The Local Authorities (Contracting Out of Investment Functions) Order 1996

Explanatory Note

(This note is not part of the Order)

This Order makes provision to enable certain bodies to authorise another person, or that person’s employees, (a “contractor”) to exercise any functions consisting of, or relating to, the investment of sums of money. The sums in question do not include sums forming (or forming part of) a trust fund or pension fund, but do include, in the case of a local authority in England which is a billing authority for the purposes of the council tax and non-domestic rates, sums paid into the authority’s collection fund which are not immediately required for making payments or transfers from that fund, and sums transferred from their collection fund to their general fund.

The bodies which may give an authorisation under this Order are —

(a) in England, county councils, district councils, London borough councils, the Common Council of the City of London, the Council of the Isles of Scilly and parish councils, and

(b) in Wales, county councils, county borough councils and community councils.

The exercise by a contractor of the functions described in Part II of the Order is subject to the conditions specified in Part III of the Order, including, in particular —

(a) in article 9, a requirement concerning contractors' qualifications;

(b) in article 10, a requirement concerning the observance of investment and accounting practices; and

(c) in article 13, a requirement that a contractor shall not appoint any other person to exercise any function which he has been authorised to exercise, unless that person has also been authorised to exercise the function concerned.