English Devolution and Community Empowerment Bill

Baroness Thornhill Excerpts

Committee stage
Thursday 5th March 2026 Grand Committee

Moved by

[Baroness Thornhill]

243: Clause 74, page 70, line 20, at end insert—
“(3) In performing its functions, the Local Audit Office must pay immediate regard to and investigate any issues concerning risk management identified by audit committees established under section 33A.”

[Baroness Thornhill (LD)]

My Lords, I will speak to Amendments 243, 249 and 250 in the name of my noble friend Lord Shipley, who regrets that he is unable to be with us today. We on these Benches absolutely understand why the Government have created this new entity of the local audit office in the Bill, but we will still listen with interest to the arguments put forward by the noble Lord, Lord Jamieson, and the noble Baroness, Lady Scott of Bybrook, on Clause 74. However, I believe that our concerns are different. These amendments speak directly to a problem that the Committee fully understands all too well: what happens when power runs ahead of scrutiny.

Amendment 243 is an early warning: it would require the local audit office to take immediate notice of serious management concerns raised by local audit committees. This is not an abstract concern. We have seen authorities where internal warnings were repeatedly raised about governance, liabilities or control systems, yet decisive action was delayed until failure became unavoidable. Audit that intervenes only after a Section 114 notice is not an oversight; it becomes a post-mortem.

I speak from bitter experience. When I was a councillor in opposition, we had our accounts disclaimed for two years on the trot. Apparently, this had never happened to any local authority before; we were not aware of it and we did not even know what the word meant until the auditor himself took the unprecedented step of breaking the story to the local Watford Observer—hence my passion to make this system work.

Analysing all those past failures, I find that they were not accidental. They were often accompanied by a pattern of executive overreach. Major decisions were taken at pace, scrutiny bodies were sidelined and challenge was treated as obstruction rather than protection. In some cases, significant financial commitments were entered into through mayor-led vehicles with limited transparency, optimistic assumptions and weak democratic oversight. In others, scrutiny committees raised concerns only to find themselves ignored, overridden or marginalised.

Amendments 249 and 250 are to deal with what happens next. They would ensure that audit scrutiny extends not only to money already spent but to how resources are planned to be used. They would allow serious findings to be made public where the audit committee considers this to be in the public interest.

Past failures were not hidden in the accounts; they were embedded in business plans, regeneration strategies and commercial ventures that were never properly stress-tested. Audit that cannot interrogate those plans early and that cannot speak publicly when necessary is simply too weak for the system that the Bill is creating.

This brings me to the local audit office itself. Done well, it could be a real asset. It could provide consistency, expertise, early challenge and a clear line of sight across a fragmented audit landscape. It could join up intelligence, spot emerging risks and give local leaders, mayors and central government the confidence that problems will be confronted early, rather than quietly managed until they explode.

We must be honest about the starting point—where we are now. The current local audit system is not working as it should, and I am absolutely certain that the Minister is aware of that. Audits are delayed, capacity is stretched and expertise is uneven. Serious concerns too often circulate without traction. The danger is that we create a local audit office in name but not in reality—an institution with responsibility but insufficient muscle.

This is now coming to the heart of our concerns, and this is what makes it more pertinent. The new system deliberately concentrates power in the hands of directly elected mayors over strategic planning, major investment decisions, long-term borrowing and delivery bodies operating at arm’s length. That concentration of power may deliver momentum, but it also magnifies risk when challenge is weak.

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I have set out the reasons why the Government will resist these amendments. I hope that noble Lords will feel able to withdraw or not press them.

[Baroness Thornhill (LD)]

I am going to be very honest and say that the Minister packed one heck of a lot into that response. I struggled to keep up with her and really understand the ramifications, because this matter is technical and detailed. I will revisit Hansard. I know that my noble friend Lord Shipley and I will have some detailed questions, which it did not seem appropriate to ask here but which we would like the Minister to go through with us. For us, this is about early, robust and public challenge. I am not sure that, with the Bill as it stands at the moment, we can be assured of that in the face of catastrophic failures that are shameful to local government, as well as this imbalance of power. The Minister knows that I want this to work, but I believe that it will work only if the scrutiny is as balanced as the powers of the new mayoral authorities.

With that caveat, in the hope that we will be able to have some specific discussions—and with the aim of reading the Minister’s detailed response in Hansard, perhaps tomorrow—I beg leave to withdraw the amendment, which was tabled by my noble friend Lord Shipley.

Amendment 243 withdrawn.

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We have tabled this amendment and these stand part notices because the evidence from legal practitioners, investors and the sector points overwhelmingly to the same conclusion: the blanket ban on upward-only rent reviews proposed by the Government is a blunt instrument with the potential to cause significant harm to the commercial property market, local regeneration and the very businesses that we all want to see thrive. If there is to be any reform in this area, it must be built on evidence, in partnership with the sector, with a commitment to economic stability.

[Baroness Thornhill (LD)]

Your Lordships will be pleased to know that I have taken a scythe to my speech, so it might come out a bit disjointed. The short version should be directed to noble Lords at the other end of the table: I understand their position because turkeys do not vote for Christmas. It depends on which lens you look at this through.

So it is no surprise that I rise to oppose the stand part notices for Clause 85 and Schedule 34. They are the mechanism by which the Bill ends upward-only rent reviews for new and renewed commercial releases. Removing them would preserve the system that has been quietly hollowing out our high streets and small businesses for years. The noble Lord talked about evidence and there is plenty of evidence to show that. The real-world effect of upward-only rents is very simple: when trade is good, rents go up, and when trade is bad, rents go up. Rents do not come down. That might look neat in a contract but, on the ground, it has meant businesses paying yesterday’s rents in today’s economy.

We have all seen what that looks like: a shop where footfall has dropped, but the rent is still set at pre-pandemic levels and is going up; a café that has survived lockdowns, energy shocks and staff shortages, only to be hit by a rent review that moves in one direction regardless of takings; or a small local business doing everything right but that is forced out because the lease allows rents to rise but never to reflect reality. I confess to my hairdresser being exactly in that position: after 40 years of work in Watford, she is no more. “The rent rise”, she said, “was the final straw”. This is real.

Clause 85 matters because it allows rents to move down as well as up, so that they can reflect what is actually happening on a street, in a town centre or in a local economy. Markets work both ways and leases should be able to do the same. If we remove Clause 85, we are not defending the market; we are defending a one-way ratchet that has already failed our high streets.

I will blot out a big paragraph here. That does not mean that we should ignore the risks. Markets will adapt and some landlords may try to push the risks elsewhere through higher initial rents or shorter leases. This is why scrutiny, monitoring and review matter, but they are arguments for refining Clause 85, if necessary, not for removing it altogether. Perhaps the Government might consider this on Report.

Likewise, a small caveat: this is a broad reform applying across all commercial sectors, not just retail and hospitality, where the effects and problems are most visible. I would be interested to know what work has been done to understand the impact of this change on commercial property investment, particularly in struggling town centres and regeneration areas. How do the Government justify the big-bang breadth of this measure? Have they considered whether a more targeted approach might have achieved the same aims over time?

If we are confident that this is the right direction—we believe it is—we also have to be confident enough to measure its effects. Therefore, we have some sympathy with Amendment 254 in the names of the noble Baroness, Lady Scott of Bybrook, and the noble Lord, Lord Jamieson, but we feel that 12 months would not be enough time to measure the true effects of this significant change.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I thank the noble Baroness, Lady Scott, for Amendment 234. I will start with the stand part notices for Clause 85 and Schedule 34.

Upwards-only rent reviews have been a long-standing issue for businesses throughout England and Wales. The British Independent Retailers Association and UKHospitality gave evidence in the other place about just how damaging the practice is and why they have campaigned for decades for the Government to take action. The practice of upward-only rent reviews has an invidious effect on the efficiency and accessibility of the commercial property market—not to mention the impact on our high streets and town centres that the noble Baroness, Lady Thornhill, outlined. It is designed to ensure that landlords and investors are insured against market conditions, but there is a cost to this, which falls chiefly on the business tenants left paying excessive rents when they are already stretched to breaking point, unable to invest or improve their productivity, or, in times of hardship, to keep the lights on or pay their staff wages.

Ultimately, these clauses make running a business less viable, damaging the competitiveness of the economy. Alongside reform of business rates, banning these clauses will help make commercial rents fairer and more efficient, help businesses invest and give them greater resilience to economic conditions. In recognition that these clauses can provide some security to investors, we have committed to consult on how caps and collars could be used. I reassure noble Lords that the Government intend to work carefully and closely with the property industry and others to implement this policy, help manage risk and maintain confidence in the market, without relying on one-sided mechanisms such as upwards-only rent review clauses.

I turn to Amendment 254. I understand the desire to consider the impacts of legislation once it has passed. However, 12 months is too limited a period to see the ban fully implemented and the market adjusted. The Bill’s impact assessment also finds that the ban is likely to have a net positive impact on the UK economy because it will make the commercial property market more efficient, reducing rents for tenants who can instead invest in their businesses and help keep consumer prices low. For those reasons, I hope that noble Lords will not press their amendments.

[Lord Jamieson (Con)]

I am grateful to both noble Baronesses for their comments. There may be a slight misunderstanding here. Our key point is that this is a very significant change to the commercial property market, and it has not been done with the industry. The Minister said that she would “work carefully and closely” to implement it. It would have been better to have worked closely and carefully with the industry in developing it. I agree with the noble Baroness, Lady Thornton. Our issue is with a blanket ban rather than looking at how we can come up with a potential system that works better for all parties. I am glad that she is more supportive of our amendment.

[Baroness Thornhill (LD)]

The noble Baroness, Lady Thornhill.

[Lord Jamieson (Con)]

I am dreadfully sorry; I apologise to the noble Baroness, Lady Thornhill. Can we have that officially minuted? I share those concerns. The key point is that we need something that works.

I wish to point out that upward-only rent reviews are nowhere near the biggest problem facing businesses up and down the high street. They are contending with devastating increases in business rates and are facing increased regulation, increases in national insurance charges and the effects of changes to the minimum wage. Although we would all like a higher minimum wage, it must be affordable.

The Government’s solution—tearing out a long-established market measure without proper consideration, without careful engagement with the sector and without understanding the consequences for investment and lending to commercial markets—is a high-risk strategy. The question today is not whether commercial tenants deserve fair terms—they do—but whether the proposal before us is the right one. There are too many uncertainties and risks that have been left unaddressed.

We will seek to revisit this issue on Report. I hope that, by then, the Government will have reflected on the concerns raised today and will come forward with proposals grounded not in assertion but in evidence, balance and economic reality. In the meantime, I beg leave to withdraw my clause stand part notice.

New Homes Target

Baroness Thornhill Excerpts

Wednesday 11th February 2026 Lords Chamber

[Baroness Taylor of Stevenage (Lab)]

I am grateful to the noble Lord for his patience on the long-term housing strategy. We will be publishing that in the first quarter of this year.

[Baroness Thornhill (LD)]

My Lords—

[Lord Robathan (Con)]

My Lords—

[Captain of the Honourable Corps of Gentlemen-at-Arms and Chief Whip (Lord Kennedy of Southwark) (Lab Co-op)]

It is the turn of the Lib Dem Benches.

[Baroness Thornhill (LD)]

My Lords, obviously, the noble Lord was not quick enough today.

Research by Crisis and the National Housing Federation found that we need to build 90,000 social homes a year to tackle the current homelessness situation. We know that councils are spending around £2.8 billion a year on temporary accommodation. I ask the Minister: will the Government commit to a specific target for social housing within their overall 1.5 million homes target, alongside a detailed pathway to deliver these homes? We all know that that end of the housing market is the real logjam in the housing crisis.

Picking up on what the noble Lord said with regard to London, will the Government commit to looking again at their disappointing decision to slash the proportion of social homes required for all new developments in London?

[Baroness Taylor of Stevenage (Lab)]

The target for the £39 billion spend that we have is that 60% of that will be social housing. The whole amount will be spent on social and affordable housing. That is the most money that has been invested in social and affordable housing for a very long time, and I am very proud of that record.

In relation to the noble Baroness’s question on London, having discussed this extensively with London councils, the important thing is to get housebuilding moving in London. London authorities will decide the percentage of social housing. We are working closely with them on that.

Renters’ Rights Act: Implementation

Baroness Thornhill Excerpts

Wednesday 11th February 2026 Lords Chamber

[Baroness Taylor of Stevenage (Lab)]

It will lead to better conditions for renters and will remove some of the barriers that stop people renting, as well as barriers that can prevent renters maintaining a tenancy. We have banned rental bidding, levelling the playing field for renters; landlords will no longer be able to encourage prospective renters to stretch themselves beyond their means; they cannot discriminate against the prospective renter because they are on benefits or have children; and rent increases will be limited to once a year at market rate, with tenants able to challenge unfair rent increases at First-tier Tribunal.

The work we have done with landlords and with tenant bodies—we have worked with both, through the whole passage of the Bill—means that we have a fair system that rewards good landlords and tenants but makes sure that bad landlords are held to account for the bad practices they have had in place.

[Baroness Thornhill (LD)]

My Lords—

[Lord Spellar (Lab)]

My Lords—

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[Baroness Thornhill (LD)]

My Lords, tenants are a group of people close to my heart. They have been promised that the Renters’ Rights Act will transform their security and will do so from 1 May this year. They will be relying on local authorities to enforce those rights. But I say to the Minister that there is still no evidence from government that local authorities have the staffing or capacity to use effectively the new powers in the Act that they gained at the back end of last year. So I ask the Minister: what confidence can the House have that on 1 May, tenants will not once again be left with protections only on paper that they cannot realistically enforce? Without that data, how do the Government know that the new burdens funding, designed to support enforcement activity, is actually sufficient?

[Baroness Taylor of Stevenage (Lab)]

I was with a group of over 300 councillors at the weekend, mainly council leaders and other councillors, who were very pleased to see the Renters’ Rights Act coming into force on 1 May. The noble Baroness is quite right to say that local councils will play a crucial role in making sure that this Act actually works on the ground. To help councils build enforcement capacity, we have provided new burdens funding for 2025-26 and a further funding allocation for 2026-27, which will be confirmed early this year. We have also funded the Operation Jigsaw network to deliver bespoke training on the Act, so that councils understand their new responsibilities. Detailed guidance covering the enforcement measures, like the new investigatory powers, has already been published.

English Devolution and Community Empowerment Bill

Baroness Thornhill Excerpts

Committee stage
Thursday 29th January 2026 Grand Committee

[Lord Shipley (LD)]

My Lords, these have been an interesting set of interventions. I agree with the noble Baroness, Lady Royall, that it is important that party-political contributions are kept to an absolute minimum when we are debating a Bill.

There is a basic issue in this group. The public have a right to expect that elected individuals do not end up with two jobs: being a mayor and being an MP. In some circumstances, it might be possible for the electorate to knowingly vote for that. However, that would be most unlikely to be the case. There is a question as to where, geographically speaking, the mayor might be the MP; it might be within the mayoral authority and it might be elsewhere. Either way, there is a clear conflict of interest, because Parliament judges the allocation of funding, for example, to the mayoral authority.

I do not think that you can have one person doing two jobs. Amendments 76 and others in the name of the noble Lord, Lord Gascoigne, would allow that, for whatever period, there could be an overlap of both mayor and MP retaining both offices. To be absolutely clear, we think that that is wrong. I say to the Minister that these matters are important and should not be for political parties to judge alone. It should instead be clearly understood that, when people have been elected to one of the posts, they should carry out the responsibilities that they have been given by the general public.

On Tuesday, I said that if, in a mayoral authority, there had been a large number of commissioners appointed by the mayor but then that mayor decided to become a Member of Parliament, he or she would leave the mayoralty and, as the Bill is currently drafted, all the commissioners would lose their jobs as a consequence. When politicians are elected to a job, they must see the job through and do it to the best of their ability, given that the public have expressed confidence in them doing so. They have an obligation to fulfil their contract with the electorate.

[Baroness Thornhill (LD)]

My Lords, I will add something to the wise words of my colleagues. To us, this is about the concentration of power in the hands of one person. The powers being given to new mayors are considerable and I understand them; to some extent, I agree with them—as a directly elected mayor for 16 years, of course, I would say that, wouldn’t I? I see the two roles as completely different: a role in national government is completely different from a local, regional role. There could be massive conflicts of interest, but the key thing is that this concentrates too much power. Conservative colleagues have talked about that, but then they are quite happy to let somebody do both jobs. To our mind, that is just not rational.

The key thing is that this creates more political opportunities for more people. It also encourages mayors. The key thing about a mayoralty is that the mayors can develop their own local, independent mandate, rather than being overshadowed by national party politics. They are very different and distinct and they could be in direct conflict with each other. That is why we absolutely believe in that separation of powers.

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Moved by

[Baroness Thornhill]

91: Clause 18, page 22, line 7, at end insert—
“(3A) After subsection (13) insert—“(14) When making regulations under this section, the Secretary of State must have regard to the need to identify and minimise any conflict, overlap, or duplication between the functions of the Mayor and the functions of other authorities or public bodies.”” Member’s explanatory statement
This amendment requires the Secretary of State, when making regulations under section 30 of LURA 2023, to consider and minimise any potential conflict, overlap, or duplication between the Mayor’s functions and those of other authorities or public bodies.

[Baroness Thornhill (LD)]

My Lords, in moving Amendment 91, I will speak also to Amendment 92. These amendments are the only ones in the group and concern mayoral powers and functions. Interestingly, I note that some of the wise and pertinent comments made by the noble Lords who are now not in their place regarding issues with London boroughs and the mayor, born of hard-lived experience, will apply in the new structures. So there are real lessons to be learned. I am hoping that my amendments might help avoid some of the issues raised in group 1.

The Bill, as we know, gives mayors significant new powers, and none of us underestimates what that means; hence our collective concerns. The Government clearly support mayoral ambitions as a means of fulfilling their political objectives, many of which we might all agree with. But power alone does not equal good devolution or good governance. Both depend on clarity about who does what, who decides what and who is ultimately accountable. The last thing mayors need are fuzzy boundaries if they are to do the job effectively, as I know from bitter experience. These amendments simply require the Secretary of State—let us not forget that a lot is going to be left to the Secretary of State—when making regulations or orders about mayoral functions to

“have regard to the need to identify and minimise any conflict, overlap, or duplication between the functions of the Mayor and the functions of other authorities or public bodies”.

Let us be clear, the new mayors will be involved in all of this and will, quite rightly, have their fingers in every pie. If they are to make a significant difference to the regions that need them most, and to the country as a whole, they will need to be doing that. But these powers, as we know, come with a new complex structure and therefore these amendments are necessary. They simply make sure that at some point when new powers are designed, someone asks a basic question: how is this going to work alongside what already exists?

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[Baroness Taylor of Stevenage (Lab)]

My Lords, I thank the noble Baroness, Lady Thornhill, for her amendments on the role of mayors. Before I respond to these amendments, I want to clarify the rationale for Clause 18. The clause will extend an existing power of the Secretary of State to provide that certain general functions may be exercised solely by a mayor. The power currently exists in the Local Democracy, Economic Development and Construction Act 2009 and, as the noble Lord, Lord Jamieson, said, in the Levelling-up and Regeneration Act 2023. This clause will ensure that it can also apply to general functions conferred under any other regulation or Act of Parliament. The extension of this existing power reflects the broader range of routes through which functions may be conferred on strategic authorities and their mayors, once the current Bill becomes law.

Amendments 91 and 92 seek to amend this clause and prevent the potential for conflict, overlap or duplication between a mayor’s functions and those of other authorities or public bodies. As your Lordships will know, mayors of combined authorities or combined county authorities are not corporate entities in themselves. For that reason, all functions must be conferred on the underlying authority rather than directly on to the mayor. However, some functions may be designated as mayoral functions, as they are to be exercised only by the mayor. Where functions have been made mayoral, they typically relate to the management of day-to-day activities.

Key strategic decisions still require approval by the strategic authority constituent members. To give an example, all members will vote on which roads form part of a key route network, after which the mayor will be responsible for managing it. This will allow for swifter decision-making and more effective governance on day-to-day matters.

It will be important that all tiers of local government work together to benefit their communities. This is why principal local authorities will be embedded within the decision-making structures of strategic authorities as full constituent members. This will ensure that they play a central role in drawing up specific strategies and plans, such as local growth plans. Furthermore, before any new function is conferred on a strategic authority by regulations, the Secretary of State will be required to consult the constituent councils of any affected strategic authorities and any other person who exercises the function concerned. This will ensure that the views of those affected are properly considered.

I hope that, with these explanations, the noble Baroness will feel able to withdraw her amendment.

[Baroness Thornhill (LD)]

I absolutely accept that the new structures are complex and complicated. It is very easy to be seduced by the noble Baroness’s fluent explanation. My amendment was coming more from the perspective of practicalities, which was also borne out by the comments earlier that, in reality, there is overlap, with weakened scrutiny, unclear accountability and eroded public trust. I would like to feel that a lot of work was being done into what those are. We know it is probably happening, but it is all going to come later through SIs and secondary legislation. I wanted to make it absolutely clear, up front, that those overlaps and duplications will be considered, because they will be a source of conflict and friction going forward. It was interesting that the leaders of boroughs are saying that that is happening even 20 or however many years later. But, for the moment, I will withdraw my amendment.

Amendment 91 withdrawn.

English Devolution and Community Empowerment Bill

Baroness Thornhill Excerpts

Committee stage
Tuesday 27th January 2026 Grand Committee

[Lord Bassam of Brighton (Lab)]

My Lords, I rather suspect that the noble Lord, Lord Bichard, and I are fishing in a similar pool here. My Amendment 196B is all about local accounting officers and is designed to help to improve the level of scrutiny and accountability for each mayoral strategic authority.

The system of departmental accounting officers and their requirement to appear before the Public Accounts Committee is often used to justify value for money—an issue that could prevent proper devolution—but this is because accounting officers are technically meant to be able to justify all spending even if, in reality, the decision to devolve to a different authority has been made. With the development of the new combined mayoral authority model, we need to learn from those models being used by the devolved Administrations where accounting officers’ responsibilities have been given to the relevant bodies.

This amendment would look to devolve AO responsibilities to new local accounting officers, who would be local and accountable to the relevant authority’s scrutiny bodies for any spending by an established mayoral strategic authority. This is loosely based on the relevant legislation for Welsh accounting officers. The relevant body here might include a local public accounts committee; the noble Lord, Lord Bichard, made the case for that.

This amendment is designed to be helpful. The Minister may say that it is unnecessary but, in my view, it would be a genuine move towards devolved accountability—in terms of models of funding and allowing places to innovate while retaining an appropriate level of scrutiny. With the development of devolved mayoral combined authorities, we need an extra layer of accountability that looks at the way in which public money is spent. For too long, local government has been burdened with more responsibility, less funding and fewer opportunities to innovate and develop; at the same time, to my way of looking at things, local authority accounting practices have not really moved on from where they were in the 1990s. This amendment is an attempt to be helpful, very much in the spirit in which the noble Lord, Lord Bichard, spoke to his amendment.

[Baroness Thornhill (LD)]

My Lords, I will make a brief comment on Amendment 196B, tabled by the noble Lord, Lord Bassam, which is worth discussing further, especially given how it fits with Amendment 191 from the Lord, Lord Bichard, which I strongly support.

The question I asked myself, perhaps trying to anticipate the Minister’s response, was: would it duplicate existing audit and scrutiny arrangements? I came to the conclusion that I do not believe that it would. Audit answers the questions of whether the accounts were properly kept and whether the acceptable processes and procedures were legally carried out. But this amendment addresses a different and much more important question: is public money being spent effectively across the whole system? Audit is retrospective, siloed and looks at individual organisations after the event. Local public accounts committees, as proposed in this amendment, would look across organisations in real time. They would look at how councils, mayors and public service partners are actually working together—they are not the same things.

The Bill deliberately—and correctly, in my view—will push power and spending into shared collaborative arrangements, but our scrutiny remains fragmented, organisation by organisation. This mismatch is the gap that Amendment 191 would fill. Without it, no one body would be clearly responsible for asking very basic questions such as: is it the case that joint working is working? Is it delivering value? Are overlapping budgets aligned with agreed priorities? Are partnerships working as intended? Audit does not do that—and scrutiny committees, as currently structured, will struggle to do that.

In contrast, this amendment would enable that. It is not more bureaucracy; it is better oversight. It is not another unnecessary new layer. The amendment is enabling, not prescriptive, and it allows Ministers to integrate these committees within existing audit and scrutiny frameworks. It provides coherence and not clutter, and in fact good system-level scrutiny actually reduces duplication by exposing it.

My main reason for supporting the noble Lord, Lord Bichard, is that devolution without strong, visible accountability risks undermining public confidence. If power and money are exercised at a mayoral strategic level, scrutiny must exist at that same level. Otherwise, we are asking people to trust structures they cannot see being properly examined.

In conclusion, Amendment 191 strengthens the Bill by aligning power, spending and accountability. It complements audit and scrutiny; it does not replace them. In fact, the financial cost of not having effective system-wide scrutiny could lead to duplicated programmes, misaligned budgets and failed collaboration, which will almost certainly cost a lot more than the modest investment required to make this work well. For these reasons, I hope that the Minister will give both ideas serious consideration.

[Lord Fuller (Con)]

My Lords, I support the principle of Amendment 191 in the names of the noble Lord, Lord Bichard, and the noble Baroness, Lady Thornhill. I observe that, for the first time, we are bringing local, parish and community councils substantially into scope, for I believe that the definitions provided in Amendment 191 will do so. What has not been fully understood is that one of the second-order effects of the Bill is that it will create a significant number of larger community councils as a result.

As a result of local government reorganisation, large numbers of cities, such as Oxford, Exeter and Norwich, and former county boroughs, such as Ipswich, Great Yarmouth and King’s Lynn, which have been billing authorities hitherto, will now fall into the lower tier of local authorities. Those authorities have no constraint or cap on the amount of council tax that they can raise. In Salisbury, they have jacked up council tax by 44% in the past four years—they have let rip, and it is not good enough. There has been no scrutiny, there has been cost shunting, and the council tax payers have paid more.

I have laid amendments, which we will discuss later, that will make provision for those larger smaller authorities to fall under the constraints that all the other authorities will have. I do not seek to fetter the smallest parish council, but if you have a population that hitherto has been part of a billing authority, it is right that they should be constrained going forward, as they have in the past.

I am not sure that I entirely welcome all the provisions in Amendment 191 on local public accounts committees, but the amendment shines a light for the first time on where we will go with these smaller community parish councils. There is merit in the thrust of what has been proposed here. I wait to hear how the Minister reacts to what constraints will be placed on this new class of large parish or town council as a result of the changes proposed in the Bill.

English Devolution and Community Empowerment Bill

Baroness Thornhill Excerpts

Committee stage
Tuesday 20th January 2026 Grand Committee

[Lord Gascoigne (Con)]

My Lords, it is a great pleasure to speak for the first time in the passage of the Bill. I know we do not have to address it, but I was intending to speak at Second Reading and I had to pull out for personal reasons just beforehand. This is an issue that genuinely interests me. Every time I sit in these meetings or take part in these discussions, it feels like being at Davos or the United Nations, with so many titles and vice-presidents, and I feel a bit left behind not having any myself. I am a bit like my noble friend Lord Norton in that I am merely a bystander in this, someone who is interested. I am a political geek and a taxpayer; those are my interests. Like others, I congratulate the Minister on many belated happy returns for yesterday. I can think of no better way of spending your birthday than with some of your closest friends late at night in the House of Lords.

My Amendment 12 is embryonic. We are in Committee and I am happy to have a discussion; perhaps if the Minister is still feeling jovial from her party, we can continue that joviality and have another discussion. This amendment is simple, yet it would introduce an essential safeguard into the Bill. Given that the Secretary of State ultimately has the power in the Bill to create these new strategic authorities—it lies in his or her hands—this amendment would ensure that they are satisfied that each new authority is capable of doing what is expected of it before it is created. Those capability tests should be grounded and focused, though not exclusively, on four areas: first, governance arrangements, to ensure that it is transparent, able to make decisions and face scrutiny; secondly, financial sustainability, so that it is on a sound financial footing and able to carry out the new powers and deliver; thirdly, administrative capacity, and whether it has the right people, expertise and systems in place; and, finally, accountability mechanisms, to ensure that it has credible systems for scrutiny and democratic oversight. To be clear, I envisage the same sorts of tests applying to both the new mayoral authorities and the new unitary authorities.

Ultimately, I say with respect to the Minister, this is not game playing, a stunt or an effort to stop the Bill. It is grounded in my concern that there is nothing in the Bill to ensure that, before a new authority can exist, it must be ready and able to do what it says it will. The Bill talks about their functions, voting systems and the powers they will have, yet a Bill about empowering the people has nothing about whether the system being invented will be able to, any good at or even capable of delivering better services for the people—not to mention better value for money, though that is in a future group. I am sure the Minister is looking forward to me speaking on it in due course.

I am sure that some will say that this amendment is unnecessary. Those people who object will probably fall into three rough camps. The first will say, “We don’t need to worry. It’s going to be fine. We should take what we’re given; it is what it is and we can’t go around dictating from on high what it should be like on the ground”. But that is exactly what the Bill is doing: we are dictating what the new system should be like. We are saying that there should be a plan in place and how it will work. I think we should make sure that these authorities are capable of standing on their own two feet. Given that one of the arguments for reforming local government is that it is already quite messy and difficult to navigate, we surely do not want to create a system that is even more confusing. Before we hit the “Go” button, there needs to be effort on the ground and in Whitehall to ensure that the new structures in place are robust and coherent. That is not bureaucracy, it is just accountability. One of the many fears I have about the Bill, I am afraid to say, is that if transparency and accountability are not built in from the outset, that will make it harder to understand and hold people’s feet to the fire. These tests do that.

Another argument against this amendment will be that, ultimately, it should be for the people to decide whether the authority is doing a good job or not. I am a genuinely firm believer in democracy: it is precious and unique. Of course the electorate will ultimately be the judge, but that will come only after the changes have happened, years down the track. With so many elections already being delayed because of reorganisation, there will be no checks put in place before changes take place.

Finally, I am sure that some will say that it is not possible to test something that does not exist. However, we can do so, not just in the prep work and the planning of what is intended, but in seeing whether existing local authorities are good at what they are doing already: whether they are late or slow in delivery, whether services are being cut or expanded, their finances, workforce capacity, roadworks, housebuilding—you name it. Before noble Lords feel compelled—this has happened to me before—to defend the honour of local authorities, I pre-empt this by assuring them that I am certainly not blanketly saying that all local councils are not up to it. Equally, I am not saying that Whitehall is perfect—far, far from it. I am merely saying that, before we proceed to create and approve these new authorities, there should be a system to ensure that they will work, including how they will build on, incorporate or tackle issues in the pre-existing authorities.

There is one final area I will touch on, which we have talked about in passing already. I do not want to open this up into a broad debate about local government finance, but it does have read-through here. We all know the challenges and I do not want to dwell on it, but, across the land, capabilities are not uniform. I read some research that showed that councils in the north are twice as likely to be at risk as those in the south. Then there are the associated costs of reorganisation, never mind whether the new entity is going to be any good. Some organisations are already asking whether the current wave of reorganisation will save money or in some circumstances cost even more. Yet this Bill has no requirement to test capability, never mind finances, before those new bodies are created.

This Bill should not be seen as an exercise to create layer upon layer without thinking it through first. This is a serious issue. It is about spending serious sums of money on serious things affecting the lives of many, so it is important that we get it right. Devolution is meant to be about making the system work better, and that is what is driving this amendment. I recognise that many councils will do an enormous amount of work in getting these changes right, but rather than hoping that this version of devolution works and that things do not go wrong for the taxpayer, let us put in a safeguard. Rather than rely on good intentions, let us make the system work from the outset. Trust is not enough. These simple tests, or something like them, would make sure that from the get-go the new system is better, stronger and more capable of delivering improved services for the people. I beg to move.

[Baroness Thornhill (LD)]

My Lords, I acknowledge the constructive intention behind Amendment 12 from the noble Lord, Lord Gascoigne. The desire to ensure that strategic authorities are properly equipped, financially sustainable and governed with integrity is entirely understandable. We have all seen, all too often, the consequences when structures are created without sufficient capacity or clarity of purpose. We do not want that to happen here, and this amendment seeks to guard against it. However—the noble Lord’s heart sinks—while I appreciate that instinct, we cannot support the amendment as drafted.

The noble Lord, Lord Gascoigne, and I have different perspectives as we come from different backgrounds—him from No. 10 and me from more than 25 years in local government, 16 of them as a directly elected mayor. To us, the amendment seems to reintroduce a centralising veto at precisely the moment when the Bill is meant to be shifting power away from Whitehall. The Secretary of State would become the arbiter of whether an area is “capable”—a term left undefined, and thus open to subjective interpretation. What one Minister might judge as prudent due diligence, another might use as a brake on local ambition. That uncertainty does not sit comfortably with our belief in consent-based, locally driven governance.

We also have to be alive to the practical effects on the ground in the places about which we have spent many long hard hours talking—those most in need of levelling up. They are often those with a much weaker starting capacity. They could find themselves locked out by criteria that they are not yet able to meet, precisely because they have not been granted the devolution tools that would help them grow that capacity. We risk creating a circular trap: you cannot have the powers until you have the capacity, but you cannot build the capacity until you have the powers.

However, we recognise that strong oversight will be necessary with changes of this magnitude. Several amendments in the names of other noble Lords show a strong appetite across the Committee for rigorous oversight, but it must be oversight that does not stray into overprescription or paternalism. I understand why there may be concerns; the noble Lord, Lord Gascoigne, expressed them well. My spectacles are not rose-coloured—I acknowledge that local government has not always got it right and that there have been failures, some of them cataclysmic—but, with my tongue firmly in my cheek, I think that we could also say this about past Governments, Prime Ministers and initiatives.

That said, the amendment springs from a very real concern: the public must have confidence that new strategic authorities will function effectively from day one. On that point, I entirely agree with the noble Lord. There is space—and, indeed, a need—for transparency in how readiness is assessed in order to ensure that governance arrangements are fit for purpose and to avoid the creation of authorities that are destined to struggle. However, in our view, the answer is not to place broad, undefined tests solely in the gift of the Secretary of State. Instead, we might look to more balanced alternatives, such as clear statutory criteria developed with the sector rather than imposed on it. I am sure that the Local Government Association will be keen to work collaboratively on this; we could even look at greater parliamentary scrutiny rather than ministerial discretion. There is room for a serious discussion on this matter—I hope that we can hold that with the Minister.

The amendment addresses a genuine risk but, in our view, the mechanism it proposes risks undermining the very local autonomy that the Bill is meant to strengthen. We should not let the perfect be the enemy of the good by setting hurdles that, in some areas, those who would benefit the most will struggle to clear. I genuinely look forward to hearing the Minister’s response.

[Baroness Scott of Bybrook (Con)]

My Lords, the amendment tabled by my noble friend Lord Gascoigne goes to the heart of what effective devolution requires: capability. As he set out so clearly, it is simply not enough to create new strategic or unitary authorities in the abstract and hope that they will succeed. We can and should look at the performance of existing local authorities—including their financial resilience, their workforce capacity, the pressures they face and the services they currently deliver—to understand whether the foundations are in place for a new body to take on, in some cases, even greater responsibilities.

My noble friend was right to say that this is not about criticising local government wholesale—many councils are doing extraordinary work under immense strain—but capability is not uniform across the country. The financial challenges facing local authorities are well known. Reorganisation carries costs, and there is a real debate around whether it always delivers the efficiencies or improvements that are promised.

Against that background, it is entirely reasonable that we should expect a clear and transparent test of readiness before new strategic authorities are created. That is precisely what Amendment 12 would provide. It proposes that, before any strategic authority or unitary authority is established, the Secretary of State “must be satisfied” that it has the governance, financial resilience, administrative capacity and accountability mechanisms that are necessary to exercise the functions conferred upon it. These are not burdensome hurdles; they are basic safeguards to ensure that a new authority is set up to succeed, not set up to struggle.

New Homes: Target

Baroness Thornhill Excerpts

Thursday 8th January 2026 Lords Chamber

[Baroness Taylor of Stevenage (Lab)]

I can give the noble Lord that assurance. We are determined to make sure that, as we go through the process of building the 1.5 million homes, enough social and affordable housing is included in that target. He will know that I take particular care to not conflate the terms “affordable housing” and “social housing”; they are different things. We have to make sure that we do our best in that regard. From the £39 billion that we have allocated for affordable housing, 60% will be for social housing.

[Baroness Thornhill (LD)]

My Lords, local planning departments are often cited as a blockage to building more homes, yet fewer than 40% of those local authorities are operating with an adopted plan. As the English Devolution and Community Empowerment Bill moves through Parliament, what action are the Government taking to ensure that local government reorganisation, with its many new structures, planning powers and inevitable changes of political control, is not used as a delaying tactic to produce an up-to-date plan, which strong anecdotal evidence suggests is happening?

[Baroness Taylor of Stevenage (Lab)]

It is essential that the local government reorganisation and devolution process does not hold up the production of local plans. My Government have made that absolutely clear and are following up with councils that have delayed local plans. Where the new strategic plans are being made, they can be made in spite of reorganisation, and the data used for them will be transferred as soon as the reorganisation arrangements are complete.

National Plan to End Homelessness

Baroness Thornhill Excerpts

Tuesday 16th December 2025 Lords Chamber

[Baroness Taylor of Stevenage (Lab)]

We had some long debates during the planning Bill about the size of accommodation and the stepping-stone type of accommodation provided in some parts of the country. The noble Baroness, Lady Thornhill, initiated those discussions. We are still discussing those issues because they are very important, as the noble Lord says. Specific content within the homelessness strategy focuses on the issues of young people, building on the national youth strategy, and will give young people the skills, connections and opportunities they need to thrive, with a key focus on prevention of homelessness among young people. We want to develop a cross- government action plan with measurable targets to reduce homelessness, particularly among care leavers under 25. We are working on this. The noble Lord makes an important point about the size of accommodation. It is still under discussion, and I will keep him in the picture on that.

[Baroness Thornhill (LD)]

My Lords, there is a real issue around the allocation of funding for homelessness prevention. While the strategy helpfully recognises this and commits to some adjustments, we still have no published needs-based formula. When will we get one? Will it set out how rent levels, housing supply and market-measured pressures are weighted? Does the Minister agree that without this it is really hard to judge whether allocations are fair and transparent and genuinely reflect local need?

[Baroness Taylor of Stevenage (Lab)]

It is very important that we continue to work with local authorities in tackling this problem. Under the new strategy, every council will publish a tailored action plan alongside its local homelessness strategy, with local targets and key outcomes. That will feed into the national picture so we can make sure that we are targeting the funding where it most needs to go. The new formulas we have devised for the local government finance settlement, which will be published later this week, are focused on making sure that the money goes where the need is and where there is less ability to raise additional funds through council tax. We are working very hard on making sure that the funding goes where the need is, and we will continue to do that. With councils now being able to set their own targets on this, we will be able to feed those into some more national targeting.

Gateway 3 New-build Applications

Baroness Thornhill Excerpts

Wednesday 3rd December 2025 Lords Chamber

[Baroness Taylor of Stevenage (Lab)]

I think the noble Lord might have been referring to Parker Morris standards, but it is quite right that we have to focus very hard on keeping up the quality of build. That is absolutely what the building safety regulator is there to do. We are making sure that we support Andy Roe and his team in what they need to do. As I am sure noble Lords are aware, there has been a capacity issue in the system, but the June spending review committed an additional £1.2 billion a year to the skills system, supporting over 65,000 additional learners in key areas such as housebuilding, remediation and building safety. That will be critical. We have also invested £16.5 million specifically to recruit and train registered building inspectors, who form a vital part of this process. We are working with the independent building control panel to identify system-wide improvements, which I am sure will help with the issues the noble Lord is concerned about.

[Baroness Thornhill (LD)]

My Lords, it is important to recognise the significant progress made recently, but, sadly, much less progress has been made on the 253 applications for remedial work to existing high-rise buildings. Some of this involved residents having to move out while still paying their mortgages and management fees for properties they cannot legally access. Due to a definition of “building work” that is arguably too broad, relatively simple and straightforward work is being caught up in the gateway scheme and is adding to the backlog. What is being done to consult with the industry so that common types of work, such as the replacement of fire door sets, can be undertaken without resorting to a gateway application at all, so that it can get on with the serious job of removing dangerous cladding?

[Baroness Taylor of Stevenage (Lab)]

Two things are under way, one of which is working with the industry to identify those issues; it is very important that the remediation programme is well under way. The BSR has established a dedicated external remediation team responsible for assessing all building control approval applications relating to cladding remediation, so that is under way already. The other work the team has been doing is to make sure that, with applications that are not dependent on some of the work that can go on in the interim, that work can progress, so we are not holding up final approvals but letting people get on with what can be done in the meantime. I am sure that will help to unlock some of the hold-ups that have been in the system so far.

Planning and Infrastructure Bill

Baroness Thornhill Excerpts

Report stage
Monday 3rd November 2025 Lords Chamber

[The Lord Bishop of Manchester]

My Lords, I noted what the noble Lord, Lord Evans, has just said. Unlike my predecessor, I have no intention of trying to petition for parts of the diocese of Chester to become parts of the diocese of Manchester, just because of the urban sprawl extending—but I rise to speak in favour of the amendment proposed by the noble Lord, Lord Fuller.

I have served on the boards of a lot of large institutional investors. One of them, the Church Commissioners, had a particular interest in one of the major landowners in the country. I can well see how for an institutional investor that wants to invest in something that is a social good, like building towns, and wants to do it for the long term, because it is interested in long-term return and not just what the next quarter’s figures are going to be, being able to invest in these kinds of things would be the right way to go. Should the noble Lord put this to the vote, I would hope to be with him in the Lobby.

[Baroness Thornhill (LD)]

My Lords, I am broadly in favour of the amendments in this group. As a general principle, we are in favour of any amendments that are genuinely about devolution and not just decentralisation. As we are all aware, there is a significant difference. However, we are aware that this brings issues of governance and accountability that are new to much of the sector at this level, with the difference in governance arrangements and in geography.

We also support the Government’s ambition and political will to build new towns to meet our challenging housing need. But—and it is a big “but”—we nevertheless feel that something as significant, important and impactful as designating a large amount of land for a new town should be subject to the super-affirmative procedure. Everyone’s voices deserve to be heard—and I understand that there is a difference between being heard and being listened to. However challenging and difficult that might be, the process is important, as the noble Lord, Lord Lansley, outlined. Increased scrutiny and the opportunity for revision are essential. We have to get this right for the people and for Parliament. Thus, we too welcome a debate on the new towns agenda and on the sites already designated.

I turn to Amendment 238. It seems to us an inevitable consequence of the new development corporations’ ambitions, roles and responsibilities. If devolution is to really mean something, it must also mean fiscal devolution. It is very unlikely in the present economic climate that any new major developments are going to be totally government funded, so it makes sense to cast the financial net as wide as possible. But—and, again, it is a big “but”—given some local government history on these and related matters, we assume that the Treasury will be concerned about rising debt and potential poor financial controls. With the discredited PFI funding also in the background, it will be concerned also about potential poor value for money. We are concerned that there should be the necessary protections and processes for good government, transparency and accountability. I wonder whether the Government may envisage a more proactive role in this regard for the National Audit Office before investment decisions are made.

Finally, a key question, which my noble friend Lord Shipley raised in Committee, is who picks up the tab if there is a loss on a project, or on several projects, or if a mayoral development corporation is running generally at a loss. Is it the council tax payer or the Government? There was no answer in Committee. It would seem likely to be the Government but, if so, it would be reasonable for them to be involved at all stages of project delivery, which makes Amendment 238 insufficient without explaining what controls would be in place. However, we would still support Amendment 238, because it gives a sense of the direction that we should go in, even if the detail is not yet in place. I look forward to the Minister’s reply.

[Baroness Scott of Bybrook (Con)]

My Lords, on Amendments 235 and 236, tabled by my noble friend Lord Lansley, all I can say is that we support all the intentions of these amendments so ably introduced, as always, by my noble friend. I do not think there is anything more that I can add to what he has already said, apart from saying to the Minister that I think these important questions need answers tonight.

Alongside my noble friend Lord Jamieson, I have co-signed Amendment 238, tabled by my noble friend Lord Fuller. Ensuring that development corporations have access to sufficient finance will be critical, as we have heard, if we are truly to deliver the high-quality new towns and new developments that we would all like to see. Having access to a range of finance resources is a key component to this, empowering development corporations to seek finance from the widest possible range of sources. This amendment would allow them to do precisely that—to access funding not only from the Public Works Loan Board but from private capital, sovereign wealth funds and pension funds, and through value-in-kind contributions as part of joint ventures. Crucially, it would also give them the ability to issue bonds, either individually or collectively with other development corporations.

Why does this matter? I suggest three key reasons. First, it enables collaboration. Development corporations could work collectively across areas, pooling capacity and scale to unlock investment in major regeneration and infrastructure projects that would otherwise be out of their reach. Secondly, it opens the door for local pension funds, particularly the Local Government Pension Scheme, to invest directly in their communities. This builds on the Government’s own commitment to mobilise LGPS capital for local growth. It would mean that people’s savings are working to deliver tangible, long-term benefits in the very places where they live and work. Thirdly, it aligns with the Government’s broader ambitions on devolution and local growth. Page 29 of the English Devolution White Paper makes clear that strategic authorities will have a duty to deliver on economic development and regeneration. Local authorities will be required to produce local growth plans, and LGPS administrating authorities are expected to identify local investment opportunities and put them forward to their asset pools.

This amendment would therefore help the Government achieve precisely what they have set out to do: to channel more of the nation’s long-term capital into productive place-based investment. It would empower development corporations to be proactive, innovative and financially self-sustaining, drawing on both public and private sources of finance to deliver growth, regeneration and prosperity for local communities.