Local Authority Governance: New code of practice for statutory officers

The Local Government Act 1972, Local Government and Housing Act 1989 and Local Government Act 1985 require local authorities to have three statutory officers which have a key role in the oversight and observance of their governance:

• Head of Paid Service (chief executive designated under s4 of the 1989 Act);
• Chief Finance Officer (s151 of the 1972 Act/s73 of the 1985 Act for combined authorities/s95 of the Local Government (Scotland) Act 1973) for Scottish authorities; and
• Monitoring Officer (responsible for legal governance designated under section 5 of the 1989 Act).

Against the background of more limited financial resources and increasing demand for legal services,

Lawyers in Local Government, the Chartered Institute of Public Finance and Accountability and Solace (a representative body of chief executives) have joined together and published a code of practice to maximise joint working of statutory officers to support better governance and decision-making within local authorities.

The main way in which the Code seeks to do this is through establishing seven new standards (designed to augment the Seven Principles of Public Life (Nolan Principles)) encouraging the three statutory officers to work together to achieve high standards of corporate governance.

The seven new standards set out in the Code contain detailed guidance for officers but can be broadly summarised as:

• Understand Governance: officers should understand their roles and what is required to perform them.
• Act Wisely: officers should collaborate when decisions are being made and ensure decisions are informed by all relevant advice.
• Lead Ethically: officers should adhere to the Seven Principles of Public Life – Selflessness; Integrity; Objectivity; Accountability; Openness; Honesty; Leadership.
• Act Effectively: officers should meet regularly to review current likely future issues and be able to attend other key meetings where financial, procedural, vires or other constitutional issues are expected to arise.
• Resource the Roles: officers should ensure they have the staff, accommodation and other resources necessary to perform their duties.
• Build Resilience: good governance should be embedded within each authority and officers should ensure robust arrangements are in place across the authority to ensure a sustainable approach.
• Deliver sound decision-making: officers should ensure decisions are understandable, lawful and implementable.

The code of practice does not impose legal obligations on statutory officers but is designed to help them know their roles and responsibilities better, encourage collaborative-working and better decision-making with a view to improving corporate governance. It is aimed at statutory officers in local government and is likely to be of equal application to statutory officers in Scotland as well as in England and Wales (given the similarities of the roles).

The publication of the code of practice is perhaps recognition that good corporate governance in the public sector requires more than statutory officers acting in accordance with the Seven Principles of Public Life and that these roles must be better understood, resourced and supported to deliver better decision-making and corporate governance across the broad spectrum of policies within the control of local government. The code of practice looks to be a step along the road to doing so, most notably by creating awareness of the requirements.

The code of practice can be downloaded here:

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