Source: http://www.legislation.gov.uk/ssi/2016/123/made
Timestamp: 2018-04-25 11:12:17
Document Index: 340342485

Matched Legal Cases: ['ART 3', 'art 4', 'ART 4', 'art 1', 'art 2', 'art 3', 'art 4', 'art 5']

The Scottish Ministers make the following Regulations in exercise of the powers conferred by section 165 of the Local Government etc. (Scotland) Act 1994(1), paragraph 5(1) of Schedule 3 to the Local Government (Scotland) Act 1975(2) and all other powers enabling them to do so.
In accordance with section 165(5) of the Local Government etc. (Scotland) Act 1994 a draft of this instrument has been laid before and approved by resolution of the Scottish Parliament.
“integration joint board” means an integration joint board established under section 9 of the Public Bodies (Joint Working) (Scotland) Act 2014(4);
“local authority” means a council constituted under section 2 of the Local Government etc. (Scotland) Act 1994(5), a joint board within the meaning of section 235 of the 1973 Act and the Strathclyde Partnership for Transport, but does not include an integration joint board or the Tay Road Bridge Joint Board;
“proper accounting practices” is to be construed in accordance with section 12 of the Local Government in Scotland Act 2003(6);
“Strathclyde Partnership for Transport” means the Regional Transport Partnership for the West of Scotland, established under section 1 of the Transport (Scotland) Act 2005(7);
“Tay Road Bridge Joint Board” means the joint board established by the Tay Road Bridge Order Confirmation Act 1991(8).
(4) For the purposes of section 56(6) of the 1973 Act(9) the determination and any variation of the authorised limits are functions of the local authority with respect to borrowing money (and therefore are functions that may be discharged only by the local authority itself).
(a)a superannuation fund which the local authority is required to keep by virtue of the Superannuation Act 1972(10);
(b)a pension fund which the local authority is required to keep by virtue of the Public Service Pensions Act 2013(11);
PART 3Borrowing in respect of lending by local authorities
10. A local authority may borrow to lend to the following statutory bodies on such terms as may be agreed between them, subject to those bodies being authorised to borrow by these Regulations or by any other enactment—
(b)the Tay Road Bridge Joint Board;
(c)an integration joint board;
(d)a Transport Partnership created under the Transport (Scotland) Act 2005(12);
(e)a community council established in accordance with the provisions of Part 4 of the 1973 Act;
(f)a harbour authority within the meaning of section 57(1) of the Harbours Act 1964(13) for a harbour (within the meaning of that section) that is wholly or partly situated within the area of the local authority.
PART 4Loans funds
Duty to maintain a loans fund
12.—(1) A local authority must maintain a loans fund.
(2) A loans fund must be administered in accordance with these Regulations, proper accounting practices and prudent financial management.
Duty to make a statutory repayment of loans fund advances
14.—(1) A local authority must, at the time of making a loans fund advance under regulation 13(1), determine—
(a)the period over which the advance is to be repaid to the loans fund; and
(b)the amount of repayment to be made to the loans fund in each financial year in that period.
(2) A local authority may subsequently vary either the period or the amount of repayment (or both), if it considers it prudent to do so.
(3) In relation to any borrowing for which the consent of the Scottish Ministers was required under regulation 2(2), paragraphs (1) and (2) do not apply to the extent that the Scottish Ministers have determined the period and the amount of repayment.
15.—(1) In section 37(1) (general interpretation) of the Local Government (Scotland) Act 1975(14), in the definition of “prescribed” the words “, except in paragraph 6 of Schedule 3,” are repealed.
(a)in paragraph 22(3) (operation of capital, renewal and repair, and insurance funds)(15), for “advanced to the loans fund” substitute “used for any purpose for which a local authority may borrow money”; and
(3) In section 33(1) of the Order in the Schedule to the Tay Road Bridge Order Confirmation Act 1991 (advances by councils to Tay Road Bridge Joint Board) (16), the words from “, in” to “1975,” are repealed.
(a)the Local Authority Stocks and Bonds (Scotland) Regulations 1975(17);
(b)the Local Authority Mortgages (Scotland) Regulations 1975(18);
(c)the Local Authority Stocks and Bonds (Scotland) Amendment Regulations 1984(19); and
(d)the Local Authority Stocks and Bonds (Scotland) Amendment Regulations 1991(20).
These Regulations make provision with respect to the powers of local authorities to borrow money, to incur debt through borrowing by way of credit arrangements and to maintain loans funds. They are made under the Local Government etc. (Scotland) Act 1994 (“the principal Act”). They will replace much of the provision in relation to local authority borrowing that is contained in Schedule 3 to the Local Government (Scotland) Act 1975 (“the 1975 Act”).
Part 1 contains general provisions concerning the citation, commencement and interpretation of the Regulations.
Part 2 (regulations 2 to 9) makes provision about local authority borrowing. Regulation 2 sets out purposes for which a local authority may borrow money. Borrowing for other purposes requires the consent of the Scottish Ministers, as does any borrowing that is not in sterling. Regulation 3 enables local authorities to borrow jointly and sets out how these Regulations apply to such borrowing. Regulation 5 enables borrowing through credit arrangements, as defined by regulation 1(3), and provides for calculation of the amount of external debt that a local authority needs to recognise in respect of borrowing through such arrangements.
When a local authority exercises the power to borrow, regulation 4 requires it to have regard to generally recognised codes of practice and to guidance, such as the CIPFA Prudential Code and CIPFA Treasury Management Code. Compliance with the CIPFA Prudential Code would mean a local authority had to set an authorised limit for its external debt; regulation 6 makes this a requirement and provides for the determination and variation of the authorised limit. Transitional provision is made by regulation 17 for the introduction of this requirement.
Regulation 7 requires that all money borrowed, and interest on it, must be secured over all the revenues of the local authority, and can only be secured in that way. All securities must have equal ranking, which is a continuation of requirements under the 1975 Act. Existing protection for lenders under the 1975 Act is continued by regulation 8.
Regulation 9 provides that borrowing by a local authority for the purposes of the funds specified in that regulation is not to be classed as borrowing by that authority for the purposes of these Regulations.
Part 3 (regulations 10 and 11) enables a local authority to borrow to lend to other local authorities, specified other bodies and any common good fund of that authority.
Part 4 deals with loans funds. All local authorities that did not already have a loans fund were required to establish one by paragraph 12 of Schedule 3 to the 1975 Act. Regulation 12 requires that these funds are maintained, though they will operate more flexibly than as provided for by the 1975 Act, and sets out how they are to be administered. Regulations 13 and 14 provide for advances from loans funds and their repayment.
Part 5 (regulations 15 to 17) makes consequential amendments to other legislation, revokes some instruments that are no longer required and makes supplemental provision in relation to regulation 6. In particular, regulation 15 makes consequential changes to the 1975 Act and the Tay Road Bridge Order Confirmation Act 1991. Some other provisions of Schedule 3 to the 1975 Act will be repealed separately, by commencement of provisions of the principal Act that provide for their repeal.
Regulation 15 also amends provision in paragraphs 22 and 25 of Schedule 3 to the 1975 Act about use of money in certain funds that is not immediately needed for fund purposes. There is no longer a requirement to recognise the internal borrowing of these funds by advancing them to the loans fund. Instead these funds can be used for any purpose that may be funded by borrowing, as set out in regulation 2, which includes financing capital expenditure and treasury management. Paragraph 22 of that Schedule continues to allow these funds to be invested externally.
1994 c.39. Section 165 was amended by Schedule 24 to the Environment Act 1995 (c.25). The functions of the Secretary of State were transferred to the Scottish Ministers by virtue of section 53 of the Scotland Act 1998 (c.46). The requirement to obtain Treasury consent was removed by section 55 of that Act.
1975 c.30. Paragraph 5 of Schedule 3 was amended by section 5(2) of the Stock Transfer Act 1982 (c.41).
1964 c.40. Section 57(1) is relevantly amended by Schedule 29 to the 1973 Act and paragraph 33(a) of Schedule 13 to the Merchant Shipping Act 1995 (c.21).