Agenda item

To receive a report from the Chief Executive on the introduction of Corporate Joint Committees (CJCs) as provided for in the Local Government and Elections (Wales) Act 2021.

The Chief Executive presented the report to members which provided an update to Members on the introduction of Corporate Joint Committees (CJCs) as provided for in the Local Government and Elections (Wales) Act 2021.

He continued that Officers of the CCRCD and the Accountable Body have been putting in place all the legal, accounting and practical steps to ensure the new CJC can be created on 28th February 2022. However, it has become clear that the specific risks and issues originally highlighted by CCR with WG will not be resolved sufficiently to support the transfer of the CCR City Deal into the CJC by the date of CJC budget setting on 31 January 2022. This is mainly because the issues that require resolution, namely S.33 (VAT) status, has not been considered by WG in setting the Regulations. As a result we require the approval of Her Majesty’s Revenue & Customs (HMRC) and Her Majesty’s Treasury (HMT) to approve the correct taxation status.

In addition, further issues have arisen in respect of Corporation Tax. This is a complex matter not addressed so far in the Regulations; and could have significant implications to the CCR operating model unless similarly addressed through an application to HMT for relevant dispensations. Work is underway to address this, with CCR supporting WG’s business case application to HMRC for the relevant dispensations.

The Leader stated that this is a step in the right direction for joint working and formulising arrangement, as long as the shift is seamless to residents with services continuing to be delivered then this will be positive.  He continued that it is important that the Local Authorities decide on what services will be delivered through the CJCs and there is local determination on services that require different needs in different Local Authority areas.  He relayed his concerns that some out of town developments could have a detrimental impact on town centres so this would need closer working with Local Authorities

The Deputy Leader commented that Scrutiny arrangements will be key to CJCs to include the wider engagement of Members and Communities to measure the impact of the CJCs.  She commented that RCTCBC had already supported a step change in the current scrutiny arrangements of the CCRCD

At this juncture of the meeting, and with permission of the Leader Cllr P Jarman addressed members on the item.  She commented whilst she is not a supporter of CJC’s, having scrutinised the legislation, she accepted that they are a model of Regional Governance.  She did query why matters and updates have not come before full council for every member to have an update on matters and there is a need to be open and accountable.

She also commented that she was disappointed that Welsh Government has not negotiated with the UK Government before the implementation of CJCs on the taxation issues. 

The Leader agreed with the comments around the taxation issues.  He added that independent legal advice was sought and the CRCD Cabinet has done everything they possibly can to progress.  He added it is disappointing that no resolution or clarification has been given from UK and Welsh Government on the matter as it needs to be resolved before key strategic decisions can be made on matters where there are financial implications.    He reassured that Local Authorities in the CCRCD are now focussed on taking this forward and making this work

Following consideration of the report it was RESOLVED to:

1.    Note that the information provided to Cabinet on 18^th October 2021 in respect of the creation and development of the South East Wales Corporate Joint Committee has been updated. In particular the decision of the Cardiff Capital Region Cabinet to introduce an interim governance and delivery model for implementation of the SE Wales Corporate Joint Committee (CJC) until such time as a number of taxation status issues and risks associated with the Regulations are resolved;

2.    Note the requirement for the CJC to set and approve a budget on or before 31^st January 2022;

3.    Note the request made by CCR of WG to amend the CJC regulations to change the date on which immediate duties commence under the Regulations from 28^th February 2022 to 30^th June 2022, to align to the other three CJCs in Wales;

4.    Note the Minister for Finance and Local Governments’ letter of 20^th December 2021 consulting the Council on amending the commencement date of the South East Wales Corporate Joint Committee to 30^th June 2022 and the response of the Council’s Chief Executive, in consultation with the Leader of the Council, confirming the Council’s support to the amendment. The consultation ended on 21^st  January 2022; and

Note the work ongoing by CCR and its constituent Councils to work with WG, UKG, Audit Wales and advisors as appropriate, to help inform resolution of the remaining issues wherever possible