This area of local government control has a rich history but can be characterised very simply.
From 1980 onwards, local authorities expressed a wish to do more charging and trading, but felt constrained by the legal powers to do so. They argued for a better suite of powers to authorise charging and trading, and these were finally provided in the Local Government Act 2003, Sections 93 and 95.
Three years after the powers came into effect, they are still not being used widely by local government, and trading activity continues to fall.
Prior to CCT being introduced in 1980, local authorities used powers such as the Local Authorities (Goods and Services) Act 1970 and other specific and incidental powers to engage in this activity, without much problem.
However, with the advent of CCT and local authorities having to bid for their own work, significant difficulties arose with flexibility on powers to act for others. The Audit Commission and the Government of the time offered restrictive interpretations of what councils could and could not do.
When the Government changed in 1997, it made changes, including the introduction of the wellbeing power, examined in the last article. But even that did not go far enough  to assuage the doubts local government had over whether a charge could be made for activities authorised by wellbeing.
This changed with the introduction of the Local Government Act 2003. It is fair to say these powers went even further than many in local government had hoped for.
The general view was that power to undertake extra work which was ancillary to tasks already being carried out, to sell a few excess windows or plants where production was required for the council's own purposes, were necessary; but the Government went further in these powers and created the ability for local authorities to engage in full commercial trading, subject to the establishment of a trading company.
In support of the trading function in Section 95, the new power to charge for discretionary services under Section 93 was widely drawn and superbly flexible.
We have been involved, with APSE, in training of local authority officers and members on this, and these sessions confirm there are still doubts as to what can be done. Indeed, this could be characterised as a general view which is rooted well in the past, still dogged by all the negative publicity about what could not be lawfully achieved.
If this mindset is not changed, then local government will never reap the benefits available from these powers.
As an example, a local authority could join the climate change agenda with charging and trading by establishing a biofuels depot in a county area. It would do this by Section 93, if it wanted to convert its own fleet, and then provide a discretionary service to others, or by establishing commercial arrangements from the start which will supply the authority and everyone else.
This would help achieve environmental targets and create a thriving marketplace for biofuels. It is this sort of creative activity the powers were designed to authorise.
Other agendas to benefit from greater use of these powers include shared services and budgets following the tight finance settlement. Local authorities can provide services for both themselves, and sell to others. Risks are then minimised and burdens reduced.
Where finance is concerned, the first reaction is towards cuts, when an increase in income might be possible. Indeed, the charging and trading powers permit local authorities to consider wholly new ways of delivering functions.
The DCLG is shortly to issue a further research report on this, and this will conclude that overall, there seems to be a degree of uncertainty as to the appropriate legislative powers. It is suggested that many authorities which actually engage in trading are not exactly clear what powers they are relying on to authorise what they are doing.
So, local government would do well to re-examine the three areas we have covered in these articles. In our view, this should take precedence over calls for more powers. In the final article in the series, we will look at why powers are not being fully used. w
Stephen Cirell is head of local government and Professor John Bennett is a consultant solicitor with Eversheds