Commentary on Sections Introduction Sections 212 and 213: Entities controlled etc by local authorities; Trusts
495.Section 212 provides power for the Secretary of State, or Welsh Ministers (in relation to Welsh local authorities), to make an order requiring, prohibiting or regulating the taking of specified actions by entities connected with an English local authority. An Order may also require, prohibit or regulate the taking of specified actions by a local authority or certain members or officers of a local authority.
496.Orders made under the power may relate to all English (or Welsh) local authorities, authorities of particular descriptions or particular authorities. Orders may make provision in relation to all entities connected with a local authority or entities of a particular description.
497.Local authorities are defined as those bodies which are required to prepare a statement of accounts by regulations made under section 27 of the Audit Commission Act 1998 or section 39 of the Public Audit (Wales) Act 2004 in accordance with proper practices and are local authorities for the purposes of section 21 of the Local Government Act 2003 (accounting practices). Proper practices under section 21 of the Local Government Act 2003 are defined, by virtue of secondary legislation, as including the Code of Practice on Local Authority Accounting in the United Kingdom – A Statement of Recommended Practice (“SORP”) as published by the Chartered Institute of Public Finance and Accounting (CIPFA).
498.An entity is stated to be “connected with” a local authority if financial information about that entity must be included in the local authority’s statement of accounts. For the purposes of this Part, a local authority itself does not qualify as such an entity.
499.It is intended to use the Order making powers to enable propriety controls to apply to the wider range of entities through which local authorities in England and Wales now operate rather than just to local authority companies as currently defined in Part V of the Local Government and Housing Act 1989 (and the Local Authorities (Companies) Order 1995 made under this part).
500.Section 213 brings trusts and trustees within the provisions that can be made under Section 212.