My Lords, I thank the noble Baroness, Lady Jones, for giving me the opportunity to clarify the scope of the Secretary of State’s intervention powers under Section 497A(4A) of the Education Act 1996 and Section 15(6)(a) of the Local Government Act 1999, as amended by Clause 82. Using these powers in a failing local authority would be a serious step, and it is right that we are very clear how they might be used. I hope to be able to satisfy the noble Baroness’s desire for such clarity.
Noble Lords will recall that these provisions are intended to put beyond doubt the Secretary of State’s existing powers to shift, in cases of very serious failure, the exercise of some of a local authority’s functions to a third party who will deliver them on behalf of the Secretary of State. Clause 82 clarifies the effect of the exercise of those existing powers—for example, in relation to care and adoption, and Ofsted’s powers to inspect the performance of the local authority’s functions—in whatever form they are delivered.
I will address each of the points in turn, because I know, as the noble Baroness mentioned, that meetings have been held with my noble friend, and that there is
a wish that this be put on the record. That is what I shall do, if noble Lords will be patient.
Amendment 57E seeks assurance that a direction under subsection (4A) of Section 497A of the 1996 Act, as that section is amended by this Bill, would not automatically result in the transfer of the functions of director of, and lead member for, children’s services to the Secretary of State’s nominee. Amendment 57F does likewise for a direction under subsection (6)(a) of Section 15 of the 1999 Act.
I can be quite clear that a direction under the provisions in question would not result in an automatic transfer of the role of director of children’s services or of lead member for children’s services, to a third party who had taken on a local authority’s functions. That is, in part, because Sections 18 and 19 of the Children Act 2004, which set out the requirements on local authorities to appoint a director of and lead member for children’s services, are not functions which may be subject to a direction under subsection (4A) of Section 497A of the 1996 Act.
Following a subsection (4A) direction, the DCS and lead member would remain in place, although their responsibilities may be altered by agreement with the local authority as part of the transfer of functions from the local authority to the Secretary of State, or a nominee. The DCS and lead member would not, of course, exercise control over the local authority functions which had transferred to a third party following a direction under Section 497A.
Although the powers under subsection (6)(a) of Section 15 of the 1999 Act apply to Sections 18 and 19 of the Children Act 2004, I again reassure noble Lords that a direction under subsection (6)(a) would not result in the automatic transfer of those functions. If the Secretary of State wanted to transfer those functions to himself or a nominee, the direction would need specifically to set that out. I also point out that the amendment to Section 15 of the 1999 Act in Clause 82 of the Bill does not alter that in any way.
I also reassure the noble Baronesses that proposed new subsections (4AE), (4AG), (6E) and (6G) in their amendments, which are intended to ensure that the Secretary of State gives the local authority written notice of a proposed direction, are not necessary. Whenever in recent years we have contemplated issuing a direction, we have conducted initial discussions about its content beforehand. We have then formally given notice of our intention to issue a direction and formally invited representations from the local authority and other interested parties—I am glad that I am going to hand this to Hansard, so that they can make sure that the record is exactly as it is supposed to be. We will continue with the practice that I have just laid out.
Further, were we looking to transfer the exercise of some of a local authority’s functions to a third party, as these powers envisage, we would of course have to follow the provisions of employment law in respect of any employees. That would require consultation and appropriate due diligence around the terms of the transfer, which could only be done together with the local authority. In any event, in all but the most urgent cases, common-law principles of procedural fairness and good governance would require that notice of a
direction be given to a council and an opportunity be afforded for representations to be made before a direction is given.
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In relation to powers under the 1999 Act, under Section 15(9) and (10) of that Act the Secretary of State is required to allow the authority to make representations in advance of a direction, a practice we have followed in recent circumstances in relation to Doncaster. Furthermore in most cases, as noble Lords will know, government intervention in local authorities rests on the use of non-statutory improvement notices. Such improvement notices and the process that surrounds them, including engagement with Department for Education officials, serves as an effective mechanism for providing local authorities with fair warning about any proposed escalation to the use of statutory intervention powers. Although Sections 15(11) and (12) of the 1999 Act allow the Secretary of State to proceed straight to a direction where he considers it urgent enough, he must explain his reasoning to the authority in question, including why no prior consultation has taken place. I can provide additional reassurance that the dialogue between the Government and local authorities in intervention cases is always a two-way process.
In relation to the format of statutory directions, let me again provide what I hope is sufficient reassurance to the noble Baroness. Statutory directions, by their very nature, must be absolutely crystal clear about the functions to which they relate. Indeed, a direction under either Section 497A of the 1996 Act or Section 15 of the 1999 Act would be legally defective and operationally ineffective if it did not set out the functions to be exercised by a third party, and who that third party should be, with sufficient clarity for it to be understood.
Finally, I turn to proposed new subsection (4AH) in Amendment 57E and proposed new subsection (6H) in Amendment 57F, which concern the modification or withdrawal of directions. This is already provided for within Sections 497A(6) and 15(6) of the 1996 and 1999 Acts respectively, which set out that a direction may be indefinite or may operate for a specific period. In either case, the provisions allow the direction to be revoked earlier by the Secretary of State. If the Secretary of State wanted to modify a direction in any way he could simply issue another direction and, following the process I have already described, discuss this with the local authority concerned beforehand.
These provisions are already in place in the 1996 and 1999 Acts. We are seeking to amend those provisions in some relatively small respects in the Bill to bring absolute clarity to their operation. I hope that in setting out clearly how they would operate, I have reassured the noble Baroness. The approach that her amendments propose is very much already covered in current legislation and public law principles, and adopted as custom and practice by this and previous Governments. I very much hope that I have managed to cover all the noble Baroness’s concerns, that all is now satisfactorily on the record and that she is content to withdraw the amendment.