Local Government (No. 2) Bill, 2000: Second Stage.

Minister of State at the Department of the Environment and Local Government (Mr. Molloy): I move: "That the Bill be now read a Second Time."
This Bill deals with the arrangements for the tenure of office of local authority managers and comprises one substantive section, namely, section 1, which amends the Local Government Act, 1991. Fixed tenure arrangements were originally introduced for local authority managers by the Local Government Act, 1991. Section 47 of that Act allowed the Minister to introduce such arrangements by way of an order laid before both Houses. These arrangements were introduced by such an order made in 1991 and provided for a standard fixed term of seven years and for interim transitional arrangements.
Managers are entitled to apply for other manager posts in the same way as other local authority officials may apply for posts in other local authorities. There are benefits to this system of open competitive mobility between local authorities both from the point of view of staff progression, experience and career development and for local authorities in providing a pool of experience from which to draw on the basis of merit. However, at the most senior level of manager, undue movement of staff, with frequent departures, tend to destabilise the system. A certain level of stability is essential.
The introduction of the seven year tenure seems to have had the unintended effect of increasing the likelihood of managers applying for manager posts in other local authorities. The principal reason managers apply for other manager posts is to ensure continued employment. To ensure that they have a new appointment before a current term expires, the trend is for managers to start looking for new posts after approximately four to five years' service. This has resulted in managers vacating their existing posts prematurely and has led to instances of instability in local authority management, which is not in the best interests of efficient and effective local government. The fundamental problem would seem to be that the contract periods are currently too short. A seven year contract with an option to extend by three years giving a maximum total of ten years, as proposed, is intended to address this difficulty. I will now deal with the provisions of the Bill in more detail.
Section 1 provides for the new arrangements to be introduced by regulations in the same way the original seven year term was introduced. Such regulations by virtue of section 3 of the Local Government Act, 1991, will be required to be laid before both Houses and are subject to annulment by resolution of either. The new tenure regime will provide as follows: the basic seven year contract will continue to stand as at present, managers will, however, have the option to extend this by three years, given a total maximum of ten years; a maximum retirement age of 65 will apply in all cases; the extension option will have to be exercised by the person concerned, giving notification to the cathaoirleach within a period – the notification period – to be prescribed in the regulations; a different notification period may be specified for a transitional phase following the introduction of the new arrangements; the standard notification period for the exercise of the extension option will be specified in the regulations as the fifth year of service within the seven year tenure; the cathaoirleach must notify the members of the local authority, the Local Appointments Commission and the Minister when given notification; where a person gives notification, he or she is precluded from applying for a manager post until six months before the expiry of his or her extended term of office and the Local Appointments Commission is precluded from considering any application made within that excluded period; and the regulations can, however, specify manager posts to which this prohibition will not apply, for example, Dublin city and Cork county, to ensure a sufficiency of suitable candidates for these top posts.
I should point out that identical provisions to those now contained in section 1 have recently been considered by the Select Committee on the Environment and Local Govermnent as section 261 of the Planning and Development Bill, 1999, from which they were deleted on Report Stage to proceed separately in the format of this Bill and as part of the local government code. This has been done in order that the new arrangements can be introduced without delay and in the light of the pending expiry of existing contracts later this year and early next year.
The tenure arrangements now being introduced are in line with the ten years recommended by the Barrington Report and the policy in the institutes of technology where the directors are now offered ten year appointments. Finally, I should point out that the Local Government Bill, 2000, published last month, provides for the consolidation and modernisation of local government law and introduces a range of reforms. It will no doubt provide ample opportunity in the next session for the consideration of all aspects of the local government code affecting councils, managers and related matters. For the moment this Bill aims to address a specific but important issue which, as I have indicated, has given rise to difficulty and I commend it to the House on this basis.

Mr. Hayes

The basic principle of this Bill is one which is right and proper and should be enshrined in law. However, I have a fundamental difficulty with the manner in which the Department of the Environment and Local Government, specifically the Minister of State, Deputy Molloy, and his colleagues, have handled this issue from the outset. The problem which we are trying to iron out tonight as we near the end of this session arises from the fact that the original Planning and Development Bill was too vast, attempted to cover too many policy areas in one code of legislation and was not as exacting as it should have been.

I understand that the Government originally intended to include the provisions of this Bill in a specific section of the Planning and Development Bill but subsequently deemed it necessary to amend that as the Bill was not making the necessary progress through the House. The Bill was not making progress through the House primarily because pieces of law were added to and subtracted from the Bill at various junctures. From a parliamentary point of view, that was not satisfactory and we should not go down that road again.

At this late stage in the session, we find ourselves debating an issue which should have been resolved some time ago. The latest story in regard to the Planning and Development Bill is that the President, on the advice of the Council of State, has requested the courts to consider the Bill's constitutionality. The Government has displayed a complete ineptitude to deal with parliamentary business or to deal with specific tranches of legislation in an amenable or sensible parliamentary fashion.

I have some questions about the wide ranging regulations which comprise part of the first section. Throughout the Bill, there is evidence of extensive regulations which can be introduced by the Minister at any given time. Under section 1, paragraph (3) of the new section 47A provides that the Minister may make regulations for the purposes of this section and such regulations may provide for a variety of matters. It would have been far more sensible for us to have held a comprehensive debate on Committee Stage on the potential of those regulations and I regret that that did not happen.

This Bill relates to a very important aspect of local government administration and policy, namely, the role of the county manager. Increasingly, this is a pivotal position in terms of local government being able to deliver local services to people on the ground. It is vital that there would be continuity in the leadership provided by a county manager. One of the big problems currently besetting local government arises from the fact that a large number of companies within the private sector can readily recruit members of staff and senior officials from the sector. We are wit nessing that in the planning and development areas in particular. Many excellent public servants working in local government will understandably move to the private sector because the benefits and remunerations in that sector are far greater than they receive in the public sector. That problem must be addressed. A massive recruitment campaign is required throughout local government because it is currently very difficult to retain staff, particularly administrative and technical staff.

Will the Minister clarify his statement that the cathaoirleach and members of a local authority must be notified if a county manager wishes to stay on for an extra three years in addition to his or her original seven year contract? While I welcome that provision, I would like to know what would happen if local authority members refused, either by way of resolution or otherwise, to accept the county manager's application to prolong his or her contract. I am aware of the pivotal role to be played here by the Local Appointments Commission. If we are serious about giving local authorities local control, the elected members must ultimately have a greater say. In this age of supposed devolution, it will not suffice to use elected members as some kind of rubber stamp. We will return to this issue when we debate the Local Government Bill.

On the prohibitions outlined in the Bill in regard to the inability of county managers to transfer from bigger local authorities, does the Minister believe this is a wise provision? Is it fair that such restrictions should be enshrined in the Bill? I believe greater flexibility is required in our public sector regime in order that people can move from one local authority to another. Such transfers would ensure that best practice and good management skills would be extended throughout the entire local government sector.

It is generally accepted that one of the best reforms introduced in the public service was the provision that senior officers would hold their positions for a seven year period. That concept has wide application in the public service. The Minister is asking us to extend that period to ten years in the case of city and county managers. As a trade union official I represented city and county managers and have a high regard for their competence, skill and sense of public service. However, I am concerned about what we are being asked to do.

Are we creating a precedent? If we have a Bill stating that the term of office of city and county managers can be extended from seven to ten years will we have more legislation in the not too distant future seeking to extend the tenure of departmental secretaries general from seven to ten years? That seems to be implied in the Minister's comments when he draws attention to the fact that directors of the institutes of technology are now offered ten year appointments and that the Barrington report recommended a ten year tenure for city and county managers. It would be helpful if the Minister stated whether this represents a change in Government policy on the normal tenure of senior office holders and if we are to have further legislation dealing with other areas of the public service.

The Minister offers as the case for this that because city and county managers are entitled to apply for county managerial posts in other local authorities there is a tendency for applications to be made in the fourth or fifth year and, therefore, there is inbuilt movement and a tenure in the system which is shorter than was expected or is desirable. I concur with that argument. However, it would be useful to know the extent of the problem. Apart from stating it is a trend, the Minister has not indicated how many cases there have been of city and county managers moving from one local authority to another in the fourth or fifth year.

Presumably there are city and county managers who would have been happy to apply for an extension if this provision had been available to them but who were obliged to move. It would be useful if the Minister would indicate whether there have been cases of city or county managers who did not move to another local authority and whose tenure ended after the seven year period prior to the normal retirement age and if any application for an extension was made to him. There may be grounds for claiming that an anomaly has been created where we may have retired city or county managers who were not given this opportunity.

Why it is necessary to do this now? The Local Government Bill has been published and will be debated in the autumn, if we return. I understand the Minister intends to have consultations on its provisions. That is the appropriate place in which to deal with the tenure of city and county managers. We have not been offered an explanation as to why it has been considered necessary to introduce separate legislation dealing solely with their tenure when it could more appropriately be included in the Local Government Bill.

The mechanism provided for in section 1 for the extension of the tenure of a city or county manager is that six months prior to the expiry of the seven year period the manager concerned notifies the cathaoirleach of the council of his or her intention to stay on for another three years. There is no provision that allows for the possibility of that application being refused. As I said earlier, I have the highest regard for city and county managers in general. However, it is not beyond the bounds of possibility that there may be occasions when there may be a city or county manager who may apply for an extension and the council might be unhappy at the prospect of being stuck with them for another three years. I would have thought it prudent to have some mechanism whereby if a manager is applying for an extension of the seven year term, it can be decided upon.

Take the hypothetical case of a city or county manager who applies for jobs as manager in other local authorities after four or five years. The Local Appointments Commission decides not to appoint the manager to another authority and the manager then applies for an extension within his own authority. It is unwise to have a simple provision which leaves the decision on this in the hands of the manager concerned.

There is need for reform of the city and county management Acts and the Local Government Act. The powers of city and county managers must be rebalanced, as must the powers of elected members of local authorities. Our system gives far too much power to city and county managers and the managerial system and far too little to elected members of local authorities. This is a subject to which I will return when and if we debate the Local Government Bill. We must look at the system of administration and administrative practices in local government. There is need for major reform in this area. A start was made on that in the better local government proposals introduced by my colleague, Deputy Howlin, when he was Minister for the Environment.

Deputy Hayes referred to the drain of good people from the local authority system into the private sector, and I agree with him. It is particularly true in the professional area. One issue that has greatly disappointed me over the years is the unwillingness of the local government system to appoint people on other than the lowest entry grade in particular types of job or professions. We need to have an arrangement in the local government system where there is movement in and out. That would be good for the system itself. I am unhappy with the way the Minister of State is implementing some of the provisions of the Towards Better Local Government document. In general I agree with the idea of having a single reporting structure within the local government system and in rationalising that, but I am concerned by the effect that is having in undermining the professions within the local government system. The way in which this is done in some local authorities, where the posts of city or county architect or engineer, for example, are effectively being suppressed, will have serious implications for the recruitment and retention of professional staff for the local government system in the long run. I have talked to senior professional staff in local government who have pointed out clearly to me that they have no wish to apply for the new positions of directors of service which are in the process of being established nor do they wish to become county managers themselves. They work in a particular profession and wish to remain in that profession at the highest level. The new structures will effectively downgrade their position and the status of those professions. That must be looked at in the context of what the country will be doing in the next few years – the national development plan and the huge infrastructural investment which will be required in roads, housing, transport and environmental services, all areas for which local authorities are responsible. We need the highest level of pro fessional competence in the local authorities and there is a signal going out at the moment, arising out of the way the Towards Better Local Government proposals are being implemented, to people in professional areas that perhaps they do not have a future in their profession in the local authority service. That must be looked at by the Minister of State and he should talk to individual local authorities and county managers about how they are implementing it.

I do not propose to oppose the Bill, though I intend on Committee Stage to pursue the issues I have raised in relation to section 1. We do not need a one section Bill to extend the term of office of city and county managers; we need legislation which rebalances and reforms the system of administration in local government. We need staffing structures, particularly at senior and professional levels, within the local government service through which the very best people can be recruited and retained within that service, particularly to do the major jobs in infrastructural development over the next decade.

As previous speakers have said, this is a very slight Bill. It is really a one liner which ends at achieving a specific objective. I welcome the Bill in as far as it goes, but it gives us an opportunity to reflect on the managerial system.

The city and county managerial system has often been regarded as the only truly Irish initiative in public administration. When it was introduced originally in the Cork Act in the 1920s before spreading to Dublin and Limerick and subsequently, in 1940, to the entire country, it was regarded as a quite revolutionary innovation, which it was. The managerial system professionalised the local government service.

The managerial system also created mandarins who were in an extraordinarily powerful position. When the managerial position was first expanded from the cities through the counties and the whole local government system in the 1940s, from 1942 to 1955 there was a series of efforts initiated by those who valued through local government to turn the issue around. Several Bills were introduced in the Dáil that did not make it to legislation until the City and County Management (Amendment) Act, 1955, was passed. When that Act was passed it was felt that we had achieved the type of rebalance to which Deputy Gilmore had referred.

I too take the view that in recent years there has been an extraordinary and excessive swing of powers to the managers. If one looks at legislation passed since the 1970s, Members on all sides paid lip service to the concept of local government but, in a series of Administrations made up of all the major parties, we have consistently stripped local government of true democracy, replacing it with something approaching, if not a dictatorship, a well entrenched bureaucracy which calls the shots. There is therefore a need to regularise the system.

I believe that a fixed term of tenure for local government managers is a good idea. That tenure should be relatively short – five or six years. The local government members, the council in session, should have a strong role to play in any extension of the term. That said, I suggest there is a serious need for a root and branch examination of the managerial system. The managerial system has professionalised local government, but it has also caused serious problems. In my local authority, for example, a few years ago we had the bizarre spectacle of the council chairperson, an elected representative who was the first citizen of the county, having to take the manager to the High Court to get access to a file. That should never have happened. Other local government managers find themselves in some mystification that that should have happened. There have been other cases where finding information or promoting action has prompted councillors from my county to use sections 2, 3 and 4 of the 1955 Act.

That Act has become something of a whipping boy for criticism, as has the use of section 3 and section 4 motions, but essentially those are democratic devices intended to create a balance between management and elected councillors. I realise the Minister and the Minister of State in the Department of the Environment and Local Government are dedicated to improving and upgrading the local government system. I welcome the Bill, slight as it is, but I hope it is the first step in a major root and branch review of the local government system.

Deputy Gilmore referred to the transition of technical and professional staff into management staff. I differ with the Deputy in this regard. Over the last 30 years in the local government service there has been anxiety in the professional and technical ranks to make the transition into management. A person with some experience as a county engineer or assistant county engineer would be well equipped to move into a senior managerial position. Deputy Gilmore may have the loss of planning staff in mind, but that is related more to income. There has been some transition in recent years and I hope we can find measures – particularly by introducing something along the lines of a top level appointments commission within the local government service – to move more technical staff into the managerial system. I see no evidence of reluctance or feeling of downgrading among technical and professional staff that they are being downgraded by this. I know there have been applicants from the technical staff to make the transition into senior management and that all too few have been successful, but that is because of the interviewing system rather than reluctance. The Deputy did not mean to be unfair to the Minister of State, but it would be unfair to suggest that the manner in which the Minister of State has moved or intends to move has discouraged technical staff in any way from transition. Deputy Gilmore may agree that there is a bias in the system which prevents technical and professional staff from making the transition. Could it be that interview boards are made up of officials from the administrative grades who value the administrative experience of someone who has been an acting county manager, assistant county manager or county secretary more than the experience of a county engineer?

There has been some movement from the Civil Service into local government. There has not been movement, so far as I know, from the State-sponsored sector into local government and there have been very few efforts to get into senior managerial positions from outside the public service. It would be healthy if civil servants, local government servants and the people who serve the State in the State-sponsored sector had more interraction and were regarded as a common staff pool with more transition in staffing appointments between one and the other.

I welcome the Bill in so far as it goes. It is slight legislation, anticipating changes which will come later in the year. When we discuss local government legislation we will have much to talk about. The only issue which concerns me is the lack of balance between the democratically elected councillors and the powers of the manager. The drafters of the Act which created the managerial system were fearful of a dichotomy between policy making and policy implementation and they were anxious to balance both sides. The managerial system has created a local government service which is entirely unbalanced. Far too much power lies in the hands of unelected officials who have, until very recent times, been appointed for life. It is very difficult to remove a local government manager. The powers to do so are there but I do not think they have ever been used. I cannot envisage a situation where councillors, although they might mutter behind their hands about county managers, would muster either the courage or the numbers to take effective action. The seven year appointment term is reasonable, given the need for a learning period. I am doubtful about the advisability of allowing a three year extension. Council members should have a more powerful role in this matter. If a manager has been effective and has worked with the elected members, there will be nothing to fear from a shorter period, but if he has been dogmatic, unco-operative and an abuser of his position, councillors should have some say in the matter.

I welcome the Bill and see no need to divide the House on it. I commend the Minister for introducing it.