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Clarifying conflicts of interest in local government

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"Integrity: Holders of public office must avoid placing themselves under any obligation to people or organisations that might try inappropriately to influence them in their work. They should not act or take decisions in order to gain financial or other material benefits for themselves, their family, or their friends. They must declare and resolve any interests and relationships."

The Nolan principle of integrity is crucial to public confidence that decisions taken on behalf of the public have been taken in a proper way and that the system is working for the benefit of the public. It is necessary to ensure that decisions are based on all the appropriate factors - focused on the merits of the argument and the available evidence; and that they are always taken in the public interest, not the private interests of decision-makers or those that might try inappropriately to influence them. For example, a councillor should have to declare and recuse themselves from voting about a housing development in which they are an investor or a buyer.

When public-office holders declare and resolve any relevant interests and relationships, they protect themselves from any accusations or perception that they have acted in an inappropriate way or based on their own interest.

From all the evidence we have taken, and from those we have met and spoken to in the course of our review so far, it is clear that most councillors want to do the right thing, and take decisions that will benefit their local communities. It is also clear that there is a long tradition of probity in local government. The vast majority of councillors are diligent in registering, declaring, and managing interests. The instinct to consider your interests, take advice, and ensure that everything is properly declared, is deeply embedded in the structure and culture of local councils.

This welcome evidence points to a positive culture in local government. But in the course of our review we have also heard a concern that the current legal framework for registering, declaring and managing interests doesn’t necessarily serve the best instincts of councillors, nor reassure the public. For example, under the current arrangements, a councillor would have to withdraw from a discussion where their spouse or civil partner has a financial interest, but not their children or other close relative. The legal wording around the current Disclosable Pecuniary Interest requirements can easily leave councillors confused about when they have to withdraw as a result of a particular interest. And when it comes to the most complex cases of potential conflicts, current case law is inconclusive, which also puts council officers, who have to advise councillors on their interests, in a difficult position.

There is a need to get this right at a local level, because some of the decisions that councils have to make - for example, in relation to planning, grant-making, and licensing – affect the interests of particular individuals or organisations in their communities. The public need to have the confidence that these decisions are being taken in the public interest and not for private gain.

Equally, councillors need to have confidence that there is a robust system in place that does justice to their instinct to do the right thing, and is clear to navigate. Whilst ultimately upholding the principle of integrity is a responsibility that lies with each individual councillor, they deserve clear guidance and a framework to help them do so.

This is something we are looking at in detail in our review, to make sure that everyone can have confidence that decisions in local government are taken in the public interest.

The Committee is planning to publish its review of ethical standards in local government in early 2019.

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