Baroness Hanham
Main Page: Baroness Hanham (Conservative - Life peer)Local Government Bill [HL]
Baroness Hanham Excerpts
Lord MacGregor of Pulham Market
My Lords, I, too, declare an interest as a resident of Norfolk for many years. We have had debates on the wider issues affecting this Bill for some time already in this House and I will not repeat the arguments. I will make three points in relation to this amendment—I very much agree with my noble friends Lord Tope and Lady Shephard.
First, it is important to remember that there were reasons other than financial ones—although I stress the importance of them—why many of us resisted the unlawful attempt by the previous Government to carry through the unitary authorities. It was very unpopular in most of Norfolk, where other councils were going to be severely affected. The county council and most district councils were opposed to this. In the only poll taken of the people of Norfolk, only 3 per cent voted for the proposal. There are other arguments apart from financial ones: there would have been considerable effects on the other authorities if the proposal had gone through.
Secondly, I wonder what the point of the amendment is. Within two or three years, we will not have seen the full six-year evaluation of the costs and so on, and in any case I very much doubt whether, with the coalition Government still in existence, it will make any difference to policy.
My final point is about costs. All the up-front costs will come in the early years and the savings, if they come in the way that is intended—and very often these calculations made at the outset are wrong—will come much later. Of course, it is in the two or three years when the costs would be incurred that the particularly severe effects of financial constraints on public expenditure will apply. This would be an additional cost at a time when we would least want it. That is why I, too, do not support the amendment.
Baroness Hanham
My Lords, I thank everybody who has spoken in this short debate on what I considered a slightly strange amendment to be brought forward at this stage. It is worth reminding the House that the orders have been quashed—they are null, void and gone. With them have gone the alterations and changes to any thought of unitary authorities in those areas. They have been quashed not only in terms of not going forward as unitaries but also in terms of the other processes that we will come to, such as elections.
The judge was clear. In the original judgment, he said that the proposals were unlawful because the previous Government had not followed their own guidelines and criteria in coming to decisions, and had changed their mind from time to time. They had started off being very opposed to unitary status for Norwich and Exeter and then, by dint of a few squirls and whirls as time went on, they decided that there were compelling reasons why these two orders should go through.
That is the background. We are finishing off a process that was started—as my noble friend Lady Shephard said—with our commitment to getting rid of these orders when they were first put through the House, against the strong advice of both of the opposition parties, who said then that if and when they were in government, they would alter that. The Bills started, but in the mean time the judicial review was put in hand and came up with the view that the orders should be quashed.
We are not in a position to be talking or bothering about reports for the future. The fact is that we are now back to having two city councils in county council areas. It would be patently absurd to have a report on these two proposals and authorities when they are not going to be doing anything different to what they were doing—and nobody has even thought about having reports on the other unitary authorities and how they differ from other authorities. Therefore, I completely reject the arguments about the need for a report. This is not about post-legislative scrutiny; it is about trying to tie up matters and ensure that at some stage Norwich and Exeter can bring forth another application for a unitary authority. The amendment is trying to bring about information that will not be available to any other authority.
There have been a number of questions and a number of criticisms, and I should like to start with the noble Lord, Lord Burnett, who asked specific questions about costs. He asked how much it would cost for Exeter to go unitary. The answer is £19.9 million. In addition, the combined cost of restructuring the two unitaries would be more than £40 million. I think that local authorities have other things to do than waste £40 million on restructuring at present.
Baroness Hollis of Heigham
My Lords, is the noble Baroness also going to tell the House about her own impact analysis of the savings of £39.4 million that would occur during the same six years? Offset against the £40 million, there would be a net cost of £300,000 per authority.
Baroness Hanham
My Lords, I am not going to go any further into the impact assessment; it is there for noble Lords to read. Our view was that, although there ultimately would be savings, they would not come about for at least another six years.
Baroness Hollis of Heigham
No, my Lords; that is not what the impact assessment said.
Baroness Hanham
It looks as though it would be about six years before the savings came about. There have indeed been references to ongoing savings of £6.5 million being forgone in 2015 and 2016. We have never said that those savings would arise from the unitary solution, but we believe that savings on a greater scale are possible from sensible collaboration between the county and the cities—something that every other authority is beginning to have to do. All across the country, local authorities are having to begin to co-operate with each other. They are having to make reductions in costs and they are not spending money on restructuring.
I do not see any point at all in bringing forward such a report, as it would have no virtue. If it were brought forth in three or four years’ time, I am not sure whether it would have the slightest effect on the coalition Government, if they were still here, and I do not think that it would be of benefit to anyone other than perhaps the proponents of unitary status in both these areas.
The noble Lord, Lord McKenzie, asked about Mr Justice Ouseley’s transcript. It is not available, as I believe the noble Lord knows. I do not know whether he was trying to put me on the spot but I do not have it. He does not have it and my understanding is that no one has it, although I am sure that it will be available at some stage. However, it is absolutely clear that his judgment quashed the orders in their entirety. That is the message that we have and that is where we are at the moment.
In all this, we do not want to lose sight of the fact that the path started on by the previous Government was unwise, illegal and totally flawed. If anyone now tried to shore up and perpetuate the proposals, that would be very unwise and would not get anywhere.
Earl Cathcart
My Lords, I was not intending to speak on this amendment but I think that I have Mr Justice Ouseley’s judgment, and I believe that one or two other noble Lords have all 106 paragraphs of it as well.
Baroness Hanham
That backs up exactly what I said which was that the orders were quashed. I do not have much more to add. The noble and learned Baroness, Lady Butler-Sloss, made a very powerful speech, as did the noble Lord, Lord Tope. It is time for this to be put aside, so that the two authorities can get back to business, working as they should with their counties and other local authorities to ensure that they provide the best service possible. I reject the amendments.
Baroness Hanham
Baroness Hanham
My Lords, I shall speak also to Amendment 7 and to my intention to oppose the Question that Clause 2 shall stand part of the Bill.
As we have discussed, on Monday 5 July, the High Court decided to quash, in their entirety, the structural change orders creating unitary councils for the cities of Exeter and Norwich. As a result, the terms of offices for one-third of the members of Exeter and Norwich city councils, which had been extended by the orders, ended on 5 July and the cities will need to arrange by-elections to fill those vacancies. Moreover, the decisions taken in March to implement the unitary proposals for Norwich and Exeter by the then Secretary of State are now overturned.
Amendment 2 seeks to remove Clause 1(3) from the Bill. This subsection currently revokes the structural change orders for Exeter and Norwich which have just been quashed by the court. Consequently, the Bill no longer needs to revoke these orders and this subsection is no longer required.
I have also made clear my intention to oppose the Question that Clause 2 stand part of the Bill. Clause 2 makes consequential electoral arrangements that would have deferred the elections of one-third of councillors from May 2010 to May 2011 on the revocation of the structural change orders. As the orders have been quashed by the court, they will no longer be revoked by the Bill and these consequential provisions will never be invoked and are no longer required.
As I have explained, because of the quashing, these one-third of councillors are no longer councillors and have not been since 5 July when the orders were quashed.
Amendment 7 will make consequential changes to the Long Title of the Bill, reflecting the removal of Clause 1(3) and Clause 2 from the Bill.
The purpose of these amendments is to ensure that the Bill does not include unnecessary legislation, and correspondingly to ensure that parliamentary time is not taken up on debating legislation that is not required.
For this reason, I would ask the Committee to support these amendments.
Baroness Hanham
My Lords, we have strayed a long way from where we started. We have had a constitutional debate or a debate on the constitution. I have been called spiteful by the noble Baroness opposite, which I regret—
Baroness Hollis of Heigham
I repeat that it was not personal. I said that the Bill was spiteful.
Baroness Hanham
There was spite and it was associated with me. None the less, there we are.
This was about the constitution. The noble Lord, Lord Howarth, was trying to make a great deal out of the fact that the judge made a decision and should not have done. As I understand it, these were draft orders, which were put through this House and had to be signed off by the Secretary of State, who is then judicially reviewable under those circumstances. The noble Lord may want to go and have the constitution changed and do all that, but that is not in our power. The fact that, as he said, Parliament had a good debate on it and came to a view on a number of amendments was not the end of the story. Its end was when the Secretary of State’s decision was challenged. The noble and learned Baroness, Lady Butler-Sloss, with her experience, put it much better than I could: there is nothing to prevent a decision from being made at any level of the High Court. It was not this Parliament and not a Member of Parliament that went for judicial review; it was those cities that were being affected. I do not think that we can spend an awful lot of time wandering around on the constitutional issues. That may be a debate for another day, if somebody wants to see them changed, but we cannot do that.
As I said, the appeal was brought by Norwich and Exeter. The fact of the matter is that they lost, because the previous Government were seen not to have performed correctly against their own criteria. The noble Baroness drew our attention to the fact that the judge said that, if the Secretary of State had taken a different course of action and had undertaken a second consultation, as it would have been, on the other aspects that he was now going to take into account away from the original criteria—he was going to add other criteria—that would have been a different matter. He did not, so the situation remained as it was when the judicial review was undertaken—the decision had been taken by the Secretary of State on the back of a flawed consultation and flawed criteria.
There is no argument about that and no argument about the fact that these orders were debated, that the debates were controversial and that the Opposition at the time said that they did not support the orders. In fact, they made it clear that, if the orders were brought forward and they were in government, they would not support them. There has been absolutely nothing about this that anybody could have been in any doubt about—once this Government were formed, the orders would be set aside. This Bill was brought forward days after the election. Its purpose is to reflect precisely what happened in the High Court, which is to stop these unitaries going ahead. There have been two arms to this—the judicial arm and the government arm—which both came to the same conclusion. In reality, most of this Bill, which we are spending an awful lot of time on, is virtually obsolete because of the court’s decision, but we need to take it through its formalities to ensure that it is completed.
The noble Baroness made a big point about the savings, but I draw attention to the fact that the cost of restructuring, even if it was £50,000 a year at the end of six or 10 years, would be of the order of £40 million. That is a lot of money at this stage of our great financial crisis to do something that was by and large not welcomed—
Baroness Hollis of Heigham
Can the Minister talk about the net costs as opposed to the gross costs, which she persists in presenting to the Committee?
Baroness Hollis of Heigham
But we should be talking about the net costs. It is not fair to talk about costs without talking about the offsetting savings. Nobody in any balance sheet would do that. I respectfully urge the Minister to give the Committee a clear indication of net costs, not gross costs—or, if she is going to talk about gross costs, also to talk about the savings.
Baroness Hanham
My Lords, I have made it clear that the gross costs are those that would have to be paid at the moment to set up the structural changes. I agree that there would be savings, but they are a long way down the road and they might never be achieved. It is the capital sum now—
Lord McKenzie of Luton
I apologise for further intervening, but it is important that we have clarity on this point. Yes, there were gross costs of £40 million, but there were also savings over the transitional period of almost an equivalent amount. There was a separate issue about ongoing savings of £6.5 million thereafter. Over the transitional period, looked at on net-present-value basis, the gap between costs and savings was very small indeed. As my noble friend says, it is important that we have that clearly on the record.
Lord Rennard
Does the Minister agree that many of the potential savings that could have been made had the reorganisation gone ahead could be achieved by better and greater co-operation between the councils in any event? Therefore, many of the savings identified in the impact assessment could be achieved without the reorganisation. However, if we had had the reorganisation, we would still have had the massive costs identified in the impact assessment.
Lord McKenzie of Luton
If that is the noble Lord’s view, why on earth would he reject an amendment that calls for a report to establish just that?
Baroness Hanham
As I have said, the position is that the gross cost would be £40 million and the gross savings would be £6 million a year. If you tide that over seven or eight years and there is a consistent £6 million saving a year, I think that after eight years you would get up to the figures that the noble Baroness was talking about. I think that we will leave that.
Baroness Hollis of Heigham
The Minister’s statement is inconsistent with her letter of 8 July. I will write to her to that effect. I expect that she has her letter with her today. She says—these are her words, not mine—that over the transition period costs incurred in the implementation of the two unitary cities would be around £40 million while over the same period the savings would be in the order of £39.4 million. Forty million pounds, £39 million—those were the Minister’s figures to me.
Baroness Hanham
My Lords, I think that I just said that. The savings would be about £6 million. However, savings can also be made by organising services in a different way and by co-ordination and co-operation between the various tiers of government. I am sure that that is what the local authorities will want to do now, rather than spending any more time on this matter. I cannot offer any further advice on this.
Lord McKenzie of Luton
Will the Minister comment on the point that my noble friend Lady Hollis was pursuing about unhappiness with the process? If there is a will to take forward unitary status for Exeter and Norwich, that could be done under the Bill; I do not think that that would have to rely on Clause 1(3), because those orders are in fact dead, but the structure of the rest of the Bill, leaving intact the provisions of the 2007 Act, would enable it to happen. If the main gripe is about process, once the Bill is enacted there will be nothing in it, in its amended form, to prevent future proposals from coming forward.
Baroness Hanham
My Lords, it was the process that was wrong. It was judicially reviewed and it was found to be flawed. As well as the process, the problem related to the criteria and the fact that the previous Government were not accurate in what they were doing.
My understanding of the Bill is that it stops the creation of unitary authorities in Exeter, Norwich and Suffolk—none of those can go ahead—but that, if there is an application in future, it will be considered. I do not say that it would be considered just against the background of process, though; there would be a whole other raft of considerations at that stage.
It is worth saying that the Boundary Committee concluded that unitary Exeter and Norwich did not meet the affordability criteria and recommended that those proposals should not be implemented. It is equally wrong to speak of massive savings that the unitaries would have yielded. At most, the savings would have been £6 million each year. We have been through that again and again; it gets you up to the figures that we were first talking about.
In my letter, I said that the costs would be around £40 million and that there would be savings in the order of £39.4 million. We have come to that; I have already said that we acknowledge that there would likely be savings in the region of £6.4 million, so six years would take us to £39 million. However, the point is not savings over a number of years; those will have to be made by whatever form of government is in these counties, otherwise the counties will find themselves in very straitened circumstances.
Baroness Hollis of Heigham
My Lords, perhaps I may comment on what the noble Earl has said. I ask the indulgence of the House, but it is Committee stage—it is not Report stage procedure—and there is ample opportunity for discussion.
On the elections, the noble Earl is of course right. However, the point was that if the orders had not been quashed by the High Court, and had the Bill not followed as the result of a general election, this tranche of councillors would have stood for election or re-election next May, when the other year’s worth would have done, too. There would have been two years’ worth of elections in the one year, so again no additional costs would have fallen.
Either, as we had expected and hoped, there would have been elections associated with the general election, in which case there would have been no additional costs, or there would have been elections after 12 months, in which case there would have been no additional costs because elections would have taken place in any event. The additional costs that we are talking about occur because these by-elections are being called in the middle of the electoral year.
Baroness Hanham
My Lords, we had quite a round robin of a debate on this amendment. I agree with my noble friends that it did not seem to lend itself to anything very much around which the debate centred.
It has been said that some things are a bit rich, but I actually do believe that it is a bit rich to try to lay at the door of the department the fact that the Secretary of State made a decision against advice from the Permanent Secretary of the department and did not follow the procedures that he himself had set down. It seems to me to be quite rich to start saying that that is all to be laid at the door of the DCLG.
This was a political move towards the election and it was clear that the decision was taken by the Secretary of State for compelling reasons, which were never quite laid out. Some of it was to do with Total Place, but there was not a great deal of information about that at the time. Total Place was an extra that was put in on the combining of budgets.
This is now a matter for the authorities. They now have to hold elections and if they do not know when to do so, they must seek their own legal advice. They must also bear the cost of what has happened. This is what would happen normally. Any UK council would have to bear them for any by-election. I understand that we have received no representations about it from the authorities and that they are taking their own legal advice.
The amendment does not seem to get us anywhere. It has been the base for a long wander around this whole issue, trying to lay the blame where the blame is not due. This situation has arisen, as I have said ad nauseam, because the Secretary of State did not follow advice or his own criteria. As a result, we have ended up with what other people have described as a total mess. It is still there, my Lords.
Lord Rennard
My Lords, these amendments contain worthy aims about co-operation between the councils concerned—something that obviously everyone should seek, although we may not have been a model of co-operation among politicians in our debate today.
The noble Lord, Lord Howarth, made some good points about the unfairness in the balance of representation in Norfolk. I must say from the Liberal Democrat Benches that there is an obvious answer to that unfairness and lack of balanced representation in many local authorities: proportional representation for local council elections. I am sure that that will be a subject for a debate in future.
I do not, as noble Lords will know, believe that the process of local government reorganisation in these areas, in particular the way in which the previous Government tried to railroad through new structural changes in their dying days, has been exactly conducive to the sort of co-operation that is now required. However, nor do I think that it is compatible with a localism agenda for the Secretary of State to have to report to Parliament on plans for co-operation between the councils in these areas. That must be agreed locally. It is something that I believe local people will want and vote for in the elections. It is not something that could practically be controlled from the centre. The uncertainty and the consequential divisions of the last few years, and the last few months in particular, need to be set aside. The councils concerned now need to do what many other councils are looking at in terms of proper co-operation without the need for structural reorganisation at this point.
Baroness Hanham
My Lords, I thank my noble friends Lord Rennard and Lord Cathcart for virtually winding up this debate for me, because they have said more or less all that I wanted to say. There are two main issues here. First, in order to produce the sort of report that is being asked for before the Act starts would mean more delay. Frankly, I think that there has been enough delay and chivvying around with these orders. As I said earlier, this is the end. We must stop this now and let everyone get on with working normally. The amendment would only delay that.
The second issue is that it is not up to Parliament to sort out how local authorities collaborate with each other. It is certainly up to Parliament to say that there is an expectation that local authorities will work together—that counties will work with their districts and districts will work with their parishes. They are going to have to do so because, as the noble Lord, Lord McKenzie, said, there is going to be far less money. If services are to be provided to a standard and in a way that all local authorities will want, there will have to be close relationships between all levels of authority.
I do not see that these amendments are for Parliament. The first one would certainly delay the issue, which would be an enormous mistake. We have many examples of where there is excellent co-operation in services in terms of procurement, transparency, social services, children’s services and waste collection. I have a long list of every single responsibility in local authority services of where co-operation is taking place, but I shall not weary the Committee with it. All of us know that there are good collaborative arrangements.
I think that Norwich’s miseries have had a good airing today. A lot of information has been given about how things take place and I am sure that that will be noted. I have no doubt at all that Norfolk and Norwich will read Hansard avidly and so will note the noble Baroness’s concerns about the difficulties and how things stand. I was going to say that I do not support these amendments. Indeed, I do not think that Amendment 6 in particular has anything to do with Parliament, so I hope very much that the noble Baroness will withdraw her amendment.
Baroness Hollis of Heigham
My Lords, I thank all noble Lords for contributing to the debate. Perhaps I may run briefly through the comments by individual contributors. The noble and learned Baroness, Lady Butler-Sloss, said that she represented the views of a senior county councillor in Devon. I am sure that is the case, but forgive me for noting that, as county councillors, they would say that, wouldn’t they? Of course they would say that the arrangements are fine. I have met senior—
Baroness Hollis of Heigham
My Lords, no one has asked the Committee to make a judgment on this, so I think that the noble Viscount is being just a little premature.
The point of the amendment is to test the validity and the viability of the noble Baroness’s assertion, which has been reinforced by a number of noble Lords during the debate, that constructive partnership arrangements are a viable alternative to unitary status. We were promised that in 1994-95, but despite those promises it did not happen. Norfolk County Council has already promised some of this to the Boundary Committee, but so far it has not happened. For these arrangements to work, we must have the information, but so far the council has refused. The noble Baroness says in all conviction, I am sure, that these alternative partnership arrangements are a viable option in place of unitary councils, but how is she going to advise us to make it stick? What advice can she give Norwich when Norfolk refuses to give it the information that it needs to make those partnership arrangements work? Will she please tell me? I will give way to the noble Baroness, because I have run out of remedies.
Baroness Hanham
As I said, there has been a barrage of questions about Norwich today. Councils will be required, first, to be transparent and, secondly, to co-operate and co-ordinate with other parts of local government. Parliament will not be able to do anything if, as the noble Baroness suggests, there is a block between Norwich and Norfolk. However, I do not believe that that can be the situation. My advice is to get in touch with Norfolk and make sure that you all work together and co-operate. This is not a matter for Parliament.
Baroness Hollis of Heigham
Will the noble Baroness support us when we seek from the county council the information the city needs in order to build these partnership arrangements?
Baroness Hanham
The noble Baroness asks the question again. This is entirely a matter between Norwich and Norfolk County Council and arrangements should be made at that end. There is not a role for the Government in this unless there is complete obduracy—and I rather doubt that that will be the case after this debate has been read and understood.
Baroness Hanham