Local Audit and Accountability Bill [HL]

Debate between Earl of Lytton and Lord Beecham

Tuesday 21st January 2014 Lords Chamber

[The Earl of Lytton]

My Lords, I relate to what the noble Lord, Lord Tope, has just said. I have a mental image of the small parish or town council, with its quite limited premises, taking on progressively more functions and finding itself in the centre of some awfully controversial measure. The premises might, quite literally, be crowded out by people with cameras or wanting to record: the sort of thing one sees on television outside the courts of justice when a person of fame—or infamy, as the case may be—has received a decision. The scrum that goes on out there is the sort of thing that slightly worries me, particularly, for the reasons given by the noble Lord, Lord Tope, with development control, which in many instances is highly contentious.

I will not ask the Minister for an answer at this juncture, but could she bear in mind that uniformity of regulations across the whole of local government might be difficult to achieve, for the reasons given by the noble Lord, Lord Tope? There is also a question of how open-ended this public right is. There will clearly be instances—I am sure we have all witnessed meetings of this sort—where it can be thoroughly disruptive and an impediment to the sober and conscientious consideration of matters on the agenda. Perhaps there must be some limitations. Like the noble Lord, Lord Tope, I look forward to seeing the draft regulations in due course. I appreciate what the Minister has said about the process for that: would she perhaps clarify the timescale for it? That would be very helpful, particularly for parish and town councils, a bigger proportion of which may be affected by this measure than principal authorities which, in many cases, already have generous facilities for public access and the recording of proceedings.

[Lord Beecham (Lab)]

My Lords, I occasionally encounter some unfortunate being who has apparently had nothing better to do than watch me on Parliament TV. It is possible that others of your Lordships may have had similar encounters. Oddly enough, although Newcastle City Council—on which both I and the noble Lord, Lord Shipley, have served—has webcast its meetings for many years, nobody has ever claimed to have seen me on those broadcasts. Perhaps that says something about the medium not quite having conveyed the message thus far.

I join my honourable friends in the House of Commons in welcoming these changes. It is fair to say, and was said by the Minister in the debate on this provision in the Commons, that the Opposition Front Bench there were very supportive of the concept. It is welcome that these proposals come here and, as the Minister pointed out, that they include the potential for safeguards. I presume that these will, as she has implied, be negotiated, or at least discussed, with the Local Government Association so as to avoid conduct which might disrupt meetings and to provide clarity about what happens when, for legitimate reasons, the press and public may be excluded. Examples might be if there are matters of commercial confidentiality or confidential personal details to be discussed in certain areas. I might like to suggest, though it may not reach into regulations, that selfies might be prohibited, but that is a matter of taste rather than democracy.

It would also be helpful if, alongside any regulations, the Government gave some information, in guidelines or otherwise, about the risks that may be attendant on people filming, tweeting or otherwise relaying actual events. Although one hopes it would not happen, what is said in council may sometimes stray into the area of defamation and those relaying matters of that sort could find themselves in a difficult situation. Some guidance about the need to be careful would help those who might otherwise run into difficulties. It is not likely to arise in a large number of cases but it is conceivable it might happen. Broadcasting authorities and so on are very alert to that danger. In Parliament it is privilege but that does not apply to local authorities.

Local Audit and Accountability Bill [HL]

Debate between Earl of Lytton and Lord Beecham

Monday 15th July 2013 Lords Chamber

[The Earl of Lytton]

My Lords, I willingly gave my name to the amendments in this group. Like the noble Lord, Lord Tope, I did not feel that this was the right stage of the Bill to argue about whether Clause 38 should stand part, although I am aware of the LGA’s concern on that. It leaves hanging the question of justification, to which the noble Lord, Lord Tope, referred. The rule seems to be designed to deal with the very few, to the potential disadvantage of the many. That is a questionable approach. The purpose of Amendments 25 and 28 is to address this.

On Amendments 30 and 36, the period of 14 days is manifestly too short for the sort of notification and response that is required in this situation. I am advised that 28 days is regarded as appropriate and the norm. Will the Minister be kind enough to explain why the norm must be cut in half?

Amendments 33 and 35 concern the basis on which the Secretary of State will inform an authority—perhaps he might choose to do so by text message to the chief executive, or something like that—and the clarity of the procedures for that confirmation, which are worthy of being tightened up. I hope that there will be a favourable response to that suggestion as well.

On Amendment 37, it seems that the present code allows for latitude in what the authority shall “consider” or “have regard to”. It might be a value-for-money consideration or something like that. The question is whether, in transition from the current voluntary code to the proposed statutory code, the latitude will continue to be there. That is the nub of the question, and the bit that has not yet been answered satisfactorily. Having said that, I very much support the thrust of the amendments in this group.

[Lord Beecham]

My Lords, as I listened to the noble Lord, Lord Tope, moving his amendment—which, given an opportunity, we would support, faute de mieux—I was reminded of the remarkable film of the man who walked on a high wire between the Twin Towers in New York. It was an extraordinary experience. With this amendment, the noble Lord is navigating the gap between the Bill and the coalition agreement. I do not recommend that he emulates the high-wire artist, because he is very likely to fall precipitately to the ground, judging by what he has advanced tonight.

To begin with, the noble Lord assumes—he may be right—that the Government’s proposals are directed at unfair competition. That is the term used in the coalition agreement. It may be the case, but what constitutes unfair competition is far from clear. What the evidence is for unfair competition existing is even less clear. I will quote, as I did in Committee, from material supplied by the National Union of Journalists. One might have thought that it would be fairly sympathetic to the Government’s point of view, since journalists’ jobs are presumably more at risk if there is unfair competition in the newspaper industry than are the jobs of a handful of local government press officers. The NUJ pointed out:

“The last select committee charged with investigating the matter, observed that there was no evidence of a link between high-frequency local authority publications and the decline of ad revenue, circulation etc of the local press in the local authority catchment area”.

It also pointed out that the Audit Commission—perhaps this is one of the reasons that it is being abolished—in 2010,

“effectively debunked the assertion of newspaper proprietors that local authority publications represented unfair competition and were commercially damaging to other local newspapers”.

The Audit Commission found that the money spent by councils was not unreasonable, that few council publications were published sufficiently frequently to be a viable media for most local advertising, and—a matter to which no doubt we will return—that the current accountability framework would ensure that any misuse of public money could be dealt with.

Those are fairly strong views by an interested party that, one might have assumed, would be sympathetic to the Government’s position but is not. Its evidence is substantial in that respect. It also points out that the press began reducing its workforce many years ago, and that already something like 61% of local newspapers in the area it contacted had closed or struggled. One reason was the decline in advertising revenue, but it was not to be attributed to local authorities including advertising in their publications, because, as the Audit Commission pointed out, in almost all cases the publications were too infrequent to have that impact. Some 55% of newspapers cited competition from the new media.

It does not stop there. There are free newspapers in circulation. The Evening Standard is a free newspaper. I am not sure about the new paper launched by the Independent. It may be free, or cost a nominal amount. Some of the newspaper groups themselves publish freesheets. Metro is published by a newspaper group and carries advertising. Therefore, the notion that somehow local authorities are responsible for the difficulties is ludicrous.

Even if local authority publications constituted competition, to what extent would it be unfair? Is it unfair because the publication is free, or in some other way? Are advertisers not able to make a commercial judgment about what would suit them better? I should have thought that that was central to government policy. The proposal to dismiss the Government’s suggestions here would not constitute a breach of the coalition agreement because there is no evidence that the unfair competition part is at all relevant to what the Government are trying to do.

There is another issue. The Government’s proposals would apply to the code, but the code can change. We do not know what restrictions the next code will bring in. Most of the code, as it stands, is fairly reasonable and acceptable. I dispute the necessity to limit titles to four publications a year, but most of the rest is fairly balanced. What is to stop the Government tightening the code and deciding on a range of things beyond those that they now say should not be published—or, conversely, should be published—in local newspapers? This would give a blank cheque to a Secretary of State to tie the hands of democratically elected local authorities in terms of how they communicate to their electorate, who, after all, should have the final say in what is done locally.

Of all Secretaries of State, the present one is the last person I would like to see entrusted with those powers. I would be quite happy, or relatively happy, for the noble Baroness to have that power but I would not be at all happy to have the present Secretary of State exercising it. Nothing in the Bill would prevent him tightening up the code and using this mechanism to ensure that it is enforced. My preference is for the whole clause to go. I am anticipating what may be said, perhaps rather more briefly, in a subsequent debate. The noble Lord’s amendment would moderate the damage but in my view he should have stuck to his guns and his party’s principles and recognised that he would not breach the coalition in so doing. Then we could have perhaps exercised a bit more leverage on his coalition partners, for the time being, and improved the Bill rather than allowing it to go forward to the statute book in its present form.

Local Audit and Accountability Bill [HL]

Debate between Earl of Lytton and Lord Beecham

Wednesday 26th June 2013 Grand Committee

[Lord Beecham]

My Lords, I have a certain sympathy with the amendment moved by the noble Lord. It is a long time since I recall seeing a notice about the provision of a cattle grid, a busker’s licence or even acupuncture, which feature among the interesting series of regulations which apparently apply, and it seems that an overhaul of the requirement is long overdue. However, I do not completely follow the line he has taken. We must not forget that a significant proportion of the population are still not involved with modern communications and are therefore not able to log on to a council website, for example. Moreover, if you log on to a council website, generally speaking you are looking for something, whereas if you are perusing a newspaper you are more likely to come across things. The question is: what things ought to be included in this provision? That is a perfectly legitimate point which the Government need to address to reduce substantially the scope of the present requirement.

However, I do not have too much sympathy with local authorities which complain that they are being charged a differential rate as the answer is in their own hands. They should threaten to withdraw the relevant advertising from the local paper if they do not get better terms. I should think that that would be a pretty powerful sanction. I think that my authority spends £88,000 a year on statutory notice advertising. There is ample scope to reduce that with a more sensible list but I would not like to see the requirement go altogether. Certain other things also have to be published by way of statutory notice—for example, in the realm of probate, licensing matters and things of that kind. Certain things in this enormously long list ought to be retained. I am with the noble Lord in hoping that the Government review this issue and come forward with a much reduced list which would make more sense and perhaps reduce the cost. However, I would not go all the way with him and support the amendment as it stands.

[The Earl of Lytton]

My Lords, I will follow what the noble Lord, Lord Beecham, said, in the same vein, because I think that getting rid of the requirement altogether would create all sorts of difficulties, which the noble Lord, Lord Beecham, has referred to.

I cannot help commenting that for all the money that is spent on these things, they seem to be reproduced in the smallest print and in the most insignificant parts of the relevant newspaper. One always wonders whether a local authority chooses its moment to stick in an important announcement when the local football team has been moved up to the next division or whatever it happens to be, and nobody is going to read the small print in the public notices part of the paper. Maybe it is because they are being charged so much that the print is so small so they need to cram it into a smaller number of column inches in order to get value for money—but that is speculation on my part.

I agree that better and more efficient ways should increasingly be used to disseminate this information. Very often I hear about things not through the pages of the press, where they are carefully hidden, but because the parish council or some other organisation sends a round robin e-mail and I happen to be on the circulation list and that is how I get to know about it. I think that must be the experience of many noble Lords and many members of the public. So I support the general purpose here. Certainly, I would not necessarily support the removal of public advertising in the press for every single thing that is on the list of the noble Lord, Lord Tope.

--- Later in debate ---

[Lord Beecham]

My Lords, perhaps I can give the Minister a few more minutes to assemble her thoughts.

Once again we are dealing with one of Mr Pickles’s little obsessions. It is unfortunate that so often our parliamentary time is taken up with dealing with these notions of his. I entirely support the amendment and the sentiments with which the noble Lord, Lord Tope, has moved it.

It is interesting to look at the justification—perhaps that is the wrong word; the explanation—for the proposals in the government document, which describes their objectives in revising the code. The code speaks of competition but of course it does not deal with competition, which can and should be dealt with by the appropriate legislation. The department, however, considers that the publicity code is,

“the right vehicle for imposing tougher rules to stop unfair competition by local authority newspapers”.

That is quite extraordinary. It goes on to say:

“The Department’s view is that the proliferation of council newspapers can have the effect of reducing the impact of independent local newspapers. A healthy free press is important in providing information to the public to hold their local authority to account”.

I could not agree more. I deplore the decline in the coverage of the affairs of my council and many others, which has gone on now, to my certain knowledge, for 20 years. Those sentiments are quite right but the statement goes on, risibly, to suggest:

“Council newspapers, issued frequently and designed to resemble a local newspaper can mislead members of the public reading them that they are local newspapers covering council events and give communities a biased view of the activities of the council”.

So the residents of Newcastle are so dim as not to be able to distinguish between the Evening Chronicle or the Newcastle Journal and the occasional distribution of the council’s Citylife? This is a ludicrous proposition.

The suggestion that somehow the terrible decline in the newspaper industry, local newspapers in particular, is the responsibility of local government is just absurd. I can quote some figures about that. Trinity Mirror, which runs papers in my part of the world, employed 6,000 production and editorial staff in 2004; the figure is now fewer than 2,700. The Daily Mail has shed a quarter of its 3,000-strong workforce since 2010. This is not because people are rushing out to get hold of a council newspaper, or waiting eagerly for it to arrive through the door, and therefore no longer need to read these other papers, it is because of the changes in the industry; it is because we now have the internet and social media; and it is perhaps because people are less interested in news.

Certainly, in my experience, local newspapers are much less interested in covering council affairs than they ever were. That process is still going on and I regret it. When I was leader of the council—this is going back a long time—I used to get daily calls from a newspaper correspondent. That stopped before I finished as leader, which was in 1994. They do not come to council meetings and never cover scrutiny meetings, because the industry is in an altogether different position now.

One of the more useful briefings that some of us have received has come from the National Union of Journalists. It opposes this government stance and this clause. As it puts it:

“The NUJ has no difficulty with additional guidance being issued to local authorities and councils. However, the new publicity code ‘includes specific guidance about the frequency, content and appearance of local authority newspapers, including recommending that principal local authorities limit the publication’”—

well, we know about that. The journalists go on to say:

“We do not believe that this element of guidance reflects the needs of many communities, nor the practicalities of providing prompt, accurate advice and information to communities”.

That is, of course, right. They also make the point that it is perfectly possible that if authorities stray into the area of political propaganda—which they should not—they can be,

“referred to the appropriate body for investigating improper use of council funds for political aims”.

Proper officers of the council should be keeping an eye precisely on that sort of area. If they do not, perhaps the auditors should be doing so. They presumably will be getting copies of any civic newspaper while they are about their business.

The Audit Commission itself, three years ago, rebutted the suggestion by newspaper proprietors that local authority publications represented unfair competition. It found that the money spent by councils was not unreasonable, that few council publications were published sufficiently frequently to be viable media for most local advertising—which is where the press think that they are being deprived of revenues—and that the current accountability framework is adequate. That seems a pretty unanswerable case. The position that the Government are adopting bears no relationship to the reality.

However, that is only publications and the press. There is another aspect to this code, which the noble Lord has not mentioned—the question of lobbying and the effective injunction against councils employing firms to lobby on their behalf. Again, if there were any suggestion that the lobbying was of a political nature, that would be caught in exactly the same way as any political material in a newspaper. But why should a council not seek to use lobbyists—preferably registered ones, which I hope will come, even if we have not got round to it yet—to develop an argument with Members of this House or the other House, or to influence government or public opinion? There is nothing wrong with that provided it is not a political exercise. However, that is also excluded under the revised code of practice.

Again, too much power is accruing in the hands of the Secretary of State, who in this case is being set up as a censor or inquisitor prepared to put something on the index of prohibited publications. That is not the function of the Secretary of State. This is an intrusion into local democracy under the specious argument that somehow local council publications are undermining the press. It is an absurd proposition and I support the noble Lord.

[The Earl of Lytton]

My Lords, the noble Lord, Lord Tope, will be pleased to know that the National Association of Local Councils supports the thrust of what he has advanced here. It does not believe that there is a problem, nor does it see a need to change the present code status. It is not aware of a single instance of the Secretary of State intervening in a parish council publicity matter. It says that the taking of additional powers by the Secretary of State is distinctly non-localist, and there are some concerns at the potential longer-term implications for parish newsletters. It certainly does not think that this is a legislative priority. I am at one with what has been said on this.

I have a separate concern that I expressed at Second Reading on the suitability of the present code to become a statutory code at all. When I put this to the Local Government Association, it agreed with me that the current drafting appears to be less than precise and said that it was a matter on which the LGA had taken some advice. However, that is not to say that the general thrust of the code is wrong. It actually contains some good principles but is qualified by all sorts of terms, mainly prefaced by the word “should”, and includes phrases such as “likely to be perceived”. There are also imperatives about there being no,

“commentary on contentious areas of public policy”,

and positions being presented “in a fair manner”. Authorities should not do anything,

“designed to influence members of political parties”.

Paragraph 13 of the code states:

“The purchase of advertising space should not be used as a method of subsidising voluntary, public or commercial organisations”.

That begs the question: when is a subsidy merely part of a cost contribution? I note also that the definition of what might be unreasonably partisan, contentious, sensitive or likely to have an influence if not even-handed is probably not a constant between Parliament at this level and the parish pump at that level. I certainly question whether it applies in equal manner to everything in between. How would making this code statutory improve things? Would it be simply an avenue for contention whereby the matter would have to be thrashed out in the courts—the Secretary of State versus some borough, parish or other?

Is that a profitable way to go forward, bearing in mind that there do not seem to have been any substantial problems? It is said there have been one or two in some London boroughs but I do not know whether they are regarded as being typical or whether those boroughs that have had the finger wagged at them have failed to observe the wagging finger. Other noble Lords may know more about than I do, but it seems to me that the case for the clause is not made.

Local Government Finance Bill

Debate between Earl of Lytton and Lord Beecham

Thursday 5th July 2012 Grand Committee

[The Earl of Lytton]

My Lords, that was what I was trying to say in terms of the Jubilee line, so I am sorry if I gave a false impression. These things are vitally important to leverage in that sort of level of finance. My only concerns are the times we live in. If one is dealing with a development appraisal in conventional valuation terms, the process contains a high number of price-sensitive variables, so much so that my professional body, the Royal Institution of Chartered Surveyors, does not really advise using that sort of development appraisal, or residual valuation, approach for producing what it calls a regulated purpose valuation because of the inherent number of price-sensitive variables. I do not want to pour cold water on things—I simply wanted to point out that TIF is a tremendously good idea but we must make sure that the circumstances are ones in which it can robustly survive.

[Lord Beecham]

My Lords, having spent some considerable time searching through the Bill to find where TIF was, I have to congratulate the noble Baroness on discovering it. It is a bit like Higgs boson. The physicist who discovered the Higgs boson will no doubt get the Nobel Prize for Physics. Perhaps we should nominate the noble Baroness for the Nobel Prize for political metaphysics.

Local Government Finance Bill

Debate between Earl of Lytton and Lord Beecham

Tuesday 3rd July 2012 Grand Committee

[Lord Beecham]

My Lords, not having had at the forefront, or indeed at the back, of my mind details of Schedule 8 to the Local Government Finance Act 1988—or indeed Schedule 7, if that be the correct schedule—I am obliged to the noble Lord, Lord Best, for having explained what was to me, frankly, an unintelligible amendment, but it is entirely intelligible now. I find myself in the odd position of already having spoken to it, in a sense, because I addressed some of the same issues and used some of the same terms as the noble Lord, Lord Best, when I spoke to an earlier amendment. I share the concern about the temptation to incentivise what the noble Lord described as new rateable floor space rather than enhanced rateable values. To that extent, I support the thrust of his argument.

However, I am less convinced about some of the other aspects. For example, massive taxpayer investment in Crossrail will presumably generate increased rateable values in the authorities in London that it will serve. Many of them are quite deprived authorities, so in one sense that is a good thing. On the other hand, that was not a decision of those authorities; the decision was taken by central government, funded by all taxpayers, including those in equally deprived parts of the country such as the one in which I live. The London chamber, to which I and the noble Lord referred, was right to say that authorities should be rewarded and incentivised for the decisions that they take. It is not necessarily appropriate that they should benefit significantly from an increase in business rate generated by taxpayers in the way that, for example, Crossrail might be argued to have induced. Presumably, it will take some time for that to happen.

I am also slightly concerned about the basis on which the claim is made that effectively we should be looking at a rise in rental values. I am not an expert in the property market but at the moment I anticipate that, although there are some exceptions, there is no great buoyancy in the commercial property sector. Many of us see empty shops, offices and factories. In my city of Newcastle we have seen the closure of one significant employer in a very modern factory in one part of the city, and we are seeing the almost certain closure of engineering works in an enterprise zone, for which the noble Lord, Lord Jenkin, was originally responsible—I give him credit for that. It was formerly Vickers and is now BAE. It will close with the loss of many jobs and the site will come on to the market. To put it mildly, I think that the anticipation that rental values will rise in the foreseeable future is incredible. It does not seem to me to be a firm basis on which to base these calculations.

Therefore, there is something in this argument—particularly the points that the London chamber raised—about trying to connect the reward to the positive actions of an authority. The converse is that an authority should not be penalised for things beyond its control when the rateable value falls, either because of general economic effects or because of an impact on general levels, leading no doubt to appeals against valuations. I have no doubt that the noble Earl, Lord Lytton, would be able to elucidate on the kinds of effects that might develop.

Therefore, the Committee needs to look at how we can tie the incentivisation to the actions of the local authority in the broad sense that the London chamber and the noble Lord and I referred to earlier—with investment in infrastructure and particularly skills and training, as well as, depending on the circumstances, community safety or other features in the local economy—rather than rely on the actions of the national Government or their agencies. The Highways Agency can transform a situation in certain areas, just as Crossrail might have done, and perhaps other bodies would have the same function or effect.

I take it that the amendment is from the Local Government Association, from which we have heard so much this afternoon. Some of us should go back to the LGA to explore this issue in greater depth to see whether we can come up with something more related to the activities of its members. I should be interested to hear the views of the Minister. I do not know whether the noble Earl, Lord Lytton, proposes to speak on this part, but it would be very interesting to hear his comments on these points, which relate very much to his professional expertise.

[The Earl of Lytton]

My Lords, with that invitation I had better rise to my feet. First I should declare an interest that I have not declared previously and probably should have done—that I have a small involvement with a local chamber of commerce, although I do not know that it especially informs this bit of the debate.

The noble Lord, Lord Best, mentioned a very important factor—that the constant incremental renewal and upgrading of our infrastructure and townscapes, as I believe he was chiefly referring to, is directly related to concepts of added value and therefore has wider application. The confidence to invest in such schemes is clearly dependent on certainty of outcomes. I said previously, on Second Reading, that I was concerned at the lack of certainty of outcomes. Like all uncertainty, it adds to risk and is a highly corrosive factor in getting good levels of net present value, to use valuer-speak.

The Bill’s laudable intentions are to a large degree overshadowed by some very difficult times, with the possible exception of central London. That colours everything, including the way in which these schemes can be financed independently and the sort of risks that you can afford to take with taxpayers’ money, if you are not financing them through conventional means. That obviously applies to central government just as it does to billing authorities and local authorities. My concern is about the migration of commercial floor space to other uses; I refer in particular to losses to residential uses. That may be the only certain outcome that delivers a sufficient return on capital invested to justify the financing. We live in the real world where finance is very difficult. Even if you have retained finance because you are a larger company, unless you can make a robust case to your finance director and the other key decision-makers, it is not going to go ahead. Things which are slow and drawn out and which have long timescales all add to the risk, even if there are no other issues.

I know that the coalition has tried to make sure that the planning process is simplified. None the less, as I mentioned on the earlier group of amendments, there are sufficient uncertainties with all the boxes that developers have to tick. Many of these boxes have to be ticked up front and much of the ticking process costs real money up front. That is the problem that the real commercial world faces. I do not see how the classic role of government, which is to intervene in circumstances of market failure, can be shifted from central government, effectively backed by the political backcloth with central government resources and finance. I do not think that you can move that intervention to overcome market failure to a local government scenario. It will not work. The whole thing is too complicated, the finance is too tight, and matters are too uncertain.

The noble Lord, Lord Beecham, referred to Crossrail, and of course there are other large infrastructure schemes across the country on a wider scale. One thinks of HS2, the high-speed rail system. Many of these create blight. Although in the long term they are considered to bring benefit, they create short to medium-term blight of the most acute nature—in other words, people are unable to sell their properties and business premises are unlettable and so on. This, too, has a highly corrosive effect but, as I see it, it is not in the gift of local government to deal with these large-scale issues of blight.

The real question goes back to what the noble Lord, Lord Best, was asking: how do we deal with the necessary incremental improvements to and upgrading of our infrastructure without this driver of a commercial outturn? In a sense, the commercial outturn is there because value and satisfaction are added. More trade may be brought to an area. For instance, if it is a seaside town the number of beds let per annum in lodging houses and hotels may increase. There can be all sorts of things that go with that. However, it is a slow and diffuse process, and that means that the benefit is not sufficiently directly connected to the investment for the authority to claw that back. It is not a bankable benefit in the authority’s hands, and that is where the disconnect arises.

It may be that this whole consideration goes much wider than the context of the Bill. However, we are transferring duties and powers and supposedly finance streams to local government, and I think that it is right to consider this issue in its wider context. At the beginning of this afternoon’s proceedings, I mentioned that it is part of the backcloth in which we operate. I certainly hope that the Minister will be able to give some comfort that the cause and effect—in other words, the risks and costs of investment and the returns that can be gained from it—will be better looked at and better managed, even if they cannot be dealt with through the business rate retention scheme. There need to be other ways in which this issue is dealt with; otherwise, we will see areas going into wholesale decline with a considerable loss in values and, with that, risks to the loan books of the mortgage sources that have lent against those investments, as well as risks to the whole financial structure. We do not need to do that. Once we start going down that road, huge perils lie there. We really need to make this constant investment in order to make sure that that does not happen. We have to move forward; there is no stand-still position.

Localism Bill

Debate between Earl of Lytton and Lord Beecham

Monday 17th October 2011 Lords Chamber

[Lord Beecham]

My Lords, I am pleased to see that the noble Lord, Lord Newton, takes the same attitude to temptation as St Augustine did to chastity. There is another line about temptation that we might want to consider:

“The last temptation is the greatest treason:

To do the right deed for the wrong reason”.

It seems that this amendment is in fact the other way round: it is doing the wrong thing for the right reason, potentially.

I noticed the typing error that the noble Lord, Lord Greaves, referred to in subsection (2)(a), but I think there may be another typographical error, or perhaps an error in drafting. Subsection (5) says:

“A community governance review … shall have a presumption that a new parish will be created”—

and I will come back to that point. Subsection (6) goes on to say:

“The provisions of this apply only insofar as they do not prevent action being taken on the request made under this section”.

It is not clear to me what that means. Does it mean the provisions of the previous subsection, or does it mean the provisions of the whole clause? I am at a loss to understand what that implies.

However, I agree very strongly with the noble Lord, Lord Newton, that there is no case for there to be a presumption that a new parish should be created on the simple fact that a request has been made by a neighbourhood forum that might constitute 21 people, of whom a majority of 11 against 10 would therefore trigger not only the whole process but a presumption as to its outcome. It seems a ridiculous proposition given that we are presumably talking about areas of several hundred people, if not thousands of people, possibly, in an area the size of an urban ward or a significant rural community.

The clause also requires the commencement of a review within three months. That might be all right if there was to be one review, but supposing there was a rash of applications from these neighbourhood forums, is a local authority obliged to commence reviews on all of them in that timescale? It does not seem at all realistic. There certainly should be a method of facilitating a legitimate demand—or a widespread demand, let us not prejudge the issue—for the creation of parish councils or town councils. They have a perfectly proper place in our system of local government and that should be facilitated, but this clause really goes much too far in that direction.

Nor is it the case that, once created, all of these bodies are trouble-free. Your Lordships will be aware, from the debate about the standards boards and the need for codes, that most of the complaints that arose under the existing procedure actually came from parish councils. The noble Lord, Lord Shipley, who is not in his place at the moment, will no doubt have told your Lordships of the case in Newcastle where a council inherited three parishes on local government reorganisation, and one inner-city area opted for a parish council. That particular grouping did not seem to perform very effectively, to the extent that Councillor Shipley’s colleagues in his political group decided that they would go in and in effect take it over, which they did—by perfectly legitimate democratic means, I should say. These places are not without their problems, although they can certainly contribute to an enriched local democracy.

However, there is one other issue in which, again, the drafting is perhaps defective—certainly it raises an issue—and that is subsection (2), which says:

“A request may be made to create a new parish council for … the area of the neighbourhood area together with the area of an adjacent parish council”.

Is it not conceivable that there may be more than one existing parish council? Certainly there are contiguous parish councils in my authority; there will be in other authorities, particularly urban authorities, I suspect. You may well find a community between the two wishing to align with both rather than one, and creating an entirely new structure. For a variety of reasons, I suspect I may find myself—unusually—agreeing with the Minister when she replies and, I hope, says that she may want to take this away and look at it, but that she cannot agree the amendment as it stands. Certainly that would be my position.

[The Earl of Lytton]

Before the noble Lord sits down, perhaps I may ask him if he would comment on the fact that although it is true that parish and town councils provide a disproportionate amount of the subject matter for standards committees, it is also true that because there is no other body of a sort which has recourse to a committee dealing with standards, there is no other basis to judge whether that statistic is large or small, or whether it is characteristic of dealing with community affairs. What I am trying to get at is that it is perhaps not a specific criticism of parish councils as a construct.

Localism Bill

Debate between Earl of Lytton and Lord Beecham

Wednesday 14th September 2011 Lords Chamber

[The Earl of Lytton]

Following on from the noble Lord, Lord Filkin, and from what has just been said, there is one other point that I should like to flag up for the Minister. I refer to subsection (3) of Amendment 181 regarding the nature of disclosable pecuniary interests. This deals with elected or co-opted members of councils and it concerns an interest of that councillor, or an interest of their spouse or civil partner, or a person who is living with them as husband or wife, or a person with whom that councillor is living as though they were civil partners where they are aware that the person has an interest. I do not believe that subsection goes far enough. The point has been made to me—I am sure that the Minister will be aware of this issue—about the son-in-law’s development project or the sister-in-law’s application to the council. The objective test of external public scrutiny is what we have to meet here. I think that this really does need to be tightened up.

[Lord Beecham]

My Lords, I am fascinated by the notion of a literally hung council. I am not sure that I would wish to be a member of such a body—presumably it would be a very short life. That apart, I endorse the views of the noble Lords, Lord Filkin and Lord Newton, and the noble Earl, Lord Lytton. There is something to be discussed here. It requires a little more care and, perhaps, a little more legal input into definitions and processes. That said, the noble Lord has assured us that those discussions will take place and that we may be able to revisit, if necessary, at Third Reading. On that basis I am happy to accept that position.

Localism Bill

Debate between Earl of Lytton and Lord Beecham

Thursday 30th June 2011 Lords Chamber

[The Earl of Lytton]

My Lords, I had not expected to speak on this amendment, but I think the noble Lord, Lord Jenkin, raises a very valid point. I live within what is known as the Gatwick Diamond economic area, so I know very well what he is referring to. I know of situations where, for instance, residential development takes place near to industrial premises through normal course of development and re-use. Gatwick Diamond, along with many other areas, is now a 24/7 operation. It is near enough to coastal ports for large lorries to be coming along and near enough to all sorts of aviation-related and other downstream industries.

Local residents may not much like 44-tonne lorries coming along in the wee small hours of the morning. I can quite see that, but it is not fanciful at all to suppose that they might not wish to procure a cessation via triggering a referendum with a view to protecting what they see as their interests. Nor is it a planning-only issue because it may relate to a whole raft of regulatory functions for which local authorities and other bodies have responsibility. While I cannot vouch that the wording that the noble Lord, Lord Jenkin, uses is cohesive, I think there needs to be some regard for the economic consequences of what is being sought by a referendum. It seems that a referendum can be formulated on quite a narrow premise. If that is the case, it is quite possible for it to concern things of a much broader spectrum. It is worthy of consideration by the Minister.

[Lord Beecham]

Does the noble Lord not agree that in matters of the significance and complexity to which he and the noble Lord, Lord Jenkin, have referred, a referendum is probably the least effective way, in terms of time, of drawing the matter to the attention of the local authority? There are ways of doing that through petitions or by addressing local councillors through the local media that would be much quicker and more likely to have an effect than the necessarily rather cumbersome processes that would be involved in a referendum. In those circumstances, therefore, is there perhaps less urgency and potency in the noble Lord’s amendment than might otherwise have been the case?

[The Earl of Lytton]

In response to the very wise comments of the noble Lord, Lord Beecham, it may well be a cumbersome way of doing it but the point is that we do not yet know what the precise trigger is going to be, or the subject matter. The provisions of the Bill cover a very large spectrum of possibilities and we are effectively empowering the Secretary of State to make orders. It is legitimate to lay down a marker as to what the parameters might be—I suspect that is all the noble Lord, Lord Jenkin, is doing at the moment—and just to sound a word of warning. It is timely in that context.

Localism Bill

Debate between Earl of Lytton and Lord Beecham

Tuesday 28th June 2011 Lords Chamber

[Lord Beecham]

It will be a real test of political leadership to withstand populist pressure of that kind. One of the concerns expressed by many of us during discussions on the Bill is that it gestures too much in the direction of populism and will make life more difficult, particularly, as the noble Lord says, for smaller local authorities that are likely to come under greater pressure than those in bigger urban areas or counties.

[Earl of Lytton]

My Lords, as this is my first contribution at this stage of the Bill, I declare an interest as the president of the National Association of Local Councils, which noble Lords may know as the national body for parish and town councils. I am also president of the Sussex Associations of Local Councils. I will limit my declaration of interest to those two because they are most relevant.

I appreciate the way the noble Lord, Lord True, introduced this particularly important set of issues. He started off with the question of triggers. That led the noble Earl, Lord Cathcart, to comment on triggers for parish and town councils. It may save time if I deal with an aspect of that by way of illustration. We will later get on to a question in relation to paragraph 18 to Schedule 12 of the Local Government Act 1972. Subsection (4), which relates to parish councils, states:

“A poll may be demanded before the conclusion of a parish meeting on any question arising at the meeting; but no poll shall be taken unless either the person presiding at the meeting consents or the poll is demanded by not less than ten, or one-third, of the local government electors present at the meeting, whichever is the less”.

As one can readily see, that is a very low trigger. I am aware of a situation where a coastal parish council considering an extension to its village hall found the process hijacked by a small group of people who raised the 10 minimum. As the matter then proceeded to a parish poll, they were faced with the cost of something approaching £4000 for conducting that, because it had to be dealt with by the principal authority under the normal rules.

One gets a sense that this is devoid of proportionality. We have talked about the gravity of the subject, but there has to be some sense of proportion. I know that there is an amendment in the Minister’s name about this. There are other issues concerning overlaps. I think the noble Lord, Lord Beecham, referred to this, sort of, in code. By overlaps, I mean the possibility of a referendum being used to countermand the other duties of a principal authority. We cannot be having that many bites at this particular cherry. Mayhem lies down that route.

Regarding the cost-benefit and cost-burden, if there is no proportionality, it is a free bet in economic terms and we will have free riders, people who have an agenda and who want to take charge. This could be the moneyed who have moved into an area or whatever it happens to be, or some particular cause célèbre. The noble Lord, Lord Greaves—or it may have been the noble Lord, Lord Rennard—referred to the fact that the run up to an election might be a good time to trigger something that would get in the local paper, or whatever it happens to be. Democratic coherence is at stake here. We are talking about localism and about having the elective democracy, to which the noble Lord, Lord Beecham, referred. We cannot bypass that by a process of sectoral interests.

Why do I mention this? It is because I strongly believe that when it gets down to the parish pump level, it is important to have something that is proportionate, cannot unduly fetter the operation of parish or town councils’ affairs, and respects the principle that when you elect a body of people to represent your interests they must to some extent be given a free hand. The test is at re-election. That is not to say that there are no matters that lie outside the normal voting pattern, but there must be a clear way of making sure that they do not cut across one another.