Explanatory note

Section 4 of the Local Government Act 1988 precludes an authority mentioned in section 1 of the Act (a defined authority) from entering into a works contract (defined in section 3(2) and (3)) on or after 1 April 1989 under which they are to carry out work falling within an activity listed in section 2(2) of the Act (a defined activity) unless they have competed for the contract. Section 5 of the Act frustrates the further performance on or after 1 April 1989 of works contracts entered into before that date unless the contract was competed for.

Section 6(3) of the Act empowers the Secretary of State to require that, after a date to be specified in regulations, a defined authority must not carry out functional work (defined in section 3(4)) falling within a defined activity without subjecting the work to competition. Dates are specified for this purpose in the Local Government Act 1988 (Defined Activities) (Competition) (Wales) Regulations 1988 (S.I. 1988/1468).

This Order specifies four situations in which, in the case of Welsh authorities work will be treated as not falling within a defined activity for the purposes of the Act.

The first exemption applies where the estimated gross cost to a particular authority of carrying out the activity in the preceding financial year does not exceed £100,000 (article 3) as calculated in accordance with the article. The second applies where work is carried out by an employee of a defined authority who is required to live in particular accommodation for the better performance of his duties (article 4). The third relates to the repair and maintenance of fire service vehicles (article 5). The fourth applies where work is carried out pursuant to an agreement between a defined authority and the Training Commission or the Secretary of State under the Employment and Training Act 1973 (article 6).