Local authority general power of competence: consultation analysis

Consultation theme 3: perceived benefits and use of a General Power of Competence

Eight questions were asked in this section to understand:

a) how a General Power of Competence would be utilised to benefit the local area and its residents and,

b) the continued reluctance of other UK administrations to rely on their existing General Power of Competence and therefore how to articulate effective enabling legislation in which local authorities have confidence.

Annex B summarises the questions asked within this theme.

Overall, when asked to provide examples of how a General Power of Competence would be utilised for commercial activity, 50% of respondents provided examples whereas when asked more specifically how a General Power of Competence would be utilised to benefit the local area only 29% of respondents provided examples.

However, when asked about the perceived benefits of a General Power of Competence and how such a power would be utilised in Scotland, proponents of a General Power of Competence emphasised that such a power would provide a broader basis for a local authority to act and therefore reduce the risk of legal challenge. In addition, the wide framing of the power to do ‘anything which an individual generally may do’, reduces the scope for adverse judicial interpretation of the use of such a power.

Local authority respondents noted that a General Power of Competence would allow greater confidence to innovate; encourage a healthier attitude to risk within local authority decision-making; promote entrepreneurship; allow local authorities to contribute to the delivery of national policy objectives relating to economic growth; and enable local authorities to deliver policy in the interests of, and for the benefit of, their communities.

Examples of the potential use of a General Power of Competence included investment in commercial property, renewable energy, transport schemes, property services, leisure services, waste management, health care, food and beverage, tourist accommodation, ecommerce, digital and IT services, consultancy and training, energy switching schemes, mortgage schemes, community led housing projects, power to take action on vacant and derelict land, including a power to force the sale of derelict land and use of common good land.

Note: With regards to the proposed use of a general power to take action on vacant and derelict land, including a power to force the sale of derelict land and use of common good land, it should be noted that, as held in the Portobello case (described in paragraph 4 above), this was held to contravene local public rights of enjoyment and planning laws and this ruling would not have been avoided by the existence of a General Power of Competence.

Limitations of a General Power of Competence

There has been a continued reluctance by many local authorities in other UK administrations to rely on a General Power of Competence and therefore the consultation asked what barriers or limitations discourage or limit the use of the general power.

35% of respondents identified examples of the barriers and limitations of a General Power of Competence, many of which closely reflect those identified as limitations of the Power to Advance Wellbeing asked earlier in the consultation. The legal uncertainty surrounding the power’s scope, with councils hesitant to use it due to fears of legal challenge and potential for adverse judicial interpretation, based on previous court rulings, was frequently highlighted. It was noted that in some cases, courts have interpreted the power restrictively, leading to ambiguity and inconsistency in its application.

Some respondents stated that the requirement for commercial activity to be undertaken through a company structure potentially stifles innovation and collaboration with third-sector organisations.

Several respondents noted the restriction that only permits charging for discretionary services on a cost recovery basis and the ability of service users to decline such services to avoid the charge.

Financial constraints were also cited as a significant limitation on the use of a general power and some respondents noted that a general power could not be utilised effectively without additional funding.

Respondents also noted the pre and post commencement limitations of the Localism Act which ensure that the General Power of Competence cannot be used to override other legislation. It is important to note that were a General Power of Competence to be introduced in Scotland it would not enable a local authority to circumvent other legislation.