Agenda item

To consider a report by the Head of Legal and Democratic Services (copy attached) relating to the changes to the Council’s Constitution required by provisions of the Local Government (Wales) Measure 2011 to include the establishment of an Audit Committee, a Democratic Services Committee and arrangements for the appointment of chairs of Overview and Scrutiny Committees.

The Head of Legal and Democratic Services (H:L&DS) presented his report (previously circulated) relating to changes to the Council’s Constitution required by provisions of the Local Government (Wales) Measure 2011 to include the establishment of an Audit Committee, a Democratic Services Committee and arrangements for the appointment of Chairs of Overview and Scrutiny Committees.

The H:L&DS explained that the report dealt with a number of mandatory provisions for members to consider and there was an expectation that they would be implemented at the Annual Council meeting.  The draft statutory guidance had been taken into account where it was consistent with the Measure.  However if the final guidance (due to be issued in June) differed significantly from the draft there may be a need for further review.  The H:L&DS elaborated upon the relevant sections of the Measure and the implications for the Council in carrying out those mandatory requirements which needed to be reflected within the Council’s constitution.

During presentation of the report members took the opportunity to raise questions and clarify particular issues with the H:L&DS and the legalities surrounding implementation of the statutory provisions.  Consideration was given to each of the following issues in turn –

Establishment of an Audit Committee

Council considered the name, size and composition of the committee and its terms of reference.  Members noted that the functions of the existing Corporate Governance Committee closely mirrored those required by the Measure for an Audit Committee.  In view of that, the effectiveness of the existing committee, and in the interest of efficiencies it was agreed that the Corporate Governance Committee continue (taking on the functions required by the Measure) and that it be designated as the Audit Committee for that purpose.  In accordance with the general rule in local government law the Council agreed with the recommendation that the committee be politically balanced.  Consideration was also given to increasing the size of the committee which appeared small in comparison to full Council, perhaps up to eleven members in line with scrutiny committee membership.  However, the consensus was that the current membership of six councillors would be sufficient to carry out the duties required within the Measure together with the mandatory independent lay member.  Councillor Julian Thompson-Hill supported exercising discretion to include the relevant Lead Cabinet Member as a member when considering the required functions set out in the Measure.  Council considered the merits of that proposal but overall felt that in order to be fully independent the committee should not include any scrutiny or cabinet members within its membership.  In response to questions the H:L&DS detailed the recruitment process of the lay member and confirmed that the lay member should be independent from the Council with no well known political allegiance and should not be a former Councillor or Officer of the Council.  Members were supportive of an independent lay member on the committee and in view of the decision to designate the Corporate Governance Committee as the Audit Committee for the purpose of the Measure there was some discussion about whether the lay member should have voting rights on other functions carried out by the committee which fell outside those required by the Measure.  Councillor Alice Jones was a particular advocate for full voting rights as she felt it would prove divisive if the lay member did not have equal status with other committee members.  However, the majority view was that the lay member’s voting rights should be restricted to those functions set out in the Measure and that other matters be reserved for those councillors elected to that position.  The H:L&DS clarified the legal position in terms of voting rights advising that all members of the Audit Committee, including the lay member, may vote on any question that falls to be decided by the committee.  Any abstention from voting on matters falling outside the remit of the functions set out in the Measure would require agreement from the lay member.  In practical terms the committee’s business could be managed to separate the functions of the Audit Committee as defined in the Measure from other corporate governance functions.  He conceded that it may be defensible to limit the lay member’s participation to Audit Committee functions only.

Establishment of a Democratic Services Committee

Council considered the establishment of the committee, its size, composition and its terms of reference.  Members noted that the Measure had clearly set out the requirements for and functions of the Democratic Services Committee which must be politically balanced.  The H:L&DS advised that it was unlikely that the committee would need to meet more than once a year.  Following a proposition by Councillor Joan Butterfield, seconded by Councillor Barbara Smith members unanimously agreed that the committee be established with eleven members, politically balanced in line with scrutiny committees.

Appointment of Chairs of Scrutiny Committees

Council considered the allocation of Chairs of Scrutiny Committees as provided by the Measure in circumstances where there were two or more political groups and multiple scrutiny committees as in Denbighshire.  In explaining the appointment process, the H:L&DS added that the Council may adopt a different allocation system and outlined the procedures which would need to be followed.  There was no reference to the appointment of Vice Chairs in the Measure and it was suggested that the appointment of Vice Chairs be a matter for those committees.  The H:L&DS clarified the definition of an ‘opposition group’ as a group not represented on the Cabinet.

RESOLVED that –

(a)       the Corporate Governance Committee be designated as the Audit Committee for the purpose of the Local Government (Wales) Measure 2011 and the Terms of Reference for that committee as set out in Appendix 2 to the report be adopted subject to (1) reference being made to reflect that where possible the committee’s business be managed to separate the functions of the Audit Committee as set out in the Measure from other corporate governance functions, and (2) by agreement, the participation of the independent lay member be limited to Audit Committee functions;

(b)       members of the Audit Committee be appointed by the Council on a politically balanced basis;

(c)        a Democratic Services Committee be established comprising eleven members, politically balanced and the Terms of Reference for that committee as set out in Appendix 3 to the report be adopted;

(d)       the principles to be applied to the appointment of Chairs of Scrutiny Committees as set out in paragraphs 4.26 to 4.30 of the report be adopted, and

(e)       the Head of Legal and Democratic Services be authorised to make the necessary changes to the Council’s Constitution to reflect the amendments required by the Local Government (Wales) Measure 2011 as set out in (a) to (d) above.