NALC calls for the Financial Services Ombudsman to cover local councils

The National Association of Local Councils (NALC) has called this week for all local (parish and town) council financial complaints (particularly those regarding banks) to be heard by the financial ombudsman.

Currently, the financial ombudsman cannot deal with local council financial complaints and NALC this week has backed a call for this to change. NALC will strongly argue to the financial ombudsman that local councils are public bodies in their own right, not subject to common control by billing authorities and raise taxation of their own as independent economic activity. As such all local councils should be able to have their financial complaints (particularly as regards banks) heard by the financial ombudsman.

This follows intelligence from Kent that a local council in that county had recently sought to complain to the financial ombudsman but told this was not possible. Not only was the council told it was part of a billing authority (which was inaccurate) but it was also told that its banking complaint could not be heard by the financial ombudsman.

Cllr Sue Baxter, chairman of NALC said: “We were shocked when we heard that the financial ombudsman considered local councils to be some kind of add-on to billing authorities, subject to common control. This is not the case. England’s 10,000 local councils are public bodies raising a precept (a form of council tax) which to our mind is independent economic activity.  We will be writing to the financial ombudsman in due course to clarify the situation and to the Treasury to request that all local council financial complaints are covered by the financial ombudsman.”