Letter dated 17 September 2001 from the Department of the
Environment including Consultation Paper Annex 1

Letter dated 15 January 2002 from the Department of the Environment Annex 2

Letter dated 17 January 2002 from the Committee for the Environment Annex 3

Letter dated 8 March 2002 from the Minister of the Department of the Environment Annex 4

Letter dated 25 March 2002 from the Chairperson of the Committee for the Environment Annex 5

Letter dated 29 April 2002 from the Department of the Environment
including Draft Bill and Explanatory & Financial Memorandum Annex 6

Letter dated 30 April 2002 from the Committee for the Environment Annex 7

Letter dated 7 May 2002 from the Department of the Environment Annex 8

Speaking Notes of 9 May 2002 from Departmental Officials Annex 9

Letter dated 10 May 2002 from the Committee for the Environment to 26 District Councils Annex 10

Letter dated 20 May 2002 from the Committee for the Environment to SOLACE and NILGA Annex 11

Letter dated 13 May 2002 from the Committee for the Environment Annex 12

Northern Ireland Office Presentations Annex 13

Draft Bill - Second Stage Reading Annex 14

Letter dated 20 May 2002 from the Department of the Environment including Detailed
response on questions to the Department Annex 15

Letter dated 22 May 2002 from the Northern Ireland Office Annex 16

Letter dated 23 May 2002 from the Committee for the Environment Annex 17

Letter dated 28 May 2002 from the Department of the Environment Annex 18

Letter dated 6 June 2002 from the Committee for the Environment Annex 19

Letter dated 7 June 2002 from the Society of Local Authority Chief Executives Annex 20

Draft Bill - Working Draft 1 Revise from Department of the Environment Annex 21

Letter dated 25 June 2002 from the Department of the Environment Annex 22

Draft Bill - Working Draft 2 Revise from Department of the Environment Annex 23

Letter dated 20 June 2002 from the Northern Ireland Office including Briefing Paper
on Community Safety and Community Safety Partnerships Annex 24

Letter dated 2 July 2002 from the Minister, Department of the Environment including
Detailed Amendments Annex 25

17 September 2001

CONSULTATION PAPER - PROPOSALS FOR A NEW FORMULA FOR DISTRIBUTION OF THE RESOURCES ELEMENT OF GENERAL EXCHEQUER GRANT TO DISTRICT COUNCILS

I have enclosed 17 copies of the Department's Consultation Paper on the above subject and should be grateful if you would have these passed to members of the Committee. The document will issue to district councils and other interested parties on 21 September 2001.

A background note on the Consultation Paper is also enclosed.

LESLEY ROONEY
Assembly Liaison Officer

CONSULTATION PAPER - PROPOSALS FOR A NEW FORMULA FOR DISTRIBUTION OF THE RESOURCES ELEMENT OF GENERAL EXCHEQUER GRANT TO DISTRICT COUNCILS

BACKGROUND NOTE

1. In the Programme for Government, the Department is committed to review the existing statutory formula for distribution of the resources element of General Exchequer Grant payable to district councils, to take account of relative socio-economic disadvantage.

2. The General Exchequer Grant consists of two distinct elements, namely:-

This review relates solely to the resources element of the Grant, as the derating element is strictly the responsibility of the Department of Finance and Personnel.

3. The Committee will be aware of the difficulties surrounding the existing formula for distributing the resources element of the Grant. They may recall particular problems over the last two years, relating to the gross penny rate produce, which is a key component of the formula.

4. The main difficulties with the formula, the detail of which is set out in Schedule 1 to the Local Government &c (NI) Order 1972, are - its complexity; the uncertainty of grant allocations each year; and the fact that it takes no account of the New Targeting Social Need (New TSN) initiative.

5. Members will recall that an initial consultation exercise was carried out towards the end of last year, involving only district councils and other interested parties. The Department made it clear at that time that, on completion of an Equality Impact Assessment, further consultation would take place.

6. Following the earlier consultation exercise, the Department has taken on board many of the suggestions put forward and has made adjustments to the preliminary proposals. The results of this work may be found in paragraphs 5.1 - 5.5 of the paper.

7. In accordance with its statutory duty under Section 75 of the Northern Ireland Act 1998, the Department carried out an Equality Impact Assessment in relation to the proposed formula. A full assessment has been completed, the details of which are set out in Appendix 2 of the document.

8. To introduce these proposals the Department will need to amend primary legislation. A Local Government Finance Bill is included in the 2001 - 2002 legislative programme. However, the new system would not become operational until 1 April 2003.

9. Consultees are asked to respond by 17 December 2001.

CONSULTATION PAPER

PROPOSALS FOR A NEW FORMULA FOR DISTRIBUTION OF THE
RESOURCES ELEMENT OF GENERAL EXCHEQUER GRANT

INTRODUCTION

1.1 The Department of the Environment (the Department) is carrying out a review of the formula for distribution of the General Exchequer Grant. As part of that exercise it consulted with directly interested parties towards the end of last year, to consider initial proposals for a suggested new methodology for distribution of the resources element of the grant.

1.2 In accordance with its statutory duty under Section 75 of the Northern Ireland Act 1998, the Department is required to carry out an Equality Impact Assessment in relation to the proposed formula. This assessment has been completed and it is now subject to a formal consultation exercise.

BACKGROUND

2.1 The Local Government &c (Northern Ireland) Order 1972, Articles 3, 4, 5 and Schedule 1, makes provision for payment and distribution of the General Exchequer Grant to district councils.

2.2 There are two elements of grant, namely:-

2.3 For the financial year 2001/2002, total General Exchequer Grant provision amounts to £44.7m. £25.7m relates to the derating element and £19.0m relates to the resources element of the grant.

2.4 All 26 district councils qualify for the derating element of the grant, whilst in this financial year only 16 councils are eligible for the resources element. Payments in respect of both elements are made by the Department in the form of quarterly instalments, with a finalisation payment on certification of annual accounts by the Local Government Audit Office.

2.5 The review underway relates only to the resources element of the grant, as rating/derating policy is the responsibility of the Department of Finance and Personnel.

EXISTING FORMULA

3.1 The existing statutory formula for determining councils' allocation of the resources element of the grant is complex. The basis steps are outlined below:-

(i) Components used in the formula are the gross penny rate product (that is, district council income from each penny of rates levied); civilian population; and net expenditure of district councils. Data, at district council level, are provided by Valuation and Lands Agency; Rate Collection Agency; Northern Ireland Statistics and Research Agency; and the 26 District Councils.

(ii) By the input of a combination of gross penny rate product and population data for a number of councils, a penny rate product per head is sought, which will ensure full distribution of the resources element of grant, that is, £19.0m this year. In accordance with Schedule 1 of the 1972 Order, these particular councils are specified annually in subordinate legislation. Thus, the Northern Ireland Standard Penny Rate Product is determined.

(iii) Individual councils, whose standard penny rate product for the district is greater than the Northern Ireland standard, are eliminated. The remaining councils, whose standard falls below the Northern Ireland level, qualify for a share of the grant. The precise amount of grant payable is then based upon each council's proportionate distance from the Northern Ireland standard and the council's net expenditure.

3.2 The detailed calculations are presently carried out at three different stages, replacing estimated figures with more reliable estimates and eventually, with actual data. Exercises take place at provisional estimates stage (December); at general estimates stage (February, following the striking of district rates); and at finalisation stage (ie, on certification of annual accounts). From beginning to end, the exercise could span a period of 24-26 months.

PROPOSED FORMULA

4.1 The key objectives of the proposed formula, for distribution of the resources element of General Exchequer Grant are as follows:-

4.2 The proposed formula has been designed, therefore, to measure the wealth of a council against its estimated expenditure needs. Weighting factors have been built in to address the additional needs generated by deprivation, sparsity and influx of tourists. Where a council's wealth base is greater than its estimated needs it does not qualify for any grant; if the wealth base is lower than a council's needs it is eligible for a share of the grant, in proportion to the total shortfall.

4.3 The components used in the new formula are district councils' gross penny rate product and population. Wealth is determined by the gross penny rate product of a district council, relative to the Northern Ireland gross penny rate product. Needs are measured by population of a district council, again relative to the total for Northern Ireland. To take account of specific needs, population data have been adjusted. Refinements are made by the application of factors representing adjusted population of district councils, relative to the adjusted population for Northern Ireland.

4.4 District council expenditure is no longer an integral part of the calculations within the formula. It is, however, used in association with the weightings. (For an analysis of the weightings see paragraph 6.1-6.5).

4.5 The proposed formula will remove the existing finalisations element from the equation. To give district councils some certainty, from year to year, in relation to the level of grant they might expect and thus assist financial planning, data relating to councils' gross penny rate product and population would be fixed for a 3-year period. Grant allocations can not be guaranteed, as total provision would always be subject to the annual Spending Review. Every effort will be made, however, to protect this baseline. Grant available in any one year should be allocated in quarterly instalments, provided the Department has no grounds for withholding payment.

4.6 In year 1 of the new formula, should any council have to suffer a significant loss, as a result of the new arrangements, the question of a phased-in approach would have to be considered by the Department.

INITIAL CONSULTATION EXERCISE

5.1 Initial consultation with district councils and other interested parties took place towards the end of last year. In total, 22 responses were received.

5.2 On the positive side, the review was generally welcomed and there was broad support for the proposed methodology. It was considered to produce a more equitable distribution of the grant available. There was recognition too, that the new formula attempted to address social needs and the means of identifying the gap between wealth and needs was easily understood. Respondents agreed that the elimination of the expenditure component and the finalisation exercise contributed to simplification of the calculation. Whilst councils were very much in favour of a formula that removed uncertainty and provided for financial planning, there were some concerns about fixing data for a 3-year period.

5.3 Adverse comments, particularly those of district councils, were mainly related to the components and associated weightings applied to the formula. All of the points raised have been examined and as many as possible of the suggestions put forward have now been taken on board. Various areas have been addressed, as follows:-

(i) General Statistics: There were some comments about the application of certain statistics. Particular criticism was directed at the use of 1991 Census of Population counts of a number of households in Northern Ireland. As the 2001 Census results are not yet published, household data from the 1996 NIHE House Condition Survey have now been used. These are the most up-to-date figures available.

(ii) Population: Civilian population has always been used in the existing formula and these data were carried through to the new formula. A number of councils challenged the use of 'civilian' population instead of 'home' population, which includes occupants of army/RAF bases. Councils held the view that they must provide services for this part of the population and therefore they should be included in the figures. Home population figures have now been built into the formula. Term-time students are included in these mid-year estimates of population.

(iii) Unemployment factors: Unemployment rates were used as a weighting factor, mainly to address deprivation. The use of these rates was questioned for two reasons. Firstly, unemployment at a point in time was used, whereas average annual unemployment is more reliable. Secondly, in 1999, pilot schemes were introduced in Lisburn and Dungannon to work more closely with the unemployed to help them with their needs, resulting in a consequent fall in the unemployment claimant counts. Either a previous year's data should be used, or, as in the case here, the unemployment indicators in the formula have been replaced with the new Noble indices of deprivation. These new indicators should become the standard measure for defining district councils for New Targeting Social Need (New TSN) purposes.

(iv) Sparsity: The need for expenditure on the Refuse Collection Service is considered dependent on both the population density, or sparsity, of the district, as well as the absolute number of households from which refuse is collected. These two factors were previously given equal weighting, but consultation indicated that more weighting should be given to sparsity. There is now a 70:30 split in the weightings of the variables for this service.

5.4 Northern Ireland Tourist Board (NITB) bed-nights data have been used to adjust for an influx of tourists, although respondents generally found that this statistic ignores a substantial number of day visitors and the additional costs of the promotion of tourism, street cleansing, etc. However, visitor/day-tripper data is simply unavailable.

5.5 Finally, it has not been possible to accommodate a few requests which have particular significance for individual councils.

WEIGHTINGS

6.1 One of the key policy objectives related to the proposals for distribution of the resources element of General Exchequer Grant is to target social need. This is also one of the Department's main New TSN objectives.

6.2 Social need has been targeted by introducing into the new formula some generally accepted weighting factors, to address relative socio-economic disadvantage. The size of the population is the greatest determinant of the magnitude of additional need. This base has been adjusted to take into account particular circumstances that impact on the cost of providing certain district council services.

6.3 Factors generating additional expenditure needs were identified and agreed by a Steering Group, which was appointed to take forward the review. The Steering Group consisted of a number of Chief Executives and Finance Officers of district councils and representatives from the Northern Ireland Audit Office; Local Government Audit Office; Central Community Relations Unit; and the Department. The additional needs factors identified were deprivation; sparsity; and the impact of tourists. It was also agreed that these had a bearing on one or other of five key services - namely, community services; economic development; refuse collection; street cleansing; and tourism. Each of these five key services was analysed in terms of various factors which allowed a weighting of the council populations. In other words, taking the refuse collection service as an example, the more sparsely populated councils will gain weighted population, as will those with more households to serve.

6.4 The factors applied are intended to measure imbalances in the following ways:-

(i) Noble index indicators of income deprivation or employment deprivation have been applied to 3 of the key services.

(ii) Domestic Net Annual a higher proportion of domestic property, compared Valuations (NAV) with non-domestic property is an indicator of lack of industry - an economic needs factor

(iii) NITB Bed-nights data information on the average number of tourists per night has been applied to the need for tourism expenditure and for street cleansing

(iv) Travel to work data the average number of workers per day adds to the need for street cleansing.

6.5 The actual weightings applied to each of the factors, which address specific needs factors associated with key services, are set out in Table 1. Tables 2 and 3 provide detailed figures relating to individual district councils, which illustrate grant entitlement (Tables 1-3 are attached at Appendix 1).

EQUALITY IMPACT ASSESSMENT

7.1 The Department is obliged under Section 75 of the Northern Ireland Act 1998, to carry out an Equality Impact Assessment in relation to the proposed formula for distribution of the General Exchequer Grant.

7.2 A full assessment of the proposals has been completed, the details of which are set out in Appendix 2 to this consultation paper.

TIMETABLE

8.1 Amendment of primary legislation is required to replace the existing formula for distribution of the resources element of General Exchequer Grant.

8.2 When drafting the legislation, the intention would be to frame the formula in primary legislation, making provision which would allow the Department to regulate the details of the calculation in subordinate legislation.

CONSULTATION

9.1 In addition to this formal document, the Department shall conduct meetings, as required, with those directly affected by the proposed formula. Working sessions with Finance Officers, through the Association of Local Government Finance Officers, may be arranged during the consultation period.

9.2 Comments on the proposed formula for distribution of the resources element of General Exchequer Grant should be addressed to:-

Local Government Division
Department of the Environment
Clarence Court
10-18 Adelaide Street
BELFAST
BT2 8GB

You may also wish to send them by e-mail to:

9.3 The closing date for receipt of all comments is

Monday 17 December 2001.

Local Government Division
Department of the Environment

September 2001

Information on weightings and detailed figure-work relating to individual district councils. Tables 1-3 included.

TABLE 1
ADDITIONAL NEEDS/WEIGHTINGS

* Percentages represent the proportion of expenditure on key services, compared with district councils' total net expenditure.

TABLE 2
METHODOLOGY: STEP 1 - ADJUST POPULATION TO ADDRESS ADDITIONAL NEEDS

* Includes tourists

TABLE 3 Methodology: Step 2 - Measure Wealth Against Needs (Identify Shortfall)
Step 3 - Distribute Grant Available

APPENDIX 2

PROPOSALS FOR A NEW FORMULA FOR DISTRIBUTION OF THE RESOURCES ELEMENT OF GENERAL EXCHEQUER GRANT

EQUALITY IMPACT ASSESSMENT

INTRODUCTION

1. Section 75 of the Northern Ireland Act 1998 requires a public authority in carrying out its functions relating to Northern Ireland, to have due regard to the need to promote equality of opportunity -

2. In addition, without prejudice to the above obligations, public authorities are required to have regard to the desirability of promoting good relations between persons of different religious belief, political opinion or racial group.

3. The Department of the Environment (the Department) is committed to assessing the proposed formula for distribution of the resources element of the General Exchequer Grant to district councils for equality impact, under the obligations of Section 75.

BACKGROUND

4. The Local Government &c (Northern Ireland) Order 1972, makes provision for payment and distribution of the General Exchequer Grant. There are two elements of grant, namely:-

5. The review relates only to the resources element of grant, as derating policy is the responsibility of the Department of Finance and Personnel.

6. 2001/2002 provision for the resources element of General Exchequer Grant amounts to approximately £19 million. Under the existing formula, 16 of the 26 district councils qualify for a share of the grant.

7. The existing statutory formula for distribution of the resources element of General Exchequer Grant has been in place for almost 30 years. The methodology is extremely complex; some of the components of the formula are widely challenged; and allocations to councils are unpredictable, year-on-year. No account is taken of New Targeting Social Need (New TSN) or Equality issues.

8. Proposals for a new methodology for distribution of the grant were agreed by a Steering Group, appointed to take forward the review. The Steering Group consisted of a number of Chief Executives and Finance Officers of district councils and representatives from the Northern Ireland Audit Office; Local Government Audit Office; Central Community Relations Unit; and the Department. An initial consultation paper issued last September to those directly affected by the policy and other interested parties. Following consultation, having considered the comments and recommendations put forward, some adjustments were made to the formula. The proposed new methodology is based on an analysis of relevant, reliable and the most up-to-date quantitative data available. However, it includes weightings which are based on informed judgement, due to the absence of relevant data.

9. Assuming the current provision of £19 million for the resources element of General Exchequer Grant and determining distribution in accordance with the proposed formula, 17 of the 26 district councils would now be entitled to a share of grant. A comparison of district council grant allocations, on the basis of the existing/proposed formula, is set out in Table 4.

TABLE 4
GENERAL EXCHEQUER GRANT (RESOURCES ELEMENT) 2001/2002

10. The consultation paper, of which this Appendix is part, has issued to a wide audience. On completion of the consultation exercise, new primary legislation will be drafted. The Local Government Finance Bill 2002 will provide for a new formula for distribution of the resources element of General Exchequer Grant to district councils, with effect from 1 April 2003.

11. The new legislation will consolidate and replace existing provisions relating to the General Exchequer Grant contained in:-

AIMS OF THE POLICY

12. The proposed formula, which has been determined by the Department, following consultation with those directly affected and other interested parties, will replace the existing statutory formula. The new methodology for distribution of the funds available is aimed at ensuring an equitable distribution of grant and assisting those councils in greatest need. A number of councils will not be entitled to any of the resources element of grant. The Department is responsible for the distribution of the grant and will advise councils annually of their precise allocation.

13. The new policy objectives are to:-

CONSIDERATION OF AVAILABLE DATA AND RESEARCH

14. The proposals set out in the consultation paper have been proofed for each of the nine equality categories namely, religious belief; political opinion; gender; race; disability; age; marital status; dependants; and sexual orientation. A full equality impact assessment has been carried out to identify, whether, within each relevant category, the policy under consideration creates differential impacts between groups.

15. The most up-to-date datasets, which have been applied at district council level to analyse the effect of the proposed formula in relation to each of the nine equality categories, are summarised below.

(i) 1991 Census of Population in Northern Ireland (2001 Census results not yet available) has been applied to the equality categories of religious belief; marital status; and dependants.

(ii) 2000 mid-year estimates produced by Northern Ireland Statistics and Research Agency have been used for the gender and age categories.

(iii) Data produced by the Multi-cultural Resource Centre provide estimates of the population of the main ethnic groups in 2000.

(iv) Records of those in receipt of Disability Living Allowance or Attendance Allowance in 2000 have been applied to the disability category.

(v) 2001 Local Government Election results, (provided by district councils and collated by Local Government Division, DOE) analysed to reflect first preference votes cast, have been used to address political opinion.

(vi) No data are available to analyse the sexual orientation category.

ASSESSMENT OF IMPACTS

16. The methodology used for impact assessment is to consider the proposed formula in isolation from historic allocations. The rationale behind the formula, the use of weighting factors to estimate additional need for expenditure, has been assessed in terms of the councils which gain weighted population as compared to those who lose. The characteristics of the populations of these two groups of councils were then compared.

17. The results of the assessment are detailed below.

(i) The effect on the sexual orientation group can not be determined, due to the absence of data.

(ii) There is not, nor is there likely to be a differential impact on the equality category of gender.

(iii) Within the race category, there are some indications that there is likely to be a differential positive impact on ethnic minorities. However, the sub-Northern Ireland spatial estimates of the numbers of ethnic minorities by district council are not thought reliable enough to determine this with certainty.

(iv) There are indications that there is likely to be some differential impact on the equality categories of disability; age; marital status and dependants, in that the councils benefiting from the proposed formula reflect the younger age-structure, with a population over-represented not only by under-16s but also, single people over 15 and households with dependants. In addition, there is a skewing towards areas with more disabled people. For a statistical analysis, see Table 5.

Table 5

(v) The analysis suggests that there is a differential impact on the equality categories of religious belief and political opinion. The formula tends to favour those district councils with predominantly Catholic and Nationalist communities. Those councils which lose weighted population (whilst still receiving resources grant), have a larger proportion of Protestants and Unionists than NI as a whole. See Table 6.

Table 6

18. The most significant differential impact of the proposed formula is on the categories of religious belief and political opinion. This result links directly to one of the key objectives of the proposed new methodology, that is, to target areas of greater social need. It is generally accepted that there is a significant correlation between deprivation indicators and religion. The deprivation indicators incorporated in the formula are the Noble Indices of income and employment deprivation, which have very recently replaced the Robson indicators and the use of unemployment factors. The correlation coefficient between religion and deprivation at district council level is 0.8, which is statistically significant.

MITIGATION/ALTERNATIVES

19. Throughout the review, particularly in its early stages and following the initial consultation exercise, alternatives have been considered for delivery of the policy outcome. The existing grant formula took council expenditure as a crude proxy for need to spend on council functions. Focus has now been placed on the Department's New TSN objective of producing a formula for distribution of the General Exchequer Grant that addresses the need to spend implications of those aspects of relative socio-economic disadvantage which are deemed relevant to council functions. This approach is regarded as a more effective basis for allocating the Grant than the existing formula, which is not regarded as a satisfactory option, and is consistent with New TSN. The impacts as detailed in paragraph 17 reflect the use of indicators of socio-economic disadvantage as a proxy for a need to spend, and the weights allocated to those indicators. Alternative indicators or, more likely, weightings could be used to mitigate the effects, but the indicators and weights used reflect the judgement of council practitioners.

FORMAL CONSULTATION

20. his Equality Impact Assessment is subject to formal consultation over the coming months, as is the main consultation document. Consultees will include representatives of each of the equality categories listed in Table C1 of the Department's Equality Scheme, as well as those normally consulted by the Department on local government issues. A 10-week consultation with district councils and other interested parties has already taken place and some of the views expressed have been taken on board. Also, a meeting has taken place with the Association of Local Government Finance Officers, the purpose of which was to expand on the original paper.

21. Further meetings may be arranged with those directly affected by the policy and others, as necessary. Due to the limited baseline data available in relation to groups representing people with disabilities and those of different sexual orientations, further information may be gathered through consultation and discussion.

POLICY DECISION

22. The new primary legislation will not be drafted until policy decisions are taken, after full consideration of comments received during this consultation exercise.

PUBLICATION OF RESULTS OF THE EQUALITY IMPACT ASSESSMENT

23. On completion of the consultation exercise, the Equality Impact Assessment will be produced in final form and all consultees will be advised of its availability. Copies in printed form and in accessible formats, if desired, may be requested from Vivienne Collins, Department of the Environment, Local Government Division, Room 5-36, Clarence Court, 10-18 Adelaide Street, Belfast BT2 8GB. The general public will be informed of the availability of EQIAs through a press release. The results will be published on the Internet.

MONITORING FOR ADVERSE IMPACT IN THE FUTURE AND PUBLICATION OF RESULTS OF SUCH MONITORING

24. The distribution of the General Exchequer Grant will be monitored closely over a period of three or four years, to identify any unforeseen results of the formula and to ensure that all objectives are being achieved. The Department will be responsible for monitoring and will involve its Finance Working Group, the membership of which includes officers of district councils. Data will be updated on an annual basis and the distribution of grant will be analysed to determine whether or not the impact of the new formula on any of the nine equality groups has changed significantly.

LETTER FROM:
DEPARTMENT OF THE ENVIRONMENT

15 January 2002

PROPOSALS FOR A NEW FORMULA FOR DISTRIBUTION OF THE RESOURCES ELEMENT OF GENERAL EXCHEQUER GRANT.

Following the presentation to the Environment Committee on the above subject on 10 January 2002, a question was raised about 'borderline' district councils, which would not qualify for the resources element of the General Exchequer Grant under the proposed formula. Officials agreed to carry out a sensitivity analysis to examine the position.

In the methodology, wealth has been measured by the Gross Penny Rate Product (GPRP) of district councils and needs have been measured by their Adjusted Population. To address the issue raised, the wealth base has to be adjusted but the needs base is constant. There are two stages to the sensitivity analysis, as follows:-

1. When grant is allocated to the 17 councils and added to their income base, wealth/needs relationships change and it would appear that 23 of the 26 councils now have needs exceeding wealth (ie. including the original 17 councils). Re-apply the methodology and apportion the £19m grant to the 23 councils.

2. Since the 17 councils will now receive a lesser proportion of the pot, it is necessary to repeat the exercise. Therefore, add together income base and grant allocation (for the 23 councils) and reassess variances between wealth and needs. The result of this exercise is that the wealth of the 6 councils exceeds their needs and confirms that only the original 17 councils qualify for grant (ie. their needs exceed their wealth).

This analysis validates the original methodology.

A Technical Appendix is attached for information of Members.

Should any further clarification be required, do not hesitate to contact me.

JENNIFER McCAY
(Acting Departmental Assembly Liaison Officer)

TECHNICAL APPENDIX

SENSITIVITY ANALYSIS - METHODOLOGY

1. Add resources grant allocation to income base of the 17 councils which qualify for grant.

2. Recalculate variances between wealth indices and needs indices (the latter have not changed).

3. 6 of the 9 councils which receive no grant now appear to qualify ie. needs exceed wealth (ie. all except Belfast, Coleraine & North Down).

4. Assume grant is given to these 6 councils - (so removing from the 'pot' for allocation to the remaining 17 councils).

5. Add resources grant allocation to income base of the 23 councils which now appear to qualify for grant.

6. Recalculate variances between wealth indices and needs indices.

7. An examination of the variances indicates that the 6 councils are again excluded and confirms that only the original 17 councils have negative variances and therefore qualify for grant.

8. The attached Table sets out a comparison with the original position.

17 January 2002

REVIEW OF THE RESOURCE ELEMENT OF THE GENERAL EXCHEQUER GRANT TO DISTRICT COUNCILS

I refer to Ms Lesley Rooney's letter dated 17 September 2001 regarding the above consultation document.

The Committee received an informative presentation from Officials of the Department at its meeting on 10 January 2002 and Members took the opportunity to ask questions of the Officials.

The Committee subsequently discussed its response and would broadly welcome the proposed new formula which the Committee recognises is intended to simplify the procedure for grant allocation and allow for better financial planning by District Councils in receipt of the Resource Element of the General Exchequer Grant.

The Committee notes that the Department's intention to make provision to regulate the detail of the calculation of the formula by subordinate legislation will allow weightings based on the Department's 'informed judgement' to be replaced by the most relevant and up to date data as it becomes available.

Finally, in light of the evidence received from Local Councils during the Committee's successful support for the reinstatement of the proposed £2m cut in the Resources Grant from the 2002 - 2003 Budget, the Committee recommends that the Department should make every effort to protect the 'baseline' for grant allocation to the poorest and most socially deprived areas of Northern Ireland.

JOHN SIMMONS
Clerk to the Committee for the Environment

ANNEX 4

8 March 2002

CRIMINAL JUSTICE BILL - PROPOSED AMENDMENT PROVIDING NI DISTRICT COUNCILS WITH STATUTORY COVER TO ENGAGE IN COMMUNITY SAFETY

1. Following consultation on the Criminal Justice Review Implementation Plan and Draft Justice (NI) Bill, representations were made by the Society of Local Government Chief Executives (SOLACE) and 7 district councils to NIO seeking an additional clause in this Bill to provide councils with statutory cover to engage in Community Safety function.

2. The Draft Bill already contains provision for Community Safety functions and refers to the Secretary of State devising a strategy for enhancing Community Safety.

3. The Implementation Plan and Draft Justice Bill recognises that the long-term arrangements for local Community Safety Partnerships should await the outcome of the Review of Public Administration. However, the Secretary of State wishes to provide district councils with discretionary powers to engage in Community Safety work until such times as the longer-term strategy is agreed.

4. Provision of such powers to district councils would normally be the responsibility of the NI Assembly. However, under Paragraph 13 of the Memorandum of Understanding, the UK Government can legislate on devolved matters, provided approval to do so has been given by the NI Assembly. Such approval is obtained by way of approval of an NI Assembly motion. A brief summary of the aims of this initiative, including the proposed structures for Community Safety Partnerships and the association provisions in the Bill, are attached in the Annex to this paper.

5. A number of councils already engage in community safety work on a voluntary basis, but SOLACE has expressed a firm opinion that many more would do so if statutory cover were provided. Furthermore, the NIO has made it known to councils that it has resources to assist them in developing and implementing community safety initiatives. Resources already secured by NIO are:

6. The NIO would fund councils directly, with the first two years financed at 100%, and thereafter in the form of grant-in-aid at a rate of up to 75% on approved costs. Councils and others amended by Departmental Officials would be expected to fund the remainder. Post 2003/2004, funding would be subject to bidding and it is understood that the NIO intends to bid for a further 3 years at least. It should also be noted that there is a possibility that councils could seek 'top up' funding from DOE after 2003/2004. This of course should not deflect from consideration of the merits of the proposal.

7. Consideration:

(i) I support in principle the granting of discretionary powers to councils to undertake community safety functions. The response from SOLACE is a good indicator of widespread support from Chief Executives, however it is not and cannot be regarded as representative of the political voice of local councils. However following the consultation referred to in paragraph One, seven councils registered firm support for legislation that would give councils discretionary powers to engage in community safety. In addition, there is clearly considerable expectation within local government that an enabling statutory power is imminent, as most councils have provided for community safety in their 2002/2003 expenditure estimates. Such budgetary decisions, I would assume, were approved by council members.

(ii) I appreciate that this issue is being processed at a pace that none of us prefer. However, I am mindful of the opportunity, which the Criminal Justice Bill offers, to provide district councils with the necessary statutory cover to engage in community safety functions, and to avail of the considerable resources, which the NIO has secured on their behalf. At the same time, I would wish to consult with the Committee to explain the background to the proposed motion.

(iii) It is important to reflect, however, that the amendment seeks to provide a discretionary power to councils to engage in community safety work. The amendment has still to be drafted, however the proposed clause would be along the following lines:

"A district council may do anything, which it considers appropriate for enhancing community safety in its district. In exercising such functions, councils shall have regard to the current strategy for enhancing community safety. References to enhancing community safety in any district are to making the district one in which it is, and is perceived to be, safer to live and work, in particular by the reduction of actual and perceived levels of crime and other anti-social behaviour."

The decision whether to exercise such a power would rest with individual councils. Accordingly I am content that the wishes of local people and their representatives would determine if, and to what level, their council engages in community safety.

8. Recommendation

I recommend to the Committee that we proceed with a motion to include in the Criminal Justice Bill a discretionary power to allow district councils to engage in community safety functions. Proposals to proceed with an amendment will be subject to comments received, but also subject to it being accommodated by the NIO within the timeframe for the Justice Bill.

I further recommend that I proceed to have a motion placed on the Order Paper for debate on 19 March.

C HOY
pp DERMOT NESBITT MLA
Minister of the Environment

(Approved by the Minister & signed in his absence)

COMMUNITY SAFETY - GENERAL BRIEF

1. What is it?

Community safety means: preventing, reducing or containing the social, environmental and intimidatory factors which affect people's right to live without fear of crime and which impact on quality of life. Target areas include: domestic burglary, car crime, domestic violence, offences motivated by prejudice, drug and alcohol abuse, street violence and so on.

2. Criminal Justice Review Implementation Plan

Key development - establishment of structures for local Community Safety Partnerships. Three-tier approach:

3. Justice (NI) Bill

Powers to S of S to:

25 March 2002

CRIMINAL JUSTICE BILL - PROPOSED AMENDMENT PROVIDING NI DISTRICT COUNCILS WITH STATUTORY COVER TO ENGAGE IN COMMUNITY SAFETY

1. Your letter of 8 March 2002 sought to consult with the Committee to explain the background to the proposed motion regarding the above.

2. The Committee considered your letter on 14 March 2002 together with a copy letter from the Chairman of SOLACE and six letters from District Councils supporting the introduction of legislation on community safety.

3. The Committee noted that the amendment seeks to provide discretionary powers to District Councils to engage in community safety work. The Committee concluded that it has no concerns with the proposals set out in your letter.

DR WM McCREA MLA
Chair, Committee for the Environment

29 April 2002

You may recall that, on 10 January 2002 officials from the Department made a presentation to the Environment Committee on 'Proposals for a New Formula for the Distribution of the Resources Element of General Grant'. Your response of 17 January 2002 indicated that the Committee broadly welcomed the proposed new formula.

The Department is now in the process of making the necessary primary legislation. The draft Local Government (Miscellaneous Provisions) Bill, together with the Policy Memorandum have today issued to the Presiding Officer for his consideration. The draft Bill is tentatively scheduled for introduction to the Assembly on 7 May 2002. Members should note that the Office of the Legislative Counsel recommended that the draft Local Government (Finance) Bill be renamed, to more accurately reflect the nature and content of the draft legislation. The proposals outlined in the Policy Memorandum will, therefore, be taken forward under the title 'Local Government (Miscellaneous Provisions) Bill 2002'.

This Bill is being used as a vehicle to extend the existing powers of district councils to promote the economic development of their areas. It would remove the financial limit currently placed on councils by Section 28 of the Local Government (Miscellaneous Provisions) Order 1992, and would allow them to engage in a broader range of activities, such as the provision of sites for economic development purposes. District councils were consulted on the proposed amendments.

The Bill also includes a clause providing district councils with the power to engage in community safety partnerships, proposed under the Secretary of State's community safety strategy. Details of the community safety proposals were provided to the Committee in the Minister's memo of 8 March 2002, when it was suggested that a relevant clause could be included in the Justice (NI) Bill. The Minister was grateful for the Committee's endorsement of the proposals in its letter of 25 March. However, timing factors prevented the inclusion of the clause in that Bill, and instead procedures were adopted to make suitable provision in the draft Local Government (Miscellaneous Provisions) Bill. The Executive endorsed the Minister's proposals on 25 April 2002.

Since the Minister's memo of 8 March, the Secretary of State has issued, for consultation, the community safety strategy. This provides outline details of the mechanisms and funding arrangements for community safety partnerships in which district councils may decide to participate. I am informed by the NIO that consultation on the strategy is widespread, with all district councils given an opportunity to offer comments. I assume that the Committee has copies of the consultation document, as I believe it also received widespread distribution in the Assembly. Community safety is largely, although not entirely, a law and order issue. Consequently, it is considered to be a reserved matter under the terms of paragraph 9 of Schedule 3 to the Northern Ireland Act 1998. In accordance with Section 8 of that Act, the Secretary of State's consent to the consideration of the Bill by the Assembly has been sought as a matter of urgency and we expect to receive confirmation of this later to day.

Because of unforeseen difficulties, related to the proposed inclusion of a community safety clause, the draft Bill has, unfortunately, suffered slippage in the legislative programme. The Department is committed, however, to having this legislation enacted in September/October 2002, to enable subordinate legislation to be made, so that the new formula for distribution of next year's grant to district councils may be introduced with effect from 1 April 2003.

To achieve this objective, the draft Bill was timetabled to reach Committee Stage before the end of May 2002, and to complete its Assembly stages before the summer recess. This challenging timetable anticipates the Environment Committee taking 30 working days for scrutiny of the draft Bill. I do, of course, appreciate that an extension might be requested.

In the circumstances, I spoke to Joanne Adair this morning and agreed that it would be helpful to issue to the Environment Committee an advance copy of the draft Bill, and the Explanatory and Financial Memorandum (which has been cleared by the Office of the Legislative Counsel), these are attached. This would allow the Committee to begin their scrutiny, which might speed up the process, at a later stage.

Your assistance and advice in this matter would be appreciated.

ALEX BOYLE

[24/04/02 16:41:47]

CONTENTS

Grants to district councils

The general grant to district councils [j1]

Determination of the resources element [j2]

Determination of the derating element [j3]

Reductions in general grant [j4]

Other grants to councils [j5a]

Powers of district councils

Powers of district councils in relation to economic development [j7]

Powers of district councils in relation to community safety [j7a]

Supplementary provisions

Interpretation [j6]

Repeals [j8]

Commencement and savings [j9]

Short title [j10]

Schedule   Repeals

A

TO

Make new provision for the payment of general and other grants to district councils; to confer new powers on district councils in relation to economic development and community safety; and for connected purposes.

BE IT ENACTED by being passed by the Northern Ireland Assembly and assented to by Her Majesty as follows:

The general grant to district councils [j1]

1.¾ (1) The Department shall for each financial year make grants ("general grants") to district councils.

(2) Subject to any reduction under section 4, the general grant payable to a council for any financial year shall consist of ¾

(a) a resources element, determined under section 2; and

(b) a de-rating element, determined under section 3.

(3) Payments in respect of general grant shall be made to a council at such times as the Department may determine.

Determination of the resources element [j2]

2.¾ (1) The amount of the resources element of the general grant payable to a district council for any financial year shall be determined in accordance with regulations.

(2) Regulations under subsection (1) may in particular make provision¾

(a) for the amount mentioned in that subsection to be calculated by reference to a formula;

(b) for determining the manner in which and time at which such calculation is to be made;

(c) for determining the person by or to whom any information required for the purpose of that calculation is to be given and the time at which and form in which it is to be given.

(3) The formula may be such that the amount of the resources element payable to a council is nil.

(4) For the purposes of this section "formula" includes methods, principles and rules of any description.

(5) Regulations under this section may contain¾

(a) any supplementary, incidental or consequential provision,

(b) any transitional or saving provision,

(c) any provision for a person to exercise a discretion in dealing with any matter,

which the Department considers appropriate.

(6) Regulations shall not be made under this section unless a draft of the regulations has been laid before, and approved by resolution of , the Assembly.

Determination of the derating element [j3]

3. The amount of the derating element of the general grant payable to a district council for any financial year is an amount equal to the difference between¾

(a) the amount of the product of the district rate for that year (within the meaning of the Rates (Northern Ireland) Order 1977 (NI 28)); and

(b) the amount which, but for the provisions of Articles 31B and 42 of, and paragraph 4 of Schedule 7 to, that Order, would have been the amount of that product.

Reductions in general grant [j4]

4.¾ (1) Where the Department is satisfied that¾

(a) a district council has failed to achieve or maintain a reasonable standard of economy, efficiency and effectiveness in the discharge of its functions, or

(b) the expenditure of a district council has been excessive having regard to its financial resources and other relevant circumstances,

the amount of any general grant payable to the council shall be reduced by such amount as the Department considers appropriate.

(2) Where any grant is reduced under subsection (1), the Department shall lay before the Assembly a report stating¾

(a) the amount of the deduction; and

(b) the reasons for making it.

(3) The Department may¾

(a) defray any expenditure incurred in any financial year in the provision of services for a district council by a body specified in regulations; and

(b) deduct from the amount of any general grant payable to the council for that year such amount (not exceeding the total of the expenditure so defrayed) as the Department considers appropriate.

(4) Before exercising its powers under subsection (3) the Department shall consult¾

(a) such associations or bodies representative of councils,

(b) such district councils, and

(c) such other bodies or persons (if any),

as the Department considers appropriate.

(5) Regulations under this section shall be subject to negative resolution.

Other grants to councils [j5a]

5.¾ (1) The Department may, in respect of a financial year, make grants to district councils for such other purposes as may be determined by the Department.

(2) A grant to a council under this section shall be¾

(a) of such amount, and

(b) made subject to such conditions,

as the Department may determine.

(3) Grants shall not be made under this section without the consent of the Department of Finance and Personnel.

Powers of district councils in relation to economic development [j7]

6.¾ (1) A district council may promote the economic development of its district.

(2) Without prejudice to the generality of subsection (1), a district council may for the purposes of the economic development of its district¾

(a) make payments; and

(b) acquire, hold and develop land.

(3) In subsection (2) "develop", in relation to land includes¾

(a) erect, alter or extend buildings thereon;

(b) carry out works thereon;

(c) provide means of access, services and other facilities for persons using the land;

(d) facilitate the doing of such things by another person;

(e) manage and dispose of the land.

(4) A district council shall exercise its functions under this section in accordance with such directions as may be issued from time to time by the Department of Enterprise, Trade and Investment.

Powers of district councils in relation to community safety [j7a]

7.¾ (1) A district council may¾

(a) participate in any relevant community safety partnership;

(b) take action in accordance with any plan prepared by, or proposals agreed by, such a partnership;

(c) accept financial or other support provided by such a partnership; and

(d) generally assist and facilitate such a partnership in the exercise of its functions.

(2) The Department may by order confer or impose on district councils other functions relating to the enhancement of community safety in their districts.

(3) No order shall be made under this section unless a draft of the order has been laid before and approved by a resolution of the Assembly.

(4) In this section¾

"community safety partnership" means a body established for an area in accordance with the community safety strategy devised by the Secretary of State under section 70 of the Justice (Northern Ireland) Act 2002 (but does not include any body established by an order under section 71(1) of that Act);

"the enhancement of community safety", in relation to any district, means making the district one in which it is, and is perceived to be, safer to live and work, in particular by the reduction of actual and perceived levels of crime and other anti-social behaviour;

"relevant community safety partnership", in relation to a district council, means such a partnership established for an area which is, or includes, the district of the council or any part of that district.

Interpretation [j6]

8. In this Act¾

"the Department" means the Department of the Environment; and

"regulations" means regulations made by the Department.

Repeals [j8]

9. The statutory provisions specified in the Schedule are repealed to the extent specified in the second column of the Schedule.

Commencement and savings [j9]

10.¾ (1) Sections 6 and 7 and the repeal of Article 28 of the Local Government (Miscellaneous Provisions) (Northern Ireland) Order 1992 (NI 6)) come into operation on the expiration of the period of two months from the date on which this Act receives Royal Assent.

(2) Nothing in the other provisions of this Act¾

(a) applies in relation to any financial year which began before the date on which this Act receives Royal Assent; or

(b) affects the operation of any statutory provision repealed by this Act in relation to any such financial year.

Short title [j10]

11. This Act may be cited as the Local Government (Miscellaneous Provisions) Act (Northern Ireland) 2002.

SCHEDULE

REPEALS

30 April 2002

Thank you for sending the Committee copies of the above draft Bill and EFM. Providing the Committee are content, Jennifer will arrange for Officials to give a presentation at next week's meting (Jim is liaising). In preparation, I wonder if you could arrange for Officials to look into a few issues:

In your cover letter, you mentioned a consultation document on the issue of community safety. Unfortunately the Committee doesn't have any copies. Could you arrange to send some on to us?

We have copies of responses to the Criminal Justice Review Implementation Team from SOLACE and from Antrim, Armagh, Ballymena, Ballymoney, Banbridge, Coleraine and Cookstown Councils. I would be grateful if the Committee could have sight of any other responses.

The Explanatory Memorandum mentioned that Councils had been consulted on the amendment of economic development powers in a Proposal for a Draft Order in Council - The Regeneration & Development (Northern Ireland) Order. Could you arrange for a copy of the consultation paper and summary of responses to be forwarded to the Committee?

I would be grateful for a response on the above as soon as possible. Prior to the meeting on 2 May would be excellent but definitely no later than 10 a.m. on Tuesday 7 May.

JOANNE ADAIR

ANNEX 8

7 May 2002

I refer to Joanne Adair's request for additional information about the amendment of economic development powers in a Proposal for a Draft Order in Council - the Regeneration and Development (Northern Ireland) Order. In particular Joanne has requested a copy of the consultation paper and summary of responses to be forwarded to the Environment Committee. Further information was also requested in regard to community safety.

Attached is a copy of the consultation letter issued to district councils inviting comments and views on the proposals for new legislation. The Committee will be aware that the draft Local Government (Miscellaneous Provisions) Bill is now being used as a vehicle to extend the existing powers of district councils to promote the economic development of their area. It would remove the financial limit currently placed on councils by Section 28 of the Local Government (Miscellaneous Provisions) Order 1992, and would allow them to engage in a broader range of activities, such as the provision of sites for economic development purposes.

All the district councils were consulted on the proposed amendments and there were 23 responses received. There were no responses received from Cookstown District Council, Dungannon District Council or Magherafelt District Council. In summary, there was overwhelming support for the proposed legislation. However, several councils recommended further strengthening of their powers and this included the removal of the 5p expenditure ceiling on economic development projects.

Over the last year the Department has received 9 letters, 8 from district councils and 1 from Sir Reg Empey, expressing concerns about the constraints on district councils' economic development powers. As mentioned above this Bill would extend the existing powers of district councils to promote the economic development of their areas.

Regarding community safety, attached are the following documents*:

(i) Extract of the Criminal Justice Review - Implementation Plan, which refers to community safety; and

(ii) Copy of the NIO Community Safety Strategy document, which is currently out for consultation.

The Department was informed by the NIO that the second document issued to all MLAs.

The Department has already provided you with copies of correspondence sent to the NIO from SOLACE and district councils in regard to the Consultation document: Criminal Justice Review - Implementation Plan. The NIO, which is responsible for consultation on community safety, has advised that it does not have any other responses from district councils on this matter. You may, therefore, wish to discuss the full outcome of the NIO consultation with NIO officials. The contact NIO official is Heather Cousins, Tel: 90 (5) 27513.

JENNIFER McCAY
(Acting Assembly Liaison Officer)

*NB: Not attached - documents available from NIO

27 November 1997

ECONOMIC DEVELOPMENT POWER - DISTRICT COUNCILS

The purpose of this letter is to invite comment on proposals for new legislation, announced by Lord Dubs in his statement of 11 September 1997, (copy enclosed) which would clarify the power of District Councils in relation to certain aspects of local economic development.

At present District Councils have the power, under Article 28 of the Local Government (Miscellaneous Provisions) (NI) Order 1992, to promote the economic development of their areas; a Council may spend up to 5p of a product in the penny rate on this activity subject to the consent of the Department. However, practical examples of uncertainty have emerged in relation to the definition of the extent of this power, where the distinction between the actual undertaking of economic development and the promotion of economic development has become blurred.

This has led to situations where, for example, Councils have had to rely on the statutory powers of other organisations in order to provide for the development of land already in Council ownership. It is now proposed to clarify the legal position, in so far as it relates to Councils' powers to acquire, develop and manage land in their Districts for local economic development purposes, through an appropriate Order in Council. This will provide a platform for Councils to become more actively involved in implementing their economic development strategies and enhance the prospect of bringing new jobs to their areas. In line with existing provisions, projects would require the Department's approval and be financed from the District rates, augmented where appropriate, by grants from other sources, eg EU Programmes.

As indicated in the Minister's statement a suitable legislative vehicle for these proposals has been identified in the form of the proposed Regeneration and Development Order in Council which was recently admitted to the NI Legislative Programme. It is anticipated that draft proposals to extend the Department's urban regeneration powers will be published in April 1998 and District Councils and other interested parties will have an opportunity to comment on a wider range of development issues at that stage. However, it is considered appropriate that Councils should have an opportunity now to consider and comment on the proposals already described in relation to their economic development powers. They will, of course, have the chance to comment more formally at the draft Order consultation stage.

Views are sought on this particular issue by 31 December 1997.

In his statement the Minister also touched upon the Government's commitment, contained in its election manifesto, to give local authorities a new duty to promote the wider economic, social and environmental well-being of their areas. DOE officials have been liaising closely with colleagues in GB, where the Department of the Environment, Transport and the Regions is planning to issue shortly a Green Paper on this initiative. The content of that paper will be fully considered here and the Department intends to produce a Consultation Paper of its own on this issue in the New Year.

R WARBURTON
Director

SPEAKING NOTES FROM:
DEPARTMENTAL OFFICIALS 9 May 2002

INTRODUCTION

• Purpose of the presentation is to take members through the individual clauses of the Bill, elaborating on each one and provide them with an opportunity to seek clarification and to ask questions about the legislation.
• Refer to change in title of Bill, which was formerly known as the Local Government (Finance) Bill, explaining the addition of two clauses (economic development; community safety).
• Explain that the Bill:

(i) puts in place a framework for payment of general grant to district councils;

(ii) consolidates the legislation in relation to the general grant;

(iii) extends existing legislation relating to economic development powers of district councils; and

(iv) provides district councils with powers to engage in community safety activity.

• Summarise the principal clauses of the Bill, 11 clauses in total - that is 7 key provisions; 4 supplementary clauses.

CLAUSE 1: THE GENERAL GRANT TO DISTRICT COUNCILS

• Explain the two separate elements of general grant, which are provided for in this clause and are payable to district councils. (This is similar to existing legislation, ie the Local Government &c (NI) Order 1972.) These are:-

(i) the derating element, the purpose of which is to compensate district councils for loss of rate income, due to the statutory derating of certain properties. Derating policy is the responsibility of DFP and there is no change in this provision.

(ii) the resources element, which under the new formula would be determined by comparing a district council's wealth and needs.

• Remind members of provision for each of the grant elements, covering the period 2001/2002 to 2003/2004, highlighting the increases year on year.
• Emphasise that figures stated for 2003/2004 represent indicative provision for that year and that these are the baseline or starting point for the 2002 Spending Review.

CLAUSE 2: DETERMINATION OF THE RESOURCES ELEMENT

• Focus on this clause, as this is where there is new and important change.
• Explain how this provision would allow the Department to make regulations.
• Explain, also, how the regulations would contain the new methodology for measuring the wealth and needs of district councils and define the components of the formula.
• Touch on the components of the formula, namely:-

- Gross Penny Rate Products; Population (adjusted).

• Spell out the additional needs of district councils that are to be addressed, namely:-

- deprivation; influx of tourists; and sparsity.

• Inform members about the flexibility that subordinate legislation would allow, eg how more up-to-date data could be applied as it becomes available; and how there would be scope for refinement.

CLAUSE 3: DETERMINATION OF THE DERATING ELEMENT

• Assure members that this clause is as before, and that full compensation will continue to be payable to all 26 district councils, in respect of derated property in their area.
• Define the formula, which is a simple calculation, as follows:-
  
  
  - notional gross income from one penny on derated property multiplied by a council's non-domestic rate.
  • Touch on the review of industrial derating, which is currently being undertaken by DFP.

    CLAUSE 4: REDUCTIONS IN GENERAL GRANT

    • Explain that two quite separate provisions are contained in this clause, but that this legislation is not new (ref the Local Government &c (NI) Order 1972).
    • The first part relates to a power (which has not been exercised to date) to reduce general grant, where a council is found to be inefficient or where the misappropriation of funds has been detected. Any such case would be reported to the Assembly.
    • The second part is a facility, whereby the Department makes reductions from a council's general grant entitlement, to pay certain bodies on behalf of the council. The bodies which are party to this arrangement must be specified in legislation (ref the Local Government (Specified Bodies) Regulations (NI) 2001).

    CLAUSE 5: OTHER GRANTS TO COUNCILS

    • Advise members that this provision is not new (ref the Local Government &c. (NI) Order 1972). It is a facility to accommodate other Departments, whereby Local Government Division, DOE makes payments, on a quarterly basis, to district councils.

    CLAUSE 6: POWERS OF DISTRICT COUNCILS IN RELATION TO ECONOMIC DEVELOPMENT

    • Remind members that the proposed amendments contained in this clause were drawn up pre-devolution and were included in the draft Regeneration and Development (NI) Order 1998. The Local Government (Miscellaneous Provisions) Bill is being used as a vehicle to take these changes forward.
    • The new provisions would:-

    (i) remove the existing 5p limit; and

    (ii) allow councils to acquire, hold and develop land.

    • Members will be aware that district councils have been pressing for existing economic development powers to be extended and for the financial restriction to be removed, so that they may avail of substantial EC monies, under the Building Sustainable Prosperity Programme 2000-2006.

    CLAUSE 7: POWERS OF DISTRICT COUNCILS IN RELATION TO COMMUNITY SAFETY

    Clause 7 (1)

    • No specific provisions in existing legislation to enable councils to undertake community safety activity;
    • Section 115 of the LG Act 1972 allows councils to spend 1/2 p in the £ on miscellaneous projects aimed at promoting the well being of their districts. But this resource is mostly 'used up' on other priorities.
    • SOLACE and some individual councils responded to NIO consultation on Justice Review Implementation Plan indicating that they need statutory cover to engage in community safety.
    • Legal opinion to Department is that such cover provides legal certainty as well as scope for councils to contribute to community safety without financial limitations.
    • Clause 7 (1) provides that cover.
    • Discretionary -decision to engage in community safety would rest with individual councils.

    Clause 7 (2) and (3)

    • Enables the Department to confer or impose on district councils (by order) other community safety functions.
    • Essentially, an enabling power designed to facilitate the will of the Assembly in circumstances where it believes a more robust approach to community safety is required. Perhaps making the activity a statutory requirement instead of a voluntary engagement.
    • Such an order to be subject to widespread consultation and approved by an affirmative resolution in the Assembly.

    Clause 7 (4)

    • CSP - a voluntary body established under the NIO Community Safety strategy provided for under Clause 70 of the Criminal Justice (NI) Act 2002.
    • Enhancement of community safety - making the district one in which it is perceived to be safer to live and work. Reduction of levels of crime and other anti-social behaviour.
    • Relevant CSP defined as one established under Clause 7 (1) for a council area.

     

    PRINCIPAL CLAUSES

    CLAUSE 1: The general grant to district councils

    CLAUSE 2: Determination of the resources element

    CLAUSE 3: Determination of the derating element

    CLAUSE 4: Reductions in general grant

    CLAUSE 5: Other grants to councils

    CLAUSE 6: Powers of district councils in relation to economic development

    CLAUSE 7: Powers of district councils in relation to community safety

     

    CLAUSE 1
    THE GENERAL GRANT TO DISTRICT COUNCILS

    DERATING ELEMENT OF THE GRANT

    • To compensate district councils for loss of rate income due to the statutory derating of certain properties.

     

    RESOURCES ELEMENT OF THE GRANT

    • To provide additional finance to those district councils whose needs exceed their wealth base.

     

    GRANT PROVISION: 2001/2002 - 2003/2004

    	2001/02 £m	2002/03 £m	2003/04 (indicative provision) £m
    Derating Element	25.7	27.7	29.7
    Resources Element	19.0	19.5	20.0
    Total Grant	44.7	47.2	49.7

     

    CLAUSE 2
    DETERMINATION OF THE RESOURCES ELEMENT

    • New methodology
    • Formula detail
    • Flexibility

     

    CLAUSE 3
    DETERMINATION OF THE DERATING ELEMENT

    Department of Finance and Personnel Policy

    CLAUSE 4
    REDUCTIONS IN GENERAL GRANT

    • Power to penalise councils
    • Power to facilitate councils

     

    SPECIFIED BODIES

    • National Joint Council for Local Government Services.
    • Northern Ireland Joint Council for Local Government Services.
    • Joint Negotiating Committee for Clerks/ Chief Executives of Local Authorities in Northern Ireland.
    • Local Government Training Group.
    • Local Authorities' Co-ordinating Body on Trading Standards (LACOTS)
    • Local Government International Bureau.

     

    CLAUSE 5
    OTHER GRANTS TO COUNCILS

    Food Safety

    • Enforcement responsibilities (EC directives and public concern about food safety)
    • Enforcement responsibilities (health conditions relating to EC Fish and Shellfish Directives

     

    Construction Products (Enforcement)

    Energy Efficiency Measures

    CLAUSE 6
    POWERS OF DISTRICT COUNCILS IN RELATION TO ECONOMIC DEVELOPMENT

    Purpose

    • Remove financial limit
    • Extend existing powers

     

    CLAUSE 7
    POWERS OF DISTRICT COUNCILS IN RELATION TO COMMUNITY SAFETY

    • Provides statutory cover for district councils to engage in Community Safety Partnerships (CSPs) proposed under the NIO Community Safety Strategy.
    • Enables the Department to confer or impose on district councils (by order) other functions relating to the enhancement of community safety in their districts.
    • Draft of such an order to be laid before and approved by the Assembly.

     

10 May 2002

Letter to 26 District Councils

The Local Government (Miscellaneous Provisions) Bill was formally introduced to the Northern Ireland Assembly on 7 May 2002. I enclose a copy of the Bill and the associated Explanatory and Financial Memorandum. The Committee for the Environment is responsible for the scrutiny of the Bill and in due course provides a report on the Bill to the Assembly.

The Committee had preliminary discussions on the content of the Bill with Department of the Environment senior officials at yesterday's Committee Meeting. The Committee agreed that it would be useful to copy the Bill to all Local Councils and to seek comments or any concerns with the specific terms of the Bill.

The Committee is currently seeking clarification from the Department on some points within the Bill. For example:

• in Clause 4 (1) (6) the definition of the 'excessive' and how is this determined; also how is 'the amount of any general grant payable to the council shall be reduced ....' determined;
• in Clause 6 (4) the definition of the word 'directions'; and
• in Clause 7 (2) the need for the words 'or impose'

The Committee has also raised a more general query on the statements in paragraphs 33 and 34 of the Explanatory and Financial Memorandum on the significant differential impact of the proposed formula on the equality categories of religious belief and political opinion.

The Committee is scheduled to consider the Bill again at its meeting of 23 May 2002 and would therefore be grateful for your response (or interim response) to reach me at the latest by close Monday 20 May 2002. My e-mail address and fax number is shown above.

JOHN SIMMONS
Clerk to the Committee of the Environment

ANNEX 11

LETTER FROM:
COMMITTEE FOR THE ENVIRONMENT

20 May 2002

Letter to SOLACE and NILGA

The Local Government (Miscellaneous Provisions) Bill was formally introduced to the Northern Ireland Assembly on 7 May 2002 and its Second Reading was passed by the House today. I enclose a copy of the Bill and the associated Explanatory and Financial Memorandum. The Committee for the Environment is responsible for the scrutiny of the Bill and in due course provides a report on the Bill to the Assembly.

The Committee had preliminary discussions on the content of the Bill with Department of the Environment senior officials at its 9 May 2002 Committee Meeting. The Committee agreed that it would be useful to copy the Bill to all Local Councils and to seek comments or any concerns with the specific terms of the Bill. The Committee subsequently agreed at its 16 May 2002 meeting that a similar request should be put to NILGA and SOLACE.

The Committee is currently seeking clarification from the Department on some points within the Bill. For example:

• in Clause 4 (1) (6) the definition of the 'excessive' and how is this determined; also how is 'the amount of any general grant payable to the council shall be reduced ....' determined;
• in Clause 6 (4) the definition of the word 'directions'; and
• in Clause 7 (2) the need for the words 'or impose'.

The Committee has also raised a more general query on the statements in paragraphs 33 and 34 of the Explanatory and Financial Memorandum on the significant differential impact of the proposed formula on the equality categories of religious belief and political opinion.

As the Committee now begins its formal scrutiny of the Bill, it would be grateful for your response (or interim response) to reach me by close Monday 27 May 2002. My e-mail address and fax number is shown above.

JOHN SIMMONS
Clerk to the Committee of the Environment

LETTER FROM:
COMMITTEE FOR THE ENVIRONMENT

13 May 2002

1. At last Thursday's (9 May 2002) Committee's meeting, Members received a presentation from and had a useful discussion with Departmental Officials on the above Bill. A number of points of clarification and questions on the specific terms of the Bill were raised by Members and Officials undertook to respond to the Committee on some of these. The Committee agreed to write to the Department to highlight some of these points together with some other questions which time did not permit Members to raise. These are as follows:

(i) Clarification is sought on:-

• in Clause 4 (1) (6) - the definition and appropriateness of the 'excessive' and how is this determined; also how is 'the amount of any general grant payable to the council shall be reduced ...' determined;
• in Clause 6 (4) - the definition of the word 'directions'; and
• in Clause 7 (2) - the need for the words 'or impose'.

(ii) A general query was raised on what cognisance has been taken of the statements in paragraphs 33 and 34 of the Explanatory and Financial Memorandum on the 'most significant differential impact of the proposed formula is on the (equality) categories of religious belief and political opinion'? Questions were raised on the significance of 'flaws' in the Noble indices in that self-employed low paid rural community workers (eg farmers) were excluded from 'make-up' of the indices. Also, was the formula responsive enough to change - such as recent changes in farmers' incomes?

(iii) Other specific questions (not put to Officials last Thursday) are as follows:

• In Clause 2 - What is the purpose of sub-section (2) (c)? Why does sub-section (4) of the Bill not mention amendment by sub-ordinate legislation, when the EM refers to this? Sub-section (5) refers to Regulations 'which the Department considers appropriate' - why is there no provisions for consultation before exercising its power, as in Clause 4 sub-section (4)?
• In Clause 4 - Sub-section (2) refers to 'the Department shall lay before the Assembly a report' . Sub-section (5) refers to Regulations subject to negative resolution. Will the 'reports' be Regulations? If the Assembly objects to the deduction or the amount deducted, will the money be reimbursed to the District Council?
• Clause 6 - Have Councils been specifically consulted on the precise terms of Clause 6? Does a Council need to consult with DETI regularly on all its proposals exercised under Clause 6? Are all the proceeds of the disposal of land retained by Councils?
• In Clause 7 - Sub-section (3) refers to 'a draft of the order'. Is this subject to negative or affirmative resolution?

(iv) Finally, the Committee's response of 17 January 2002 to the Department's Consultation Document on the Review of the 'formula' noted that weightings based on the Department's 'informed judgement' are to be replaced by most relevant and up-to-date data as it becomes available. What is the position on this?

2. The Committee has already written to the Chief Executives of Local Councils seeking comments or any concerns with the specific terms of the Bill. A copy of the letter was e-mailed to you on Friday afternoon. On the basis that the Committee wishes to consider any responses from Local Councils at its meeting of 23 May 2002, I would require the Department's response to the above ideally by close this Friday 17 May or at the latest lunchtime Monday 20 May 2002.

JOHN SIMMONS
Clerk to the Committee for the Environment

ANNEX 13

CREATING A SAFER NORTHERN IRELAND THROUGH PARTNERSHIP

Presentation to the Committee for the Environment 16 May 2002

ANNEX 14

LOCAL GOVERNMENT (MISCELLANEOUS PROVISIONS) BILL

1. The general grant to district councils

2. Determination of the resources element

3. Determination of the derating element

4. Reductions in general grant

5. Other grants to councils

6. Powers of district councils in relation to economic development

7. Powers of district councils in relation to community safety

8. Interpretation

9. Repeals

10. Commencement and savings

11. Short title

Schedule    Repeals

Make new provision for the payment of general and other grants to district councils; to confer new powers on district councils in relation to economic development and community safety; and for connected purposes.

BE IT ENACTED by being passed by the Northern Ireland Assembly and assented to by Her Majesty as follows:

The general grant to district councils

1.-(1) The Department shall for each financial year make grants ("general grants") to district councils.

(2) Subject to any reduction under section 4, the general grant payable to a council for any financial year shall consist of -

(a) a resources element, determined under section 2; and
(b) a derating element, determined under section 3.

(3) Payments in respect of general grant shall be made to a council at such times as the Department may determine.

Determination of the resources element

2.- (1) The amount of the resources element of the general grant payable to a district council for any financial year shall be determined in accordance with regulations.

(2) Regulations under subsection (1) may in particular make provision-

(a) for the amount mentioned in that subsection to be calculated by reference to a formula;
(b) for determining the manner in which and time at which such calculation is to be made;
(c) for determining the person by or to whom any information required for the purpose of that calculation is to be given and the time at which and form in which it is to be given.

(3) The formula may be such that the amount of the resources element payable to a council is nil.

(4) For the purposes of this section "formula" includes methods, principles and rules of any description.

(5) Regulations under this section may contain-

(a) any supplementary, incidental or consequential provision,
(b) any transitional or saving provision,
(c) any provision for a person to exercise a discretion in dealing with any matter,

which the Department considers appropriate.

(6) Regulations shall not be made under this section unless a draft of the regulations has been laid before, and approved by resolution of, the Assembly.

Determination of the derating element

3. The amount of the derating element of the general grant payable to a district council for any financial year is an amount equal to the difference between-

(a) the amount of the product of the district rate for that year (within the meaning of the Rates (Northern Ireland) Order 1977 (NI 28)); and
(b) the amount which, but for the provisions of Articles 31B and 42 of, and paragraph 4 of Schedule 7 to, that Order, would have been the amount of that product.

Reductions in general grant

4.-(1) Where the Department is satisfied that-

(a) a district council has failed to achieve or maintain a reasonable standard
of economy, efficiency and effectiveness in the discharge of its functions, or

(b) the expenditure of a district council has been excessive having regard to its financial resources and other relevant circumstances,

the amount of any general grant payable to the council shall be reduced by such amount as the Department considers appropriate.

(2) Where any grant is reduced under subsection (1), the Department shall lay before the Assembly a report stating-

(a) the amount of the reduction; and
(b) the reasons for making it.

(3) The Department may-

(a) defray any expenditure incurred in any financial year in the provision of services for a district council by a body specified in regulations; and
(b) deduct from the amount of any general grant payable to the council for that year such amount (not exceeding the total of the expenditure so defrayed) as the Department considers appropriate.

(4) Before exercising its powers under subsection (3) the Department shall consult-

(a) such associations or bodies representative of councils,
(b) such district councils, and
(c) such other bodies or persons (if any),

as the Department considers appropriate.

(5) Regulations under this section shall be subject to negative resolution.

Other grants to councils

5.-(1) The Department may, in respect of a financial year, make grants to district councils for such other purposes as may be determined by the Department.

(2) A grant to a council under this section shall be-

(a) of such amount, and
(b) made subject to such conditions,

as the Department may determine.

(3) Grants shall not be made under this section without the consent of the Department of Finance and Personnel.

Powers of district councils in relation to economic development

6.- (1) A district council may promote the economic development of its district.

(2) Without prejudice to the generality of subsection (1), a district council may for the purposes of the economic development of its district-

(a) make payments; and
(b) acquire, hold and develop land.

(3) In subsection (2) "develop", in relation to land includes-

(a) erect, alter or extend buildings thereon;
(b) carry out works thereon;
(c) provide means of access, services and other facilities for persons using the land;

(d) facilitate the doing of such things by another person;
(e) manage and dispose of the land.

(4) A district council shall exercise its functions under this section in accordance with such directions as may be issued from time to time by the Department of Enterprise, Trade and Investment.

Powers of district councils in relation to community safety

7.- (1) A district council may-

(a) participate in any relevant community safety partnership;
(b) take action in accordance with any plan prepared by, or proposals agreed by, such a partnership;
(c) accept financial or other support provided by such a partnership; and
(d) generally assist and facilitate such a partnership in the exercise of its functions.

(2) The Department may by order confer or impose on district councils other functions relating to the enhancement of community safety in their districts.

(3) No order shall be made under this section unless a draft of the order has been laid before and approved by a resolution of the Assembly.

(4) In this section-

"community safety partnership" means a body established for an area in accordance with the community safety strategy devised by the Secretary of State under section 70 of the Justice (Northern Ireland) Act 2002 (but does not include any body established by an order under section 71(1) of that Act);

"the enhancement of community safety", in relation to any district, means making the district one in which it is, and is perceived to be, safer to live and work, in particular by the reduction of actual and perceived levels of crime and other anti-social behaviour;

"relevant community safety partnership", in relation to a district council, means such a partnership established for an area which is, or includes, the district of the council or any part of that district.

Interpretation

8. In this Act-

"the Department" means the Department of the Environment; and
"regulations" means regulations made by the Department.

Repeals

9. The statutory provisions specified in the Schedule are repealed to the extent specified in the second column of the Schedule.

Commencement and savings

10.- (1) Sections 6 and 7 and the repeal of Article 28 of the Local Government (Miscellaneous Provisions) (Northern Ireland) Order 1992 (NI 6) come into operation on the expiration of the period of two months from the date on which this Act receives Royal Assent.

(2) Nothing in the other provisions of this Act-

(a) applies in relation to any financial year which began before the date on which this Act receives Royal Assent; or
(b) affects the operation of any statutory provision repealed by this Act in relation to any such financial year.

Short title

11. This Act may be cited as the Local Government (Miscellaneous Provisions) Act (Northern Ireland) 2002.

Schedule

Repeals

Short Title

Extent of repeal

The Local Government &c. (Northern Ireland) Order 1972 (NI 22)

Article 2(3).
Articles 3 to 6.
Schedule 1.

The Rates (Northern Ireland) Order 1977 (NI 28).

In Part II of Schedule 15, paragraphs 5 and 6.

The Enterprise Zones (Northern Ireland) Order 1981 (NI 15).

Article 18.

The Local Government (Miscellaneous Provisions) (Northern Ireland) Order 1985 (NI 15).

Article 41.

The Local Government (Miscellaneous Provisions) (Northern Ireland) Order 1992 (NI 6).

Article 28.
Articles 48 and 49.

The Rates (Amendment) (Northern Ireland) Order 1994 (NI 11).

Article 4(4).
Article 5(5).

20 May 2002

I refer to your letter of 13 May seeking further information on a number of points and questions on the specific terms of the Bill, for the Environment Committee.

Please find the attached response, using a question and answer format, for the Committee's information. I understand the Northern Ireland Office will be writing, separately, to the Environment Committee about funding arrangements for Community Safety.

JENNIFER McCAY

Clause 2 - Determination of the resources element

Sub-section (2)(c)

Sub-section (4)

Sub-section (5)

Clause 4 - Reductions in general grant

Sub-section (1)(b)

Sub-section (2)

Clause 6 - Powers of district councils in relation to economic development

Sub-section (4)

Clause 7 - Powers of district councils in relation to community safety

Sub-section (2)

Sub-section (3)

OTHER GENERAL POINTS

Explanatory and Financial Memorandum (paras 33 and 34)

Noble Indices

Responsive Formula

Formula Data

CLAUSE 2 - DETERMINATION OF THE RESOURCES ELEMENT

Sub-section (2)(c)

Question

What is the purpose of this provision?

Answer

This provision is related to the proposed regulations (subordinate legislation).

It requires, for example, the Chief Executive, as Accounting Officer of the district council, to provide the Department with information which is needed for part of the calculation to determine the grant allocation.

Sub-section (4)

Question

Why does this sub-section not mention amendment by subordinate legislation, when the Explanatory and Financial Memorandum refers to this?

Answer

Sub-section (4) is a definition only of 'formula' and this should be read in conjunction with sub-section (2).

Sub-section (5)

Question

This sub-section refers to regulations '.. which the Department considers appropriate'. Why is there no provision for consultation before exercising its power, as in Clause 4, sub-section(4)?

Answer

Regulations, or amendment of regulations would automatically require consultation with district councils. The Department accepts that amendment of this sub-section may be necessary.

CLAUSE 4 - REDUCTIONS IN GENERAL GRANT

Sub-section (1)(b)

Question

Clarification is sought on the definition and appropriateness of the word 'excessive' and how '....the amount of any general grant payable to the council shall be reduced...' is to be determined.

Answer

A precise figure could not be stated, to indicate what might be considered excessive, as it would be relative to the circumstances of the council in question. Also, account would be taken of any report by the Local Government Auditor.

The details of each case would have to be examined and the Department would recommend the amount to be deducted from general grant.

Sub-section (2)

Questions

Answers

Such reports would not be regulations. They would form a written account, prepared by the Department, of the circumstances surrounding the case, together with details of any concerns raised by the Local Government Auditor including justification for the amount of grant deducted.

Any comments made by the Assembly would be considered carefully by the Department and the position would be reviewed.

CLAUSE 6 - POWERS OF DISTRICT COUNCILS IN RELATION TO ECONOMIC DEVELOPMENT

Sub-section (4)

Question

Answer

DETI have advised that they may issue guidance in respect of economic development activity, similar to that issued in 1992 by the former DOE (NI). These would be non-statutory guidelines and not a legal document. They would inform councils of types of eligible economic development activity, to ensure a cohesive approach to economic development policy and avoid overlap and inconsistency.

The Department would accept that clarification in the wording of this clause and in the Explanatory and Financial Memorandum will be necessary.

Sub-section (4)

Question

Answer

A copy of the draft legislation issued on 27 November 1997 to district councils when views were sought from district councils on the proposed changes. The text of this clause is unchanged (except for the title of the new Department of Enterprise, Trade and Investment).

Sub-section (4)

Question

Answer

Councils would not be expected to consult with DETI on all its proposals, providing it was operating within whatever guidelines are issued.

Sub-section (4)

Question

Answer

The Local Government Act (NI) 1972 requires that capital receipts derived from the sale of any asset held by a council should, in the first instance, be offset against the repayment of any borrowings by the council, for the purpose of acquiring that asset.

Otherwise, with the approval of the Department, the capital receipts may be used by the district council for any purpose.

CLAUSE 7 - POWERS OF DISTRICT COUNCILS IN RELATION TO COMMUNITY SAFETY

Sub-section (2)

Question

Clarification is sought on the need for the words 'or impose'.

Answer

Essentially, Clause 7 (2) is an enabling power where the term 'impose' is used to facilitate any future policy requiring a more robust approach to community safety. For example, circumstances could lead the Department to consider making community safety activity an obligatory function, rather than a discretionary one under the provisions in Clause 7(1). Any such proposals would, in any case, be subject to detailed consultation and consideration by the Assembly institutions.

Sub-section (3)

Question

This sub-section refers to '... a draft of the order...'. Is this subject to negative or affirmative resolution?

Answer

Any proposals to introduce such an order would be subject to affirmative resolution in the Assembly.

OTHER GENERAL POINTS

(i) With reference to the proposed formula for allocation of the resources element of the grant, what cognisance has been taken of the statements in paragraphs 33 and 34 of the Explanatory and Financial Memorandum on the '...most significant differential impact of the proposed formula is on the (equality) categories of religious belief and political opinion'?

Answer

The measures used to identify the additional needs of district councils have been applied consistently across all councils. For example, the Noble employment index and the Noble income index have been used to address relative socio-economic disadvantage.

The outcome of the application of these factors has highlighted that the greatest areas of deprivation are councils with Nationalist and Catholic majorities. However, those councils which experience a negative population adjustment, but still receive grant under the formula, have a higher percentage of Protestant and Unionist population, than Northern Ireland as a whole.

The Department's officials have offered to explain the detail of the formula to members again if required.

(ii) Again, with reference to the proposed formula, what is the significance of 'flaws' in the Noble indices, in that self-employed, low paid rural community workers (eg farmers) were excluded from 'make-up' of the indices.

Answer

No specific occupational groups were identified in the research exercise. People who were in receipt of means-tested benefits would feature on the income domain. This would include those on low income, who were entitled to claim family credit.

While it would have been desirable to include those on low income, who were not in receipt of benefits, such data are not currently released by the Inland Revenue. However, in any future review of the measures, it is anticipated that these data will be made available.

The flexibility of the proposed regulations would allow new data such as this, to be included in the formula.

(iii) Is the proposed formula responsive enough to change - such as recent changes in farmers incomes?

Answer

The Bill would allow the Department to make regulations, (subordinate legislation) which would contain all the detail of the formula.

The advantage of having the detail in regulations is that, this makes for flexibility. As more up-to-date data becomes available, measures, weightings etc may be replaced. For example, should a review of the Noble indices take place at any stage, the new factors could easily be incorporated in the formula.

(iv) With reference to the Departments Consultation Document on the review of the 'formula' it was noted that weightings based on the Department's 'informed judgement' are to be replaced by most relevant and up-to-date data, as it becomes available. What is the position on this?

Answer

At the point when both the primary and subordinate legislation are made, the Department will replace all the indicative figures that were used at consultation stage, with the most up-to-date data available. (NI. Tourist Board Bed Nights; Travel to Work data etc.)

The normal arrangement would be to hold this data fixed for a 3-year period and at the end of that period to replace all the figures again. The cycle would continue in this way and therefore, district councils should be better placed to control their budgets. The Department has agreed, however, to carry out an informal annual review of data and advise councils of the outcome, as some are uneasy about the proposed 3-year cycle. If this arrangement is found to be unsatisfactory all data can be replaced annually.

Apart from the above, should more appropriate measures become available (eg. statistics relating to day-trippers, to address the 'influx of tourists' need) steps should be taken immediately to amend the subordinate legislation.

22 May 2002

COMMUNITY SAFETY

Thank you for the opportunity last Thursday to present the draft Community Safety to the Environment Committee. As I said, we are currently involved in a consultation process on the Strategy and welcome every opportunity to further the debate.

In your comments you requested further clarification on the funding that would be made available to partnerships. The funding arrangements are set out in Chapter 5 of the draft Strategy. Overall £2.5m has been secured by Ministers for the first two years of the Strategy and it is our intention to continue to bid for this level of resource. We recognise that enhancing community safety is not a short-term initiative.

The funding proposals in the Strategy are for allocations to a Community Safety Challenge Competition (70%) and to Partnership Development (30%). The Partnership Development element includes making resources available for the employment of a co-ordinator (paragraph 5.6). The draft Strategy suggests that this should be at a rate of 100% for the first two years and 75% in the third year. In addition, the Strategy recommends that the post should be evaluated in the third year.

We have already had a number of representations in respect of this funding. In the light of this, once the consultation is complete, we will give further consideration to this approach. It would make sense to continue the funding at 100% for the third year while the evaluation is taking place.

I should also clarify that this funding is not being made available to any specific organisation but for the partnership. Clearly an individual organisation would be nominated by the partnership to undertake the employment function. However the co-ordinator is acting on behalf of the entire partnership. It would therefore be for the partnership to make good any shortfall in funding, not the individual employing organisation.

The Community Safety Challenge Competition will involve partnerships bidding for funding for the projects in their action plan. Clear funding criteria will be set and published along with guidance notes. One of the criteria will be the need to attract matching funding, either financial or in kind. This matching funding can come from partnership organisations, thus demonstrating their commitment to the project, or from external sources, eg Peace II monies.

I hope this provides greater clarity on the issue of resources for partnerships. We would expect all partner organisations to be prepared to contribute some resources to enhance community safety as, by participating in the work of the partnership, they are able to further their own organisational objectives.

I am copying this letter to the DOE officials who attended the meeting.

MARK McGUCKIN

23 May 2002

Department Officials attended today's meeting of the Committee and answered some questions in relation to the above Bill following on from your letter of 20 May 2002. It was not possible to put all of the Committee's questions to the Officials in the time available and it was agreed that these would be forwarded to the Department for reply. I have also included those questions (and some associated comments) that were put at the meeting as the Department may welcome the opportunity to clarify their oral answers. The 'question areas' follow the order of your response of 20 May 2002.

CLAUSE 2 (2) (c)

Should there not be an enabling provision within this Clause to stipulate the consequences of not providing the required information at the time and in the form required?

CLAUSE 2 (4)

On page 5, para 5, line 1 of the Explanatory Memorandum, it states - 'Subsection (4) allows the Department to amend the subordinate legislation.' This appears to have been the view of the Minister when speaking to the debate on the Second Stage Motion in the Assembly on Monday 20 May 2002 - see Hansard, page 138.

Is this statement within the Explanatory Memorandum right? (Our legal advice is that it does not reflect the wording of the Clause, subsection (4), as presently worded.)

If the Explanatory Memorandum reflects the intention to allow the Department to amend the subordinate legislation, does Clause 2 (4) as currently stated within the Bill, not need to be amended to reflect this important point?

If the need to amend Clause 2 (4) is accepted, should the words 'of any description' not be removed and replaced with wording similar to 'to be agreed within the Regulations made under Clause 2 (1)?

The Explanatory Memorandum gives quite extensive details relating to both the formula and the data to be used, for example, page 1, para 5 and page 5, para 2. If Clause 2 (4) is to be amended as suggested above, would this show that the relevant Clauses within the Bill are merely enabling Clauses allowing for the introduction of Regulations that will stipulate the full detail of the formula?

Consequently, would the Department agree that it is not for the Committee to scrutinise the formula at this time but that the proper time to do so will be when the Committee receives the draft Regulations? When will this draft be available and can the Committee see the current working draft as soon as possible?

CLAUSE 2 (5)

The Department has accepted that this Clause may need to be amended.

Does the Department accept that it needs to consult with others apart from District Councils, as in Clause 4 (4), including for example, NIPSA and NILGA?

When will the Committee know if the Clause is to be amended and, if so, when will the Committee have sight of the specific terms of the proposed amendment?

CLAUSE 4 (1) (b)

The Department has said that a precise figure could not be stated 'as it would be relative to the circumstances of the council in question.' Yet Clause 4 (1) (b) uses the phrase 'having regard to its financial resources and other relevant circumstances' which is a much more broader statement and could literally bring any circumstances into consideration. This is a considerable and significant difference.

Why is it considered necessary to have such an all-embracing phrase within Clause 4 (1) (b) and would it not be more appropriate to use the phrase within the Department's response to the Committee, that is, 'relative to the circumstances of the council in question'?

The Department's response stated that 'account would be taken of any report by the local Government Auditor.' Why is there no specific reference to the reports of the LGA within Clause 4 (1) as surely such a report must be essential, and necessary, to determine the failure of a Council as in Clause (1) (a) and (b)?

The Department's response stated that 'the Department would recommend the amount to be deducted.' To whom would this recommendation be made?

CLAUSE 4 (2)

Should Clause 4 (2) that deals with reporting to the Assembly, not stipulate that the report must include any report from the LGA, as reflected in the Department's response?

The Departments has stated ' Any comments made by the Assembly would b considered carefully by the Department and the position would be reviewed.' Exactly how will this report be brought before the Assembly to allow Members to comment?

Clause 4 (2) as currently worded makes no provision for the Assembly to comment, nor indeed, for the Assembly to have any sanction against the decision of the Department. Also, there is no obvious provision for the Department to review its decision. Will Clause 4 (2) be amended to reflect this?

CLAUSE 6 (4)

Clause 6 (4) states that 'A district Council shall exercise its functions under this section in accordance with such directions as may be issued from time to time by the Department of Enterprise, Trade and Investment.' On this basis, surely the status of 'such directions' is elevated beyond non-statutory guidelines, despite what the Department's response would suggest. (Page 8 of the Department's response clearly indicates that Councils can take forward proposals provided it is operating within whatever guidelines DETI issue.)

Given their central and obvious importance, should these 'directions' not have some limit in what they contain and should they not be determined through a formal consultation process as in Clause 4 (4) and legislated for within Regulations, subject to affirmative resolution?

As the 1997 Consultation exercise predates the 1998 NI Act provisions, especially Section 75 of that Act that deals with equality, what specific consultation and consideration of Clause 6 (4) took place in the Equality Impact Assessment, outlined within the Explanatory Memorandum of the Bill?

Was this proposal considered within the Department's own Equality Scheme?

Where within legislation, is the requirement to seek the approval to spend capital receipts?

Which Department will consider this approval?

CLAUSE 7 (1) & (2)

If it is intended to make Community Safety Partnerships under Clause 7 (1) an obligatory function rather than a discretionary one, does the Department agree that the word 'other' within Clause 7 (2) would not enable the Department to do that because it refers to 'other functions', implying that the imposition of Community Safety Partnerships is something other than a District Council may do under Clause 7 (1)?

What is the basis for the use of the phrase 'any functions' as stated within the Explanatory Memorandum on Page 7, para 3?

GENERAL POINTS ON THE PROPOSED FORMULA

What consideration has been given to measures which might mitigate any adverse impact and to alternative policies which might better achieve the promotion of equality of opportunity?

Will these considerations and alternatives be detailed within the Equality Impact Assessment?

When will the final EIA be printed?

Will the draft Regulations to be prepared this Autumn, contain the precise detail of the data to be used in the required calculations for payments in 2003/04?

Should the proposed 'informal annual review of the data' not be a formal annual review and be specified within the Regulations?

Should the Regulations include the proviso that 'should more appropriate measures become available' these will be taken into account within the annual review rather than the Department's statement that 'steps should be taken immediately to amend subordinate legislation as this may raise equality issues?

CONSULTATION WITH COUNCILS

As the Department is aware, the Committee has written to all Councils for their views and any concerns on the Bill. As agreed at this morning's meeting, I have enclosed copies of all 15 responses received to date for your information. It is hoped to receive short presentations from some Councils followed by a question and answer session on 6 June 2002.

THE WAY AHEAD

Department Officials have been invited to attend next week's meeting to continue the discussion on the specific terms of the Bill - it is anticipated that this will centre on the Department's response to this letter. While a full response would be desirable, it is accepted that it may not be possible to respond promptly in detail to all of these questions. However, as full a response as possible to this letter is requested by noon on Monday 27 May 2002.

It is hoped that any outstanding answers from the Department will be discussed at the meeting on 6 June 2002 - therefore a response to outstanding issues is requested by noon 31 May 2002 please. As stressed by the Chair of the Committee earlier today, it would be most helpful if the Department can bring forward the required text amendments to the Bill-as soon as possible-either for 30 May Meeting or 6 June Meeting.

Please do not hesitate to contact myself or John Simmons if you have any queries on this letter.

JIM BEATTY

28 May 2002

I refer to your letter of 23 May seeking further information on a number of points on the Bill, for the Environment Committee.

Please find attached response, using a question and answer format, for the Committee's information.

JENNIFER McCAY

CLAUSE 2 (2) (c)

Should there not be an enabling provision within this Clause to stipulate the consequences of not providing the required information at the time and in the form required?

Answer

The consequences of the late submission of information by any council or organisation (RCA, VLA etc) would result in the Department being unable to carry out the calculation of the resources element of the grant. This would create a delay in informing councils of their allocations. In turn, this would impede councils striking their district rates, (which they must do by 15 February each year).

Councils and others are fully aware of these implications. However, as it is the Department's intention to stipulate precise requirements and deadlines for submission of data, in the Regulations, it is not considered necessary to indicate the consequences in the primary legislation

CLAUSE 2 (4)

On page 5, para 5, line 1 of the Explanatory Memorandum, it states - 'Subsection (4) allows the Department to amend the subordinate legislation.' This appears to have been the view of the Minister when speaking to the debate on the Second Stage Motion in the Assembly on Monday 20 May 2002 - see Hansard, page 138.

Is this statement within the Explanatory Memorandum right? (Our legal advice is that it does not reflect the wording of the Clause, subsection (4), as presently worded.)

If the Explanatory Memorandum reflects the intention to allow the Department to amend the subordinate legislation, does Clause 2 (4) as currently stated within the Bill, not need to be amended to reflect this important point?

If the need to amend Clause 2 (4) is accepted, should the words 'of any description' not be removed and replaced with wording similar to 'to be agreed within the Regulations made under Clause 2 (1)?

The Explanatory Memorandum gives quite extensive details relating to both the formula and the data to be used, for example, page 1, para 5 and page 5, para 2. If Clause 2 (4) is to be amended as suggested above, would this show that the relevant Clauses within the Bill are merely enabling Clauses allowing for the introduction of Regulations that will stipulate the full detail of the formula?

Consequently, would the Department agree that it is not for the Committee to scrutinise the formula at this time but that the proper time to do so will be when the Committee receives the draft Regulations? When will this draft be available and can the Committee see the current working draft as soon as possible?

Answer

The Department accepts that the wording of Clause 2 (4) does not match the statement at page 5, paragraph 5, line 1 of the Explanatory and Financial Memorandum.

Legal advice has been that the Department should amend the Explanatory and Financial Memorandum to reflect that Clause 2 (4) is simply a definition.

The Department agrees that the Committee will be given every opportunity to scrutinise the formula when it receives the draft Regulations. The Department aims to have a first working draft of the Regulations by the end of June, and will forward it to the Committee at the first opportunity.

CLAUSE 2 (5)

The Department has accepted that this Clause may need to be amended.

Does the Department accept that it needs to consult with others apart from District Councils, as in Clause 4 (4), including for example, NIPSA and NILGA?

When will the Committee know if the Clause is to be amended and, if so, when will the Committee have sight of the specific terms of the proposed amendment?

Answer

Legal advice in relation to these queries has confirmed the Departments view that an amendment is required to Clause 2. This amendment will make provision, requiring the Department to consult with district councils and other bodies representative of councils.

CLAUSE 4 (1) (b)

The Department has said that a precise figure could not be stated 'as it would be relative to the circumstances of the council in question.' Yet Clause 4 (1) (b) uses the phrase 'having regard to its financial resources and other relevant circumstances' which is a much more broader statement and could literally bring any circumstances into consideration. This is a considerable and significant difference.

Why is it considered necessary to have such an all-embracing phrase within Clause 4 (1) (b) and would it not be more appropriate to use the phrase within the Department's response to the Committee, that is, 'relative to the circumstances of the council in question'?

The Department's response stated that 'account would be taken of any report by the local Government Auditor.' Why is there no specific reference to the reports of the LGA within Clause 4 (1) as surely such a report must be essential, and necessary, to determine the failure of a Council as in Clause (1) (a) and (b)?

The Department's response stated that 'the Department would recommend the amount to be deducted.' To whom would this recommendation be made?

Answer

The Department considers the wording ' and other relevant circumstances' to be appropriate, as it ensures that it extends to more than financial resources alone.

The Department accepts the Committee's view, and agrees that the role of the Local Government Auditor should be reflected in the Bill.

The Department also accepts that a recommendation should be made to the Assembly in the form of a report, and that the Department should not take any action to make deductions from general grant unless and until such deduction is approved by the Assembly.

CLAUSE 4 (2)

Should Clause 4 (2) that deals with reporting to the Assembly, not stipulate that the report must include any report from the LGA, as reflected in the Department's response?

The Department has stated ' Any comments made by the Assembly would be considered carefully by the Department and the position would be reviewed.' Exactly how will this report be brought before the Assembly to allow Members to comment?

Clause 4 (2) as currently worded makes no provision for the Assembly to comment, nor indeed, for the Assembly to have any sanction against the decision of the Department. Also, there is no obvious provision for the Department to review its decision. Will Clause 4 (2) be amended to reflect this?

Answer

The Department agrees to amend Clause 4 (2) to stipulate that the report must include any report of the LGA.

The report would be laid before the Assembly for its consideration and comment. The Department will only act to make a deduction with the express approval of the Assembly.

CLAUSE 6 (4)

Clause 6 (4) states that 'A district Council shall exercise its functions under this section in accordance with such directions as may be issued from time to time by the Department of Enterprise, Trade and Investment.' On this basis, surely the status of 'such directions' is elevated beyond non-statutory guidelines, despite what the Department's response would suggest. (Page 8 of the Department's response clearly indicates that Councils can take forward proposals provided it is operating within whatever guidelines DETI issue.)

Given their central and obvious importance, should these 'directions' not have some limit in what they contain and should they not be determined through a formal consultation process as in Clause 4 (4) and legislated for within Regulations, subject to affirmative resolution?

As the 1997 Consultation exercise predates the 1998 NI Act provisions, especially Section 75 of that Act that deals with equality, what specific consultation and consideration of Clause 6 (4) took place in the Equality Impact Assessment, outlined within the Explanatory Memorandum of the Bill?

Was this proposal considered within the Department's own Equality Scheme?

Where within legislation, is the requirement to seek the approval to spend capital receipts?

Which Department will consider this approval?

Answer

The Department accepts that clarification of 'directions' is required and is currently liaising with DETI officials about the possible changes to this Clause.

The Equality Impact Assessment carried out in 2001 addressed the new formula for the resources element of general grant only. At that time the Department did not know or anticipate the inclusion of the Clause in relation to economic development powers to district councils. The Committee will, however, be aware that the 1997 consultation exercise resulted in district councils giving overwhelming support for the proposed legislation. In addition, a number of councils have made representations to the Department recently, pressing for the extension of powers and the removal of the expenditure limit, so that they may match European funding that is available to them under the Building Sustainable Prosperity Programme 2000 - 2006.

Section 59 of the Local Government Act (NI) 1972 (c.9) deals with the proceeds of the sale of capital assets and the requirement to seek the approval of the Department of the Environment to spend capital receipts.

CLAUSE 7 (1) & (2)

If it is intended to make Community Safety Partnerships under Clause 7 (1) an obligatory function rather than a discretionary one, does the Department agree that the word 'other' within Clause 7 (2) would not enable the Department to do that because it refers to 'other functions', implying that the imposition of Community Safety Partnerships is something other than a District Council may do under Clause 7 (1)?

What is the basis for the use of the phrase 'any functions' as stated within the Explanatory Memorandum on Page 7, para 3?

Answer

In responding to these questions, it is important to clarify the provisions in Clauses 7 (1) and 7 (2).

Clause 7 (1) makes provisions enabling district councils to engage in voluntary Community Safety Partnerships (CSPs), to be established in accordance with Section 70 of the forthcoming Justice (NI) Act 2002. Because these are discretionary provisions, it is quite feasible that some councils may choose not to participate in their local CSP.

Clause 7 (2) empowers the Department to confer, or impose, on district councils any functions aimed at enhancing community safety, which would be additional to or complement any community safety strategy devised by the Secretary of State (see Explanatory and Financial Memorandum). This clause, therefore, enables the Department (with the approval of the Assembly) to introduce by order community safety provisions, other than those provided for in Clause 7 (1). In other words, the powers in Clause 7 (2) cannot override what is provided for in Clause 7 (1).

Conferring further community safety powers to councils might arise if certain functions are not provided for through the voluntary CSPs. The term 'impose' is used to facilitate the will of the Assembly, if it takes the view that all councils must engage in some of these additional functions i.e. obligatory community safety functions as opposed to (but not in place of) the discretionary community safety powers provided in Clause 7 (1) or those conferred under Clause 7 (2).

Section 71 of the forthcoming Justice (NI) Act 2002 makes provision enabling the Secretary of State to establish statutory CSPs. The NIO Community Safety Strategy indicates that such policy and legislative proposals would be dependent on consultation with the Executive and progress on the Review of Public Administration. The powers provided in Clause 7 (1) of the Local Government (Miscellaneous Provisions) Bill 2002 would not apply to statutory CSPs. Therefore, should the occasion arise, the inclusion of district councils in such statutory bodies would be subject to detailed consideration by the Department, in conjunction with councils, the Environment Committee and other interests.

GENERAL POINTS ON THE PROPOSED FORMULA

What consideration has been given to measures which might mitigate any adverse impact and to alternative policies which might better achieve the promotion of equality of opportunity?

Will these considerations and alternatives be detailed within the Equality Impact Assessment?

When will the final EIA be printed?

Will the draft Regulations to be prepared this Autumn, contain the precise detail of the data to be used in the required calculations for payments in 2003/04?

Should the proposed 'informal annual review of the data' not be a formal annual review and be specified within the Regulations?

Should the Regulations include the proviso that 'should more appropriate measures become available' these will be taken into account within the annual review rather than the Department's statement that 'steps should be taken immediately to amend subordinate legislation as this may raise equality issues?

Answer

The existing formula takes no account of New TSN. When reviewing policies the Department was obliged to address New TSN principles.

The options considered were:-

(i) GB models, with particular focus on the Scottish model.

(ii) Variations on the GB model.

(iii) EU Programme for Peace and Reconciliation Package formula.

(iv) The measurement of the wealth of a council against its estimated needs.

The measures built into the proposed formula address relative socio-economic disadvantage and adjustments made take account of particular circumstances that impact on the cost of providing certain district council services.

After having considered all the possible measures, (eg the Robson indicators), that could be built into the formula, the Steering Group selected what were considered to be the most appropriate and effective measures. It is considered that the measures used (ie Noble deprivation indicators), are the best available at the present time.

The Department has drawn up the EQIA in the required format, and it does not include detail of other alternatives considered. However, these have been presented in the consultation paper which accompanied the EQIA.

It is hoped to publish the EQIA next month.

The Regulations will set out clearly all the components, measures and weightings used in the formula.

The Department agrees to the Committees proposal to carry out a formal annual review, and that this should be specified in Regulations. This will be included in draft Regulations, which will be brought to the Committee.

The Department is now preparing instructions to the Office of the Legislative Counsel, about the required amendments to the Bill, and also the Explanatory and Financial Memorandum. Proposed amendments will be brought to the Committee following the clarification of any issues raised by district councils.

ANNEX 19

LETTER FROM:
COMMITTEE FOR THE ENVIRONMENT

6 June 2002

COMMUNITY SAFETY

Thank you for your letter of 22 May 2002 to the Chair of the Committee for the Environment, clarifying the funding that would be available to partnerships.

The Committee have asked me to write to you on one other aspect of Community Safety Partnerships which arose during the Second Stage Reading debate on the Local Government (Miscellaneous Provisions) Bill on 20 May 2002. (I include a copy of the Hansard for reference purposes). A number of Members, notably Mr Hay and Mr Byre, raised concerns regarding duplication between Community Safety Partnerships and District Policing Partnerships. Points were made about "two administrative policy mechanisms" and "the complexities that two parallel structures might impose on councils" and "confusion over the setting up of those partnerships".

The Committee would be grateful if you would provide some insight on how such matters are being and will be addressed. This will provide the Committee with a proper understanding of how the powers being sought under Clause 7 of the Bill sit alongside District Policing Partnerships and 'any body established by an order under section 71(1) of the Justice (Northern Ireland) Act 2002'.

JOHN SIMMONS
Clerk to the Committee for the Environment

ANNEX 20

7 June 2002

I refer to my attendance at the Environment committee on 6 June regarding the above Bill.

At the hearing I made verbal comments in respect of the SOLACE response to the Bill and would now confirm these comments in writing.

SOLACE had the opportunity to briefly consider the Bill at its meeting held on 31 May. There was a general welcome for the provisions contained in the Bill and two specific points were made:

1. Powers in Relation to Economic Development
The effectiveness of Councils in respect of the proposed additional powers in relation to Economic Development would be enhanced with the inclusion of vesting powers. An additional clause should be added to Section 6 providing vesting powers.

2. Emergency Planning
It was suggested that the opportunity should be taken to include in the Bill specific provisions in relation to Councils and their Chief Executives in respect of undertaking Emergency Planning activities and incurring expenditure.

The Chairman made reference towards the end of the hearing to the effect that SOLACE had proposed that Councils undertake the lead role in local Community Safety activities. For the record, I would clarify that this point was made in the Craigavon Borough Council response rather than the SOLACE response. However, SOLACE is clear in its support of Councils civic leadership role on behalf of their districts.

T E REANEY
Honorary Secretary

ANNEX 21

LOCAL GOVERNMENT (MISCELLANEOUS PROVISIONS) BILL -
WORKING DRAFT 1 REVISE

The general grant to district councils [j1]

Determination of the resources element [j2]

Determination of the derating element [j3]

Reductions in general grant [j4]

Other grants to councils [j5a]

Powers of district councils in relation to economic development [j7]

Powers of district councils in relation to community safety [j7a]

Interpretation [j6]

Repeals [j8]

Commencement and savings [j9]

Short title [j10]

Schedule    Repeals

Make new provision for the payment of general and other grants to district councils; to confer new powers on district councils in relation to economic development and community safety; and for connected purposes.

BE IT ENACTED by being passed by the Northern Ireland Assembly and assented to by Her Majesty as follows:

The general grant to district councils [j1]

1.¾ (1) The Department shall for each financial year make grants ("general grants") to district councils.

(2) Subject to any reduction under section 4, the general grant payable to a council for any financial year shall consist of ¾

(a) a resources element, determined under section 2; and

(b) a de-rating element, determined under section 3.

(3) Payments in respect of general grant shall be made to a council at such times as the Department may determine.

Determination of the resources element [j2]

2.¾ (1) The amount of the resources element of the general grant payable to a district council for any financial year shall be determined in accordance with regulations.

(2) Regulations under subsection (1) may in particular make provision¾

(a) for the amount mentioned in that subsection to be calculated by reference to a formula;

(b) for determining the manner in which and time at which such calculation is to be made;

(c) for determining the person by or to whom any information required for the purpose of that calculation is to be given and the time at which and form in which it is to be given.

(3) The formula may be such that the amount of the resources element payable to a council is nil.

(4) For the purposes of this section "formula" includes methods, principles and rules of any description.

(5) Regulations under this section may contain¾

(a) any supplementary, incidental or consequential provision,

(b) any transitional or saving provision,

(c) any provision for a person to exercise a discretion in dealing with any matter,

(6) Regulations shall not be made under this section unless a draft of the regulations has been laid before, and approved by resolution of , the Assembly.

as the Department considers appropriate.

Determination of the derating element [j3]

3. The amount of the derating element of the general grant payable to a district council for any financial year is an amount equal to the difference between¾

(a) the amount of the product of the district rate for that year (within the meaning of the Rates (Northern Ireland) Order 1977 (NI 28)); and

(b) the amount which, but for the provisions of Articles 31B and 42 of, and paragraph 4 of Schedule 7 to, that Order, would have been the amount of that product.

Reductions in general grant [j4]

4.¾ (1) Subsection (2) applies where the Department is satisfied, from information contained in a relevant report relating to a district council, that as regards any financial year¾

(a) the council has failed to achieve or maintain a reasonable standard of economy, efficiency and effectiveness in the discharge of its functions, or

(b) the expenditure of the council has been excessive having regard to the council's financial resources and other circumstances relevant to the council.

(5) The Department may¾

(a) defray any expenditure incurred in any financial year in the provision of services for a district council by a body specified in regulations; and

(b) deduct from the amount of any general grant payable to the council for that year such amount (not exceeding the total of the expenditure so defrayed) as the Department considers appropriate.

as the Department considers appropriate.

(7) Regulations under this section shall be subject to negative resolution.

Other grants to councils [j5a]

5.¾ (1) The Department may, in respect of a financial year, make grants to district councils for such other purposes as may be determined by the Department.

(2) A grant to a council under this section shall be¾

(a) of such amount, and

(b) made subject to such conditions,

as the Department may determine.

(3) Grants shall not be made under this section without the consent of the Department of Finance and Personnel.

Powers of district councils in relation to economic development [j7]

6.¾ (1) A district council may promote the economic development of its district.

(2) Without prejudice to the generality of subsection (1), a district council may for the purposes of the economic development of its district¾

(a) make payments; and

(b) acquire, hold and develop land.

(4) In subsection (2) "develop", in relation to land includes¾

(a) erect, alter or extend buildings thereon;

(b) carry out works thereon;

(c) provide means of access, services and other facilities for persons using the land;

(d) facilitate the doing of such things by another person;

(e) manage and dispose of the land.

Powers of district councils in relation to community safety [j7a]

7.¾ (1) A district council may¾

(a) participate in any relevant community safety partnership;

(b) take action in accordance with any plan prepared by, or proposals agreed by, such a partnership;

(c) accept financial or other support provided by such a partnership; and

(d) generally assist (whether financially or otherwise) and facilitate such a partnership in the exercise of its functions.

(2) The Department may by order confer or impose on district councils other functions relating to the enhancement of community safety in their districts.

(3) No order shall be made under this section unless a draft of the order has been laid before and approved by a resolution of the Assembly.

(4) In this section¾

"community safety partnership" means a body established for an area in accordance with the community safety strategy devised by the Secretary of State under section 70 of the Justice (Northern Ireland) Act 2002 (but does not include any body established by an order under section 71(1) of that Act);

"the enhancement of community safety", in relation to any district, means making the district one in which it is, and is perceived to be, safer to live and work, in particular by the reduction of actual and perceived levels of crime and other anti-social behaviour;

"relevant community safety partnership", in relation to a district council, means such a partnership established for an area which is, or includes, the district of the council or any part of that district.

Interpretation [j6]

8. In this Act¾

"the Department" means the Department of the Environment; and

"regulations" means regulations made by the Department.

Repeals [j8]

9. The statutory provisions specified in the Schedule are repealed to the extent specified in the second column of the Schedule.

Commencement and savings [j9]

10.¾ (1) Sections 6 and 7 and the repeal of Article 28 of the Local Government (Miscellaneous Provisions) (Northern Ireland) Order 1992 (NI 6)) come into operation on the expiration of the period of two months from the date on which this Act receives Royal Assent.

(2) Nothing in the other provisions of this Act¾

(a) applies in relation to any financial year which began before the date on which this Act receives Royal Assent; or

(b) affects the operation of any statutory provision repealed by this Act in relation to any such financial year.

Short title [j10]

11. This Act may be cited as the Local Government (Miscellaneous Provisions) Act (Northern Ireland) 2002.

Section 9

25 June 2002

I understand that at the meeting of the Environment Committee on 20 June, some concerns were expressed about the use of the word 'impose' in Clause 7 (2) of the above Bill.

It is accepted practice to use the word 'impose' in legislation, where provision is made to enable the introduction of a mandatory duty or requirement. The word 'confer' is used whenever a power is given to do something that would not be mandatory.

Hence, the reason for using the words 'confer' and 'impose' in Clause 7 (2) of the Bill is to provide the Legislator with the power to introduce mandatory or discretional functions using subordinate legislation. Such draft legislation for community safety would be subject to full consultation with district councils and other interests, followed by scrutiny by the Assembly institutions. Indeed, the legislation would be subject to affirmative resolution of the Assembly, as provided for in Clause 7 (3) of the Bill.

The omission of the word 'impose' from the Bill would mean that any future proposal to introduce a mandatory duty on community safety would have to be subject to further primary legislation. Given the extended process for making primary legislation it may be more expedient, and indeed a more effective use of public resources, to make further statutory provisions for community safety using subordinate legislation. The consultation and scrutiny requirements inherent in the making of such legislation ensure that any new provisions would be subject to close examination, and requiring Assembly approval.

I trust the Committee will find this letter helpful in its further consideration of the Bill.

BERNIE McASTOCKER
(For Assembly Liaison Officer)

ANNEX 23

LOCAL GOVERNMENT (MISCELLANEOUS PROVISIONS) BILL -
WORKING DRAFT 2 REVISE

Powers of district councils

6. Powers of district councils in relation to economic development [j7]
7. Powers of district councils in relation to community safety [j7a]

Supplementary provisions

8. Interpretation [j6]
9. Repeals [j8]
10. Commencement and savings [j9]
11. Short title [j10]

Make new provision for the payment of general and other grants to district councils; to confer new powers on district councils in relation to economic development and community safety; and for connected purposes.

BE IT ENACTED by being passed by the Northern Ireland Assembly and assented to by Her Majesty as follows:

The general grant to district councils [j1]

1.¾ (1) The Department shall for each financial year make grants ("general grants") to district councils.

(2) Subject to any reduction under section 4, the general grant payable to a council for any financial year shall consist of ¾

(a) a resources element, determined under section 2; and

(b) a de-rating element, determined under section 3.

(3) Payments in respect of general grant shall be made to a council at such times as the Department may determine.

Determination of the resources element [j2]

2.¾ (1) The amount of the resources element of the general grant payable to a district council for any financial year shall be determined in accordance with regulations.

(2) Regulations under subsection (1) may in particular make provision¾

(a) for the amount mentioned in that subsection to be calculated by reference to a formula;

(b) for determining the manner in which and time at which such calculation is to be made;

(c) for determining the person by or to whom any information required for the purpose of that calculation is to be given and the time at which and form in which it is to be given.

(3) The formula may be such that the amount of the resources element payable to a council is nil.

(4) For the purposes of this section "formula" includes methods, principles and rules of any description.

(5) Regulations under this section may contain¾

(a) any supplementary, incidental or consequential provision,

(b) any transitional or saving provision,

(c) any provision for a person to exercise a discretion in dealing with any matter,

(6) Regulations shall not be made under this section unless a draft of the regulations has been laid before, and approved by resolution of , the Assembly.

as the Department considers appropriate.

Determination of the derating element [j3]

3. The amount of the derating element of the general grant payable to a district council for any financial year is an amount equal to the difference between¾

(a) the amount of the product of the district rate for that year (within the meaning of the Rates (Northern Ireland) Order 1977 (NI 28)); and

(b) the amount which, but for the provisions of Articles 31B and 42 of, and paragraph 4 of Schedule 7 to, that Order, would have been the amount of that product.

Reductions in general grant [j4]

4.¾ (1) Subsection (2) applies where the Department is satisfied, from information contained in a relevant report relating to a district council, that as regards any financial year¾

(a) the council has failed to achieve or maintain a reasonable standard of economy, efficiency and effectiveness in the discharge of its functions, or

(b) the expenditure of the council has been excessive having regard to the council's financial resources and other circumstances relevant to the council.

(5) The Department may¾

(a) defray any expenditure incurred in any financial year in the provision of services for a district council by a body specified in regulations; and

(b) deduct from the amount of any general grant payable to the council for that year such amount (not exceeding the total of the expenditure so defrayed) as the Department considers appropriate.

as the Department considers appropriate.

(7) Regulations under this section shall be subject to negative resolution.

Other grants to councils [j5a]

5.¾ (1) The Department may, in respect of a financial year, make grants to district councils for such other purposes as may be determined by the Department.

(2) A grant to a council under this section shall be¾

(a) of such amount, and

(b) made subject to such conditions,

as the Department may determine.

(3) Grants shall not be made under this section without the consent of the Department of Finance and Personnel.

Powers of district councils in relation to economic development [j7]

6.¾ (1) A district council may promote the economic development of its district.

(2) Without prejudice to the generality of subsection (1), a district council may for the purposes of the economic development of its district¾

1. make payments; and
2. acquire, hold and develop land.

(4) In subsection (2) "develop", in relation to land includes¾

(a) erect, alter or extend buildings thereon;

(b) carry out works thereon;

(c) provide means of access, services and other facilities for persons using the land;

(d) facilitate the doing of such things by another person;

(e) manage and dispose of the land.

Powers of district councils in relation to community safety [j7a]

7.¾ (1) A district council may¾

(a) participate in any relevant community safety partnership;

(b) take action in accordance with any plan prepared by, or proposals agreed by, such a partnership;

(c) accept financial or other support provided by such a partnership; and

(d) generally assist (whether financially or otherwise) and facilitate such a partnership in the exercise of its functions.

(2) The Department may by order confer or impose on district councils other functions relating to the enhancement of community safety in their districts.

(3) No order shall be made under this section unless a draft of the order has been laid before and approved by a resolution of the Assembly.

(4) In this section¾

"community safety partnership" means a body established for an area in accordance with the community safety strategy devised by the Secretary of State under section 70 of the Justice (Northern Ireland) Act 2002 (but does not include any body established by an order under section 71(1) of that Act);

"the enhancement of community safety", in relation to any district, means making the district one in which it is, and is perceived to be, safer to live and work, in particular by the reduction of actual and perceived levels of crime and other anti-social behaviour;

"relevant community safety partnership", in relation to a district council, means such a partnership established for an area which is, or includes, the district of the council or any part of that district.

Interpretation [j6]

8. In this Act¾

"the Department" means the Department of the Environment; and

"regulations" means regulations made by the Department.

Repeals [j8]

9. The statutory provisions specified in the Schedule are repealed to the extent specified in the second column of the Schedule.

Commencement and savings [j9]

10.¾ (1) Sections 6 and 7 and the repeal of Article 28 of the Local Government (Miscellaneous Provisions) (Northern Ireland) Order 1992 (NI 6)) come into operation on the expiration of the period of two months from the date on which this Act receives Royal Assent.

(2) Nothing in the other provisions of this Act¾

(a) applies in relation to any financial year which began before the date on which this Act receives Royal Assent; or

(b) affects the operation of any statutory provision repealed by this Act in relation to any such financial year.

Short title [j10]

11. This Act may be cited as the Local Government (Miscellaneous Provisions) Act (Northern Ireland) 2002.

LETTER FROM:
NORTHERN IRELAND OFFICE
CRIMINAL JUSTICE SERVICES DIVISION

20 June 2002

COMMUNITY SAFETY PARTNERSHIPS

Thank you for your letter of 6 June 2002, which enclosed a copy of the Assembly Debate on the local Government (Miscellaneous Provisions) Bill: Second Stage.

Your letter drew attention to discussion during the debate of possible duplication between the Community Safety Partnerships and District Policing Partnerships. You advised that the Environment Committee has asked for clarification on this issue.

I attach a paper which seeks to clarify the Community Safety, Community Safety Partnerships and their functions and how they differ from District Policing Partnerships. I hope that this will answer the questions raised by the Committee and assist in their deliberations.

E M McGUCKIN
(Signed in his absence with approval)

BRIEFING PAPER ON COMMUNITY SAFETY AND COMMUNITY SAFETY PARTNERSHIPS

Introduction

1. Community Safety is a relatively new concept in Northern Ireland, although many organisations have been engaged in activities which will contribute to improvements in community safety for many years. The Community Safety Centre was established in 1996 and has been engaged in raising the profile of community safety. However, until now, there has not been a Community Safety Strategy for Northern Ireland, nor has there been any formal structure for delivering community safety. The purpose of this paper is to provide a definition of community safety; define a community safety partnership, its functions and membership; and explain the difference between a community safety partnership and the new District Policing Partnerships that are soon to be created.

What is Community Safety?

2. Many people think that community safety is the same as crime prevention. The two concepts are different but each can contribute to the other. Community safety is about a whole range of factors that impact on the quality of life within a community. The following definition appears in the draft Community Safety Strategy:

"Community safety means preventing, reducing or containing the social, environmental and intimidatory factors which affect people's right to live without fear of crime and which impact upon the quality of life. It includes preventative measures which contribute to crime reduction and tackle anti-social behaviour. It is about local solutions to local problems which have been identified by local people."

3. There are a range of other definitions of community safety that have been adopted within other jurisdictions. Typical of these are following two definitions.

Community safety has different meanings to different people at different stages of their lives. From protecting children, keeping teenagers out of crime, protecting property to addressing fears in older years - community safety is an essential element. Although there is no universally agreed definition of community safety most (Scottish) partnerships have accepted, in broad terms, the COSLA definition of 'protecting people's right to live in confidence and without fear for their own or other people's safety.' This embraces a range of issues from crime prevention, domestic abuse, drug abuse, road safety, fire safety, accident prevention, etc.

We see community safety as having both social and situational aspects, as being concerned with people, communities and organisations including families, victims and at-risk groups, as well as attempting to reduce particular types of crime and the fear of crime. Community safety should be seen as the legitimate concern of all in the local community. (Working Group on the Morgan Report).

4. It can be seen from the definitions that community safety is a complex issue with many contributory factors. It follows that no one organisation can deliver community safety on its own. Statutory organisations have responsibility for the delivery of range of services, but no one organisation has, or can have, responsibility for the delivery of all services. It requires the input from a wide range of organisations, with specific responsibilities to deliver services, to achieve improvements in community safety. It is as a result of this that the concept of Community Safety Partnerships (CSPs) arose.

What is a Community Safety Partnership?

5. Put simply, a Community Safety Partnership is a structure that brings together all of the statutory organisations with responsibility for the delivery of services. Typically this will include organisations dealing with education, health, social services, probation, police, housing and the environment. A list of typical organisations is attached at Annex A. These organisations will work together with voluntary organisations and the community to identify the issues that are of concern at a local level and to develop collaborative ways of tackling these issues. The Partnership is about maximising the potential of all of the organisations so that they each deliver their own objectives more effectively. It is not about marginalising individual organisations or assuming their responsibilities.

6. Ideally these organisations should have a statutory responsibility to engage in Community Safety Partnerships. It has been demonstrated elsewhere that partnerships are most effective in these circumstances. However, as the Northern Ireland Executive has launched a review of public administration, which is likely to have an impact on many of the organisations that would participate in a CSP, a statutory responsibility is not being applied at this time. Instead the Justice (NI) Bill gives the Secretary of State powers, in consultation with the First Minister and Deputy First Minister, to create a statutory basis for Community Safety Partnerships. When community safety is devolved this power will pass to the First Minister and Deputy First Minister. In the meantime, the statutory organisations will be encouraged to develop partnerships on a voluntary basis. Indeed some such partnerships have already been established, for example in Antrim.

7. It is essential to emphasise that Community Safety Partnerships are made up of statutory organisations and that in due course these organisations or their successors will be specified by the Secretary of State or, following devolution, the First Minister and Deputy First Minister. The partnership will be expected to consult and work with voluntary organisations and the local community. However, each organisation must retain responsibility for its own statutory responsibilities and cannot delegate these.

What will a Community Safety Partnership Do?

8. The whole idea of a Community Safety Partnership is to maximise the impact that individual organisations can have by working collectively with other organisations to deliver shared objectives. They will not give up their normal responsibilities, but by working in partnership with other organisations and the community they can make sure that they address the priority issues in the community more effectively.

9. The functions of a Community Safety Partnership are set out in Clause 71(4) of the Justice (NI) Bill and include:

a. conduct research to ascertain the issues which people living or working in its area consider ought to be addressed in order to enhance community safety in the area and how they consider that those issues ought to be addressed;

b. having regard to the results of such research and the current Northern Ireland Strategy, prepare plans for addressing those issues and other issues which it considers ought to be addressed in order to enhance community safety in its area;

c. identify targets or other indicators to assess the extent to which those issues are addressed by action taken in accordance with the plan;

d. provide any such financial or other support as it considers appropriate to person involved in venture designed to enhance community safety in its area; and

e. make an annual report to the Secretary of State describing how community safety has been enhanced in its area in the financial year by action taken in accordance with its plans, by persons to whom it has provided support and otherwise.

10. The important area here is that the Partnership should carry out a community safety audit of the area, identify the priorities that need to be addressed and develop a local strategy and action plan to address the priorities. Each organisation will make its own contribution in line with its statutory responsibilities. For example:

Relationship between Community Safety Partnerships and District Policing Partnerships

11. The functions and membership of CSPs and DPPs are very different. The CSP will be engaged in delivering services to and with the community. As a result it will be made up of statutory organisations which have responsibility for those services - it will also wish to liaise closely with the community. The DPP is established as an accountability body for the police at a local level. Its functions and vires are limited to policing issues. It too has a responsibility to consult with the public in respect of crime prevention, but its sphere of influence relates to the activities of the police. It does not number among its membership the service delivery organisations - not even the police are represented on the DPP. Instead it is made up of elected members and independents. The independents are appointed on their own merits and are not there to directly represent any organisation. This is appropriate for an accountability body.

12. There is the potential for some duplication in activities of the two bodies. This relates in particular to undertaking a community audit. Both bodies should be encouraged to collaborate on this and undertake a joint process. We would expect some common themes between the Community Safety Strategy and the Policing Plan. Having said that the Policing Plan will have a policing focus and should influence the Community Safety Strategy, which will also include the contributions from the other partner organisations. However, there is little overlap in any other area. The primary role of the DPP will be to influence the activities of the police and to hold them to account. The activities of the CSP as identified in the Justice (NI) Bill include the issues and contributions of all the partner organisations, eg, housing, youth work, domestic violence, etc, anti-drug campaigns, and not merely those influenced by the police.

13. It will be important for the police to be part of the CSPs. The police will report to the DPP but they actually contribute to the work of the CSPs. They need to be able to influence the other partners to ensure that they contribute to the achievement of policing objectives as set out in the local policing plan.

14. It can be seen therefore that the CSP and the DPP must have different membership because their functions are very different. The aim of the CSP is to enhance participation and co-ordination among statutory organisations, with the community and with voluntary organisations. The primary aim of the DPP is to hold the police to account. There is some, though limited, scope for duplication. However, this can be readily addressed, firstly because the police will be participating in CSPs and, secondly, if the DPP were to nominate a representative to participate in the CSP. There is also scope for the secretariat of the DPP to work closely with the community safety co-ordinator, especially if the co-ordinator is employed by the District Council.

15. It has been suggested that community safety could be undertaken by a sub-group of the DPP to which the appropriate statutory organisations would be invited to become members. They argue that this would reduce bureaucracy, avoid the danger of DPPs and CSPs taking different, and conflicting, approaches to the same issue, reduce the number of meetings that the police have to attend and reduce the co-ordination role of the District Council.

16. The current legislation does allow for the DPP to establish a sub-committee. However, that committee must be made up of the members of the DPP - there is no provision to invite the statutory organisations on to the sub-committee. In addition, a DPP sub-committee can only - by statute - deal with DPP functions. Even if it were possible through new legislation, to create a sub-committee it would not deliver the improvements suggested. First of all this sub-committee would have to be properly constituted with its own support mechanisms. It would need to meet no more and no less than a community safety partnership. Therefore there will be no reduction in bureaucracy and co-ordination will still be required. There is nothing in the proposed structure to stop the sub-committee taking a particular approach which is not entirely consistent with that adopted by the DPP. The DPP does not have a service delivery responsibility, while the organisations on the sub-committee do have statutory service delivery responsibilities. It would be entirely inappropriate for the DPP, which has been created to hold the police to account, to try to tell another statutory organisation how to deliver its function.

Conclusion

17. It can clearly be seen that a Community Safety Partnership is an equal partnership of those organisations that have responsibility for delivering those services that have an impact on the level of community safety within an area. The purpose of the partnership is to take steps to address the issues that are of particular concern within that locality and to maximise the effectiveness of the services that they deliver through co-operation.

NORTHERN IRELAND OFFICE

District Councils

Northern Ireland Housing Executive

Health and Social Services Trusts

Health Boards

(Health Promotion Agency)

(Drug and Alcohol Co ordination Teams)

(Health & Safety Executive)

Fire Service for Northern Ireland

NI Ambulance Service

Probation

Police Service for Northern Ireland

Education & Library Boards

Roads Service Agency

Department of the Environment - Roads Safety

ANNEX 25

2 July 2002

My officials, who attended meetings of the Environment Committee over the past number of weeks, have been keeping me advised on points of concern and issues raised by members about the Local Government (Miscellaneous Provisions) Bill.

In response to the matter raised I have agreed to move amendments to Clauses 2, 4, 6 and 7 of the Bill. The amendments are set out, in summary, below:

Clause 2 - An additional subsection (7) to be inserted to ensure consultation on proposed regulations for the new formula for distribution of general grant.

Clause 4 - Subsections (1) and (2) of this Clause, which makes provision for the amount of general grant payable to a district council to be reduced, originally mirrored existing legislation. The Committee wished to enhance the role of the Assembly and also wanted the role of the local government auditor to be transparent.

The revised provisions, subsections (1), (2), (2A) and (2B) set out a requirement for a draft order, which must be approved by a resolution of the Assembly, to deal with any proposed reduction in general grant. The local government auditor's role is specified in subsection (2C).

Clause 6 - An additional subsection (3) has been inserted in the Bill, which will confer on district councils vesting powers for the promotion of economic development activity.

Further amendments within this Clause (subsections (4) and (5) refer) relate to the requirement for a district council to have, regard to any "guidance" (rather than "directions") issued by the Department of Enterprise, Trade and Investment where it is promoting the economic development of its district. In addition, the amendments reflect that any such "guidance" should be drawn up in consultation with district councils and other interested bodies or persons.

Clause 7 - Subsection 7(1)(d) has been amended to include the words "whether financially or otherwise" to provide clarification on the ability of district councils to be able to spend monies on community safety.

Attached is a copy of the detailed amendments which I would propose to have tabled.

A revised Explanatory and Financial Memorandum, which will reflect the revised Bill and clarify the points and issues raised by the Committee, will be finalised following Consideration Stage.

I hope that these amendments address all of the concerns expressed by members. I can assure you that my officials will continue to work closely with the Committee and secretariat staff to bring the Bill to a successful conclusion.

DERMOT NESBITT
Minister of the Environment

Clause 2, page 2, line 15, at end insert¾

'(7) Before making any regulations under this section the Department shall consult¾

(a) such district councils; and

(b) such other interested bodies or persons,

as the Department considers appropriate.'

Clause 4, page 2, line 25, leave out subsections (1) and (2) and insert¾

'(1) Subsection (2) applies where the Department is satisfied, from information contained in a relevant report relating to a district council, that as regards any financial year¾

(a) the council has failed to achieve or maintain a reasonable standard of economy, efficiency and effectiveness in the discharge of its functions, or

(b) the expenditure of the council has been excessive having regard to the council's financial resources and other circumstances relevant to the council.

(2) Where this subsection applies, the Department shall prepare and lay before the Assembly¾

(a) a draft order providing that, in such financial year as is specified in the order (or in each of such financial years as are so specified), the amount of any general grant payable to the council shall be reduced by such amount as is so specified (or is so specified in relation to that year); and

(b) a document setting out¾

(i) the reasons for making any reduction specified in the order; and

(ii) such details of the relevant report as the Department thinks appropriate.

(2A) If the draft order laid before the Assembly under subsection (2)(a) is approved by a resolution of the Assembly, the Department shall make the order in the same terms as the draft.

(2B) If that draft order is not so approved, the Department may prepare and lay before the Assembly a new draft order and document complying with subsection (2); and subsection (2A) and this subsection apply in relation to that draft order as they apply in relation to the original draft order.

(2C) In subsections (1) and (2) "relevant report" means a report made by a local government auditor under section 80, 88 or 89A of the Local Government Act (Northern Ireland) 1972 (c. 9).'

Clause 4, page 3, leave out line 3

Clause 4, page 3, leave out line 5 and insert¾

'( ) such other interested bodies or persons,'

Clause 6, page 3, line 24, at end insert¾

'( ) The power to acquire land under subsection (2)(b) includes power to acquire it otherwise than by agreement.'

Clause 6, page 3, line 32, leave out subsection (4) and insert¾

DETAILED AMENDMENTS contd.

'(4) In exercising its powers under this section a district council shall have regard to any guidance for the time being issued under subsection (5).

(5) The Department of Enterprise, Trade and Investment may, after consultation with district councils and other interested bodies or persons, issue guidance as to the exercise by district councils of their powers under this section.'

Clause 7, page 4, line 2, after 'assist' insert '(whether financially or otherwise)'