community right to challenge

© Urban Forum 2010

A community ‘right to challenge' (previously referred to in the Queen's Speech as a ‘right to bid') has been introduced in the Localism Bill. If enacted, the Right will give local communities the ability to register an interest to bid to take over a local public service which they would like to run better or differently. The Localism Bill was introduced 13th December 2010 and went through a second reading on 17th January 2011. A consultation on the details of both the Community Right to Challenge and the Community Right to Buy will run in parallel with the Bill's passage through Parliament.

Background
The Community Right to Challenge is key part of the Government's Localism and Big Society agendas, which seek to devolve power to local people. Community rights have been developed as a way to help people to hold local service providers to account - by giving them the power to take over both assets and services that they are unhappy with. The Government says it wants to give local people more of a say in how local services are run and empower them to challenge local authorities if they think services should be run better or differently.

When originally announced in the Queen's Speech in May, this was expected to be called a Right to Bid, as the emphasis was on the power to directly take over public services. With the Localism Bill, it has now been renamed the Community Right to Challenge, being more specifically the power to submit an expression of interest to trigger a procurement process, rather than to immediately bid to take over the service.

What does it mean?
The Right to Challenge gives voluntary and community groups, social enterprises, charities, parish councils and relevant local authority staff the right to submit an expression of interest to bid to run a local authority service. Local authority staff are also empowered to take over public services via the Right to Provide, which encourages the formation of employee-owned mutuals. The Secretary of State will retain the power to change the definition of who has the right to challenge, either extending or limiting its use in the future. The right to challenge only applies to services run by local authorities, but it may be extended to include services run by other public bodies. This also means that services that are contracted out to private companies or to charities and social enterprises, may be excluded from the right to challenge.

Expressions of interest may only be submitted by groups who intend to bid for the service if a procurement exercise is triggered, but submitting an expression of interest by no means guarantees that the group will be awarded the service. Upon receiving an expression of interest, local authorities can: accept it and undertake a procurement exercise in line with legal requirements; accept the expression of interest with modifications; or reject it.

Going forward
Regulations will be introduced which will outline in exactly which circumstances local authorities may reject an expression of interest, but this will in general be because the service is excluded from challenge; the service is delivered by an authority other than the local council; the service is currently contracted out; or the organisation expressing interest would not be capable or appropriate to bid to run the service if the expression of interest were accepted. Authorities must consider whether an expression of interest and a procurement exercise can improve the social, economic or environmental well-being of an area when taking a decision.

The particular details on these matters will be open to consultation prior to the publication of official guidance (secondary legislation). A consultation document will be published shortly, and the Department of Communities and Local Government will be running events over the 12 week consultation period. The consultation will also seek opinions on what information should be required in an expression of interest and the timeframe during which a local authority will be required to respond to an expression of interest, among other things. A Public Service Reform White Paper will also be published in February 2011 which will outline other changes to be made to services which may affect the right to challenge.

Caitlin McMullin
January 2011