It also introduces “community rights”, such as the right for community groups to bid to run local services, and bid to take over local assets. The majority of the Act came into force in April 2012.
The Localism Act introduces a wide range of changes to the operation of local government:
General Power of Competence (GPC): Councils will be allowed to do anything that an individual may do which is not specifically forbidden by law. Transfer and delegation of functions to councils: Any local authority will be eligible to make an application to the Secretary of State to take over other local public functions that are a high priority for their communities.
Governance: The Standards Board regime and the model code of conduct have been abolished; however, a local authority must adopt a code of conduct that is consistent with the Nolan principles and must set out the registration and required disclosure of pecuniary and non-pecuniary interests. It will become a criminal offence to deliberately fail to declare a personal interest in a matter.
Pay Policy: Local authorities will be required to publish annual pay policy statements which set out an authorities' approach to the remuneration of its highest and lowest paid staff, and its approach to the relationship between the remuneration of its chief officers and the rest of the workforce. The Pay Policy Statement must be published on the Ealing Council public website.
Local Finance: Councils will be given more discretion over business rate relief, including:
- The power to set local discounts and raise supplementary rates with agreement from the business community;
- Tax Increment Financing – the ability to capture an increase in income from business rates from infrastructure development, and borrow against future income.
Local Democracy: Residents will get the power to veto excessive council tax increases. Central government will decide on an annual basis what would count as “excessive”; if a local authority wishes to raise Council Tax above this level then they will be required to hold a referendum.
Community Right to Challenge. The Community Right to Challenge gives civil society organisations (VCS, charities, staff groups) the right to bid to take over and run a service currently being delivered by a local authority.
Local groups, including groups of 2 or more employees, may submit an “expression of interest” in running a service. The local authority must then decide whether to accept or reject the expression of interest, using criteria specified by the Secretary of State. If it is accepted, then a full procurement process (in line with procurement law thresholds) is triggered. Any organisation can bid for the service in the procurement exercise.
For more information see: http://www.ealing.gov.uk/info/200925/localism_act
Assets of Community Value. This provision seeks to give local groups and people the opportunity to buy local assets if they come up for disposal on the open market. Community groups may nominate assets which they believe to be of community value. Community value is defined as an actual current use of the building or other land (that was not an ancillary use) furthers the social wellbeing or social interests of the local community, and it realistic to think that this will continue.
The Council decides whether to accept or reject the nomination, and list all accepted assets on a publicly available register. The local authority must also keep a list of unsuccessful nominations.
When the owner of a listed asset wishes to sell the asset, s/he must inform the local authority who will then be required to inform the organisation who nominated the asset in the first place. A moratorium then begins during which the sale cannot happen, to give the community the opportunity to organise itself to offer to purchase the asset. The owner does not have to sell the asset to a community group – it is up to them who they ultimately sell the asset to.
The aim of this section of the Act is to enable local forums representing communities to develop plans to shape planning decisions in their localities by creating a “Neighbourhood Planning Authority” (NPA). The NPA could be based on existing parishes or group of parishes, or could be an organisation designated by the Local Planning Authority as a “Neighbourhood Forum”. If the designation is made by the Local Planning Authority, it must also consider whether the area should be designated as a “business area”.
To be designated as a neighbourhood forum a group or organisation must have a purpose which seeks to promote the overall economic, social and environmental well-being of an area. Forums will be expected to try to recruit members from a broad spectrum of the community, including residents, businesses and councillors.
Once a forum has been set up it will then be able to develop neighbourhood plans, and hold a referendum in the area to approve the plan. Councils should approve neighbourhood plans if they receive 50% of the votes cast in a referendum and meet strategic goals. In business areas there would need to be two referendums in relation to any neighbourhood plan – one referendum of local residents, and one of non-domestic ratepayers in the area.
The authority may (but need not) make the plan if there is a majority vote in favour in one of the referendums (it has no choice if the plan is voted through in both referendums, or is voted down in both).
The Act also provides for neighbourhood development orders to allow communities to approve development without requiring normal planning consent; and gives a Community Right to Build where there is overwhelming local support for development.
The Act introduces a new requirement for prospective developers to consult local communities before submitting planning applications for very large developments (developments above 200 dwellings or 10,000 square feet).
The Community Infrastructure Levy (CIL) – which allows local authorities to set charges which developers must pay when bringing forward new development in order to contribute to new infrastructure – has been retained. The Act now also enables for some CIL funds to be passed to neighbourhoods where the development has taken place.
Some of the requirements around the Local Development Framework have also been amended, giving greater discretion to local authorities on how LDFs proceed. In the examination of a development plan document the Inspector's recommendations to amend it are no longer binding on the authority.
The London Development Agency has been abolished. There are new powers for the Mayor of London to create Mayoral Development Corporations to focus regeneration where it's needed most, such as to help secure East London's Olympic legacy, in partnership with London Boroughs.
Housing. The Act brings to an end the Housing Revenue Allowance (HRA) Subsidy system, and introduces a self-financing system, allowing Councils that operate HRA to keep the rent received.
On social housing, there will be a new form of flexible tenure for social housing tenants. Local authorities will have the power to limit who can apply for social housing within their areas. Social landlords will be expected to support tenant panels (or equivalent bodies) in order to give tenants the opportunity to carefully examine the services being offered.
Social landlords will be required to participate in a national homeswap scheme. Local authorities will be able to offer private rented accommodation to homeless people rather than social housing.
Further general information:
Localism Act 2011
Communities and Local Government information and guidance
Information on Council’s response to the Act:
Report to LBE Cabinet, Localism Act 2011, 10th
Report to LBE Local Development Framework Advisory Committee, Localism Act 2011 – Some Implications for Planning Policy, 18th
For more information contact Emily O’Hare, Policy & Performance, LBE, firstname.lastname@example.org