The government is removing the unnecessary and burdensome financial restrictions on parish councils to improve their productivity and stop them being fined, Brandon Lewis announced today (11 November 2013).
The Local Government Minister laid the parliamentary papers to abolish the existing, inflexible, “2 signature rule” that currently prevents parish councils from using electronic payment methods and wastes too much of council members’ time.
Currently, all parish council transactions have to be completed with a cheque that is then signed by 2 members of the council. This makes it difficult for parish councils to use electronic means of payment and many businesses and other public bodies that parish and community councils deal with are increasingly either refusing to take cheques or discouraging their use by discounting electronic payments.
The government attaches the highest importance to the security of public funds. New guidelines will allow parish councils to use electronic methods of payment provided robust anti-fraud measures are in place. Councils will need to ensure that they have a sound and comprehensive system of internal control with checks before and after a payment is made.
Brandon Lewis said:
Given that there are over 9,000 parish councils in England and 50 of them spend over £1 million each every year, it was ineffective to continue with the current system.
Removing this red tape that is strangling parish councils will not only free up members’ time and let them do more useful council work but also save the councils money by getting discounts for using electronic payments.
The change is being made by legislative reform order that has been laid in draft and will be considered by parliamentary committees over the coming weeks.
Read the legislative reform order.