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Socio-Economic Duty in Wales

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2 November 2019 the Welsh Government launched a consultation on how it intends to implement a new duty on public authorities in Wales - the socio-economic duty, as envisaged by the Equality Act 2010.


Those of you involved in developing and delivering your property asset strategies might well wish to familiarise yourselves with this proposed new requirement, and consider whether and how it might impact on your future strategies.


What is this duty?

The Equality Act 2010 Act is a legal framework which harmonised discrimination law and strengthened the law which supports progress on equality. The Act brought together and re-stated a number of enactments including the Equal Pay Act 1970 , the Race relations Act 1976 and the Disability Discrimination Act 1995 .


The Act makes it unlawful to discriminate against those persons with a protected characteristic under the Act.


The Act also places a ‘due regard’ duty (Public Sector Equality Duty) on public bodies, to ensure that advancement of equality of opportunity is a key consideration for public authorities when carrying out their functions.


When the 2010 Act was enacted, this socio-economic duty remained dormant on the statute book, as UK Government elected not to commence it. The Wales Act 2017 included the devolved power to commence the socio-economic duty in Wales to the Welsh Ministers and with the impending withdrawal from the EU the Welsh Government are keen to embed this socio-economic duty into Welsh law.


What is a socio-economic duty?

There will be a new duty on key public bodies, when taking strategic decisions, to have due regard to the need to reduce the inequalities of outcome that result from socioeconomic disadvantage. The questions naturally arises as to what is a ‘strategic decision’.


The Welsh Government have proposed that in Wales a strategic decision, in the context of the proposed duty, is defined as:


“Decisions which set the organisations’ overall priorities, strategies and key policies, targets, broad approaches, and expenditure concerning the delivery of its business.”

What is a strategic decision?


In general, a strategic decision will be one which effects how the body fulfils its intended statutory purpose over a significant period of time (i.e. twelve months) and does not include routine ‘day to day’ decisions.


For some relevant public bodies, such decisions may only be taken annually, in other cases, they will come up more often.


The consultation document lists some possible examples of strategic decision making for local authorities in Wales and where they should explicitly consider their socio-economic responsibilities. I have repeated this list below:


  • Setting and publishing well-being objectives;

  • Preparation of a local development plan;

  • Preparation of a local transport plan;

  • Preparation of a housing strategy;

  • Preparation of economic development/regeneration strategy such as City deals;

  • Development of education policies;


The eagle-eyed amongst you will have noticed that this does not include asset strategies or capital strategies. However, this is only an indicative list and is stated as not being exhaustive. This means local authorities will need to reflect on all its strategies and determine how this new duty will be reflected.


What is meant by ‘due regard’?

Due regard is an established legal concept in equalities law.

The concept of ‘due regard’ should be well understood by public bodies in relation to the Public Sector Equality Duty. It means giving weight to a particular issue in proportion to its relevance.


The welsh Government are expecting the same principles to apply to this duty.

Relevant public bodies already have clear policy objectives. The new duty does not override these as to require public bodies develop new ones, although they may choose to do that in some cases. This does not therefore mean necessarily that local authorities have to revise corporate priorities on the back of this new duty, although they may choose to do so.


For those with an existing asset strategy or capital strategy the same thing might apply.

Instead it will require relevant public bodies, make making new strategic decisions, to consider the desirability of reducing the unequal outcomes that result from socio-economic disadvantage with their other objectives. This means that when you next produce or revise your asset strategy or capital strategy that you may need to reflect the socio-economic duty.


What is “inequalities of outcome”?

If local authorities are going to reflect this new duty into asset strategies and capital strategies then understanding what ‘inequalities of outcome is and how to deal with that, will be important.


The explanatory notes accompanying the 2010 Act state:


“Such inequalities could include inequalities in education, health, housing, crime rates, or other matters associated with socio-economic disadvantage. It is for public bodies subject to the duty to determine which socio-economic inequalities they are in a position to influence.”


The Welsh Government have said that they wish to use an approach which does not create unnecessary bureaucratic burden and duplication for public bodies, and where possible allows the duty be embedded alongside existing working practices. They are therefore looking to help public bodies in determining which socio-economic inequalities are important to Wales by linking this to existing measures of inequality.


They propose that this can be done through a number of ways, one of which might be through public bodies giving regard to the National Well-being Indicators laid by Welsh Ministers under the Well-being of Future Generations (Wales) Act 2015 which are relevant to inequalities. Primarily this would be the indicators that contribute most significantly to ‘a more equal Wales’ well-being goal, which aims to create a society that enables people to fulfil their potential no matter what their background or circumstances (including their socio-economic background and circumstances)’.


As the consultation document says, features of socio-economic disadvantage are complex and are often interlinked, for example health outcomes get progressively poorer across the socio-economic gradient; no/ low accumulated wealth leads to households having no/ limited access to basic goods and services such as transport, education and health care services; a lack of social mobility in terms of higher education and career prospects; discrimination faced if individuals have protected characteristics.


Based on the complexity, location and interconnecting factors of socio-economic disadvantage, the Welsh Government are proposing to use a similar definition which is contained within Scotland’s interim guidance for the Fairer Scotland Duty, which is:


“living on a low income compared to others in Wales, with little or no accumulated wealth, leading to greater material deprivation, restricting the ability to access basic goods and services. Socio-economic disadvantage can be experienced in both places and communities of interest, leading to further negative outcomes such as social exclusion.”


It could be very challenging indeed to assess the socio-economic impact of asset strategies and capital strategies, let alone structure those strategies in such a way as to comply with this new duty.


Summary

The commencement of the socio-economic duty is about requiring relevant public bodies to:

  • consider socio-economic disadvantage when making key strategic decisions;

  • demonstrate they have considered available evidence on socio-economic disadvantage to inform how they can better target their policies and resources to help those who are most disadvantaged;

  • balance the desirability of that aim against other objectives;

  • working within existing resource allocations and budgets, and within existing planning, decision-making, and reporting processes.


Anyone involved in developing, reviewing or revising asset strategies and capital strategies might wish to engage early with colleagues in other departments, to begin to assess what the socio-economic impact duty will mean for you, and how your future strategies might need to not only reflect this new duty, but be explicit about that impact.


The consultation runs through to 17 January 2020.

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