"My Government will introduce a Bill to modernise local government by improving the delivery of local services through better financial management and greater freedom for councils based on performance."

A draft bill having been published in June 2002, John Prescott now gets the chance to push through the long awaited measures seen to be close to his heart.

The Office of the Deputy Prime Minister promises that the Local Government Bill will cut red tape for all councils and give additional responsibilities to the top performing authorities.

All councils will be allowed to borrow capital for investment within "prudent limits".

The bill will also try to improve relations between councils and local businesses by providing rate relief for small businesses and introducing new Business Improvement Districts.

Greater discretion will be given to councils in setting council tax bands and exemptions.

Sir Jeremy Beecham, chairman of the Local Government Association, said plans to give councils more freedom were "the way forward".

"This bill signals a relaxation of central control over local affairs. Many of the proposals are an essential first step if the government is to travel the road towards freedom and flexibility for local councils," he said.

"There is still a Whitehall knows best ethos that we need to confront if local government is to be freed up to properly represent local people and meet their needs."

Key points:

All councils will be allowed to borrow capital for investment within "prudent limits" and they will be given greater discretion in setting council tax bands and exemptions.

The Local Government Bill would enable local government to improve local services by cutting red tape for all councils and giving additional incentives for the top performing councils.

The Bill would give greater financial freedom for all councils to borrow capital within prudent limits. It would allow them to trade and to charge for discretionary services.

It would also enable councils to work in partnership with businesses to improve town centres and commercial areas through new Business Improvement Districts.

Small businesses would also benefit with the introduction of the new small business rate relief scheme.

It would also make a number of provisions about Council Tax including a fixed 10-year cycle of revaluations and for the creation of additional bands. Authorities would have greater freedom on the discounts and exemptions from council tax that they grant.

House of Commons

First reading: November 25 2002 (HC Bill 9)

Second reading: January 7 2003

Standing Committee (Standing Committee A)

• 1st sitting: January 21 2003 (am)
• 2nd sitting: January 21 2003 (pm)
• 3rd sitting: January 28 2003 (am)
• 4th sitting: January 28 2003 (pm)
• 5th sitting: January 30 2003 (am)
• 6th sitting: January 30 2003 (pm)
• 7th sitting: February 4 2003 (am)
• 8th sitting: February 4 2003 (pm)
• 9th sitting: February 6 2003 (am)
• 10th sitting: February 6 2003 (pm)
• 11th sitting: February 11 2003 (am)
• 12th sitting: February 11 2003 (pm)
• 13th sitting: February 13 2003 (am)
• 14th sitting: February 13 2003 (pm)
• Bill as amended in committee:(HC Bill 59)

Remaining stages

• 1st day: March 5 2003
• 2nd day: March 10 2003
• Bill as amended (HC Bill 43)

House of Lords

First reading: March 11 2003

Second reading: April 3 2003

Grand Committee

• 1st sitting: June 2 2003
• 2nd sitting: June 4 2003
• 3rd sitting: June 10 2003
• 4th sitting: June 11 2003
• 5th sitting: June 16 2003
• 6th sitting: June 17 2003
• 7th sitting: June 23 2003
• 8th sitting: June 24 2003
• Bill as amended (HL Bill 82)

Report stage

• 1st day: July 10 2003
• 2nd day: July 16 2003
• 3rd day: July 17 2003

Third reading: September 10 2003

House of Commons

Bill as reprinted: HC Bill 157

Consideration of Lords amendments: September 15 2003

House of Lords

Bill reprinted: HL Bill 106

Consideration of Commons amendments: September 17 2003

House of Commons

Consideration of Lords amendments: September 17 2003

House of Lords

Consideration of Commons amendments: September 18 2003

Royal Assent: September 18 2003