Direct Labour and Direct Service Organisations

HC Deb 24 October 1996 vol 284 cc3-4W

Mr. Devlin

To ask the Secretary of State for the Environment what further action he proposes to take against those local authorities whose direct labour and direct service organisations failed to meet their statutory financial objectives in 1994–95. [653]

Sir Paul Beresford

On 30 July this year, 22 statutory notices were served on 17 local authorities concerning the failure of their direct labour and service organisations to meet the required financial objectives in 1994–95, and one notice was served on an authority for submitting a qualified account for work which it was carrying out. My right hon. Friend has now considered the responses to those notices, and has decided to give 16 directions to 12 local authorities.

The directions take the following forms: Restricting the type of work the authority can carry out, and preventing the authority from carrying out any part of the work if it fails to meet the financial objective in 1996–97 or 1997–98: The London borough of Brent (building maintenance). Preventing the authority from carrying out the work if it fails to meet the financial objective in 1997–98 or 1998–99: Great Yarmouth borough council (grounds maintenance). Preventing the authority from carrying out the work if it fails to submit unqualified accounts in 1995–96 or 1996–97: Mid Devon district council (building maintenance). Requiring authorities to retender the work and to seek the consent of the Secretary of State if proposing to award the work in-house: Amber Valley district council (refuse collection), Harborough district council (grounds maintenance), Stockton on Tees borough council (vehicle maintenance). Requiring authorities to retender work if they fail to meet the financial objective in specified years, and to seek the Secretary of State's consent where the work has to be retendered and where the authority subsequently wish to award work-in-house: 1996–97 and 1997–98: Knowlsey MBC (highways and sewers), Rossendale borough council (highways and sewers). The London borough of Tower Hamlets (building maintenance). 1997–98 and 1998–99: Rotherham MBC (grounds maintenance).

The Secretary of State has also decided to take no further statutory action in respect of financial failure in 1994–95 by: Bedfordshire county council (vehicle maintenance), Cambridge city council (building cleaning, refuse collection, other cleaning), Chorley borough council (highways and sewers), Halton borough council (vehicle maintenance) and North East Derbyshire district council (refuse collection).

To date, 67 notices have been served by the Department on 47 local authorities for losses incurred by their DLOs/DSOs in 1994–95, and one notice served on an authority for producing qualified accounts. Today's decisions follow those announced on 13 May and 20 June this year, and complete the programme of financial failure action in relation to 1994–95 accounts.

This action demonstrates our commitment to protect the interests of local taxpayers, and ensure that they receive value for money services from their local authorities. Where authorities' in-house teams have failed to achieve their financial targets, and where they do not seem to have taken the steps necessary to bring about an improvement in their performance, we will not hesitate to take statutory action.