Chair's discretion to authorise payments

Question

A few months ago I asked about any restrictions on the discretion of the Clerk and the Chair to authorise payments,based on my concern that this power was being used to circumvent the need to get the agreement of the Council.  Based on your helpful responses I raised this with the Parish Council and pointed to the Financial Regulations.

I have now received a response which says that the Clerk and Chair have the authority to authorise expenditure up to (in our case) £500 and the  limitations in the Financial Regulations apply only to the authority of the Clerk and Chair to authorise payments.  Looking at the Financial Regulations I can see this is the language used in the relevant clauses (in our case 4 and 5.5/6) but is that the correct interpretation?

If so, what would happen if the Chair and Clerk authorise expenditure which does not fall within 5.5 and then the Council resolves not to pay it?  In my case, and since my original post, the Chair and Clerk have bought a "gift" for the local History Society without consulting the Parish Council, it simply appeared on the list of payments to be approved some months later.  What would have happened if the Council had declined to agree it? 

Answer 1

As a Parish (and as Chair) our Clerk is authorised to spend upto £500 if the expenditure cannot be otherwise authorised.

e.g. We need to arrange a plumber to fix a leak. It would not be sensible to wait until the next parish meeting to authorise the booking of plumber to fix a leak. The clerk can book the plumber, fix the leak, pay the plumber and report it at the next meeting

It is not for general spending or grants. A gift for the history society would fall under the free resource rules, these can only be approved by councillors as they need to make a specific declaration of free resource spending. - Without this declaration, it technically isn't legal.

Answer 2

It depends whether or not the item of expenditure has been allowed for within the budget for the year. To quote the current model financial regs:

4.1. Expenditure on revenue items may be authorised up to the amounts included for that class of expenditure in the approved budget. This authority is to be determined by:

·         the council for all items over [£5,000];

·         a duly delegated committee of the council for items over [£500]; or

·         the Clerk, in conjunction with Chairman of Council or Chairman of the appropriate committee, for any items below [£500].

A gift to the local history society might be a legitimate item of expenditure under Section 137, if you have a budget for this. The limit of £500 can only be exceeded by a resolution of the council. As a councillor myself, I would want to know why it was necessary for this matter to be handled in this way, but I would have no authority to overrule the decision.

The emergency power has already been explained. The other relevant powers include the authority for the Clerk to make payments between meetings if necessary to avoid the payment of interest (para 5.5) and to make regular payments previously authorised as part of an ongoing payments schedule (para 5.6).

It is important to note that these powers are given to the Clerk/RFO, not the Chair, who has no such powers unless a specific provision has been agreed in the setting of the budget.