HC Deb 14 February 1985 vol 73 cc283-4W
Mr. Evennett

asked the Secretary of State for the Environment whether he is now able to publish his proposals on competition in the provision of local authority services; and if he will make a statement.

Mr. Patrick Jenkin

With my right hon. Friends the Secretaries of State for Scotland and for Wales I have today published a consultation paper setting out proposals for promoting increased value for money by exposing more local authority activities to the test of competition. Copies of the paper have been placed in the Library.

By virtue of Part III of the Local Government Planning and Land Act 1980 local authority directly employed staff are already obliged to compete for most of their building and maintenance work and authorities are required to draw up separate annual reports and accounts showing the results of their direct labour organisations performance of such work.

The consultation paper makes two main proposals. First, it proposes that a similar compulsory tendering regime should be extended to the following activities:

  1. i. Refuse collection and street cleansing;
  2. ii. The cleaning of buildings;
  3. iii. Catering services;
  4. iv. Ground maintenance;
  5. v. Vehicle maintenance.

Second, there is a wider range of local government activities where there is scope for securing the benefits of a more competitive approach but where formal statutory tendering regime on DLO lines cannot easily be applied. Therefore, in order to compare the value for money from using directly-employed staff with that of going to outside firms, the paper outlines proposals which would enable the Secretary of State to require authorities to prepare and make public reports comparing in-house costs of particular activities with the costs of having the work done outside.

The paper contains two further proposals. The first is to nullify the imposition by local authorities of contract conditions which have nothing to do with the contractors' competence to carry out the work in question (for instance a condition disqualifying contractors who have worked on certain NATO defence contracts). The second is to give to the Secretary of State power to act where local authorities unjustifiably set aside or frustrate the objective of fair competition. This will make the DLO rules more effective and enforceable.

The proposals in the paper will make a major contribution to the extension of the principles of fair competition in the provision of public services and so enable councils to get better value for money to the benefit of their communities.