What is Power to Spend

The power to spend for parish and town councils in the United Kingdom is derived from their legal status as local authorities. This power is governed by the Local Government Act 1972 and subsequent legislation, which sets out the powers, duties, and responsibilities of local authorities.

Parish and town councils have the power to spend money on the provision of goods, services, and works that are necessary or desirable for, or in connection with, the exercise of their functions. This includes spending on community facilities, maintenance of public spaces, and provision of services such as parks and open spaces.

The expenditure of parish and town councils must be in accordance with their budgets and financial regulations, and must be authorized by the council's elected members. The council must also ensure that it has sufficient funds available to meet its obligations and maintain its statutory responsibilities.

It is important for parish and town councils to consider their statutory obligations and to ensure that their spending is in line with both their financial regulations and the law. They must also be transparent and accountable in their use of public funds and must keep accurate records of their financial transactions.

What are the powers

The powers available to parish and town councils can vary depending on the region. However, here are som ecommon powers Parish councils in England and Wales have:

1. Power to expend money on local facilities and services: This includes spending on things like public toilets, parks, play areas, allotments, cemeteries, bus shelters, and community centres.
2. Power to expend money on highways: This includes spending on things like road repairs, signs, and traffic management measures.
3. Power to expend money on planning: This includes spending on things like planning applications, objections to planning proposals, and environmental impact assessments.
4. Power to expend money on environmental protection: This includes spending on things like litter collection, graffiti removal, and other environmental protection measures.
5. Power to expend money on community projects: This includes spending on things like community events, festivals, and local projects that support community cohesion and regeneration.
6. Power to expend money on grants: This includes spending on things like grants to local organisations, charities, and community groups.
7. Power to expend money on emergency planning: This includes spending on things like emergency planning, emergency response, and emergency evacuation.

These powers are subject to several statutory obligations, including financial controls, reporting requirements, and transparency. The precise nature of these obligations will depend on the legislation that applies to the specific council, as well as the relevant financial and accounting standards.

Common mistakes related to Power to Spend

Common mistakes that Parish clerks & RFOs in England and Wales may make when it comes to spending powers, and guidance on how to avoid them:

1. Lack of understanding of financial regulations and procedures: Parish clerks should be familiar with the financial regulations and procedures of the council, including the policies on procurement, budgeting, and record-keeping.
2. Inadequate budget planning: The council should have a clear budget plan in place and regularly review its spending to ensure that it remains within budget.
3. Failure to obtain proper approvals: Parish clerks should ensure that all spending decisions are made with the proper approvals, such as those of the council or the relevant committee.
4. Insufficient record-keeping: Parish clerks should maintain accurate records of all financial transactions, including receipts and invoices.
5. Not following proper procurement procedures: Parish clerks should ensure that all procurement is conducted in accordance with the council's procurement policies and guidelines.
6. Unauthorized spending: Parish clerks should only spend funds that have been authorized by the council.
7. Inadequate monitoring of spending: Parish clerks should regularly monitor the council's spending to ensure that it remains within budget and that the council is not overspending on any particular item.

By following these guidelines, parish clerks can help to ensure that the council's spending is managed effectively and efficiently, and that the council remains in compliance with financial regulations and procedures.

Compliance tips for Clerks and RFOs

Here are some tips for a parish clerk to ensure they are complying.

1. Familiarise yourself with the relevant laws and regulations: The powers of parish and town councils to spend are governed by the Local Government Act 1972 and other relevant legislation. Make sure you understand the legal framework in which you operate, including any restrictions on spending.
2. Develop and follow financial policies and procedures: The parish council should have clear financial policies and procedures in place that outline the steps for budgeting, spending, and reporting. The clerk should ensure that these policies are followed consistently.
3. Maintain accurate and up-to-date financial records: Financial records should be accurate, complete, and up-to-date. This will help the council monitor its spending and ensure that it remains within budget.
4. Exercise proper controls over cash and bank accounts: The clerk should ensure that there are adequate controls in place over the council's cash and bank accounts to prevent fraud or misappropriation of funds.
5. Seek professional advice when needed: The clerk should seek professional advice from an accountant or lawyer if they are unsure about any financial aspect of the council's operations.
6. Report any irregularities: The clerk should report any financial irregularities or suspected fraud to the council's internal audit committee and/or the relevant authorities as soon as possible.
7. Ensure that the council's spending is in accordance with the council's responsibilities and functions: The clerk should ensure that the council's spending is in line with its statutory responsibilities and functions, and that the spending is in the best interests of the community.

By following these tips, a parish clerk can help ensure that the power to spend for a parish council is used effectively, efficiently, and in accordance with applicable regulations and best practices.

Overview of the Powers

This  will take you through the key spending powers that underpin your council’s financial decisions. From the General Power of Competence (GPC) that lets you flex your financial muscles, to Section 137 for those times when no other power quite fits, we’ve got you covered. Plus, we’ve thrown in practical examples to help you spend like a pro—compliantly, of course!

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General Power of Competence (GPC)

Source: Localism Act 2011, Section 1

What it Allows: The General Power of Competence (GPC) gives councils the flexibility to do anything an individual can legally do, provided it's not restricted by other laws. To use this power, your council needs to meet eligibility criteria, such as having a qualified clerk and elected councillors.

When to Use: For spending that benefits the community but isn’t covered by any specific statutory power.

Examples of Purchases:

• Funding a community event that doesn’t fit under other powers.
• Setting up a local business hub to promote entrepreneurship.
• Installing free public Wi-Fi in community areas.

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Section 137 of the Local Government Act 1972

Source: Local Government Act 1972, Section 137

What it Allows: Section 137 lets councils spend on items or services that benefit the community when no other statutory power applies. The spending is capped per elector, with the limit for 2024-25 set at £9.93 per elector.

When to Use: If no other power fits, but the expenditure benefits the area or its inhabitants.

Examples of Purchases:

• Donations to local charities or causes.
• Sponsoring a community newsletter.
• Buying new equipment for a local youth club.

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Powers for Specific Services (Statutory Powers)

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Allotments

Source: Smallholdings and Allotments Act 1908, ss. 23, 26, 42

What it Allows: Power to provide, maintain, and enhance allotments.

When to Use: For anything related to allotment provision and upkeep.

Examples of Purchases:

• Tools or equipment for maintaining allotments.
• Installing water troughs or sheds for allotment holders.
• Fencing or signage for allotment sites.

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Burial Grounds and Cemeteries

Source: Local Government Act 1972, s.214; Open Spaces Act 1906, ss.9 & 10

What it Allows: Power to acquire, maintain, and contribute to the upkeep of burial grounds and cemeteries.

When to Use: For any spending related to burial grounds.

Examples of Purchases:

• Upgrading pathways in cemeteries.
• Maintaining headstones and memorials.
• Installing benches or signage for visitors.

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Bus Shelters

Source: Local Government (Miscellaneous Provisions) Act 1953, s.4

What it Allows: Power to provide and maintain bus shelters.

When to Use: For installing or improving bus shelters in the community.

Examples of Purchases:

• Installing a new bus shelter at a busy stop.
• Adding seating or weather protection to existing shelters.

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Community Centres and Village Halls

Source: Local Government (Miscellaneous Provisions) Act 1976, s.19

What it Allows: Power to provide and equip buildings for clubs with athletic, social, or educational purposes.

When to Use: For upgrading or creating community spaces.

Examples of Purchases:

• Renovating a village hall or installing a new kitchen.
• Buying furniture or audiovisual equipment for community events.
• Installing energy-efficient heating systems in a community centre.

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Crime Prevention

Source: Local Government and Rating Act 1997, s.31

What it Allows: Power to spend on crime prevention measures.

When to Use: To help reduce or prevent crime in the local area.

Examples of Purchases:

• Installing CCTV cameras or extra lighting in public areas.
• Funding neighbourhood watch schemes.
• Purchasing alarm systems for council-owned properties.

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Entertainment and the Arts

Source: Local Government Act 1972, s.145

What it Allows: Power to provide entertainment and support for the arts, including festivals and local celebrations.

When to Use: For funding artistic or entertainment activities for the community.

Examples of Purchases:

• Funding a local arts festival or open-air theatre.
• Hiring a band for a community event.
• Purchasing equipment for a community arts project.

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Public Conveniences

Source: Public Health Act 1936, s.87

What it Allows: Power to provide and maintain public toilets.

When to Use: For installing or upgrading public conveniences.

Examples of Purchases:

• Installing new toilets in a park.
• Upgrading existing facilities to include accessibility features.

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Recreation Grounds and Open Spaces

Source: Open Spaces Act 1906, ss.9 & 10; Public Health Act 1875, s.164

What it Allows: Power to provide and maintain public parks, recreation grounds, and open spaces.

When to Use: For maintaining or enhancing public spaces.

Examples of Purchases:

• Buying playground equipment for a local park.
• Installing benches, bins, or lighting in recreation areas.
• Landscaping or planting trees in public spaces.

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Tourism

Source: Local Government Act 1972, s.144

What it Allows: Power to contribute to the promotion of tourism.

When to Use: For promoting local tourism or enhancing tourist facilities.

Examples of Purchases:

• Creating promotional materials for local attractions.
• Improving signage or information boards for tourists.
• Funding a local tourism event or market.

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War Memorials

Source: War Memorials (Local Authorities' Powers) Act 1923, s.1; Local Government Act 1948, s.133

What it Allows: Power to maintain, repair, and protect war memorials.

When to Use: For any spending related to war memorial upkeep.

Examples of Purchases:

• Cleaning or repairing war memorials.
• Installing new plaques or remembrance features.
• Adding benches or flower beds around memorials.Borrowing Powers

Source: Local Government Act 1972, Sch.13

What it Allows: Councils can borrow money for capital projects, subject to approval from the Secretary of State.

When to Use: For large-scale projects that need funding beyond the council’s annual budget.

Examples of Purchases:

• Borrowing to build a new community centre.
• Upgrading council-owned sports fields or buildings.

Power to Raise a Precept

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Source: Local Government Finance Act 1992

What it Allows: Power to raise funds via a precept through local council tax to finance the council’s services and projects for the coming financial year.

When to Use: During the annual budget process to secure funds for essential services.

Examples of Use:

• Raising funds for maintaining parks and public amenities.
• Funding street cleaning or environmental services.

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Additional Powers

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Archives

Source: Local Government (Records) Act 1962, ss.1 & 4

What it Allows: Power to support local archives and make records available to the public.

When to Use: For preserving local history and records.

Examples of Purchases:

• Digitising historical council records.
• Funding local archive exhibitions.

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Training for Councillors

Source: Local Government Act 1972, s.175

What it Allows: Power to provide training for councillors.

When to Use: To enhance councillor skills and knowledge.

Examples of Purchases:

• Enrolling councillors in training courses.
• Purchasing training materials.

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Incidental and Ancillary Powers

Source: Local Government Act 1972, s.111

What it Allows: Power to cover anything incidental to the council’s functions, including day-to-day administrative costs.

When to Use: For supporting statutory functions or general council operations.

Examples of Purchases:

• Office supplies and IT equipment.
• Professional services like legal advice or auditing.

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