Part 1Structural and boundary change in England
Chapter 2Control of disposals etc
I124Authorities dissolved by orders: control of disposals, contracts and reserves
1
The Secretary of State may direct that, with effect from a date specified in the direction, a relevant authority may not without the written consent of a person or persons so specified—
a
dispose of any land if the consideration for the disposal exceeds £100,000;
b
enter into any capital contract—
i
under which the consideration payable by the relevant authority exceeds £1,000,000; or
ii
which includes a term allowing the consideration payable by the relevant authority to be varied;
c
enter into any non-capital contract under which the consideration payable by the relevant authority exceeds £100,000, where—
i
the period of the contract extends beyond a date specified in the direction; or
ii
under the terms of the contract, that period may be extended beyond that date; or
d
include an amount of financial reserves in a calculation under section 32(3) or 43(3) of the Local Government Finance Act 1992 (c. 14).
2
In this Chapter “relevant authority” means a local authority—
a
which by virtue of an order under section 7 or 10 is to be dissolved; and
b
which is specified, or of a description specified, in the direction.
3
In this section—
“capital contract” means a contract as regards which the consideration payable by the relevant authority would be capital expenditure for the purposes of Chapter 1 of Part 1 of the Local Government Act 2003 (c. 26) (capital finance);
“non-capital contract” means a contract which is not a capital contract.
4
A person specified in the direction as a person whose consent is required may be the Secretary of State or such authority or other person as he thinks appropriate; and the direction may specify different persons—
a
in relation to different matters for which consent is required;
b
in relation to different relevant authorities or descriptions of relevant authority.
I225Directions: further provision about reserves
1
A direction under section 24—
a
may provide that the consent of the person or persons specified in the direction is not required for the inclusion, in a calculation under section 32(3) or 43(3) of the Local Government Finance Act 1992, of financial reserves of a description specified in the direction;
b
may, in relation to any authority or description of authority, provide that that consent is not required for the inclusion in such a calculation of an amount of financial reserves not exceeding an amount specified in or determined under the direction.
2
If a direction contains provision by virtue of subsection (1), the reference in section 24(1)(d) to an amount of financial reserves is to be read as a reference to an amount of financial reserves other than an amount permitted by the direction.
I326Directions: supplementary
1
In this section “direction” means a direction under section 24.
2
A consent for the purposes of a direction may be given—
a
in respect of a particular disposal or contract, or in respect of disposals or contracts of any description;
b
unconditionally or subject to conditions.
3
The following enactments have effect subject to any direction—
a
section 123 of the Local Government Act 1972 (c. 70) (power to dispose of land);
b
any other enactment relating to the disposal of land by local authorities.
4
The consent required by a direction is in addition to any consent required by the enactments mentioned in subsection (3)(a) and (b).
5
Where the consideration or any of the consideration under a contract is not in money, the limits specified in a direction by virtue of section 24(1)(a) to (c) apply to the value of the consideration.
6
Where—
a
a question arises in relation to a direction as to the value of any consideration, and
b
the relevant authority concerned and the person or persons specified under section 24(1) fail to reach agreement,
the value is to be determined by the Secretary of State.
7
A direction may be varied or revoked by a subsequent direction.
I427Consideration to be taken into account for purposes of direction
1
In determining whether the limit specified in a direction by virtue of section 24(1)(a) is exceeded in the case of a disposal of land by a relevant authority, the consideration with respect to any other disposal of land made after 31 December 2006 by the relevant authority is to be taken into account.
2
In determining whether a limit specified in a direction by virtue of section 24(1)(b) or (c) is exceeded in the case of a contract entered into by a relevant authority (“the contract in question”), the consideration payable by the relevant authority under any other relevant contract shall be taken into account.
3
For the purposes of subsection (2) a “relevant contract” means a contract which is either or both—
a
a contract entered into after 31 December 2006 by the relevant authority and the person with whom the contract in question is entered into;
b
a contract entered into after that date by the relevant authority which relates to the same or a similar description of matter as that to which the contract in question relates.
I528Contraventions of direction
1
A disposal made in contravention of a direction under section 24 is void.
2
A contract entered into by an authority (“the old authority”) in contravention of a direction under section 24 is not enforceable against a successor.
3
In subsection (2) a “successor” means a local authority (other than the old authority)—
a
which is established by an order under section 7 or 10; and
b
whose area consists of or includes the whole or part of the area of the old authority.
4
A contract which apart from this subsection would be a certified contract for the purposes of the Local Government (Contracts) Act 1997 (c. 65) is not a certified contract for those purposes if it is entered into in contravention of a direction under section 24.
5
If an authority includes financial reserves in a calculation under section 32(3) of the Local Government Finance Act 1992 (c. 14) in contravention of a direction under section 24, the authority is to be treated for the purposes of section 30(8) of that Act as not having made the calculations required by Chapter 3 of Part 1 of that Act.
6
If an authority includes financial reserves in a calculation under section 43(3) of that Act in contravention of a direction under section 24, the authority is to be treated for the purposes of section 40(7) of that Act as not having made the calculations required by Chapter 4 of Part 1 of that Act.
I629Power to amend
1
The Secretary of State may by order—
a
substitute another sum for any sum for the time being specified in section 24(1);
b
substitute another date for the date for the time being specified in section 27(1) and (3).
2
An order under this section may include transitional or saving provision.
I730Definitions for purposes of Chapter 2
1
In this Chapter—
“local authority” means a county council in England, a district council in England or a London borough council;
“relevant authority” has the meaning given by section 24(2).
2
References in this Chapter to disposing of land include references to—
a
granting or disposing of any interest in land;
b
entering into a contract to dispose of land or grant or dispose of any such interest;
c
granting an option to acquire any land or any such interest.