of reasons.

We know that, around the world, actually, self-improved systems work better and that people care a lot more about their reputational risk than they do about any kind of financial penalty. So, telling an authority, 'After this assessment, we know that you are much the worst performing authority in Wales and we're going to make that very public' is, to my mind, a far greater incentive on that local authority to do something about it than saying, 'And here's a fine.' Fines don't always work. They work in some circumstances, but they don't always work to change behaviour. Sometimes they actually make things worse. So, if it's a low-performing authority and you give it less money, I don't entirely understand how that makes it better. So, I think this is a much better system. We're putting back a capability into the Welsh Local Government Association, an improvement and transformation service for the WLGA, to allow them to engage the experts they require from around the world in order to drive this.

What we're absolutely determined to do with this is to make good practice travel in Wales. We have excellence in many of our authorities in many areas. We have no authority that's excellent in every area. What we want to do is get them to get the excellent services to travel. Unfortunately, previously in Wales, excellence has been a poor traveller. We have many authorities where we know that they have an excellent service in this authority, and right next door, they have one of the poorer services in the same field. Why won't that travel? So, this is about reviewing this. So, 'Local authority A, why can't you do what local authority B is doing? Let's look at your systems. What's preventing it?' So, that's what we're trying to get.

It's broadly welcomed by absolutely everybody in the local government family and community. They understand that it drives their behaviour much more vehemently than the current system does. And then there are the usual intervention powers. So, if you do a peer review performance assessment and you don't act on it, then the Minister has various powers to intervene on an escalating ladder of intervention, right up to the nuclear option of removing the councillors, and so on. We don't want to get into that position. That's not good for the council or the people it serves. We really do not want to get there, so we want a system in place that allows that authority to understand where it's failing and to put that failure right as soon as possible, so that people get the services they need. After all, this is all about getting the services delivered on the ground, so we think this is a much better system. The authorities are very happy to do it and we'll co-produce the various guidance arrangements and regulatory frameworks. And, Chair, I very much hope to be able to share those with the committee as we co-produce them as well, as the Bill goes through. 

10:25

That would be very useful, Minister. I take it from what you've said to us now, in answer to my question, that if there's a concern that a move towards a greater degree of self-assessment might result in a less robust system of performance management and evaluation, you would say that that very much will not be the case because there will be these other safeguards and failsafe mechanisms in place to—

Yes, absolutely. So, if you do a self-assessment and you assess yourself as 'excellent' throughout and we have lots of empirical evidence to tell us whether you are excellent throughout—. So if you were a council daft enough to say, 'We're excellent in every regard,' then the likelihood of your getting a whole series of inspectorates coming in to show you the error of your thinking would be high, I would say. 

What we want is genuine self-assessment here. Local authorities know where they're struggling or not struggling, actually, and they will have peer review to do that. So, they will have people coming in from other authorities where there are good systems in place, saying, 'Goodness me, what are you doing, Council A? Why do you do it like that?' So it's really very robust. 

The other thing about it is it stops the time-lagging. So, if you get an audit and it goes in, by the time it's published, it's 18 months later and typically the authority then says, 'Oh, we don't do it like that any more. We've changed all our systems. That's not relevant.' That doesn't help. It doesn't do anything. It's not driving the kind of improvement that we want. We know it isn't. So this, I think, is a much better system for making authorities be much better at understanding where they could deliver better and what other systems are available outside. 

Is it tried and tested elsewhere, Minister, this approach? And have you had a look at where it's used and how effective it is?

Yes. We can supply the committee with some evidence from around the world, but self-improving systems work. We've been doing it in our school system for some time and we know that it picks the performance up. People care about their reputation. They care about it a lot and so, if you're being told publicly that you're a poorly performing authority, then people really do care about that. It's much harder to get out of that than it is, I don't know, your performance indicator on gully cleansing is down this year and you say, 'Well, that was 18 months ago and we've got two new vehicles now.' That doesn't drive the kind of improvement that we want.

And, frankly, some of the performance measures that we've got in place don't drive improvements either. This is a bit of a historical anecdote, but I will tell you this. I once worked for a local authority that had excellent gully cleansing, even though all the gullies were overflowing. And the reason was that the performance indicator was 'How many complaints have you answered within two hours of getting a complaint?' And the answer was we'd answered all of them because the local authority hadn't had any complaints because people had given up complaining because all the gullies were overflowing. So, sometimes, it drives quite the wrong behaviour, is what I would say. I'm not prepared to reveal the authority in question, and that was a long time ago, but you have to be very careful what behaviour you drive. Human beings are ingenious; they look to see what they can get the best effect out of. It's very hard to get out of this kind of assessment by finding some clever way through to denigrate it. It's very hard, so you actually have to put the stuff in place to make the system better, rather than trying to game it in some fashion.

Okay. Thanks very much for that, Minister. One further question from me on this area and that is: are you content with the requirements in section 89 for principal councils to consult at least once in each financial year on council performance and are you concerned at all that the process might become onerous for statutory consultees?

10:30

No, I think what—. Look, what we need to see is a rolling set of consultations through a five-year council term, where, over the five-year term, it has consulted on everything, so that it has a complete system in place—it's got good feedback across all its services, it's got good local engagement and it's got a good programme in place.

So, it doesn't mean that you have to consult on everything the council does every year; it means that, over a five-year term of a council, in order to comply with the peer review arrangements, you should have data on everything you do. So, they should put a system in place that allows them to do that on a rolling programme, and to get the feedback and feed it in. And, again, I don't think that's onerous at all; I think it's something that local authorities should—. Good local authorities do that, because they want to get that feedback.

And with statutory consultees, you're content that it won't be onerous for them.

No, because we're not talking about doing everything all at once. You're talking about this rolling programme. So, we should be able to work with the statutory consultees to make sure that they have the right capacity to respond to various local authorities doing various things. This will apply to regional arrangements as well, of course.

Thank you. The Auditor General for Wales already has powers to carry out special inspections if it's considered that a council is not meeting its performance requirements. To what extent, therefore, is the requirement to establish a panel for each principal council to assess the extent it's meeting its performance requirements excessive?

So, those are complementary systems, I would say. So, a panel-led performance assessment informs the improvement journey of the council. We're talking about a self-improving system here. So, what you want to do is you want a self-assessment, you want a panel to look at what the self-assessment throws up, and you want to have different perspectives on that from a range of people across the authority. It's just a very straightforward system of looking to see what information the council has and then feeding back what improvement mechanisms you've got in place for that.

The audit system is a, 'Look, this isn't going well; we're going to come in and tell you why it's not going well.' So, it's part of the failing system, if you like. So, they're complementary, as I see it. So, the council has this information, it's not acting on it, and then the auditor can come in and say, 'Well, actually, we think you should do x, y, z.'

Yes. I was just going to add that, although it's called 'panel assessment', in the Bill, it is effectively a peer review. And when we first consulted and thought about the design for the new performance and governance system, this was based on a number of local authorities already using peer review themselves. So, it's kind of codifying the good practice in that area that's already happening across Wales. So, the WLGA already peer reviews for lots of authorities across Wales and the evidence from that is that it's been a very useful process and one of the processes that, as the Minister said, has driven improvement, more so than the straight audit process.

How do you ensure independence in that arrangement, including panel membership, given that if people operate within the council, either as officers or members, they may perceive conflict of interest, they may be afraid of challenging certain people, or if it's an external representative, they may nonetheless be dependent in some way on the goodwill of the council or senior persons within the council?

Yes, and so we'll be working with local authorities to develop the detail of the new system and we'll share that as we develop it with the committee. But, absolutely, Mark, you have to get a good cross-section of people, don't you? So, you have to get good independent people and you have to have people who understand the ins and outs of how the council works. Independence is everything. You can put all kinds of nonsensical recommendations up, if you don't really understand how a local authority works. So, you have to have that outside staff. You have to have people who understand how the system works. I would say that you have to have people from other councils who aren't beholden to you and who know how the system works—so, cross-referring people.

We're putting expertise back into the WLGA, so we'll be able to provide that, and we'll co-produce this guidance with the WLGA and local authorities in order to come up with a system that we think is robust, fair and transparent, so that you go through a process, the panel looks at it and it recommends actions. The council takes forward that set of improvement actions on its self-improving journey, and it details that and it's very open and transparent about it.

So, yes, the panel will have to have a good cross-section of people on there. I'm also saying, actually, for some of the regional arrangements, we may have Welsh Government officials involved in that because we also perform some of these functions. So, actually, I'm very keen that we devolve some of our functions and powers down to the regional arrangements so that they take ownership of it. You will have heard me talk quite a lot about strategic land use planning, for example. That's something I'd be very keen to see—Welsh Government-owned land looked at in conjunction with public-owned land across the region, just as one example where I'd be looking to have that devolved down. And then, in the peer assessment, you'd want to have that element of it taken account of as well. So, it's quite a complicated thing to set up. I'm sure we can work out a set of arrangements.

10:35

The guidance will set out what a panel should look like and set out what we think the minimum should be, which would be an independent panel chair not serving in an official or political capacity within local government, a peer from the wider sector, a serving officer, and elected members. So, we're setting out in the guidance what the minimum construct of a peer review panel should look like.

So, just to clarify, a peer review panel, is that the same as the governance and audit committee or separate?

Because the proposals for the governance and audit committee include an independent chair and a third of the members being lay members. Again, how will that improve, do you believe, on the functions of membership of that committee?

So, that's got a much narrower set of overlapping functions, I agree, and what we'd expect is that the outcomes of those committees were fed into the wider peer-review process. So, you've got a narrow set of audit requirements, if you like, that feed into the wider process.

Again, we'll go through a process with the council and the WLGA to set it out in guidance, unless we've already set it out—have we, Claire? Not that I'm aware of.

Well, existing audit committees already have lay members. The local authorities have processes for recruiting lay members to audit committees, in the same way as they have processes for recruiting lay members to standards committees.

You say you'll be co-producing that with the WLGA, but given that this is about independence and lay persons, shouldn't that co-production involve independent persons or lay persons or representative bodies of those?

Yes. I'm happy to consult with anyone who wishes to be consulted, and, yes, absolutely.

Not consult—co-produce.

Yes, and co-produce. Part of putting this function back into the WLGA is to enable them to pull in these other people, because, at the moment, we don't really have a mechanism for doing that unless we do it via the Government. So, I want the WLGA to be able to pull in expertise from all over the place—consulting, co-producing—in order to get the best possible set of guidance out. So, that's why we're wanting to put the function back.

Enable but not require.

Well, again, this whole Bill is about empowering local government. I'm not in the business of telling them what to do. What we're trying to do is give them the tools to self-improve. Why would they not take them? I think there's a big problem with not trusting local government to be able to do the right thing. I'm not into this paternalistic kind of, 'You must do it'. I'm saying, 'Look, I'm giving you a powerful tool. Use it'. So, there are backstop arrangements for the Government to be involved, but I'm not in the process of telling each local authority what to do; they're all grown up and everything.

Okay, Minister, just before we continue, there's a problem with your microphone, so Linda is just going to press a button or do what's necessary. There we are. Okay. Thank you very much. We'll move on now to voluntary mergers, and Dawn Bowden.

Thank you, Chair. Minister, you'll remember, back in 2015, when the public services Minister rejected three applications for voluntary mergers. So, my question to you is, under these proposals, what level of support is going to be available to councils that—if not the Welsh Government now—to councils that come forward saying, 'Well, we'd like to go down this route', rather than just submit proposals and then find that they've been rejected?

Yes, I'd be very keen. Any two local authorities or more that wanted to come together as a voluntary merger, we'd be very keen to support them. I'm very keen to co-produce these things with people. So, I think this business about us seen to be marking the homework, so to speak, is not a great way of doing it.

The reasons that any two local authorities might want to come together in a merger will be very different, depending on the circumstances. So, we'd want to work with them to understand what those circumstances look like, what they thought would be the outcome, what the improved outcome—. You'd obviously want there to be an improved outcome: more efficiency, more effective service, whatever it is. So, you'd want to work with them to understand what that looked like and then support them through the process. I'm not in the business at all of preventing authorities that think that they'd be better off working together working together, but nor are we mandating it. So, if local authorities want to approach us and say that they think they would be better off as a merged, one single authority, then we'd be very happy to work with them to develop the case for that, understand where they're coming from and assist them through the process. I very much want that to be something that local authorities themselves—

10:40

Yes. I was thinking more about the kind of advice and support they might get through the process, really, so that they don't do a lot of work on that and then come to you and you say, 'No, that's no good.'

We wouldn't be anticipating that at all. We would be anticipating that as soon as two local authorities had started down the road of thinking that was a good idea, we would work with them, alongside the WLGA. I'm very keen on putting this function back into the WLGA so that they can help themselves, if you like. So, there would be a function inside the WLGA that could work with the authorities, supported by us, in order to bring such a merger forward.

Okay. That's helpful, thanks. In terms of the footprint of voluntary mergers, are you averse to local authorities coming to you and suggesting different footprints, so not necessarily on the same boundaries, maybe looking at health board footprints or something? When we're talking about two or more local authorities coming together, would you expect or only be prepared to consider mergers where you have local authorities that are adjacent, if you like? So, going back to your Ynys Môn and Newport example, you clearly wouldn't be looking at a proposal to merge Anglesey and Newport.

I would take a lot of persuading that merging two authorities so geographically distant would be a good plan. But we'd be interested in looking at the business case for anything that came forward. I haven't got any parameters for this, that's the truth of it. If local authorities want to come forward with a decent business plan, or plan—I don't know why I'm calling it a business plan—with a decent plan for merger because they think that that would better serve their inhabitants, their citizens in terms of service delivery and so on, we will, of course, look at it. But it is very hard to understand how geographically separated authorities could efficiently run a service.

But there is the potential, and I was thinking about my own area, where I've got a constituency that currently covers two local authorities, two health boards, two police areas and so on, that maybe one part of a local authority might say, 'Well, actually, we think we could be better with that local authority,' because then we'd hit one police authority, one health board area. So, would you consider breaking up existing—

Nobody's suggested that to me, I have to say, but my view very firmly is that this is in local authorities' court. So, if a local authority came to me and said, 'We'd be better split into two and working with two different authorities,' and the other two authorities all agreed with that, certainly, of course, we would look at it. I'd be really interested to find a local authority that thought that was a good outcome, but—

I don't think, in practice, that's going to happen, but in theory—. This empowers local authorities to come forward with their proposals. That's what it does.

And you're not ruling anything out, basically, is the point. That's helpful—

As I say, I don't have—I just want to say this, because I've been asked this question more often than anything else—a map. There's no map.

So, in the explanatory notes, you've talked about councils that can agree on voluntary merger actually coming forward and taking that forward before this Bill comes into force. Is that a correct interpretation—that if you've got a couple of councils that come forward now and say, 'We're happy to crack on with this,' you'd be happy to consider that before the law is enacted? So, it's not that they will have to wait until this comes into—

No, if there are any that are out there who are sitting waiting with bated breath then—

—I'd be very happy for them to come forward. I have to say, Chair, we've not had any indication from any local authority that they're currently considering this. It's more of an enabling provision, from our point of view. But if I'm wrong in that and there are authorities sitting out there desperate to come forward, then we'd be very happy to talk.

That's fine. My final question, Chair, is allied, I think, to the answer given to Huw Irranca-Davies earlier on about Government interventions, but on the powers to restructure principal areas. Could you explain the changes in relation to the 2011 Measure and what you're proposing in this Bill that is different to the 2011 Measure?

10:45

We're changing the whole system so that it's more of an escalated system on some outcomes. The 2011 Measure, I feel, had lots of sledgehammer-type options but very little in the way of nudge, help, assist-type options, so what we want this Bill to have is a range of options. So, as I said earlier, what it's doing is it's giving us various powers to assist the authority along the way. For example, if we were to say that an authority had to put some of its functions into a regional corporate joint committee, they would still have democratic control over that, and so it doesn't take the democratic control away. It's another string to our bow, if you like, because the leader of that council would still have their seat on the corporate joint committee, and so on. We've got everything from 'Here's some help. You've clearly—.' I don't know—I'm just trying to use examples that aren't current, because I don't want this to be a reflection on any particular situation we have at the moment—if they need to cut the grass to a uniform standard, or something, so, 'Here's somebody to show you how to do you that. Look, you're still not doing it. Look, you're still not doing it. Look, you're still not doing it'. So, it escalates up the process and eventually we would have the power to say, 'We're going to get that service provided by another council, or through a regional arrangement', right up to, 'Well actually, we're going to take the whole lot off you because you're clearly dysfunctional'. So I see it very much as a ladder or a snake, depending on your analogy, for an authority. We'd be really disappointed to get to that end of that. Why on earth would an authority not work with its improvement arrangements in order to bring itself back to a good performing authority? So, I would be really surprised if we were ever exercising this. Something would have gone monumentally wrong with the system if we get to here.

Thank you. I wonder if you intend to take forward any of the potential legislative measures that you consulted upon last year in relation to non-domestic rates, in addition to the tax avoidance measures that you've got? And if you do intend to take forward some of those legislative measures, do you intend to do that as part of this Bill?

No, it's not part of this Bill as far as I am aware. I'm just checking. The Bill is so enormous I sometimes forget which bits of it are in which. My colleague Rebecca Evans has been outlining some provisions around what we're doing for making council tax fairer, and some new provisions around non-domestic rates and some of those provisions. Rebecca has put a couple of written statements out recently saying some of the things that we are considering taking forward, and then other things are for consideration by a new Government in the next Assembly, whoever that Government is, around anti-avoidance rules and all that kind of stuff. So, it's not possible to do that now, but some of the empty property relief stuff and all that kind of stuff, Rebecca has been taking it forward as part of her work on fairer local taxation systems.

Okay. In relation to the powers in the Bill for local authorities to inspect premises, for non-domestic rates billing functions, why have you decided on only 24 hours' written notice for an inspection to be sufficient when concerns have been expressed by the Federation of Small Businesses and others as well?

It's because we have evidence, I'm afraid, that ratepayers trying to avoid rates will modify the contents and arrangements in a property pretty rapidly if they know that an inspection's coming, so it's with a view to preventing them from doing so.

So it's more a spot-check kind of set-up. Okay. Finally, can you respond to the call by several local authorities that the removal of imprisonment for non-payment of council tax should be accompanied by alternative methods of recovery, and can you explain what consideration has been given to introducing those alternative measures in this Bill?

I have no sympathy at all with local authorities who think that imprisoning people for debt is a good thing to do, so we are working very hard across local government on all kinds of people who are indebted to public services on a range of measures, for what we can do to help citizens who find themselves—

It's not just council tax. It's a whole series of things, right down to rent policies and all sorts of stuff, because having a situation where citizens are indebted to public services, and that's having the most profound impact on their lives, is not a situation that we like. So, trying to figure out what we can do to make sure that, of course, people pay the taxes and library fees and all the rest of it that they're required to, which might look very small to us but might be very big to that person, but nevertheless it has to happen, people must pay fines on library books or dinner money or whatever, but we have to have a system that is commensurate to the level of debt that that person—

10:50

Can I just say, you mentioned earlier on that there's not much point in fining a local authority if they've got no money, and so the same would apply to individuals here, wouldn't it? So you're not sending them to prison, you're not going to give them a fine; you're narrowing the potential opportunities to get—

We are. What we want to do is to work with local authorities on what we can do. So, there is a whole series of things that we could do to help that, but understanding what the circumstances of that person are and why they're in that debt is a good start. I have a very personal view; this is not the Government's view, it's my very personal view, that sending bailiffs around to people who are already in severely traumatised circumstances is not a good thing. So, I want to work very carefully with—. This is Rebecca's portfolio, actually, and I want to work very carefully with Rebecca and local government colleagues to of course maximise the tax take, because we want to do that, and to get rid of avoidance, which is a different thing—people who are deliberately avoiding paying who could pay, that's a very different thing—and then, to work with people who are indebted to public services in circumstances where they are in poverty, what we can do about that. 

That's not an easy balance to strike, necessarily, though, is it? 

It's a very difficult balance to strike, but strike it we must, because we cannot have—. I think, Chair, the committee may have seen the paper that we've had on evictions from social housing in Wales. This is a situation we just cannot have. We're creating poverty spirals that are not helpful in terms of getting tax take up, but actually cost the taxpayer an enormous amount of money and traumatise generations of people, so we have to find a better way of doing this. So, we're working carefully with Rebecca and the Welsh Local Government Association on what systems we can put in place to make sure that we pick up the people who are deliberately doing it, because that's a whole different kettle of fish, and we are as hard as it's possible to be on people who are deliberately avoiding it, but that we work out systems where people who are in severe difficulty, through no fault of their own, have alternate ways of paying back—

It might be worth you having a conversation with the probation service. 

We're already in conversation with the probation service and a number of other services about what we can do around this. 

Okay, thanks very much. And finally, then, some miscellaneous matters from Dawn Bowden. 

Yes, just a couple of quick questions, Chair. Just on Part 9: miscellaneous. So, in terms of heads of democratic services, how is the Welsh Government expecting the provisions in section 157 of the Bill to help achieve the objective of providing appropriate and sufficient support for scrutiny?

I think that the provision in the Measure that prevents the monitoring officer from being the head of democratic services is a fundamental misunderstanding of how most local authorities function. So all it's doing is correcting that. So, I don't think it's a big deal but, actually, most local authorities already function in that way. The head of democratic services almost always reports to the monitoring officer, for example. And we think that the head of democratic services has to be a very senior officer in order to have the clout necessary, and it seems completely ludicrous to me. I just think it's a misunderstanding of how local government works. 

It's just regularising a situation that I think was unintended and has had unforeseen consequences, which we're just putting right. 

Dawn, before you go on, can I just bring Mark in at this point?

Just on this point, how do you propose to ensure that the monitoring officer, unless personally subject to inappropriate behaviour from an officer or councillor, remains independent in relation to complaints against employees or members, so that they can provide impartial information and advice as necessary?

This doesn't force you to have your monitoring officer as the head of democratic services, it just doesn't prevent it any more, which is what the situation is at the moment. I don't think that's been at all helpful. In circumstances where a monitoring officer finds themselves the subject of a complaint and therefore can't investigate it, the authority has to have systems in place that allow another officer to take over part of that function or, indeed, ask another monitoring officer from another local authority to step into that role. 

Chair, I was a monitoring officer in a local authority for the best part of 20-something years and it's by no means uncommon, unfortunately, to have to get another monitoring officer to step in.