Cities and Local Government Devolution Bill [HL]
Lord Shipley
“Devolution of powers
(1) The Secretary of State may by order confer the power to exercise any functions that may be required on a combined authority established under Part 6 of the Local Democracy, Economic Development and Construction Act 2009 (economic prosperity boards and combined authorities).
(2) An order under this section may only be made where a proposal for the combined authority to exercise these functions has been made to the Secretary of State by the appropriate authorities.
(3) The Secretary of State may refuse to make an order under subsection (1) if he believes that the proposal made by the appropriate authorities—
(a) does not provide sufficient democratic accountability over the functions to be exercised;(b) does not have the support of local authority electors within the appropriate area; or(c) would risk the proper functioning of local government within the relevant area or parts of the relevant area.(4) The Secretary of State may not, in making an order to enable a combined authority to exercise functions under subsection (1), require the combined authority to elect a mayor under section 107A of the 2009 Act.”
Lord Shipley (LD)
My Lords, I said on Amendments 1 and 2 that we should avoid being overly strict on what structure and governance can be proposed and approved, but we need to be very careful that, in not being too prescriptive, we do not end up giving the Secretary of State carte blanche to do whatever he wishes. There has to be a set of principles by which proposals can be judged. We have set out four in this amendment: democratic accountability, the support of local government electors, the need to avoid risk to the proper functioning of local government within the area of the elected mayor, and that it should not be an automatic requirement that there is an elected mayor.
We should note the context here. In Greater Manchester there is to be an elected mayor without either a referendum or a full consultation with local people, and with an interim mayor elected by a handful of council leaders, not by the general public. There appears to be little evidence of positive public consent to the governance structure. Indeed, a referendum on an elected mayor in the city of Manchester received a no vote very recently. We need to be very careful that we do not introduce new structures that, because they lack democratic legitimacy, could put at risk the devolution of power that we want to achieve. The Government have to explain why, if an assembly is right for London, it is not right for Greater Manchester and other parts of the country.
As they stand, the proposals in the Bill run the very serious risk of creating a one-party state in some parts of the country without adequate checks and balances in the governance structure. Let me explain. It would not be good for democracy or for accountability for an elected mayor from one party to be able to appoint a deputy mayor of the same party from the combined authority, and then to chair that combined authority—dominated by that same party—with the overview and scrutiny function led by a chair of that same party and dominated by members of that same party. This is dangerous, because the only connection with the governance of the combined authority for an elector is to vote for the mayor, but nobody else. We want to change the electoral process to include the combined authority itself. That is because we do not wish to replace one form of centralism with another. This is about accountability, which cannot be guaranteed with the proposals that the Government are making. Our amendments are designed to improve the Bill’s failures in this respect.
Let me be very clear: this is not about refusing to accept the concept of elected mayors. The concept can work, with the right governance structures around such a mayor—indeed, the Government have a mandate to introduce them. Nevertheless, it would be a mistake to assume that the election of one person for the whole of a combined authority area would of itself be sufficient to secure public consent to the new arrangements.
We must amend the Bill to improve it in order to make the proposed structures more accountable, with checks and balances which everyone understands. We shall therefore examine the way in which overview and scrutiny will work, particularly as regards the rights of the public, the press and the media to obtain information, and the rights of opposition councillors to call for papers. We do not want to end up with meetings of combined authorities in which the business is conducted in secret pre-meetings composed of just one party, and then announced to the press and public as decisions in short public sessions with little debate or discussion.
All our amendments to the Bill are tabled with the aim of improving it and enabling it to earn broad public consent. It needs to be amended to achieve that and the requirements and safeguards recommended in subsections (3) and (4) of the new clause proposed in Amendment 3 are extremely important in that regard. In moving Amendment 3, I have spoken also to Amendments 9 and 10.
Lord Heseltine (Con)
My Lords, I have worked with the noble Lord, Lord Shipley, and I know of his long experience and dedication to this cause. However, I disagree with the consequences of what he is asking your Lordships to accept.
We are looking at a system of local government which has not delivered the necessary standards in a whole range of fields. In my life as a politician, I have seen how we have ruthlessly taken power away from local government and centralised it in Whitehall departments. I see present many noble Lords and noble Baronesses who supported that. The reason we did that was because the standards of local provision were in our view inadequate. We may have been wrong, but whether it was my party and the Housing Corporation, which I think was established in the 1970s, or the academies which the Labour Party introduced under the leadership of Tony Blair, the same basic premise has always applied—namely, that local government was not up to the job of delivering the services to the standard that central government believes in.
We now have an historic opportunity—it is historic, as we discussed on Second Reading—to create locally a standard of service and a scale of delivery which can produce results which reflect local strengths and weaknesses, and which is of a different order from that which exists today. The great dilemma I hear expressed is that, time and again, noble Lords taking part in this debate assume that we are trying to recreate powers for local government as it is. That would be a great mistake and would not command the support that the thrust of this Bill is trying to achieve.
We are trying to create organisations of a scale and resource, and with the leadership qualities, that can compete on a world scale. We are looking at the départements of France, the states of the United States and the Länder of Germany. We know that to maximise the endeavour of this country we must have the ability to compete in a whole range of activities—education, economic generation and perhaps health—so we are looking to attract men and women who command respect and have the capacity and the leadership qualities to change the public perception of local government.
We hear about accountability. What accountability is there in local government today? The noble Lord referred to a “one-party state” but two-thirds of the constituencies that elect another place never change allegiance. The battles are fought in the marginal constituencies. In a vast number of councils in this country, the councillors never change from one party to another. A significant number of councils do not change allegiance either. So if one is talking about changing, the present system does not do it.
Lord Beecham (Lab)
My Lords, the noble Lord, Lord Heseltine, is perhaps the best-qualified special adviser ever to have occupied that position. He is a unique spad, but that is no reflection on the legions of other spads who have found their way into positions in your Lordships’ House or elsewhere.
With great respect to the noble Lord, his argument is not entirely convincing. On his argument, we should have an elected Prime Minister rather than an elected Parliament. Perhaps that might not be a bad idea in the circumstances but as a matter of principle I would not have thought that he would subscribe to that. When he talks about the legitimacy of an elected mayor, he seems to overlook the turnout in the most important mayoral elections of all, in London. As I recall, that has varied between 35% and 45%—marginally above the average local authority election turnout, which I guess is in the upper 30s and lower 40s. That does not suggest that that office has any greater legitimacy than that of council leaders.
I ought to refer to my local government interests. Like the noble Lord, Lord Shipley, I have been leader of Newcastle City Council. There are other very experienced council leaders around the Chamber, although not, I think, on the Government Benches—apart from the Minister, of course, who has her own brief to deliver—although there are experienced local government members of the Conservative Party in your Lordships’ House from time to time.
The noble Lord also implies that somehow the people are being consulted, but that is not what is happening. They are not going to be consulted. The offer apparently will be made that, “You will have a certain set of powers providing you have an elected mayor but we are not going to ask you to vote on whether or not you have an elected mayor”—perhaps because all but one of the authorities that chose to have referendums a few years ago decided against it, and perhaps also in the light of the turnout in the elections for the other post that was much bruited by the present Administration, elected police commissioners, where the turnout was even more risible than that for elected mayors in London.
The noble Lord’s support for local government in various forms has manifested itself over the years and I do not for a moment take away any of the credit that he deserves for his interest in and support for local government, although he himself admits it was somewhat qualified by the circumstances of the day. But I do not think that what he is suggesting is acceptable, in the sense that we are going to have effectively two tiers of local government across the country or across such parts of the country that do the deal that the Government are offering to them. I do not think that division of local government is going to reinforce local democracy; I think it will weaken local democracy.
Local government is essentially place based. The problem with some of this is that whereas there are major functions which need a wider canvas, as it were, to be dealt with—one thinks of transport, elements of economic development and the like—other services are intrinsically local and much more closely community related. I repeat what I said in an earlier debate about size. The Norfolk area, as we heard, runs 70 miles from north to south. It is greater in the north-east, embodying in the North East Combined Authority two county areas and five metropolitan districts—not a single city, not even just a city region but a complicated set of areas like that; and the same will apply in other parts of the country where this might take place—and that will devalue the immediacy of local government and the community-based services of local government, and that would be a blow to our general democracy.
It would be unfortunate if the line that the noble Lord has argued was to be adopted, in the sense that you would get a deal only if you accept that. I do not entirely concur with everything the noble Lord, Lord Shipley, says but I think there is merit in much of his argument and I fear that the case put by the noble Lord, Lord Heseltine, frankly overstates the democratic element, which we want to see conserved and, indeed, improved in local government.
Lord Campbell-Savours (Lab)
My Lords, I have developed huge respect for the noble Lord, Lord Heseltine, over the years following the work that he did in Liverpool Toxteth and his overseeing of that very significant project, which I was able to visit some 25 years ago. But I want to speak specifically to the wording in this amendment because I am unable to understand why the noble Lord takes exception to it. Amendment 3 says:
“The Secretary of State may”—
I stress, may—
“refuse to make an order under subsection (1) if he believes that the proposal made by the appropriate authorities … does not provide sufficient democratic accountability … does not have the support of local authority electors … or … would risk the proper functioning of local government”.
It does not say that the Secretary of State will refuse if the proposal made by the authorities does not provide sufficient democratic accountability. All that is happening here is that the Secretary of State is being given discretion to make a judgment, based on whatever information is brought before them. They are not required to do so because suddenly the electorate in an area are saying, “We demand that this procedure does not take place”. It is for the Secretary of State to make a judgment and to use his or her discretion. If the noble Lord, Lord Heseltine, had read the amendment in that light, I would have thought that he may have taken a more flexible view of it.
Baroness Hollis of Heigham (Lab)
My Lords, I, too, would like to support the remarks of my noble friend Lord Beecham and to challenge, with some trepidation, the history of local government over the last 30 or 40 years which was offered to us tonight by the noble Lord, Lord Heseltine. I think I would not be unfair to him if I suggested that he made two main arguments: first, that local government was in disrepute and, secondly—with the implication that this was a consequence of the first point—that there had been increased centralisation because local government could not be trusted or did not have people of sufficient quality or merit to carry out the functions of local government. I remind the noble Lord, although I am sure that he knows this perfectly well, that actually he has it the wrong way round.
What we have had since 1974 is several reorganisations and a poll tax which took millions of people off—and effectively destroyed—the electoral register. Then, within the course of the same Parliament, that was reversed and there was a new form of funding: the council tax, which had its own inadequacies. We have had the effective nationalisation of the business rate—although it was not effective but ineffective, with some seepage back to local authorities on the grounds of “earned autonomy”. I find the arrogance of such a statement appalling. Even in the last five years, we have had our resources cut by some 40%. Then the noble Lord, Lord Heseltine, wonders why local government does not have the same effectiveness and high standing in the community that it had in the 1960s and 1970s. We could even go back to Joe Chamberlain in the 1880s and the like. The noble Lord has got it back to front. Central government—my party is guilty as well—has had a campaign, in the name of the sovereignty of a parliamentary, united system, to bring the powers back into central government.
The reason is that whichever Government are in power, over the course of a few years the battle in local government swings to the other party. Then we had Mrs Thatcher telling local government, “Take your tanks off my lawn”. She said it to the universities and the lawyers, and she said it to local government. That political will was matched by the Treasury’s will to turn local government into what were essentially post-boxes—agencies for central government wishes and responsibilities. That is what happened. It is not that we were in disrepute and, as a result, tried to make amendments and take powers to the centre. Since the 1970s, central government has sliced and sliced away at local government’s responsibilities, finance and functions, and its standing in the community. Central government must take responsibility for what it has done. I will give way to the noble Lord although I have not quite finished.
Lord Heseltine
I am most grateful. I think that the noble Baroness is perhaps not old enough to know this but the real problem was the Redcliffe-Maud inquiry of the 1960s, which the Labour Party of the time established, and which set out the model for local government in this country. It replaced 1,400 local authorities with about 60 and it is towards that model, created by a Labour Government of the 1960s, that we have been progressively moving.
Baroness Hollis of Heigham
I do not disagree that Redcliffe-Maud was a sizeable problem. I did quite a lot of work on this and thought that the Senior minority report looked at one stage as if it was going to be the main way through. As the noble Lord, Lord Heseltine, will also remember, before that there was the Kilbrandon report on regional government, which some of us were also involved with. So we both have long memories of what has happened to local government, going right back to the mid-1960s. The point I am trying to establish—and I am not trying to say that it is one party especially, rather than the other—is that by taking slice after slice of local government authority, responsibility, functions and resources, central government have knowingly and with collusion undermined the local government that we all want to see. I am sure that the noble Lord is right that we want to see that local government revived. That is healthy and appropriate, but what you should not do is to say, “You can only have that revived local government on my terms, of having an elected mayor, if you want that earned autonomy of the combined authorities”.
I was a local authority leader, first as a councillor in the county borough and then the district. I was also a county councillor, et cetera. I say to the noble Lord, Lord Heseltine, that as the leader of my local authority, directly elected in my ward by my constituents and, further, directly elected by other councillors, there was nothing I could not do that I could now do as mayor. In addition, I had the support of a majority group, I could share power and devolve it down through committee structures, which a mayor would not so easily be able to do, and I had the full financial backing of that local authority. As a leader, and with consent, I effectively had more power, potential and resources than any elected mayor as presently prescribed by Whitehall would have. So I say to him that one model does not fit all and we cannot decide that we want autonomy and bottom-up, local decision-making in some territories and not in others. If individual local authorities or groups of local authorities want an elected mayor, I will cheer them on. If they decide that it is not right for them, the Government in London, and the noble Lord, Lord Heseltine, should give them the respect and dignity of their choice. That is what localism is about.
Baroness Warsi (Con)
My Lords, you will be pleased to know that I am not going to get into this discussion about what happened in the 1960s. My memory certainly does not stretch as far back as that, having been born in the 1970s. I would like to speak about what business is looking for from local decision-makers. My interests are noted on the register of interests. As somebody who in her real life—before life in politics—started and ran three businesses, of which I am still involved in two, it is important for me to have heard today from the Federation of Small Businesses that its members are in a robust mood. It did a survey and two-thirds of small businesses are hoping to grow moderately or rapidly over the next year. That is great news and, to some extent, is a response to the policy that has been pursued in this area over the last four or five years.
I pay tribute to the noble Lord, Lord Shipley, and my noble friend Lord Heseltine for the tremendous amount of work they did under the last Administration to make sure that the building blocks were put in place, with the benefits that we are seeing today. Much of the work on devolution had already been started. Certainly in West Yorkshire, where the businesses I am involved in are based, the first agreement on devolution was already in place. Indeed, as we scrutinise the Bill, agreements and discussions are ongoing about what that devolution deal will look like now for West Yorkshire or the much broader Yorkshire region. Those decisions have still to be made.
The only question I would raise is this: is what we are going to create, or what we are asking for, going to assist or get in the way of business? Is the extra bureaucracy that we want to put in place in the name of democratic accountability going to help create jobs, which is what ordinary people want, or delay their creation? Is the consultation that we think is so vital before we put these structures in place going to help businesses to grow, or is it going to slow things down and therefore detract from this robust mood that small businesses up and down the country are showing?
Time is of the essence. I know from my own involvement with the regional growth fund and its payment to businesses in Yorkshire—I am involved in two manufacturing businesses, which manufacture furniture and ingredients respectively—that when an order comes through the door, no one waits for you to get your act together and discuss it with the LEPs and the RGF, and for them to make a decision and come back to you to tell you about timescales and ensure that everything has been properly consulted on. These opportunities do not come along often. Therefore, we should not stand in the way of these structures being created quickly, of local decision-makers being able to respond quickly, of getting money into businesses and getting them to invest more in expanding and—playing upon this robust mood that the Federation of Small Businesses is talking about—creating the very jobs we need for the economy to keep growing. Speaking from a user’s perspective, in scrutinising this legislation, let us enable, rather than creating further layers of bureaucracy.
Lord Scriven (LD)
My Lords, I have listened to the noble Lord, Lord Heseltine. Like the noble Baroness, Lady Warsi, I cannot recall the 1960s; I was born in that decade, so my period is rather similar.
The noble Lord has always been a big figure in local government during the entire time that I have risen up and been involved in it, but I have to say that I think his analysis on this is wrong. I say that because my starting point is that, although some people might say that this is just semantics, the Bill is not really about devolution but about decentralisation. It is fundamentally a decentralisation of responsibilities from certain bodies to a combined authority or a mayor. The noble Lord talked about international comparisons, whether it be the Länder in Germany or the cities in the US, or elsewhere, where they have not just a nameplate saying “mayor” but real fiscal powers. When I was leader of Sheffield City Council it would have made no difference whatever whether my nameplate said “leader” or “mayor”; I would have been pulling levers with nothing attached because all the fiscal powers were in Whitehall. That is the important point that is missed by the Bill.
While I agree that it is a step in the right direction, we should not kid ourselves that under the present fiscal arrangements a mayor will be the silver bullet that will give local areas the autonomy and power to be authors of their own destiny in the way that some are suggesting in this debate; something more fundamental is required. Having said that, if we are going to go ahead within the boundaries of the Bill as it stands, then nothing in the amendment of my noble friend Lord Shipley would stop a mayor or powers being created if that was what the local area, along with the Secretary of State, so wished. As the noble Lord said, all that the amendment says is that the Secretary of State “may” refuse an arrangement that has been proposed if it,
“does not provide sufficient democratic accountability”.
What is wrong with strong democratic accountability? We have it here in this Parliament, and I would expect it in local government. All that the amendment says is that not only would strong economic powers be taken into consideration but there would be strong democratic oversight of the powers invested in, possibly, one person. That is reasonable.
In the amendment, the second reason why the Secretary of State might refuse a proposal would be that it,
“does not have the support of local authority electors”.
To go ahead without the support of the electors would be rather strange in my part of the world, where only a few years ago the electors rejected a mayor but now it would be imposed upon them if they wished to have these powers. I hear the Minister when she says that a mayor would not be imposed, but I ask her about the report in the Birmingham Mail on 1 June about the Chancellor saying to the leaders of the West Midlands that,
“only elected mayor will guarantee full funding and powers for West Midlands”.
If that is not a prescriptive approach, what is? So there is prescription within this if you are going to get full funding powers. How would the people of South Yorkshire and Sheffield feel, having said that they, including businesses, did not want a mayor, only to have one imposed in order for limited powers to be decentralised from Whitehall to the area?
There is a third reason in the amendment why the Secretary of State may refuse a proposal. Wherever powers are devolved or moved within the existing structures, whether from national or local government, that should not destabilise local government. There is nothing wrong with that. There are still functions that councils will have when there has been the shifting of the existing chairs on the deck, which is all that the Bill actually does. If there were some fiscal powers, then it would be a devolution Bill. However, if those chairs are going to be moved, it is really important that some of the functions are kept with each individual council. It does not mean that financially they cannot continue to carry out what will be significant statutory functions.
The final subsection proposed in the amendment is about the mayor. I have already spoken about this: a nameplate is not going to change how a place is governed. If it was so significant, why have some councils that had already moved to a directly elected mayor moved back? It has not been the panacea that some would suggest. I advise the Minister to think very carefully about a Bill that puts so much reliance on a name without thinking about significant fiscal powers being moved downwards—which, after all, is what makes a difference.
I end by saying that I think the noble Lord, Lord Heseltine, argues my case for me. He talks about the powers of local government in the past, the engines of economic growth and social change. However, they did not have mayors or a single democratically elected person; they had the powers that central government has taken over. I accept that some of those responsibilities and powers will go, but without looking at the fiscal powers that make the difference we will be back here in five or 10 years’ time having the same discussion, because that is the key that will make the change, not the name on a nameplate.
Lord Woolmer of Leeds (Lab)
My Lords, I agree with every word just said by the noble Lord, Lord Scriven. I return to the remarks of the noble Lord, Lord Heseltine, who has almost provided the framework in which we have discussed this amendment. I seem to recall that it was not a Labour Government who brought forward the legislation following up Redcliffe-Maud.
Lord Woolmer of Leeds
It was Peter Walker in the Conservative Government, but that is history. If I have understood the argument of the noble Lord, Lord Heseltine, it was that over the years local government has fallen increasingly into disrepute and lost the confidence of the people, and that is why everything went to the centre. Now it has been decided that we are going to devolve some real powers back to these discredited bodies that no one has any confidence in, but we are not going to give them the power; we are going to create one elected person in each area, called the mayor. In place of dozens of discredited local councillors—in the vision of the noble Lord, Lord Heseltine—there will be one credible, powerful mayor.
Lord Brooke of Sutton Mandeville (Con)
My Lords, this is my first intervention on the Bill. I apologise for that. Looking around the Chamber, I think that I am the only veteran of the Committee stage of the Greater London Authority Bill in the other place. We assembled a Committee of 29, 27 of whom were London Members—I will come back to that in a moment.
My late noble kinsman was not only a Minister of Housing and Local Government for four years—what would now be Secretary of State for the Environment—but a close friend of the late Lord Maude, to whom others have alluded in this debate. In so far as we are obliged to indicate our credentials in an instance such as this, I will simply confess that I served for 18 months on Camden Council at a time when 18 months on Camden Council seemed like 18 years. I therefore regard it as being a reasonable credential. Until I was 72 years of age, I had had a London address the whole of my life.
The Greater London Authority Bill Committee, which is analogous to what we are engaged in today, had 20 Labour Members on it, seven Conservatives and two Liberal Democrats. I bring them in because it was the noble Lord, Lord Shipley, who introduced this amendment. Both of the two Liberal Democrats who served on that lengthy Committee also served in the recent coalition. They served with distinction on the original Bill. As I said, only two of the 29 were not London Members.
One of the consequences of that was that it was an extremely well-informed Committee, and a Bill which arrived with us with only about 270 clauses ended up having nearer 430. To go back to remarks that my noble friend Lord Heseltine made much earlier this afternoon, that occurred because Whitehall did not really know as much about London as the people who were elected Members in London. We London Members introduced a great deal of totally relevant material into the Bill, and I have no doubt at all that we greatly improved it in the process. It had more than 400 clauses by the time it came out of the House of Lords because, although in Committee in the House of Commons officials were saying to Ministers, “Minister, you must resist this amendment”, the amendments which were sensibly introduced in the House of Commons were then picked up in the House of Lords. As a result, we ended up with a Bill with more than 400 clauses. I have no doubt at all that the Bill was greatly improved in that process, but it did take time. I would not begrudge time on this particular subject, so important is it.
I am not sure whether I have helped in any way either side of the argument with my comments, but I agree with my noble friend Lord Heseltine that this is a spectacular opportunity and I hope we can collectively seize it.
Lord Tyler (LD)
My Lords, I am grateful for the contribution that the noble Lord, Lord Brooke, has just made, but I will return to the issue of the comparison between the work done by the committee to which he referred and the eventual statute that emerged in a later group of amendments.
I can remember the 1960s. Indeed, I was elected a county councillor in 1964. I think I am right that the then Conservative candidate for Tavistock, my neighbouring constituency, was none other than a very young, sprightly Conservative called Michael Heseltine. What I admire so much about the noble Lord, Lord Heseltine, is that, like William Gladstone, he gets more radical as he gets older. He may not appreciate that particular compliment but it is a genuine one.
I return to the tone and content of his earlier contribution, which really set the main argument for this part of the Bill and for this amendment in the names of my noble friend Lord Shipley, myself and others. If I may say so, there is an inherent contradiction in what the noble Lord, Lord Heseltine, said. On the one hand, he was determined to let local people free to make their choice as appropriate to their particular needs. That was very much the theme of his peroration, which is in character with what he has sought to do over recent years. Yet, at the same time, he said that we must somehow impose a one-size-fits-all elected mayor on that local decision-making process. He argued for local determination but at the same time said, “Oh, but we must impose the one-man-band mayors”.
I think that we should trust the people. That was another good Conservative slogan of yesteryear. I am, for example, really concerned about extending this process beyond the first tranche of combined authorities into other areas. It has been a major theme throughout the House that we should see this happen not just in the five existing combined authorities but throughout the country. We should let the people of Cornwall be free to decide what they wish to do. That is why my noble friend Lord Teverson and I put our names to this amendment in particular.
As it happens, in Cornwall there has already been a very successful and substantial reorganisation of local government to avoid a lot of the duplication that came from the 1960s and 1970s—to which the noble Lord, Lord Heseltine, referred. We have a unitary authority. It is now beginning to work extremely well. It is making substantial savings by avoiding duplication between different levels. That is the right answer for Cornwall. I am not saying it is the right answer for everywhere else but I am absolutely convinced that to impose on that, before they can get any further devolution or decentralisation of power, a one-size-fits-all elected mayor would be plumb crazy. Much more importantly, it would go right against what the noble Lord, Lord Heseltine, sought to suggest to your Lordships that we should do: let local people decide how they can best be governed.
It happens that in Cornwall we have a distinct identity, integrity and leadership. There is a tradition of cross-party and cross-community leadership. It would not be appropriate to insist on having one particular person, presumably on a minority vote as that is how first past the post tends to produce representation, where there is already plural representation and leadership, and where that is very popular. The noble Lord’s and the Minister’s party, certainly in Cornwall, would be locally absolutely determined to stand alongside others of us who feel that the imposition of a mayor before we can achieve any greater level of decentralisation and devolution would be entirely wrong.
The noble Baroness, Lady Warsi, rightly referred to the dangers of delay. If, for example, Cornwall was not allowed to move until it accepted the imposition of an elected mayor, that would have a devastating effect on the encouragement of investment and the growth of businesses in Cornwall—which is not a wealthy part of the country and desperately needs new initiatives.
Noble Lords on all sides of the House are very much with the noble Lord, Lord Heseltine, when it came to his peroration. What we find difficult is how to match that up with the apparent contradiction that he insists that we have elected mayors throughout the country before we can move into this new, devolved arrangement.
Lord Callanan (Con)
My Lords, I listened with great interest to the speech from my noble friend Lord Heseltine earlier because I was a councillor in the 1980s and the 1990s, when he served with great distinction in the Conservative Governments of the time. I was a councillor in the same part of the world as the noble Lords, Lord Shipley and Lord Beecham, who spoke earlier—the north-east of England—although I was not on the same authority. I also never had the chance to be council leader, as they did, because I was a Conservative in Gateshead. In fact, not only did I not have the chance to be leader, for many years I was the only Conservative out of 66 councillors.
That of course was a difficult time in local government: a time of rate capping and when the Governments of the time took considerable powers away from local government. At the time, I was a cheerleader for that. I thought that many local authorities were dominated too much by ideological, left-wing councillors and that ratepayers—ordinary men and women—needed protecting from some of those people by methods such as rate capping and the removal of those powers. I now believe that I was wrong and that it was a mistake to do that. Since then, events have proved that. So I fully support the Government’s aims now in seeking to return those powers by devolution to local authorities. I hope that they will be able to take matters further and devolve considerably more powers to local authorities. The mayor model is the right way to do that. It was in the Conservative manifesto and for that reason alone the Government should do it; Governments should stick by commitments they have made.
However, that is not the long-term answer to the problem. We have seen declining rates of participation in local government elections for many years. Most people do not bother taking part in those elections. I think the reason is that most electors have worked out that it does not really matter in most cases which councillors they have because councillors have their ability to act so constrained by national legislation and the fact that the vast majority of their finance is supplied by national government that it does not make a lot of difference whether electors participate in local government elections.
It is not in the scope of the Bill, but ultimately the only way to regenerate properly local democracy will be to reform the system of local government finance so that, once again, electors have a considerable stake in their local authorities and it actually makes a difference to what is delivered locally and, more importantly, what they must pay out of their own pocket for those services—then we would regenerate local government, and that would make a big difference.
That is not in the scope of the Bill and it is a very controversial subject. Clearly there are no easy answers to it, but ultimately that would be the way to regenerate local government. As a first step, the Government are going the right way. They are reversing the path of many Governments for a number of years in accumulating power towards the centre. It is a good first step and I wish them well in their endeavours.
Baroness Pinnock (LD)
My Lords, I agree with much of what the noble Lord, Lord Heseltine, said in his analysis of the problems facing local government. He is quite right that local government has been denuded of its powers over decades. He is quite right that many councils simply do not change political colour during elections. However, the solutions to those challenges provided by the noble Lord are not ones that I personally agree with, as they do not provide an adequate response.
The first challenge is that councils do not change political colour. Well, as the noble Lord rightly pointed out, neither do two-thirds of constituencies during a general election. They never change political hands. That political problem is resolved by having not a mayoral system in local government but a different electoral system. A fair voting system would provide the opportunity for people to elect differences. At the moment, under the current system, they do not have that opportunity. The second issue that—
Lord Grocott (Lab)
We have heard reference to the electoral system, which is not an uncommon reference from the Liberal Democrat Benches. There is an idea that it is only under first past the post that people are returned regularly from the constituency and we have the notion of the safe seat. I can think of no seat that is safer than being number one on a list for a party, as is the case, for example, in the proportional representation system that we have for the European Parliament. I understand that the Liberal Democrats consider this an improvement on the first past the post system but I, for one, consider it a step backwards, precisely for the reason the noble Baroness argues against safe seats under the first past the post system.
Baroness Pinnock
Fair voting in my description is not the list system, which I regard as just a fancy way of changing from first past the post. The proper fair-voting system enables the electors to choose, rather than putting the power in the hands of the political parties as the list system does. My idea of fair voting puts the power in the hands of the elector, but I digress.
The noble Lord, Lord Heseltine, also referred to the difficulty of the loss of power by local councils and the solution being this great big single figure who would somehow make all these big, strategic decisions in a combined authority. I have to say that in West Yorkshire, where I have been a councillor for many years—over 25 years, and leader of Kirklees Council for part of that time—a mayoral model simply does not provide the solution that he is looking for. A combined authority is not going to do what the noble Baroness, Lady Warsi, wants, which is get decisions made quickly so that small businesses can invest. What a combined authority is primarily about is making big, strategic—and therefore, by definition, long-term—decisions for that area. We are talking about a local government function which will set out a transport infrastructure for the next 20 or 30 years. It is about setting out planning and economic regeneration schemes for the next 20 years. It is about bringing in inward investment, which takes by definition many years. It is about dealing with carbon control, which by definition takes many years. That will not be achieved by having a single, big figure because all those decisions by definition require two elements. One is public consent, because it will mean big changes to the geography of a local area. The second is big investment of public money, which by definition, in this country at least, requires big accountability. That is why I am totally opposed to a mayoral model.
The second element of this is that the noble Lord, Lord Heseltine, was describing a mayoral model which is simply not that described in the Bill. In the Bill the mayoral model is not this big figure who will somehow paint the future Utopia for an area. The mayor in the system as described in the Bill is the chair of a committee made up of the leaders of the constituent councils of the area. That, to me, is a very different system from that which the noble Lord describes.
My third point about the mayoral model is that if one lives, as I do, in Yorkshire, when anybody talks about the mayoral model the word “Doncaster” immediately comes to mind. I have to say that Doncaster has not had its many problems and challenges resolved by having a mayor. If fact, many would argue that having a mayor has actually made the problems worse. To suggest a mayoral model to people in Yorkshire—or my part, West Yorkshire—leads us down the path of further denigration of local government.
The fourth thing I would say about the mayoral system as it applies in West Yorkshire is that we have all had this idea—it is in the descriptor of the Bill—whereby somehow we have a single city, as we have in Manchester, and all the hinterland is drawn into it. That might work well in Manchester. In West Yorkshire, as I reminded noble Lords at Second Reading, we have not one but four cities, each of which regards itself, quite rightly, as a great city. We have Bradford, Leeds, Wakefield, which is the former county town of the West Riding, and, at some distance from the rest of West Yorkshire, the great city of York. To have a single mayoral model for those great cities will not be acceptable to local people, because they know that the consequence of a mayoral model is to be ruled by Leeds. If you go to York and say, “Actually, folks, you are going to be ruled by Leeds”, they will turn to you in horror, especially if, as we are being told, there can be no proper accountability for that person.
We must accept the will of the people, which in referenda that were held in West Yorkshire was a big and resounding no. This was not because the referenda were taken over by the political machines, as the noble Lord, Lord Heseltine, said. Actually, we could not get people to go and vote, because they were not interested. What local people want out of this combined authority is an accountable system that will consult people locally, take up their ideas, give them some passion and enable them to get West Yorkshire going again. The heart of the industries of the north of England is in West Yorkshire; we want to make the most of it—we will not have a mayoral model imposed on us—and we want the fiscal powers from central government in order to achieve that. Currently we have a mayoral model to be imposed and no money to go with it. A better solution would be to have fiscal powers and to throw the mayoral model into the bin, where it belongs.
Lord Grocott
My Lords, I am very encouraged by this debate. One always tends to worry as the years go by that one’s views have become rather fixed and stagnant. My opposition to directly elected mayors is of long standing and my earlier depression was reinforced by the fact that, as I understand it, at the moment all three political parties’ leaderships are committed in one way or another to directly elected mayors. It is always a slightly worrying state of affairs when all three party leaderships seem to be in agreement, but most contributions from the Back Benches that I have heard in both the debates we have had today on the Bill have expressed reservations about directly elected mayors. I suddenly feel that the pendulum may be swinging. It certainly did a long time ago as far as the electorate were concerned—we know that. The electorate say no, no, no, no and an occasional yes when they are asked about directly elected mayors. Is it just wishful thinking or is parliamentary opinion, at least in this House, changing on the issue? If it is, then I think it is for very good and sound reasons.
I do not want to be in any way disparaging about people who support the idea of directly elected mayors. One or two are sitting close to me at the moment. I acknowledge that this phrase that we all use and are all committed to—“democratic accountability”—can take many forms. In truth, it takes two forms more than most others. That is to say, it can be achieved via what we would broadly refer to as a presidential system, or through a parliamentary system. Both have forms of democratic accountability.
Lord Smith of Leigh (Lab)
My Lords, I rise somewhat reluctantly to participate in this debate. I declare my interest as leader of Wigan Council and a member of the Greater Manchester Combined Authority—so maybe I have a little experience there. I am also a vice-president of the LGA, and perhaps my contribution will show that, whatever party they are from, vice-presidents of the LGA do not always agree with each other. I have been a councillor only since 1978, so I am a mere stripling compared with some people here, and I do not intend to go back over my version of local authority history. However, the noble Lord, Lord Heseltine, was right—there has been increased centralisation for a number of reasons. Partly, it was to do with mistrust of local councils. The irony is that, having given the pass to Whitehall, has Whitehall done any better? The answer is no—and in many cases, it has done a lot worse.
In facing the current austerity, there is more innovation going on in local government than in any other part of the public service. We actually have to deal with the problem on a day-to-day basis, and we are not doing it by simply slicing bits off as we might have done in the past. We are thinking radically about what we need to do and how we do it, and how we engage with the community. It is good.
In Wigan, there is a Labour council. Whatever I have done over the past five years, I have done it from my own perspective. I have always done something in Wigan that has, quite frankly, reflected my political values. I think that we get that difference in local authorities.
Electoral participation has gone down in local government, but my goodness it has gone down in national government, too. It is a real problem for the country that we do not get people to think that what we do as politicians is important.
In my experience of trying to get devolution from Governments of different colours, what is on offer now is the only thing that has been real. In the past, we got sympathy in Greater Manchester from Ministers but, frankly, they did not have the determination to get it through departments. Now we have a Government who are actually beginning to break that down and who are offering us some devolution.
The combined authority, which the last Labour Government set up—and a lot of us are trying to say this—is a new way of working. It is not working as in the past but working in a new manner. I think that the Minister will say that in Greater Manchester different parties sat down together to work in a consensual manner for the good of the conurbation. At one stage, when I was chairman, we had five Labour and five opposition members, but we worked together through that issue. As the electoral cycle has swung in other areas the balance is now eight to two, but we have not changed the style in which we work. I have still not had a vote as chairman of the combined authority, and if I did have one I would think of it as a failure.
It is about the leadership provided by leaders, who need to think how they can make an area more economically viable—because that is the objective. In Greater Manchester we have the twin aims of growth—clearly, everyone has that aim—but also reform of public services.
In Greater Manchester, over the last summer and into the autumn we had a long debate about how we saw the future of our governance. We came to the conclusion that the system that we had was not working properly, and we needed someone separate from the leaders—and we have 10 leaders in Greater Manchester. There is a view that Manchester is one city with nine outriggers, but Bolton would not regard itself as a suburb of Manchester and neither would Wigan. In fact, parts of where I come from, in Leigh, do not regard themselves as part of Wigan. With all those obstacles to overcome, we do it in a different way. It is not as though Manchester was some wonderful, single city where we can all work together. We do work together, but we need someone who is going to be independent of local authorities who can help to get it through, with more powers and responsibility, and be an executive for Greater Manchester rather than someone representing a district.
In the autumn, we met the Chancellor, who offered us a deal, with significant devolution—a bit more than we thought we were going to get; although we knew that we were going to get quite a lot, we got slightly more in some areas. There was a price—it was a deal—and the price to pay was to have the elected mayor. My noble friend Lord Grocott will be pleased to know that I am not the greatest fan of the elected mayoral model but, quite frankly, the prize was worth it—it was worth getting more powers and devolution to be able to influence the lives of ordinary people in Greater Manchester and not have all the decisions made by Governments and civil servants who live in Surrey, and so on. We wanted that change; we wanted it to happen.
And it is not one size fits all. The model that we are going to work in greater Manchester will be different from the elected mayor model in London. The elected mayor in Greater Manchester will be subject to the wishes of the combined authority and will not be superior in lots of ways. That is important. It is not one size fits all; it is what you want to make it. We want to make it a model for governance that can deliver significant change for Greater Manchester.
Lord McKenzie of Luton (Lab)
My Lords, it falls to me to give the Opposition’s official position on this amendment. I hope that in doing so I do not disappoint too many of my noble friends. Overall, we are not able to accept this amendment as it stands. There are a number of issues to raise, but there is the prospect of recasting the amendment by the time we get to Report so that we may well be able to accept it.
Subsection (1) of the new clause proposed in Amendment 3 must be subject to further consideration of the report by the Delegated Powers Committee which has crossed over this issue because it focuses on orders and delegated powers and talks about whether that broad order-making power is appropriate. Subsection (2) suggests that any order or a proposal must start with the combined authority and then go to the Secretary of State. My understanding is—my noble friend may be able to confirm this—that this is an iterative process. In any event, if that unwittingly stopped additional powers going to a combined authority after it had been set up simply because they were initiated by the Secretary of State, that would be a backwards step.
On democratic accountability, I am not sure from what the noble Lord, Lord Shipley, said whether this is an integral part of the elected assembly. We have a debate coming on the elected assembly in due course, and I will hold my comments generally until then, but I will make the point that if we were to accept the amendments’ proposition of an elected assembly, which I would oppose, we would end up with a situation in which we would have first-past-the-post elections for members of the combined authority, a supplementary vote system for the elected mayor and STV for assembly members. That seems unnecessarily convoluted.
We see circumstances where an elected mayor might be entirely appropriate, but we do not believe elected mayors should be prescriptive and mandatory. We think it should be for local areas to make their own judgments. That is the thrust of the amendment which will be our next business, but I shall deal with it now rather than have a repeat of this debate. The amendment I proposed to move was to make clear that there must not be an inevitable linkage between having the full benefit of the devolution provisions of the Bill and the acceptance by a combined authority of an elected mayor. It is accepted that devolution deals entered into ultimately involve an agreement, and if an elected mayor is included, it could be said that it is with consent. However, if there are circumstances where that is a clear red line for the Government—it was clearly so in the case of Greater Manchester, as my noble friend Lord Smith outlined—our amendment was seeking to address and negate that proposition. It is difficult to implement at the margins because there is an iterative discussion going on. I shall take this opportunity to be clear where the Government stand on this, but before doing so, I should make it clear that strong visible leadership is essential to the success of devolution. That leadership could well come in the form of an elected mayor, and combined authorities should have the opportunity to choose that course if they think it is right for them, but they should not be forced to have an elected mayor if they consider that an alternative leader model suits their circumstances. This view is consistent with the recommendation of the noble Lord, Lord Heseltine, in his No Stone Unturned report.
Lord Storey (LD)
My Lords, first, I apologise for having to leave during Second Reading; I had to shuffle out with a really bad back. I have no problem with the name—as the song says, “What’s in a name?”—but the hallmarks of devolution must be three important pillars: powers and responsibilities; resources and fiscal autonomy; and accountability. When the noble Lord, Lord Heseltine, came to Merseyside following the Toxteth riots, he was given the title Minister for Merseyside. He was able to lead that first stage, the beginning of the regeneration of Merseyside, because he had the resources and the power to do so. That is hugely important.
I wind the tape forward and look to a period before combined authorities when on Merseyside we had what was called the Merseyside co-ordinating committee. It was made up of the leaders of the Merseyside authorities from Labour and my party. There were no Conservatives. There was real leadership among that group. We wanted to have a tram system. The Labour Government at the time would not give us the resources or the powers, and the ill-fated tram scheme never happened because we lacked those opportunities.
I agree with the noble Lord, Lord Heseltine, that cities can be turned around, even if they have not got the resources or powers, by sheer determination of leadership. Leadership is a very important part of that equation. You only have to look at how over the past two or three decades Manchester has turned itself around, often against imposition from central government, by the sheer dogged determination of the leadership of that city.
Again, it surprises me a little that Manchester chose not to have an elected mayor for the city. For the combined authority, a sort of agreement has been reached. It surprises me that a Conservative Government are not in favour of democratic accountability or of letting the people decide—oh, sorry; there was that bit about mayors in the manifesto, that well-read document that we all got copies of, and which we all debated and discussed. That surprises me.
One can look around and see numerous examples littered around, not just across the world but across the UK, where there has not been political accountability, and we have seen the excesses caused by the corrupting influence of that power. You only have to look back to the 1960s and 1970s and what happened in the north-east, where there was not proper accountability. You only have to look more locally, recently, to see what happened where there was no proper accountability. Therefore in any proposals there has to be good accountability. I will end by reminding noble Lords that Disraeli said that lack of accountability would lead to the death knell of democracy.
The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Williams of Trafford) (Con)
My Lords, I thank all noble Lords who have made various points on these amendments. Amendment 14 was also touched upon, so I will touch upon it but not delve too deeply into it, because we will discuss it later on.
Amendment 3 would insert a new clause into the Bill for the devolution of powers to combined authorities, enable the Secretary of State to refuse to make such an order if he considers that specified criteria are not met, and prevent the Secretary of State requiring a combined authority to elect a mayor. Amendments 9 and 10 seek to require that the Secretary of State must be satisfied that the local government electors of the area of the proposed or existing combined authority have been consulted by the appropriate authorities on the area’s proposal to adopt a devolution deal with a mayor.
While we certainly share the aim of devolving powers to combined authorities, it is neither necessary nor appropriate to include these provisions in the Bill. The provisions in subsections (1) and (2) of the proposed new clause are broadly consistent with Clauses 5 and 6, but there are critical differences. First, the proposed new clause provides for “any functions” to be conferred on a combined authority. Our policy is certainly to devolve wide-ranging functions, and indeed the Bill provides for any functions of a public authority to be conferred on a combined authority. However, I suspect that to have simply “any functions” is too broad.
Secondly, subsection (3) of the proposed new clause is not necessary. The Secretary of State always has a judgment as to whether or not to make an order. More importantly, specifying criteria in this way risks creating a tick-box exercise. It does not reflect the context in which the provisions of the Bill will be used: that is, to implement bespoke devolution deals agreed with areas.
On each of the criteria specified, subsection (3)(a) of the proposed new clause would require the Secretary of State to consider that the democratic accountability is strong enough to support the devolution of powers. This is clearly important, and it will be an important part of the consideration by the Secretary of State when negotiating and agreeing devolution deals with individual areas, and when considering laying a draft order. Clearly, Parliament will consider the issue very carefully when deciding whether to approve the draft order. For example, a central part of the Greater Manchester devolution agreement is a reformed governance system. The agreement stated clearly:
“Strengthened governance is an essential pre-requisite to any further devolution of powers to any city region”.
At this point I pay tribute to the noble Lord, Lord Smith, whose work on this over years has got us to the point where we are, as well as the work done by the noble Lord, Lord Adonis, and of course my noble friend Lord Heseltine—although the noble Lord, Lord Smith, steered this so beautifully through Greater Manchester. He is absolutely right; it was not because we were of the same party. We worked together as different parties. There was a period when the AGMA, as it was then, was hung, but largely we have worked together for the betterment of the city, which is why we got the trams; my noble friend Lord Heseltine saw that there was leadership in Greater Manchester.
However, to get back to these amendments, it would be wrong to present the considerations as a box that needed to be ticked. Subsection (3)(b) of the proposed new clause would require the Secretary of State to consider the level of support from local government electors. The Government are keen to consider proposals for the transfer or devolution of powers, supported by the appropriate strong and accountable governance. I consider the approach in Clauses 5 and 6 of the Bill to be preferable. These require that all appropriate authorities must consent to any devolution or transfer of powers before it can be made. Therefore, the point made by the noble Baroness, Lady Pinnock, about anything being imposed—and any other suggestions about anything being imposed—are quite wide of the mark. Nothing is imposed on anyone, or any local authority that does not want it.
Lord Scriven
The Minister says that, but let us take my own area of South Yorkshire as a practical example. There will be four local leaders, all of the same party, which through a whip system will control the four local authorities within that area. Therefore, even if the vast majority of local people were against it, the party system could force it through, and if it went through, it could not be reversed once the local electorate had had their say at the election. Rather than talking in general, can the Minister think through carefully the practicalities of areas such as mine, where it will be down to four people, who could force it through within their local authority by using the whip system?
Baroness Williams of Trafford
My Lords, technically the noble Lord is right—it is down to four people—but they are elected by their local council groups, and their local councillors are elected by the electorate. This was explicit in the Conservative Party’s manifesto for the general election, whether anybody read it or not—although I hope that some people did.
Going back to what I was saying—which makes the very point that the noble Lord raised—this means that those who have been democratically elected by the local authority electors are making this decision on behalf of those who have elected them. That is representative democracy, which is the bedrock of our local democracy. In devolving powers and reaching devolution agreements with areas, it is right that the Government deal with those elected to represent the area—those with a democratic mandate—rather than in some way trying to go over the heads of the elected local representatives and reach their own view on what the local electorate want.
Baroness Hollis of Heigham
My Lords, I am still not clear on this. If, for example, out in shire England, three local authorities of different political persuasions are working together in what is effectively a city deal and an extended partnership, and they seek to have greater powers devolved to them, would that be compulsory, or would the Secretary of State have the power to insist that they can do that only if there were an elected mayor?
Baroness Williams of Trafford
My Lords, if that situation arose, those three local authorities would enter into a discussion with the Secretary of State in the same way that Greater Manchester did, or any other area might do. They would reach agreement with the Secretary of State as to what the appropriate level of accountability was for the level of powers being devolved. There would be a separate conversation that would happen with each area; it is a bespoke deal with each area. That is why the legislation is enabling in the way it is, because nobody will—
Lord Campbell-Savours
I will ask the Minister about this matter again, on the detail of the amendment. The Bill states:
“The Secretary of State may by order provide for there to be a mayor for the area of a combined authority”.
In taking that decision, would the Secretary of State have in mind what is in subsections (3)(a) to (c) of the proposed new clause in the amendment?
Baroness Williams of Trafford
My Lords, it would be entirely between the Secretary of State and those local authorities. I am sure that he would have in mind precisely what powers they wanted devolved and the level of accountability that that would require. I hope that answers the noble Lord’s question.
Lord McKenzie of Luton
Can I come back on the question posed by my noble friend Lady Hollis? It seems to me that the opportunity for the Secretary of State to provide for there to be a mayor relates to a combined authority, and the authority for that comes in Clause 1 of the Bill. The arrangements that my noble friend may have been talking about would not necessarily have involved a combined authority—it might be some other configuration of councils—and I do not think that the power to cause there to be an elected mayor rests in Clause 10.
Baroness Williams of Trafford
My Lords, there are powers available under other local government Acts. For example, the Localism Act can provide such a thing that the noble Baroness alluded to. I hope that in some way answers her question.
Baroness Hollis of Heigham
My Lords, forgive me, this is Committee stage and I would not behave like this on Report but I am still not clear. If the Minister is saying that this could be a condition, then across a lot of southern England there will not be combined authorities with urban centres under one political control, surrounded by rural areas under a very different control which may outnumber them numerically, and where that would be reflected in the election results, but where the energy is coming from the city. In combined authorities where currently three leaders on relatively equal terms negotiate, agree and work with each other and the system works, at least some of them will not be willing to go that step further into a combined authority with an elected mayor who has the backing of only one party and in which the energy is disjoined from the voting numbers. I can assure the noble Baroness that not that many combined authorities will be able to generate the economic growth that she wishes to see if that is the price they have to pay.
Baroness Williams of Trafford
My Lords, this Bill provides for combined authorities. Perhaps I originally misunderstood what the noble Baroness was referring to. Other local government Acts would provide for other types of powers to be devolved down but not in the way that this Bill provides—for example, through the Localism Act. It is important to understand that nothing would ever be imposed on a local area. The area would have to want it to happen. It would have to be a combined authority under the terms of the Bill and everyone would have to agree.
Lord Woolmer of Leeds
My Lords, I am grateful to the Minister for reminding us that the Bill applies only to combined authorities. Can she confirm that? I want to return to a question asked by my noble friend Lady Hollis on whether a mayoralty will be insisted on by the Government in discussions with a combined authority. It was said that that would be a matter for individual discussions. Surely the Minister and the Government must have some guiding principles? Surely the Government cannot enter into discussions with a range of combined authorities with different scales, resources, problems and issues and not have any basic principles to which they are working? Otherwise it would be a matter of great unfairness. One combined authority would not have to have a mayor to be granted certain powers while another one could be told that it had to have a mayor to obtain exactly the same powers. I say to the Minister again, and I am sure we will keep returning to this: surely the Government must have some principles in mind of what powers would trigger this requirement to have a mayoralty.
Baroness Williams of Trafford
My Lords, because these are bespoke deals, it will be very much a conversation between the local areas and the Secretary of State. The Government are clear about two things: first, any proposals have to be proposals for growth and, secondly, they have to be fiscally neutral within the Government’s spending envelope that would have usually gone into those devolved matters. We have deliberately avoided specifying and putting down criteria because it is a bespoke deal between local areas and the Secretary of State. So no prescriptions are laid down; it is a matter for discussion between the local areas and the Secretary of State.
I apologise to the noble Baroness, Lady Hollis, because I talked about the Localism Act but actually councils can resolve to have an elected mayor under the Local Government Act 2000. I just want to correct that mistake.
There have been different views on local government over the past decades and the past 150 years. I was a baby of the 1960s so cannot remember some of the reorganisations that took place then, but my noble friend Lord Heseltine made the compelling point that government has centralised over a period of 150 years. No matter how it has done it and how it has been prescribed, it has ever increasingly pulled power towards the centre. This is our golden opportunity to reverse that and it is the right thing to do.
We are now pursuing an unprecedented process to reverse that and we demand an accountable form of governance to support the powers being devolved. We have made it very clear that we want to hear from areas on their proposals. As to opposition to mayors, we are not trying to impose them anywhere but, where mayoral powers are devolved, there must be a clear, single point of accountability. International experience shows that where cities have a mayoral model it is a powerful form of governance, and the Chancellor has said that we will devolve major powers only to those cities which choose to have a mayor.
Going back to subsection (3)(c) of the proposed new clause, it is already part of the Secretary of State’s consideration about whether to establish or change an existing combined authority. The Secretary of State has to consider whether there is convenient and effective local government.
Finally, the provision in proposed subsection (4) seeks to prevent the Secretary of State imposing on a combined authority the Government’s model of an elected mayor. This is unnecessary. The Bill requires that all appropriate authorities must consent to governance change, as I said before. The Secretary of State could not and would not impose a metro mayor on any combined authorities that did not wish to adopt such a model.
Lord Scriven
My Lords, if a combined authority asked for powers similar to those of the Manchester deal, would the Government seek to impose a metro mayor on that model or would another form of governance be acceptable?
Baroness Williams of Trafford
My Lords, the Government would not seek to impose a metro mayor, as I have repeated several times. That combined authority would have a discussion about what powers it sought to be devolved and what form of governance it wished to introduce. It would have a metro mayor only if there were agreement between that local group of authorities and the Secretary of State. Nothing would be imposed.
Lord McKenzie of Luton
I am sorry to come back on this but it is an important issue that we need to get clear. Let me go back to what the Minister James Wharton said in the Westminster Hall debate:
“If they want the Manchester model—the exciting package of powers that we are already delivering to the Greater Manchester area—a mayor will be a requirement of it. We in the Government believe that that needs to happen, and we will insist on it”.—[Official Report, Commons, 9/6/15; col. 79WH.]
I accept that, if the alternative is no deal at all, it could be argued that there is not an insistence. However, it seems to me that it is very clear from the position of the Minister at the other end that the Government will insist on it in certain circumstances. We are still trying to fathom what “less” will be required for that insistence not to take place. Surely it is clear that there is an insistence if an area wants a deal.
Baroness Williams of Trafford
My Lords, the Government certainly would want it, but with the agreement of those local authorities. Greater Manchester has not had a mayor imposed upon it; it has agreed that a metro mayor will be the accountable person.
Lord Woolmer of Leeds
Surely that is a misuse of language. My noble friend Lord Smith of Leigh made it clear that, in his experience, when it came to it, the price was worth paying—his words—to have a mayor in order to get those powers. Surely it is a misuse of language to say that it was up to them. Surely that was a condition of having, if we can call them this, the Manchester powers. What my noble colleague from Sheffield asked the Minister was, in short hand, whether in order to have the Manchester powers a combined authority would have to have a mayor.
Baroness Williams of Trafford
My Lords, if I could repeat the point, the combined authority agreed with the Secretary of State that the mayoral model was the model of governance that it would agree to have. Greater Manchester did not have that model imposed upon it. It agreed with the Secretary of State that that would be the model that it would go with. I am sure that the noble Lord, Lord Smith, will correct me if I am wrong.
If I could make some progress—
Lord Campbell-Savours
I cannot just let that slip away. There is a clear difference in interpretation of what is intended between what was said in the Commons and what is being said from the Dispatch Box here. I think that we need something in writing. Perhaps the Minister should write to Members and explain exactly what the position is. We need to know what it really is and not be left in this very confused state.
Baroness Williams of Trafford
My Lords, I will try to clarify again. It is certainly true that, for the full suite of powers to be devolved, such as in Greater Manchester, the Government would expect there to be a fully accountable person. The model that Greater Manchester agreed to was a mayoral model.
Lord Campbell-Savours
“Insist” was the word that was referred to by my noble friend on the Front Bench.
Baroness Williams of Trafford
My Lords, I cannot be more clear that that was the system that Greater Manchester and the Secretary of State agreed would be the accountable model.
Baroness Hollis of Heigham
I know that the Minister is doing her best and this is absolutely no criticism of her, but we are getting very discordant messages from the Commons end and the Lords end. I am no more clear now than I was an hour ago whether, if an area wishes to be a combined authority and exercise certain powers to promote the national agenda of economic growth, a mayoralty may be a condition imposed on it by the Secretary of State.
Baroness Williams of Trafford
My Lords, it may well be a condition that is agreed to rather than imposed. I hope that that makes sense.
Baroness Hollis of Heigham
I am sorry, but will the Minister tell me what the difference is between imposing something in return for getting those powers and actually coming to a genuine agreement on the model and the powers?
Baroness Williams of Trafford
My Lords, imposition is different from agreement—I think we can all agree. No combined authority will have anything imposed upon it. It will have to agree mutually that that is what is to be the accountable model.
Baroness Hollis of Heigham
If it does not agree, it will not be a combined authority with those powers. Therefore, it is an imposition.
Baroness Williams of Trafford
My Lords, it is not an imposition. It has to be agreed. The Secretary of State does not want to impose anything on anyone, but he does want to see full accountability for the full devolution of powers.
Lord Beecham
You go into a shop and there are two items for sale. One of them has a price tag—the price in this case is a mayoral authority—and the other is a different, cheaper item. If you want the bottle with mayoral authority, you have to pay that price. Is that not the position? In that sense, there is not really a choice, is there?
Baroness Williams of Trafford
My Lords, no one is going to force you to buy that bottle—it depends on what the bottle contains.
If I could, I will make some progress. I cannot even remember where I was—if noble Lords could just indulge me, I will find where I was up to.
I want to get to Amendments 9 and 10. The Bill provides that the Secretary of State may make an order to provide for there to be a mayor for a combined authority if a proposal has been made by that area. The Secretary of State must gain consent from each constituent local authority before an order can be made. It is open to the local authorities, when developing proposals, to decide to consult their electors at this stage.
Government policy is to devolve far-reaching powers to local areas and it is clear that, if areas are to have such powers, they must adopt strong governance and accountability arrangements. Where major powers are devolved to cities, there must be a single point of accountability. People need to know who is responsible for decisions that affect them and their local area. A directly elected mayor will provide this point of accountability.
It is up to an area’s democratically elected representatives to decide whether they are interested in taking up the devolutionary offer we are making, with the benefits that that will bring to the city’s people and businesses. My noble friend Lady Warsi talked quite compellingly about businesses and business growth in her area of Yorkshire. She asked where the view from businesses was. I am sorry to hark back to Greater Manchester again, but local enterprise partnerships, which are made up largely of businesses, should be at the heart of the process and conversation that the combined authority has, as they are in Greater Manchester. They are business led and, in many ways, cannot wait for the growth opportunities that it will entail.
Imposing a statutory consultation requirement on the authorities, as this amendment would do, risks delaying or derailing potential devolution deals, as my noble friend Lady Warsi points out. These deals are about firing up our cities, towns and counties so that they can become economic powerhouses, and backing businesses so that they can create thousands of jobs for people.
I will turn to some other points that noble Lords made, without taking up too much time. My noble friend Lady Warsi asked whether this extra bureaucracy in the name of democracy was going to help businesses. The Government do recognise that no two places are the same. People who live, work and do business in a local area know best what that area needs to prosper and grow. Through the bespoke devolution deals, the opportunities for businesses to further shape local business are significant. This is a very compelling offer.
Finally, the noble Lord, Lord Shipley, asked why an assembly was only for London. The issue of an elected assembly arises in a number of amendments this evening but I will touch on it here. We do not want—and I am confident that few in our cities and counties would want—a new tier of government with more politicians. London is quite different and it would be wrong to see the London arrangement as suitable for other places. My noble friend Lord Brooke’s comments were very helpful in making that point.
I hope with all those assurances that the noble Lord feels able to withdraw his amendment.
Lord Shipley
My Lords, I am grateful to all those who have taken part in this debate. In one sense, we have had something akin to a Second Reading debate—it has lasted just on two hours. On the other hand, it has proved extremely helpful in identifying what some of the issues are. I concluded from it that many issues will have to be resolved between now and Report. So much is in the phrasing—the words that are used.
I am very grateful to the noble Lord, Lord Campbell-Savours, for twice reminding us that Amendment 3 is a clarifying amendment. It simply asks the Secretary of State to ensure that certain criteria are in place before making a decision. I had not thought when I drafted the amendment that this would prove quite so controversial and lengthy a debate. However, there we are.
I am grateful for the contribution of the noble Lord, Lord Heseltine. He was very critical of local government, relating largely to the 1980s, about which there was a great deal of truth. I pay tribute to his work with the Urban Development Corporations which revived so many of the cities in England. The difference here is that I am trying to talk about legitimacy and accountability. Indeed, in her reply, the Minister talked broadly in the same field. For me, this is about making the proposal in this Bill sounder in terms of public acceptability and legitimacy and in terms of making accountable those who are in positions to spend very large sums of public money.
Both the noble Lord, Lord Woolmer of Leeds, and the Minister talked about us trying to create a new layer of local government, but that is not the case. The Bill itself reinforces the combined authority layer of government and provides for a mayor and deputy. That is a function of the Bill, not of our amendments. The question is whether areas outside London should have unaccountable mayors while London benefits from a proper system of scrutiny by directly elected representatives. We will have a discussion about this when we read the relevant amendment. The assemblies that we propose would not have many members, but they would play a vital role in speaking up for citizens and communities against a potentially very powerful mayor who must be subject to scrutiny. That takes me to my next point.
Lord McKenzie of Luton
The noble Lord said that what he proposed would not have many members, but it would work out at something like 50 members for Greater Manchester—five per area—which is double the number of the London Assembly.
Lord Shipley
Indeed, it is 50. Of course, there are a number of issues around the selection of those numbers. We have identified in that amendment—we will have the opportunity to examine this in greater detail when we reach the amendment—that there are different populations in the authorities. It may be that some other number is more suitable. We would be perfectly happy to discuss that. But the question comes back to what the noble Lord, Lord Smith of Leigh, said a little while ago. The Minister thanked him for his hard work in producing the current position in Greater Manchester. I pay tribute to our members in Stockport for their involvement in helping to bring Greater Manchester together. The noble Lord, Lord Smith of Leigh, said that somebody has to bring it all together, if I recall his words correctly. But I would be happier if it was not somebody but some body. The question at the heart of this is whether one single person is the right answer or whether a body of elected people is the right answer. We will have to discuss that further when we reach that point in the amendments.
The noble Lord, Lord McKenzie, was correct in his comments about Clause 1, given the report that we have considered today. That will certainly need to be revisited. But in addition to that, it is my intention, with the leave of the House, to recast that amendment for Report stage. If in so doing we are able to have the usual discussions around how it might be helpful to the Government in terms of its phrasing, we would be happy to enter discussions on that. With that, I beg leave to withdraw the amendment.
Lord McKenzie of Luton
“( ) An order under subsection (1) shall not be used as a condition for the transfer of local authority or public authority functions.”
Lord McKenzie of Luton
My Lords, a moment ago I touched on Amendment 4. The other amendments in this group are Amendments 5, 6 and 7. Given the hour, I will not reopen the Amendment 4 debate. We will, I know, return to it.
Amendment 5 is a small amendment clarifying the consequences of the appointment of an elected mayor who becomes a member of and chair of the combined authority. The amendment seeks to ensure that by virtue of being chair the mayor does not automatically have any casting vote in the affairs of the combined authority, although of course, depending on the number of members of that authority, that is clearly a matter that could be agreed. Will the Government explain why they consider that an elected mayor should always be the chair? Leadership skills required to deliver a change of dynamic growth in complex situations will not inevitably be the same as those to engage and persuade individual members, who are likely to be powerful and able individuals in their own right.
So far as the Government’s expectations on governance go, looking at the Manchester agreement, it appears that for non-mayoral functions decision-making will be by way of one member, one vote, including one for the mayor. Interestingly, the Manchester agreement requires the mayor to consult the combined authority cabinet on: strategy, which could be rejected on a two-thirds vote; spending plans, again amendable on a two-thirds vote; and the spatial framework, which needs unanimous approval. Would the Government expect these constraints on the mayor’s freedoms to be the norm in any agreement?
Amendments 6 and 7 enable the revocation of an order that provides for a combined authority to have an elected mayor. This is consistent with the Bill proposed by the noble Baroness, Lady Janke, and an amendment that we both supported in a debate in the last Session in relation to Bristol. If a combined authority has a mayoral model and wishes to change it, there should be the right to do so. We accept that the consequences of unpicking a mayoral combined authority will not always be straightforward, especially if PCC functions have been devolved to the mayor. Clearly, there should be protections against chopping and changing every few years, but potentially being locked into an arrangement, particularly when it might be accepted by all as not working, does not seem to be a sensible position to end up with. I beg to move.
Baroness Janke (LD)
My Lords, I support Amendments 6 and 7. I am a former leader of Bristol City Council and have raised this issue in the House before. The fact that a city may opt to have an elected mayor does not mean that the city wishes to keep the mayor in perpetuity. Some allowance should be made for the authority, whether or not it is a combined authority, as in this case; I will return to that later in the Bill when I refer to existing city authorities. It seems to me that the people who are being governed need to be able to express their view. In Bristol, a petition has been signed by I do not know how many thousands expressing the wish to have the right to change the system. That does not necessarily mean that they are rejecting the mayor. I know the mayor well because he is a former colleague. I would not wish this to be an intervention that talks in any way about the specifics of the situation in Bristol, but I support the amendment because local government is constantly changing. That does not mean to say that you would want to change frequently, but if we are to govern by consent, as many Members have said in our debates, people must be reassured. The Minister has already said that the Government will not impose mayors on authorities and the amendment is in that spirit: it says that, should there be a mayor, the combined authority will have the chance to set up proceedings to ask the Secretary of State to revoke the order and thus change the system.
Lord Heseltine
My Lords, we are trying to create world-class prestigious authorities to negotiate on behalf of our major urban areas a massive range of opportunities. I ask the noble Baroness what she thinks about having a directly elected Bristol mayor in Tokyo negotiating a billion-pound investment for the city when, in the fortunes of life, the mayoralty is relatively politically unpopular—and they will be, as we all are. The Japanese negotiators will say, “It is all very well for you to come all this way, but you may not be the mayor in six months’ or a year’s time. We have seen someone from one of the German Länder where there is no question about their future. They all know where they will be. So I am sorry, Mr Mayor of Bristol, you go home and sort out your future and then come back to us”. That is a classic example of exactly what we are not trying to achieve in the new dynamism of localism.
Lord McKenzie of Luton
Will the noble Lord help us out? The fact that a mayor has to be elected means that the individual’s circumstances are uncertain at certain times. The noble Lord is surely not suggesting that we should do away with elections for elected mayors.
Lord Heseltine
The mayor would be speaking in his position as an elected official and in normal circumstances he would be able to refer to his successor as representing a policy that was the Bristolian policy. If the issue is, as suggested, that the mayoralty may go and a completely new form and structure of government take its place, what is to say that the devolved responsibilities that had been associated with the mayor would be retained after the abolition of the mayoralty? It injects a degree of uncertainty that is wholly unrealistic in the competitive world in which this country is engaged.
Baroness Janke
I would like to respond to that. Basically, at the moment there is huge confusion about mayors. The meaning of “mayor” depends on the context. I know a mayor of 500 residences in France—he is still the mayor. We have a Lord Mayor of Bristol and there is the Mayor of Bath. The Bristol mayor, should we have a combined authority, will not be the mayor of the combined authority because the other authorities will not support that. I think that we are getting really hung up on the business of the name. Under the system of governance, I as a leader had exactly the same powers as the existing mayor. What we are talking about in terms of devolving powers is actually about power, not about personalities and names for civic leaders, and not about vesting individuals with celebrity and enormous powers over public money with no accountability whatever. The people of the city and the people of the combined authority are paramount. They are the electors and, if they want to change the system of governance, we should listen to them.
Baroness Williams of Trafford
My Lords, Amendments 4 to 7 address the role of a mayor in the combined authority and I shall take each amendment in turn. Amendment 4 sets out on the face of the Bill that the introduction of a mayor for a combined authority area would not be a precondition for the transfer of functions to combined authorities. The Government’s policy is to devolve far-reaching powers to local areas and is clear that, if areas are to have such powers, they must adopt strong governance and accountability arrangements. We want to hear from areas what their proposals are, what powers and budgets they want devolved to them and what governance arrangements they think are needed to support those powers and budgets.
My right honourable friend the Chancellor of the Exchequer made clear in his speech in Greater Manchester on 14 May that:
“We will transfer major powers only to those cities who choose to have a directly elected metro-wide mayor”.
This amendment would frustrate the Government’s announced policy. My noble friend Lord Heseltine has made the point well with examples from other cities around the world. Where such powers are conferred on an area, there needs to be a single point of accountability. People need to be clear about who is responsible for decisions affecting their day-to-day lives, whom to look to when actions are needed and who is to address things that have gone wrong. That we have this offer most certainly does not preclude us from engaging with all areas to consider their proposals for devolution. We are happy to have conversations with any area. The Bill does not limit in any way the devolution proposals that areas can make and the Government will consider any and all proposals from cities, counties and towns for greater local powers.
Amendment 5 seeks to clarify that the mayor, who will be the chair of the combined authority, would not have the automatic right to a casting vote in the process of decision-making in the combined authority. I agree with noble Lords that it is not for the Government to prescribe whether a metro mayor would or would not have a casting vote or second vote. This Bill is an enabling Bill. It does not set out the detailed constitutional arrangements for the mayoral combined authority. It is for areas to decide what voting arrangements would be most appropriate to provide strong, accountable and transparent governance. While the mayor will be the directly elected figurehead for the area and will chair the combined authority, it does not follow that they should necessarily have a casting vote within the combined authority. Indeed, none of the current combined authorities, when they were formed by order, decided to give the chair or vice-chair a casting vote in decision-making. In summary, the Bill as it stands does not give the mayor or the chair of a combined authority the right to a casting vote.
Amendments 6 and 7 seek to amend Section 107A(7) of the 2009 Act to allow the Secretary of State to make a further order under that section to revoke the post of mayor for a combined authority, following a request by the combined authority. As the Bill stands, the office of mayor can be revoked only if an order is made to abolish the combined authority itself under the existing powers in the 2009 Act. This is to ensure that where a devolution deal including a mayor is made with the agreement of the authorities involved, and major powers are devolved, a mayor will be present to provide the powerful point of accountability. It ensures that these governance arrangements cannot then be removed, leaving the area with the powers but without sufficient and robust accountability. Should an area wish to tear up its deal—we would hope that no area would ever wish to do so, given that it would be detrimental to the people and businesses of the area—this Bill allows for the mayor, the combined authority and the deal to be abolished. I cannot envisage that this situation would ever arise or that local leadership would allow it to happen.
With those assurances, I hope that noble Lords will agree that these amendments are not necessary.
Lord McKenzie of Luton
My Lords, I thank the Minister for her response to the debate and other noble Lords who have participated. I think that we have probably given this issue airing enough for tonight, although no doubt we will return to at least part of it. In the mean time, I beg leave to withdraw the amendment.