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Comments from the Association of Chartered Certified Accountants
June 2001

The Association of Chartered Certified Accountants' (ACCA) is pleased to have this opportunity to participate in the development of a code of conduct for local authority members. The draft code has been considered by ACCA's Public Sector Technical Issues Committee.

ACCA welcomes the Secretary of State's proposal to introduce a model code of conduct for elected and co-opted members to local government. ACCA is generally supportive of the "preventative" approach taken by the proposed code, although we make some suggestions for improvements to the following sections, which we would like to see reflected in the DETR's published code.

General obligations

Box B chapter 2 (a) of the code, which aims to promote equality, does not add value to the existing legal requirements in relation to discrimination. In the UK it is unlawful to discriminate against anyone one the grounds of their race, gender or disability and the forthcoming EU derived legislation will make it unlawful also to discriminate on the grounds of age, religion or sexual orientation. We suggest, therefore, that the provisions in the code should build on the legal framework by requiring local authority members to implement equal opportunities' policies which ensure that people (whether employees, customers, suppliers or visitors, for example) are treated equally and fairly by respectfully acknowledging their special needs and circumstances which may arise from cultural, physical or learning differences.

Box F paragraph 6 (a) of the code requires members, when reaching decisions, not to act "unreasonably" and paragraph 3.9 of the consultation paper explains what is meant by "unreasonable" by quoting the definition in the Oxford English Dictionary and relevant case law. Such an explanation could be construed as inhibiting the free expression of views of democratically elected representatives to public office.

We suggest, in order to avoid unreasonable behaviour at meetings, that the members of each local authority should be required to formally adopt financial regulations and standing orders to direct the proceedings of local government business. Members and officers should have clear terms of reference setting out the extent of their duties and delegated authority for decision making.

The declaration of interests

ACCA agrees that the current participation rules appear confusing, complex and subjective to operate. We would support an approach which makes it clear to members and regulators at the outset, what does and does not constitute a conflict of interest. We believe that such an approach would involve bringing together all exceptions, dispensations and exemptions, which are derived from primary legislation and statutory regulations, into one place in the model code. ACCA agrees with the Government's proposal not to roll forward the current exemption relating to members who sit on outside organisations in a personal capacity.

Dealing with conflicts of interest

ACCA agrees that non financial interests do not relate solely to planning, licensing and grant related matters and that in some instances non financial interests can be of greater significance than financial ones. We therefore support the Government's view that a more restrictive approach is needed in relation to such interests. We believe that the definition of a "personal interest" as set out in Box I is clear and workable, although we believe that the words "professional credibility," should be inserted at paragraph 8 (2) of the code before the word "wellbeing", which would then reflect the points made at Box J, paragraph 9(2) and Box L paragraph 11 in relation to members, their families and friends when making executive decisions or when acting as a member of another committee.

Restrictions on member participation

It is our view that members need to meet certain conditions concurrently and hence member's participation would require that a member:

• declares the existence of a personal interest in a matter to be discussed and withdraws prior to the commencement of the discussion
  
  
• is not privy to any information relating to the relevant matter which is not in the public domain
  
  and
  
  
• has not made any executive decision or served on another committee in relation to that matter.

If the above mentioned criteria are met then there is no need to require the member to disclose also the nature of the interest.

We believe that the range of circumstances in which a member is required to withdraw if they have prejudicial interest is correctly drawn, although, we suggest that paragraph 11 should apply also to executive decisions and to a member's family and friends (see paragraph above on "declaration of interests").

Gifts and Hospitality

ACCA does not believe that a blanket threshold value approach for registering the receipt of gifts and hospitality is in the public interest. We believe that each authority should be required to adopt a formal policy stating out both the circumstances and the threshold value under which gifts and hospitality are considered acceptable.

For example, token (say £10 or less) promotional gifts such as pens, calendars and diaries could be considered acceptable, particularly at Christmas time, without the need for members to declare them in the register. Likewise members of the public may find it acceptable for the authority to present a gift on retirement to members or to long serving officers within a certain threshold value (say in the region of £50 to £100); otherwise, documented procedures should establish a system under which offers not accepted or gifts returned can be monitored.

We believe that it is ill advised to specify in the code that gifts above a specified value should become the property of the authority as this could lead to legal problems of ownership and accountability.

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