How do I correct possible errors in the Annual Return?

Question

It would appear that a parish council's annual return includes the clerks basic salary in section 4 - staff costs, but not PAYE; National Insurance; pension contributions; or employment expenses including an office maintenance allowance.

As the clerk is aged over 65 I'm not sure if National Insurance or Pension contributions is relevant, but I am fairly sure that PAYE and the office maintenance allowance should have been declared.

It would appear that this has not been picked up by the Internal Auditor over the last two years, but it is difficult for this to be established as I cannot gain access to the Annual Accounts.

Before I light the blue touch paper do you have any advice to offer?

Answer 1

The annual return form clearly states that employment costs should include all costs, including National Insurance, pension contributions, etc. I would think that an office maintenance allowance might not count as an employment cost but an administrative expense.

If the clerk is over retirement age, then they are exempt from employee NI contributions, but employer NI contributions are still payable.

Access to council documents by councillors is a common law right, and would certainly include the annual accounts. Most councils make their accounts public.

Apart from the councillor rights, the public have the right of inspection during a set period of 20 working days as described here: "Each year the Council's Annual Return is audited by an auditor appointed by the Audit Commission. Any person interested has the right to inspect and make copies of the accounts to be audited and all books, deeds, contracts, bills, vouchers and receipts relating to them". (The new audit arrangements are a bit different, but the same principle still applies). So accounting records cannot be kept secret.

Personally, I'd be disinclined to worry too much about mistakes in past returns provided the problem is only that the costs have been recorded in the wrong way but the overall figures are correct. However, it is certainly a good thing to make sure that future returns are prepared correctly.

Comments

The Transparency Code for Smaller Authorities published by the Department for Communities and Local Government in December 2014 requires parish councils to publish various financial information including all items of expenditure over £100, end of year accounts and the internal audit report. The first annual set of data should have been published by July 2015. Moreover the data and information specified in the Code has to be published on a freely available website.

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Thanks Old Tom. The only Transparency Code data available on the website is the Annual Return, no other supportive information. Still plugging away seeking answers.

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This is quite correct, although it applies only to local councils with a turnover of not more than £25,000.  Confusingly, there is also another transparency code that applies to principal authorities and local councils whose income or expenditure exceeds £200,000. A lot of local councils will be in the gap between the two boundaries.

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The Transparency Code for Smaller Authorities is ‘mandatory’ but there are apparently no sanctions if Parish Councils choose not to comply - which quite a few are doing. Surprisingly it seems that Parish Councils can break the rules - Code of Conduct for example - and there’s nothing you can do about it except make a fuss at meetings. As far as getting the information you want: have you tried a Freedom of Information request? Refusal of that would put the Parish Council in trouble.

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Having had requests for information / documents ignored several times in the past ten months I have resorted to FOI. First time it took 19.5 days plus two reminders just to receive back copies of minutes. This time wrong information was sent and we are ten days into the FOI response requirements. Quite worrying, if this is the treatment meted out to a councillor, one wonders how a parishioner would fare.

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I would be more insistent!  In relation to minutes, see as an example http://www.ashford.gov.uk/download.cfm?doc=docm93jijm4n2020.pdf&ver=3422 item 5, inspection of minutes, the whole document relating to the relevant statute as shown. Point out that refusal to make minutes available is unlawful and puts the council in jeopardy. Also emphasise the point that councillors have a common law right of access to council documents and insist that anyone who prevents this is acting unlawfully. If this doesn't work, threaten to complain to the external auditor. If that doesn't work, I'd think about writing to the local press, inviting the local Standards Officer to intervene or making a complaint to the external auditor that the council's procedures are unlawful.  The Standards Officer doesn't have much power, but can be influential all the same.

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Interesting reply, how does the common law right to access sit with our Council quoting LTN 1 - the right to know?

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Good question, but I don't think there is a conflict. The common law right is, by definition, not formally stated but the result of practice and court decisions. But the principle is that a councillor, in the nature of their office, is entitled to have access to council documents that are needed to effectively carry out their duties. That does have limits, as indicated in the legal topic note, and as the note says the common law right does not extend to satisfying idle curiosity or "fishing trips". In the case cited here, I cannot see that a councillor would not have access to the annual accounts, which are needed for any consideration of the financial state of the council. If a councillor has concerns over the accounting procedures and can cite reasons for their concerns, I would think that would be adequate grounds to insist on seeing further accounting documentation.