Baroness Hollis of Heigham
Main Page: Baroness Hollis of Heigham (Labour - Life peer)Local Government Bill [HL]
Baroness Hollis of Heigham Excerpts
Baroness Hollis of Heigham
Can the noble Lord tell us of anyone in the county of Norfolk—in the district council, county council or city council—who supported the Boundary Committee’s recommendation?
Lord Rennard
My Lords, I have not argued the case for the Boundary Committee’s proposals and am not doing so today. I am simply pointing out that the Boundary Committee, having been commissioned and given a remit by the Government, decided that the proposals which the Government subsequently put forward were simply not right. It said that they were unaffordable and it confirmed a previous rejection of exactly the same proposals by a previous Secretary of State in the same Government. The Boundary Committee also warned that there would be serious questions over the ability of the rest of Devon to function effectively as a unit of local government if Exeter alone became a unitary local authority.
The House of Lords Merits Committee drew the House’s special attention to the two orders. The committee found that the unitary proposals did not meet the Government’s five strict criteria for implementation. It said that the Government had failed to provide sufficient information to explain their departure from the criteria, and the Joint Committee on Statutory Instruments expressed doubt about whether the orders could be lawfully made. These are all reasons why we approved in this House Motions of regret tabled by the noble and learned Baroness, Lady Butler-Sloss, calling on the Government not to proceed with the orders without further consultation. There is no change in the logic of the arguments that were supported in this House on 22 March, and the same logic therefore dictates support for the Bill today.
Baroness Hollis of Heigham
My Lords, I declare an interest as former leader of Norwich City Council, and also a former Norfolk county councillor. Perhaps I may add that nothing I will say in any way casts aspersions on the integrity of my fellow Norfolk Peers or indeed on the Minister herself, whom I hold in high regard.
I fully accept that the judicial review has cut across this Bill, which means that we did not pursue the issue of hybridity and we did not argue the case before the Examiners. Not surprisingly, therefore, the examination was exceedingly short. We also accept that, together with the Minister, we need to clarify the electoral situation of councillors. However, the Bill is before us and that is what we are debating, so I want to say something about local government reorganisation more generally, and then analyse the reasons for what I regard as a spiteful little Bill.
In 1974, Norwich and Exeter had been unitary councils for more than 600 years. They had ratepayer democracy half a century before county councils were even invented. By the 1930s, Norwich County Borough not only exercised all of today's district and county council functions, including the police, but ran the massive non-voluntary hospitals and public health chunk of the future NHS, all of today's Anglia water authority and the major utilities, as well as a large part of the social security system. Norwich's budget would have been between £1.5 billion and £2 billion, I calculate in today's prices, compared with our current non-housing budget of £50 million.
With that record, it is insulting when Eric Pickles of unitary Bradford, a mere village when Norwich was the second city of England, or the Minister, from the unitary London Borough of Kensington and Chelsea, invented only in the 1960s, tell us that unitary status is fine for them but not for us. From 1888, when Norfolk County Council was invented, until 1974, almost every initiative of note in the county was pioneered by the city. That is what cities do.
We are the largest non-unitary authority in the country. We are already considerably larger than many existing unitary authorities. Our population will be 160,000 in eight years’ time. We have two cathedrals, two universities, a major FE college, an international airport, a thriving theatre and the greatest collection of medieval churches in western Europe. What are we lacking—apart, obviously, from the fact that Mr Pickles is not our MP? We have recently been shortlisted alongside Birmingham, Sheffield and Derry/Londonderry for the title of City of Culture. Disinterested observers might think that Norwich was up there with the major cities rather than down there with the rural district councils.
Into that respectful and complementary partnership between county borough and county council—at the time, I was a city councillor—came 1974. Peter Walker wanted unitary counties. I was a member of the AMA. We fought for, but failed to save, most of the county boroughs. The history of local government reorganisation since then has been that of remedying the folly of Peter Walker's policies by both parties. In the early 1980s, the Conservatives got rid of the met counties and made Mr Pickles' Bradford unitary. Whoopee! In the mid-1990s, as my noble friend said, the Conservatives, under David Curry and John Gummer, to whom I pay tribute, made a whole swathe of cities unitary: Leicester, Derby, Nottingham, York—all former county boroughs, like Norwich and Exeter—Milton Keynes, Peterborough and Basildon, which do not have such a history or track record. Norwich and Exeter were on that list. Norfolk should have come under the wire then, as the noble Lord, Lord Bowness, has agreed and admitted, but the county Tories in Norfolk fought it off.
That drive to unitary status as the most effective local government structure for cities continued under the Labour Government. My noble friend made this point very well: do your Lordships know of any counties that would now wish to turn the clock back to district councils for their cities? Does Derbyshire want to do that to Derby, Nottinghamshire to Nottingham, Leicestershire to Leicester, Buckinghamshire to Milton Keynes? No, they value and support their cities, recognising how much they bring to their county’s economy and growth. Why, by contrast, is Norfolk so bellicose and so fearful? I will come back to that.
Following the 2006 White Paper, 26 cities and large towns made their bid. The Boundary Committee was requested to consider Norwich’s and Exeter's proposals, and twice, with unerring instinct, produced the only solution that none of the local authorities, including the county council in Norfolk, wanted: a return to a Peter Walker unitary county. However, the Boundary Committee would not listen, so JRs followed. As Paul Rowsell, the senior civil servant responsible, said in his court witness statement of 22 March this year, had the Boundary Committee reported on time, not nine months late, implementation would have already happened and this spiteful little Bill would not have seen the light of day. Had the Boundary Committee reported on time, the Secretary of State could, as the judge suggested, have consulted on the additional criteria, the JR would not have succeeded and, again, this spiteful little Bill would not have seen the light of day. Max Caller and his Boundary Committee team have wasted a lot of time and money and have served local government very badly indeed.
So what are the professed reasons for this spiteful little Bill? Page 7 of the impact assessment—I had to request extra copies, but the Minister was good enough to put them into the Printed Paper Office—is headed “Rationale for Change” and is personally signed by the Minister as a fair and reasonable view of costs, benefits and impact. It gives four reasons for the rationale for the Bill. First, she says, it is in the coalition programme. So what? That programme was negotiated after the election by two minority parties and has no electoral mandate. In any case, as the noble Lord, Lord Low, pointed out in the Queen’s Speech debate, it is utterly at odds with the rest of the localism programme in the coalition programme.
Secondly, the Minister states that these two cities becoming unitary would be expensive and poor value for money, a point hammered home by the noble Lord, Lord MacGregor. For the first six years of transition, the total net non-discounted cost of Norwich and Exeter going unitary comes to around £300,000 per authority, or £50,000 per year per authority. The impact assessment allows, grudgingly, that there should be savings thereafter but, oddly, it does not estimate them. Funny, that. Your Lordships might just think it relevant that over the following six years those savings would equate to at least £20 million or upwards and would grow each year thereafter. These figures are certified by Deloitte and, for what it is worth, they have been crawled over by me. Will the Minister tell me how an expenditure of £300,000 in the first six years to generate savings of £20 million or more the next six years is expensive and poor value for money? For the impact assessment to give costs, but not savings over time, means these statistics are not worth while.
Thirdly, the Minister buttresses her case, which was much quoted by the noble Lord, Lord MacGregor, by quoting the Permanent Secretary as saying that a unitary Norwich and a unitary Exeter represent poor value for money, and that “therefore” stopping these unitaries is good value for money, but compared with what? What the Minister does not say, and did not say in her impact analysis or in her speech today, what the impact assessment should have said and what the House is entitled to know is that the Permanent Secretary, when arguing that city unitaries were poor value for money, was comparing them not with the status quo of the Bill, as you might expect, given that it is supposed to be an impact analysis, but with unitary counties, which are not introduced by the Bill, which were indeed the cheapest option, but which nobody but the Boundary Committee and the Permanent Secretary appear to want.
The Permanent Secretary’s comparison is completely invalid. Indeed, it is worse than that because what the Minister does not tell us, which again the House should surely know, is that her solution—the status quo—is the most expensive of the three options. It is far more expensive than unitary Norwich and Exeter, as I have shown. On costs versus benefits, it is far more expensive than the Permanent Secretary’s unitary Norfolk. Her version of value for money is to save £300,000 for each authority over six years and forego savings of £20 million over the next six years. That is not mentioned—funny, that.
As Ministers, many of us have signed impact analyses. We know what we are talking about, so I say with the utmost seriousness that this impact analysis is greatly misleading, makes false comparisons and suppresses relevant information. I am sad that the Minister, whom I respect most profoundly, could put her name to it. It really will not do.
The fourth of the Minister’s arguments is in the rationale on page 7 of the impact statement. She argues that the 2006 non-statutory criteria were not followed. As we argued at that time, additional criteria were added: that is, a sensible response to the recession. The High Court judge, Mr Justice Ouseley, has nullified the orders because the DCLG failed to indicate in December 2009 that “compelling reasons” such as the recession might lead to a proposal being accepted that did not meet all the 2006 proposals. The Boundary Committee’s tardiness has meant there was no time for further consultation.
We, the city of Norwich, have been urged to appeal on constitutional grounds that such action—striking down not just the actions of the Secretary of the State, which can happen, although infrequently, but the will of Parliament itself—has not been taken, and I may be wrong, but I have been told this, by any judge hitherto below the level of the Law Lords and now the Supreme Court. At £200,000 or so, Norwich cannot afford the risks of challenge. Of course, the JR reviews the decisions of a Minister, but one High Court judge striking down the express will of Parliament over seven hours of debate is somewhat unsettling.
In consequence, we did not pursue the issue of hybridity: that Norwich and Exeter were being singled out for unfavourable treatment compared with the other authorities that had gone through. That argument has also gone by default. Why, then, are the Government so determined that Norwich and Exeter in particular should not be unitary? Clearly, the four arguments in the impact analysis are a work of constructive fiction.
Some years ago, when I fought a Norfolk seat with a large rural hinterland, a farm worker rang me from a public phone box. I said that I would drive over, but he said, “No, no. I will come on my bike”. I said, “But it’s eight miles”. He said, “It’s more than my job or my cottage is worth to be seen speaking to you”. That was the Norfolk I experienced as a county councillor. People were decent and public spirited but with an unshakeable belief in a right to rule over pheasants, farm workers and Norwich. The city was gifted to them in 1974 and what they have they hold.
Over and beyond property rights, money is the second reason why Norfolk county councillors—two-thirds of whom are also rural district councillors—have fought us. Urban Norwich subsidises the rural county at a severe cost to its own services. Even the Boundary Committee acknowledges that Norwich has been poorly served. In 1974, we handed over six comprehensives, from four of which you could go to good universities, as did my two sons who went through the state system. On Norfolk’s watch, one comprehensive has been closed and four of the remaining five have been taken into special measures. Why? Rather than raise the rates to keep open small rural schools, which I support, Norwich schools have been run down instead. Poorer Norwich council tenants see their services run down to ensure that the rates on affluent Broadland homes are kept low.
The third reason for the Tory county opposition is because cities, especially unitaries as my noble friend argued, generate jobs and growth. Half of Norfolk’s jobs are in Norwich, but, as I was told on the county council by one Norfolk county councillor who was also a farmer, no local employer wanted the competition from more new jobs because that would push up wages.
The final reason is of course politics. Norwich is a left-of-centre city. It celebrated the French Revolution with a maypole in the market square. It has been the home of dissenters, Chartists, Liberals—at least until now—and now Greens. A unitary Norwich would be stronger not only economically but politically, and I am not sure which is the greater offence.
My dismay is particularly with the Lib Dems. Norman Lamb is the MP for North Norfolk. With no formal connection to Norwich, he and the national party of the Lib Dems have overruled the local Lib Dems on the city council, who initiated the move to unitary status and who have fought heroically for unitary status. They view the actions of their London party with utter fury. Norman Lamb’s position is also at odds with the position of the new Lib Dem MP for Norwich South, Simon Wright, who is also committed to a unitary Norwich. On 9 March, Norman Lamb told the other place that he wants progressive city councillors to remain on the county council—that is why he does not want Norwich to be a unitary—so that, in his words, one party, a Tory party, does not,
“rule for the rest of Norfolk for ever and a day”.
That, he said, would be,
“an outrage”.—[Official Report, Commons, 9/3/10; col. 252.]
For Norman Lamb, a Tory county would be an outrage—before he joined the Tory coalition, of course—so he supports the Tories nationally to block Norwich’s unitary status in order to better fight the Tories locally. How twisted, and how cynical, is that?
This remains unfinished business. Be in absolutely no doubt that Norwich will become a unitary authority, although it may take us several years longer than we had hoped. In the mean time, the people who will pay the real bill are the people of Norwich and the county of Norfolk. They will be denied a strong, focused, unitary city that could bring them the jobs and growth they so desperately need.
Viscount Ullswater
My Lords, I declare an interest in this matter as an elected member of the Borough Council of King’s Lynn and West Norfolk.
It gives me great pleasure to support this timely legislation. Although I did not speak when the orders were debated on 22 March, I attended the debate. I am afraid to say that I even defied my own party Whip and voted against the order for Norwich and Norfolk by supporting the amendment tabled by my noble friend Lord Tope. The orders were as wrong then as the Bill before your Lordships’ House is right today.
It would be senseless to rehearse in detail the arguments given before the orders were made in March—in fact, they have been rehearsed—as they are all in Hansard. Suffice it to say that the consultation found that almost everyone was against the orders; the Government’s own criterion of affordability was not met; the Permanent Secretary of the Department for Communities and Local Government sought a political direction because he did not believe that the proposals represented value for money; and the Permanent Secretary warned that the orders would provoke a judicial review that would be likely to succeed. That review has taken place; indeed, the High Court ruled on 21 June that the decision to make the orders was unlawful. There was also a devastatingly critical report from the Merits of Statutory Instruments Committee of your Lordships’ House, as mentioned by my noble friend Lord MacGregor.
The list is longer, of course, but given an opportunity and a little time to reflect on the passing of the orders, it is right and proper for the new Government to keep their word and the promise made before the election and to move swiftly with the Bill to annul these orders. Even the attempt by the noble Lord, Lord Howarth, to delay the Bill by persuading the House that it could be hybrid has now been firmly quashed by the report from the Examiners that was published yesterday.
Baroness Hollis of Heigham
On a point of information, it was not contested. We withdrew from that examination and therefore the arguments were not aired and fully debated, because we knew about the situation with the judicial review.
Viscount Ullswater
My Lords, all I would say is that the Examiners have examined it. Their report has been published and the Bill is not hybrid.
For all those reasons, I am delighted to support my noble friend Lady Hanham, who introduced this Bill.
Lord Tope
It is probably inappropriate for me to comment on the Minister’s answer before she has given it. I may well have another opportunity to do that. Perhaps I may answer the noble Lord indirectly. As a believer in unitary government, I really believe and would expect the Minister herself, having been a London borough councillor and council leader for many years, to believe that this is absolutely not the time for local authorities of whatever structure to be distracted into what is almost always the very expensive, energy-sapping distraction of worrying about what I call their democratic structure—where their ward and council boundaries are, and all that sort of thing.
The concentration for local authorities now needs to be on what services they should be delivering, how and with whom they should be delivering them and their relationship with other local authorities, whether in a two-tier structure or with neighbouring authorities in a single-tier structure. Their concentration should and must be on many more shared services and much more co-operative working. If I may give a sort of answer to the noble Lord, Lord McKenzie, before I have heard the Minister’s answer, my advice to all my colleagues in local government will be: that is where to concentrate, not on having rather difficult and fruitless arguments on possible restructurings which may or may not happen, and probably will not. That is the wrong priority.
The other point made by the noble Lord, Lord McKenzie, which I really did not follow, was about democratic legitimacy. I understand entirely why, having moved those orders in the first place, he may at least be sad about the Bill. He may well disagree, as he obviously does, with the view of the two government parties. However, I simply could not follow the democratic legitimacy argument. The Conservative Party made very clear before the election that it would not proceed with unitary proposals and, in particular, would revoke these orders as soon as possible if it was successful in the general election. That was repeated in the debate in this House. It could not have been a clearer commitment.
I led, somewhat controversially, a fatal Motion. Not everyone felt able to support it. I understand that. However, we could not have made our position much clearer before the general election. I should have thought we would be much more open to criticism, as a coalition Government of two parties so committed, had we not acted quickly to implement what we were saying—had we allowed that uncertainty to go on, and the implementation committees and so on to meet and continue as though nothing had happened. If that criticism was being made it would be wholly legitimate, but to suggest that we do not have a democratic mandate for doing this is somewhat bizarre. In saying that, I remind the noble Lord, Lord MacGregor, that, yes, Norwich elected a Conservative MP but it also elected a Liberal Democrat MP.
Baroness Hollis of Heigham
I have made my point. Only 40 per cent of the Conservative MP’s constituency is in Norwich. The Norwich South MP is Simon Wright, whose wife is, I understand, a Liberal Democrat city councillor. The Lib Dems on the city council have been ardently in favour of these proposals. They are bitterly angry and feel betrayed by the actions of the noble Lord and his colleagues.
Lord Tope
As the noble Baroness, Lady Hollis, has intervened, I will comment on her quoting, at some length, Norman Lamb, MP for North Norfolk. She forgot to mention that Norman Lamb is a former leader of Norwich City Council and, I believe, still lives in Norwich, and so has some interest.
Baroness Hollis of Heigham
My Lords, he is a solicitor in Norwich but is the MP for North Norfolk and has no formal connection at all to the city.
Lord Tope
I do not want to detain your Lordships’ House. This has distracted us but I think the main arguments have been clear.
Most of this debate has dwelt on the past. I have been guilty of that, too. We now need to look to the future. I do not think anyone questions that the Bill is necessary. Some welcome it, some may regret it, but it is necessary. We now need to pass the Bill as quickly as possible to end such uncertainty as remains so that, whether people welcome it or otherwise, people in the counties and cities are clear about what the position is. They can then concentrate all their efforts on the considerable task that lies ahead of them—as it does ahead of all of us—of looking to cut budgets by up to 25 per cent, while still trying to deliver the essential services in the most effective and efficient way. I wish the Bill a speedy success. I hope that when it is passed, the councils and councillors—county and city—will put the past behind them and work positively and constructively together on the very challenging task that lies ahead. If they do that, I believe—speaking as a city councillor—that much of what has been said would be won for Norwich and Exeter can be delivered within the present structure. We support the Bill.
Baroness Hanham
My Lords, I thank all those who have taken part in this debate for their contributions. I have been struck by the fact that we have been discussing different issues. The winding up of the noble Lord, Lord Rosser, has confirmed to me either that we are discussing different issues or that there is some determination to see that those issues are not the same.
We are discussing the decision by the previous Government to agree to applications by two councils for unitary status. Those were made late on in the Parliament. The applications were considered by the Government on at least three occasions. On two of those, Ministers said that the criteria—the criteria that have been quoted around the House today—were not met and that therefore they would not proceed. However, a sort of magical moment took place just before the election. Quite suddenly, a third decision was made, saying that all was well. The Government said that they did not mind that the criteria had not been met and that there were now compelling reasons—not stated—for why the councils should be allowed to go forward for unitary status.
This is not an argument about the value or the virtue of unitary government: it is about the mismanagement and mishandling of two applications for unitary government. That is why we are here today. We are here today because there was much opposition to what was going on. There was opposition not only on the basis of unitary authorities being formed, but on the basis of how the decision was being made. So concerned was this House, that the orders put forward were voted down on a Motion tabled by the noble and learned Baroness, Lady Butler-Sloss. The issue was taken up by the political parties before the election, and my party said that in the light of the orders being agreed we would stop them going ahead.
That was a manifesto commitment. When the coalition Government was formed, we agreed that it would be fulfilled. As the noble Lord, Lord Tope, has so carefully reminded us, it was abundantly clear that the Liberal Party was also against this, witnessed in the fatal Motion that he moved to stop these orders. Let us settle down and be sure what we are talking about here. We are talking about why the previous Government made their decision and the background against which it was made.
My Government are not against unitary authorities—plenty of them are working extremely well. There may be some that are not so good, but the existence of such authorities is recognised. However, we are against them being invoked and formed when the criteria that every other authority has had to satisfy have not been met.
There was also the issue of the last-minute compelling reasons, which were never laid out. Here, the noble Lord, Lord Rosser, finds himself in a very difficult position. He has got around the situation about as well as he could have done, but it is not comfortable. He was chairman of the Merits Committee when it produced one of the most withering reports that I have read on the process for these unitary authorities. The report drew attention to the compelling reasons and asked what they were. It never, as far as I know, had a reply and nor did anyone else. It drew attention to the fact that the criteria were not being met. It drew the House’s attention to the fact that these orders were progressing and being put forward on a false basis. I am sorry for the noble Lord, Lord Rosser, and believe that he took a very brave stand when he was chairman of the Merits Committee because he spoke strongly against his own Government. However, I think that today he has failed to back up that brave stand. We are therefore moving forward on the basis of the criteria not being met.
Baroness Hollis of Heigham
My Lords, before she went on to the issue of the Merits Committee, the noble Baroness was clear that she in particular, and the Government and the coalition more generally, were not opposed to unitary authorities as such. Her main criticism was of the process by which decisions were arrived at by the previous Secretary of State. Given that, as my noble friend Lord McKenzie said, Part 1 of the 2007 Act, which, as I understand it, permits future bids for unitary status to come forward, has not been repealed, may I have an assurance from the noble Baroness today, in the light of what she has just said, that any future bids from Norwich, Ipswich or Exeter will be properly considered in the light of that Act. If she says no, the Bill is hybrid.
Baroness Hanham
My Lords, if the noble Baroness had continued to sit for a bit longer, she would have heard me get to her point. It is correct that the Bill does not repeal the Local Government and Public Involvement in Health Act 2007, but it would also be fair to say that the Government have no plans to issue further invitations for unitary authorities and, if there were applications, they would be viewed against the serious economic situation we are in at the moment and consideration would be given to whether they offered any value for money whatever, which these applications have proved not to have. I should have thought that any local government worth its salt would think twice about putting forward an application under those circumstances.
Baroness Hanham
My Lords, that was the bit I had forgotten. Clause 2 moves the elections from 2010 to 2011. If it is quashed, we go back to 2010 being the defining moment for the elections. In that case, by-elections would have to take place within the next six weeks, and it may be decided that it would be more helpful to move them on.
I have been asked a number of questions. I have probably answered those asked by the noble Lord, Lord McKenzie, but I shall make one point. I am not surprised that the noble Baroness, Lady Hollis, made a very passionate speech, as it is clear that this is something that she feels very strongly about. However, I am just a little bit perturbed by the fact that she said that once the judgment appeared to be taken against the councils, that was the reason why they did not pursue or give evidence to the Examiners on hybridity. This action to challenge hybridity caused a lot of difficulties and trouble and brought into question the decision of the Public Bill Office of this House. It was a well argued trap the last time—
Baroness Hollis of Heigham
It was not a trap. It took place in the full presence of the House at prime time. A trap is something that happens as an ambush late at night. It was very clear to a number of people, including former MPs who are much more experienced in matters such as this, that there was an arguable case that the Bill was hybrid. The Speaker of the House of Commons had ruled that if there was any possibility that a Bill was hybrid, it should be referred. That was the decision. It was a very low hurdle, and the House agreed that that low-hurdle test had been met. There was very substantial support from the Cross Benches. There was no trap. If the Government had wanted to avoid that situation, they might have been better advised to have produced a more watertight Bill.
Baroness Hanham
Trap or not, we ended up with an examination to which no further evidence was given. The two memorials were laid. They were withdrawn, but because they had been there, they were considered. Effectively, the hearing took place without the arguments that had been put forward by the noble Baroness. We are where we are. We know the Bill is not hybrid. We are proceeding with it and will carry it through as far as we can to the end.
The noble Baroness also asked questions about the impact assessment. We should not forget that the unitary proposals for Exeter and Norwich failed to meet the affordability criterion and that the previous Government accepted that. The independent financial consultants supported that view. In short, the proposals were not value for money. The impact assessment reflects that, as it can be interpreted.
I thought that I might have one or two further questions to answer, but I believe that I have finished what I need to say. I am grateful for the contributions made by Members of the House. I beg to move.