Homelessness

Lord Beecham Excerpts

Wednesday 21st December 2016 Lords Chamber

[Lord Beecham (Lab)]

My Lords, homelessness often goes hand in hand with food poverty. Do the Government have any estimate of the number of people who, this Christmas, will be dependent on food banks? I declare an interest as I represent a ward in Newcastle that has the busiest food bank in the country.

[Lord Bourne of Aberystwyth]

My Lords, I will have to write to the noble Lord with the specifics on the food bank figures. I recognise the importance of food banks throughout the country and pay tribute to what volunteers do, both in giving to food banks and in ensuring that food gets to the people who need it.

Local Government Finance Settlement

Lord Beecham Excerpts

Thursday 15th December 2016 Lords Chamber

[Lord Beecham (Lab)]

My Lords, the Government are qualifying themselves for nomination for the Nobel prize for complacency in how they are addressing the problems facing local authorities. Since 2010, when Salome, in the perhaps unlikely form of Eric Pickles, offered up local government as a prize to central government, which led to the largest share of cuts in any area of government expenditure going to local government, councils have struggled manfully to maintain services. I refer to my interest as a member of Newcastle City Council and a vice-president of the LGA. In Newcastle, we are heading, by 2020, for a £291 million a year cut from what was being provided in 2010. That is a remarkably high figure. It amounts to about £1,000 per head of the population per year. How are councils supposed to maintain services?

The Government’s complacency is reflected in the remarkable assertion that added certainty will provide “increased stability”—the stability of the graveyard for councils—and that,

“By 2020, we will see local councillors deciding how to fund local services using local money”.

But of course, there are inadequate amounts of public money. This will apparently be, “true localism in action”. It is more likely to be inaction in local government, because councils will not have the capacity to deliver the services that their people need.

The Government go on in this Statement, unilluminating as it is, to talk about how the,

“extra flexibility to raise funding … will add just £1 a month to the average council tax bill”.

Councils have not been able to increase council taxes beyond a very limited amount over recent years, so if it is being permitted now to raise council tax by this modest amount, why has that not been available beyond the 2% limit imposed on local authorities in previous years?

The Statement is worse than that in a way because it goes on to say that councils will be able,

“to support people who need care in their area”,

and show,

“how it improves adult social care services”.

It is not a question of improving adult social care services; it is a question of trying to maintain adult social care services against rising costs and, increasingly, rising demands for which no provision is being made.

It is remarkable that the new homes bonus is relied on to transfer one part of local government money to another area. That rather eliminates the whole point, one would have thought, of the new homes bonus, which was supposed to encourage housebuilding, which the Government may have noticed is desperately in need of increasing.

Local councils and, more importantly, their residents are facing an unprecedented decline in services. It is certainly true that some people are not aware of the damage being done because they do not have intimate family knowledge of it. That is why some of the polling suggests that people regard the service as okay. Unless people happen to know members of the family denied services—not able to use a library that used to exist—or do not have children in a school that is under great pressure, they do not get the true picture. The Government are clearly colluding in an attempt to conceal the true picture of what is happening in communities up and down the country.

I have one final point to make in relation to business rates, because this will apparently be the great answer. We do not know how the business rates system will work. We do not know how it will reflect the different yields that will occur in different parts of the country and what method of redistribution will be applied. We do not know, for that matter, how the appeals system will work against the new valuations, which have been controversial in various parts of the country and which may complicate the picture significantly. This finance settlement is unsatisfactory. It is entirely the responsibility of the Government to see that there is a fair distribution directed at meeting needs, and this Statement does nothing to do that.

[Lord Bourne of Aberystwyth]

My Lords, I thank the noble Lord, Lord Beecham, for what was perhaps more a diatribe than a series of questions, but I will try to extract some points that were made in what seemed to me an excessively gloomy speech, although with the noble Lord’s characteristic lightness of touch.

First, it is worth pointing out that 97% of councils, across the political divide, have signed up to the four-year deal. The settlement that we have reached recognises that there has to be a balance of interests—of council tax payers and looking at the problems of the age, specifically the very serious problem of adult social care. The noble Lord said, incorrectly—I think I am quoting him correctly because I wrote it down—that no provision was being made for adult social care. That is patently not the case.

[Lord Beecham]

No.

[Lord Bourne of Aberystwyth]

I think that is what the noble Lord said. I wrote it down. In fairness, he then went on to cite the use of the £240 million funds, so perhaps a careful reading of what was said will indicate that one of us is wrong. However, I think he did say that no provision was being made for adult social care. We have allocated £240 million in the next financial year, from savings from the new homes bonus, which is specifically to address what I acknowledge is a serious issue. That, together with the precept and the ability to reprofile the increase in the precept of 3% and 3% then 0%, recognises £900 million additional spending in the next two years. That is a significant amount for what is, admittedly, a serious issue.

I will home in on an area that the noble Lord quite fairly raised in relation to the business rate retention. As noble Lords are probably aware, there will be legislation on this in the new year. It will be introduced into the Commons first and will come subsequently to your Lordships’ House, so there will be more detail about how that will operate well ahead of it coming to us.

Affordable Housing

Lord Beecham Excerpts

Tuesday 29th November 2016 Lords Chamber

Asked by

[Lord Beecham]

To ask Her Majesty’s Government, further to the announcement in the Autumn Statement that they will invest £1.4 billion to deliver 40,000 affordable homes, how many affordable houses to rent they expect local authorities to build by 2020.

[The Parliamentary Under-Secretary of State, Department for Communities and Local Government and Wales Office (Lord Bourne of Aberystwyth) (Con)]

My Lords, our expanded affordable homes programme, with a total capital budget of £7.1 billion between 2016 and 2021, including the additional investment of £1.4 billion announced last week, will now fund a wider range of affordable housing, including affordable rent, rent to buy and shared ownership. Local authorities will be able to bid into this.

[Lord Beecham (Lab)]

My Lords, I declare my interest as a Newcastle city councillor and an honorary vice-president of the Local Government Association. Could the Minister please explain the arithmetic underlying the Government’s claim that the £1.4 billion announced in the Statement will build 40,000 affordable homes, given that this appears to represent a cost of only £35,000 a home? Will he confirm the estimate of the chair of the Local Government Association, his noble friend Lord Porter, that the enforced reduction of council rents by 1% yearly until 2020 will cost councils £2.6 billion, which could have built, according to its estimate, 19,000 homes, while housing associations will suffer a loss of income of £2.7 billion, with a similar impact on their capacity to build affordable homes?

[Lord Bourne of Aberystwyth]

My Lords, as the Mayor of London, Sadiq Khan, said, this is,

“the largest sum of money ever secured by City Hall to deliver affordable housing”,

and no doubt he would have been more effusive if it had not been for political considerations. This is the largest affordable housing programme for 40 years, and social housing can bid into it too, as the noble Lord appreciates. This is all part of the programme of ensuring that we have 400,000 affordable homes in this Parliament.

Housing and Planning Act 2016

Lord Beecham Excerpts

Thursday 24th November 2016 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, what resulted in the change was considering how people, particularly in London, would be penalised on the levels we are looking at. The Government should not be criticised for examining the situation in front of them and reconsidering a policy, which is what we have done. As I say, the provision will remain on a voluntary basis because there are people on very high incomes who should pay more for the housing they occupy.

[Lord Beecham (Lab)]

My Lords, while the Government are in the mood to reconsider things, will they look again at the requirement under the Act for councils to let tenancies for periods of between two to five years only? I understand that councils will have the discretion to decide whether to apply the pay-to-stay provision. Why cannot that same discretion be applied to the length of tenure for which they are enabled to house their tenants?

[Lord Bourne of Aberystwyth]

My Lords, it is important that we get the balance right on housing by ensuring that we have people in social housing for an appropriate time, in order to ensure that as many people as possible are housed. Of course the Government take account of all these things. As the noble Lord will know, we are looking at restricting local authority lifetime tenancies, and 20 local authorities across the country are looking at how we proceed with this. But he will appreciate that the aim of the Government, and the commitment of the Prime Minister, is to build as many houses as possible because this is the basic problem facing the country. Some of those houses will be on an owner-occupied basis and some will be for affordable rent.

Housing: Vulnerable People

Lord Beecham Excerpts

Thursday 13th October 2016 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, the noble Baroness is right to address concern that this is interactive with the health area. This is something we touched on in a debate earlier this week. The consultation that will open shortly in relation to the cap and the way that we ensure that the additional costs are taken care of will be transparent and collaborative. It will be a very open process, so I ask noble Lords to ensure that they, as well as outside organisations, participate in it so that we get this right and are able to protect the sector and the variations that exist between different local authorities.

[Lord Beecham (Lab)]

My Lords, what discussions have taken place between the noble Lord’s department and the Department of Health about the impact on social care budgets that is now being felt throughout the country? Clearly, the work of social services and adult care is closely related to the conditions under which the residents of sheltered housing live.

[Lord Bourne of Aberystwyth]

My Lords, the noble Lord is right to say that there is interaction with the Department of Health. We discuss this with it, as we do with the Department for Work and Pensions. There is interaction across a lot of areas and, as we found earlier in the week when we debated this, this of course has great impact on the health and well-being of tenants, as well as in education and many other areas. We have to take this in the round and have a holistic approach.

Devolution: North-east England

Lord Beecham Excerpts

Wednesday 12th October 2016 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, the noble Lord has given distinguished service to the north-east and I agree with him about the importance of the devolution deal for the north-east. As I understand it, the blockage is not about the mayor but elsewhere, but we remain very much of the view that to get the most powers you need the best accountability, and that is delivered by directly elected mayors.

[Lord Beecham (Lab)]

My Lords, regrettable though the failure to reach a devolution deal covering the seven members of the North East Combined Authority is, do the Government realise the significance of its member councils’ financial concerns? The offer of an investment of £30 million a year for 30 years between seven councils—£900 million in total—must be seen in the context of annual budget cuts amounting to some £1.5 billion a year, coupled with huge uncertainty about the working of the business rates system on which councils will have to rely as revenue support grant ends. Is not the best way to revive the devolution concept for the Government to recognise that devolving responsibility without the power conferred by adequate funding undermines their proclaimed objectives?

[Lord Bourne of Aberystwyth]

My Lords, other areas—Greater Manchester, Liverpool City Region, Tees Valley—have come to an agreement and are pursuing the need for an elected mayor. It is regrettable that the north-east is not doing so, but we do not impose these things—they are to be bottom-up—but I appeal to the north-east to come together so that we can proceed with this deal, perhaps in 2018.

Housing

Lord Beecham Excerpts

Tuesday 11th October 2016 Lords Chamber

[Lord Beecham (Lab)]

My Lords, this timely debate focuses on the issues of housing quality and affordability —matters scarcely addressed in the Housing and Planning Act over which this House laboured for four months. Even now, five months after Royal Assent, we await the outcome of consultations on a range of provisions included in what a Conservative Peer described as “this terrible, terrible Bill”—let alone the secondary legislation that will translate its aspirations into practice. As to the latter, it is high time that the Government reported on progress in relation to consultation and the likely timetable for the incoming tide of regulations that will implement the policies embodied in the Act. Perhaps the Minister could enlighten us as to that timetable.

Quality was not featured in the Bill, which was essentially designed to run down council and, in effect, social housing to finance and promote owner occupation. Let me be clear: the aspiration of home ownership is absolutely legitimate and should be encouraged, but not at the expense of those whose housing needs cannot be met by that sector. The quality of new-build housing in terms of space standards and energy efficiency, to which some of your Lordships have referred, lags behind that of our continental neighbours—thanks in no small part to the coalition Government’s deliberate weakening of requirements, especially in relation to the latter. When I was first elected a councillor in Newcastle in 1967, houses were built to Parker Morris standards, long since abandoned. As I have mentioned before in this Chamber, in that year Newcastle City Council built 3,000 council houses.

In some ways, the most disturbing feature of government policy has been the weight given to affordability. For social housing tenants this is defined not in relation to their income but as 80% of what private landlords can charge as market rents in a time of acute housing shortage. All too often, this imposes real hardship. Characteristically, the Government seek to buy votes via the right to buy both council and housing association homes, funded in part by the sale of so-called high-value properties. If there are insufficient sales, the Government will impose a levy on councils.

The starter homes programmes will confer large, untaxed capital gains on purchasers, especially at the top end of the new house price range, wholly irrespective of means. First-time buyers from comfortably-off families in London, for example, will enjoy a discount of up to some £90,000 and the no-doubt inevitable rise in value on resale. Meanwhile, social housing provision faces the prospect of not only the loss of accommodation through right to buy but the pernicious effects of the Government’s enforced reduction of rents in the sector—nothing, of course, is being done in that respect in the private sector. This even includes supported housing. Money which would have been invested in maintaining and improving the existing stock of council and housing association properties, and perhaps contributed to the provision of desperately needed new, genuinely affordable homes, will now be used by the Government to reduce the cost of housing benefit—though not, of course, in the private rented sector.

In Newcastle alone, the enforced 1% rent reduction policy will lead to a 12% reduction in rental income by 2020—or £40 million, rising over time to £590 million. On a national scale, we are looking at a loss of investment in council housing running into billions. In addition, the council will in the meantime suffer a levy on high-value properties, as I have said, whether or not they are sold. Again, we will be looking at millions of pounds lost, though in the absence of any clarity from the Government it is impossible at this stage to be precise about the impact. I do not know whether the Minister will be able to give us any estimate of what that is expected to realise.

Finally, there is the impact on housebuilding. The Conservative-led Local Government Association has estimated that 88,000 council homes will be sold by 2020 and predicts that 80,000 of these homes will not be replaced. These figures will no doubt be echoed in relation to housing association homes. The warm words of the Prime Minister, Mrs May, on the steps of 10 Downing Street sounded like a return to relatively benign Conservatism of the kind that Harold Macmillan embodied as Housing Minister in the early 1950s when, among other things, he encouraged the building of council homes. He must be spinning in his grave.

Neighbourhood Planning (Referendums) (Amendment) Regulations 2016

Lord Beecham Excerpts

Tuesday 6th September 2016 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Communities and Local Government and Wales Office (Lord Bourne of Aberystwyth) (Con)]

My Lords, the regulations set a latest-by referendum date in the final stages of the neighbourhood planning process. I beg to move that they be approved and come into force on 1 October.

Neighbourhood planning gives communities direct power to develop a shared vision for their neighbourhood and to shape the development and growth of their local area. For the first time, community groups can produce plans that have real statutory weight in the planning system. So far more than 1,900 communities across England, representing nearly 10 million people, have started the process of neighbourhood planning. More than 200 plans have passed a public referendum and are now in force. These plans are now the starting point for planning decisions.

We are fully committed to strengthening neighbourhood planning. The introduction of the neighbourhood planning Bill shortly will further empower local communities to get the homes and infrastructure that local communities need delivered as quickly and effectively as possible. But we need to ensure that the neighbourhood planning process is as simple and expeditious as possible so that communities see the benefits of their plan without unnecessary delays. Neighbourhood planning can take, on average, two to three years. Slow decision-making by local planning authorities can be particularly frustrating for communities and can discourage them from taking up neighbourhood planning. That is why we introduced a number of measures in the Housing and Planning Act 2016 that could speed up neighbourhood planning by an average of 17 weeks.

Complementing the new powers in the Housing and Planning Act is a power in Schedule 4B to the Town and Country Planning Act 1990 for the Secretary of State to make regulations prescribing a date by which the referendum must be held or before which it cannot be held. Holding a referendum is a key step required to bring a neighbourhood plan or order into force once it has been through public consultation stages and an independent examination. Where the neighbourhood area has been designated as a business area, there is an additional referendum for the businesses in the area. On average, referendums have been held within eight weeks of a local planning authority’s decision to submit a neighbourhood plan or order. However, while some authorities have called a referendum within six weeks, others have set a referendum date more than 17 weeks after their decision to do so, and some have been far later even than that. This is why we consider that it would be beneficial for new regulations to set out a clear expectation regarding the time period for holding a referendum.

In February, we consulted on proposals for these regulations as part of a wider package of measures. A summary of the responses to the consultation has been prepared and is available on the department’s website, along with the Government’s response. The proposal received considerable support, and a small number of technical amendments were made as a result of the consultation to ensure that the regulations could be implemented effectively. The details of the regulations have been agreed with the Electoral Commission and the Association of Electoral Administrators.

The regulations, if approved, will be an important safeguard to ensure that a minority of local authorities do not cause delays to the neighbourhood planning process. The regulations would require local planning authorities to hold a referendum on a neighbourhood plan within 56 working days of their decision that a referendum should be held, or 84 working days in certain more complex cases. The cases where the 84-working-day limit would apply are where there is also a business referendum; where the neighbourhood planning area falls within more than one local planning authority area; or where the local planning authority is not the principal authority responsible for arranging the referendum, as with mayoral development corporations or national park authorities.

There are three exceptions to the 56 or 84-working-day time limit. First, they are where a neighbourhood planning referendum can take place on the same day as, or be taken together with, another poll due to be held within three months of the end of the 56 or 84-working-day period described above; where there are unresolved legal challenges to the decision to hold a referendum; or where a local planning authority and the neighbourhood group agree that the referendum need not be held by that date. Those exceptions provide necessary flexibility to allow for local circumstances to be taken into account.

Neighbourhood planning has been hugely successful in making planning more accessible to local people. It empowers significant numbers of communities to take an active role in determining the future of their areas, and it is a principle that we can all agree on. This Government are committed to speeding up and simplifying the process so that even more communities benefit. It is important that we set time limits for key local planning authority decisions in the neighbourhood planning process to speed up and simplify the system in a sensible and pragmatic way, and I believe that that is what the regulations will do. I therefore commend the draft regulations to the House.

[Lord Beecham (Lab)]

My Lords, the proposals that the Government embody in these regulations are of course accepted. I declare my relevant local authority interests, which are referred to in the register.

There are a number of questions I would like to put to the Minister. He told us that 190 communities have started the process, that being the figure contained in the background documents which are available in the Printed Paper Office, and that 200 communities have proceeded to implement—or at least to agree—a plan under this procedure. However, that is 200 out of 1,900 in three years. Can the Minister say how many of those communities abandoned their projects or had them rejected in that time? What is the average time for concluding the process? The Minister referred to a reduction of some 17 weeks which will flow from this provision: 17 weeks compared to what as the average time so far? Moreover, the documents reveal that 89% of those who voted—presumably of these 200—voted in favour of the plan as drawn. The question is: 89% of what? What was the actual turnout relative to the potential turnout in these votes? There might well have been 89% voting in favour, but that could have been 89 people out of 100 who took the trouble to vote in a community of some thousands. It is simply not clear. I would be grateful if the noble Lord enlightened us. I do not suppose that he has the information immediately to hand, so I would be grateful if he wrote to me and placed the answers in the Library subsequently.

One of the problems for local authorities is that the planning service is under huge strain. Often, local authorities are reducing the number of planning officers because of the financial constraints on them. The Government, in paragraph 39 of their response to the consultation, indicated that they would enter into,

“updated arrangements for funding local planning authorities”.

Perhaps the noble Lord can enlighten us as to what progress has been made in that respect. As I understand from the documents, the Government do not accept that this process was a new burden, although any local authority would surely have thought it was, in the sense that it is a new responsibility which has been created, however welcome it may be. What funding is to be made available and what estimate has the department made of its impact on the number of officers who would be enabled to carry out this work, which would be in addition to the current work of planning departments, which are already considerably overstrained?

If we are looking at timescales, what are the Government doing about the hundreds of thousands of planning permissions granted for development upon which no action has been taken? We have here a measure which prescribes a very limited timescale, understandably in many ways, because in the most part we are not talking about large projects. However, what is sauce for the local government goose does not appear to be on the menu for the developer gander because long-standing planning permissions are simply lying on the table. At a time when everybody acknowledges the need for hundreds of thousands of new houses to be built, it seems extraordinary that the Government are prepared to impose a pretty rigid—I concede it is not entirely rigid—timescale for the processing of these plans, but no timescale at all on the implementation of planning permissions granted, in many cases, some years ago. Will the Government look again at the question of imposing a timescale for planning permission for significant developments to be implemented, rather than simply leaving it to the developer—who is presumably hanging on to the land in the hope that ultimately prices will rise and greater profits will accrue—when there are many, many people looking for new homes to buy or rent? The principle here, which is a fair one, is to make progress on community plans, but can we also see some progress on the carrying out of development in accordance with permissions already granted?

[Lord Foster of Bath (LD)]

My Lords, I am pleased to follow the noble Lord, Lord Beecham, although it was very difficult to gauge from his remarks to your Lordships’ House whether or not he supports neighbourhood planning. I make it very clear that I am a huge supporter of neighbourhood planning and neighbourhood plans, which arose from the Localism Act 2011. I was delighted that the Minister made very clear his support for them. I entirely support his and the Government’s desire to speed up and simplify the process so that still more communities can benefit from the opportunities that neighbourhood planning will bring to them.

I share of course the concern of the noble Lord, Lord Beecham, that the Government are often very keen to impose tight time limits on other bodies whereas they themselves do not necessarily have to live up to similarly tight timescales. But in the area of neighbourhood planning and enthusiasm for it, while I entirely support these measures, I ask the Minister to look carefully at the departmental website and the way in which it increasingly does not show the same initial enthusiasm for neighbourhood planning that perhaps once existed. For example, the departmental website has had a series of notes on neighbourhood planning. It currently goes up to addition 17—at least, that is what is available on the department’s website. In 2015, additions 14, 15, 16 and 17 were spread over roughly three-monthly periods. Yet, as far as I am aware, there has been no further note on neighbourhood planning from the department. Will the Minister identify whether they exist and, if so, whether they can be given more publicity because they contain—at least up until December—some very interesting and helpful information for local communities that want to go down the neighbourhood planning route.

While on the issue of the departmental website, will the Minister agree to take on a small exercise when he eventually gets home tonight? Will he see whether he can find on the departmental website the results of the consultation to which he referred? No fewer than five people have worked with me on trying to find it. It was only with the help of the very efficient staff in the Library that we were eventually able to find it. But I note that the details provided on the website are somewhat different from the information provided in the Explanatory Memorandum. For example, the website says that there were 362 responses to the consultation but the Explanatory Memorandum says that there were only 321.

The point is that the report, which can eventually be found if noble Lords take the time to get to it, does not provide any helpful information whatever. Clearly, any noble Lord who wishes to participate in this debate would want to know what the objections were from those councils that were not happy with the proposal. The report merely says that the vast majority were in favour and that a few came up with some suggestions for changes. I hope that the Minister will agree to publish a fuller document on the responses to question 5.6 of the consultation.

Having been somewhat niggly, for which I apologise to the Minister, I will say that I entirely share his enthusiasm for neighbourhood planning. In my brief time as a Minister in the department, I had an opportunity, along with Mr Nick Boles, to see many community groups working on them and know the real benefit that they can bring to communities.

Housebuilding: Target

Lord Beecham Excerpts

Tuesday 19th July 2016 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, the 1 million figure is of course made up of a range of sources. Some 400,000 will be affordable houses while 200,000 will be starter homes, and it is right that there should be a mix of types of housing. That is something the Government are absolutely pledged to.

[Lord Beecham (Lab)]

My Lords, I refer to my interests as a member of Newcastle City Council, in which the imposed reduction of 1% in council rents will lead to a reduction of £28 million by 2020, which would otherwise be invested in new housing and the existing housing stock, and of £593 million over 30 years, while £2.6 billion will be lost nationally to such investment by 2020. What assessment have the Government made of the impact on the new building of social housing, council housing and the improvement of the existing stock as a result of that decision to force rents to be reduced?

[Lord Bourne of Aberystwyth]

My Lords, as I have indicated, we are watching very closely what the position is regarding new build. We are committed to a range of sources, including affordable houses for rent as well as houses to buy. We should take account of the fact that, I suspect, most if not all of us own our own houses, so there is a concentration on helping people to buy their homes. However, we are not blind to the need to encourage the affordable housing for rent sector as well.

Barnsley, Doncaster, Rotherham and Sheffield Combined Authority (Election of Mayor) Order 2016

Lord Beecham Excerpts

Monday 18th July 2016 Lords Chamber

We are committed to this devolution agenda because it gives a real opportunity for areas to assume powers and budgets, which will help those areas achieve their potential, take control of their growth and, importantly, have a positive impact on the lives of local citizens. These orders will provide both the Sheffield City Region and the West Midlands with a strong voice and an effective leader who can deliver for the local area and help rebalance the economy of the country as a whole. I therefore commend these draft orders to the House.

[Lord Beecham (Lab)]

My Lords, I extend a warm welcome to the Minister on his first appearance at the Dispatch Box in his new position. It troubles me that it was 10 years ago that I concluded a report on public services in Wales, which was named—though not by me—the Beecham report. At some point perhaps the Minister and I could have a session in which I can catch up on what, if anything, has happened since that report was published.

These two orders, providing for the election of mayors for the combined authorities of the West Midlands and South Yorkshire, constitute the launch, in effect, of two further vessels to join the devolution armada which the Government are intent on creating. Both areas contain authorities which voted by substantial majorities not to have elected mayors when they were compelled to have referendums on the issue. The Government pretend that it is open to the authorities in question to accept or reject the concept of an elected mayor for the combined authority and so, formally speaking, it is. However, given that the entire devolution deal depends upon the adoption of the mayoral model, the reality is that councils are faced with the political equivalent of Henry Ford’s offer to those who wished to purchase his cars: “You can have any colour as long as it’s black”. The millions of people who live in these areas can have devolution with any kind of local governance as long as it is headed by a mayor.

In the case of these areas and others which have entered into or plan to enter into agreements with the Government, there are concerns about the new system and the claims made for it by Ministers. Some of these relate to the alleged benefits to be derived from the additional funding to be provided to combined authorities and their mayors for investing in economic growth. The West Midlands will receive £36.5 million a year for 30 years, or, as the Minister said, £1.095 billion, which equates to £13 a year per head of population. South Yorkshire will receive £30 million a year, £900 million in aggregate, which is the equivalent of £22 per head of population per annum.

These figures compare with £915.6 million of local authority capital expenditure and £105.2 million of annual growth fund allocations to the local enterprise partnerships in 2014-15 in the West Midlands, and £367.4 million and £54.7 million respectively for South Yorkshire. Therefore the bonanza amounts to an additional 3.6% for the West Midlands and 7% for South Yorkshire. Meanwhile, Birmingham alone will by 2020 be suffering from cuts to its revenue expenditure of £817 million a year. By the end of this year, Sheffield will have sustained cuts of £350 million a year, with the likelihood of some £50 million or £60 million a year more by 2020. It is clear that the vaunted claims for devolution made by its erstwhile progenitor, the lately departed George Osborne, were, in financial terms, wildly overstated. But there are other issues of concern to these two areas which need to be considered.

As the Secondary Legislation Committee points out, and as I mentioned when we discussed the combined authority order for South Yorkshire, there is an issue concerning the wishes of two districts in Nottinghamshire and Derbyshire, Bassetlaw and Chesterfield. They will become part of the combined authority and thereby, for the purposes of the combined authority, will come under the authority of the elected mayor for South Yorkshire. They would, however, remain under their existing county councils for functions such as education, social care and libraries. But, given the relationship between, say, housing and public health, which are matters over which the combined authority may be expected to exert influence, how is this likely to work?

I warned that we seemed to be in danger of sliding into a back-door reorganisation of local government as the demand for a unitary model, based on an expanded South Yorkshire combined authority, inevitably grows. Alternatively, or additionally, will we see the creation of a North Midlands combined authority, presumably not a mayoral authority, of which, confusingly, Chesterfield and Bassetlaw would seek to be members, as the Select Committee observed? They would be based upon the two counties of Derbyshire and Nottinghamshire.

The National Audit Office explicitly warned, as the Secondary Legislation Scrutiny Committee reminds us, that devolution deals, such as that in the West Midlands,

“are increasingly being negotiated and agreed with more complex and untested geographies”.

Its report of 20 April refers explicitly to,

“risks around alignment with the administrative geographical areas for other linked policies”,

citing the NHS planning guidance which requires areas,

“to define their own local health economies and to consider devolution deals while doing so”.

As the National Audit Office points out, given that,

“geographical configurations … have yet to be resolved in many areas, it is not yet clear how these two processes will align”.

So can the Minister tell us what discussions have taken place between the DCLG and the Department of Health, and for that matter with NHS England, about the position in general, and specifically with regard to the two areas we are discussing today? This is particularly relevant to the complex situation in the West Midlands where, as I pointed out when we were discussing the combined authority order, we appear to be reverting to the era of the Anglo-Saxon Heptarchy, with its Kingdom of Mercia.

The West Midlands mayor will head a combined authority with seven member councils, three local enterprise partnerships and no fewer than five non-constituent member authorities: namely, Cannock Chase, Nuneaton and Bedworth, Redditch, Tamworth, and Telford and Wrekin, all of which are districts within a county council whose residents will not have a voice or a vote in the choice of mayor. How is this consistent with democratic local government? What will be the relationship with the relevant county councils?

The Secondary Legislation Scrutiny Committee referred in an earlier report to “combination creep” through the involvement in combined authorities of non-constituent councils or councils outside the geographical limits of existing combined authorities. Given that the report was published only last Thursday I do not expect the Minister to be able to respond today and to provide the greater clarity the committee seeks. But could he indicate when a reply will be provided, and whether it would not be sensible to pause before proceeding with this series of orders, which seem set to lead in some areas to highly complex changes whose benefits are at best highly unquantifiable?

The idea of devolution is welcome, but not every aspiring area is the same. Huge questions go unanswered about finance, accountability and structures to different degrees in different areas, and we do not know whether the new Prime Minister, her Chancellor and the Secretary of State share the apparent enthusiasm of their predecessors for this policy.

Some areas—Greater Manchester, Merseyside and the Tees Valley—are well down the road and are well defined, but more work is surely required to ensure that for the kind of areas we are discussing today, and with some still to come, the serious questions raised by the National Audit Office, the Secondary Legislation Scrutiny Committee and others can properly be addressed. I make it clear that we on these Benches—all of us—want to see this devolution work and be properly funded, but it is difficult to see how well it will work unless these critical questions are answered. We do not want to see the devolution armada scattered to the four winds like its Spanish naval counterpart.

[Lord Shipley (LD)]

My Lords, first, I congratulate the noble Lord, Lord Bourne of Aberystwyth, on his appointment, and we welcome him in assisting the drive for devolution. I agree with what the noble Lord, Lord Beecham, said about the importance of devolution—it is a shared agenda across your Lordships’ House. I hope very much that the new Minister will bring his expertise to bear on the detail of the move to greater devolution within England as the Cities and Local Government Devolution Act is implemented.

I should say at the outset that I am a vice-president of the Local Government Association. Right across local government, politicians have been very supportive of the move to greater devolution.

Last week, there was a debate on similar orders for Merseyside and the Tees Valley. I do not want to repeat comments that were made during that debate, except to say that I agree with much of what the noble Lord, Lord Beecham, said about the general approach being taken and about some of the problems being produced by changes in government, as well as the overall financial problems that local government has.

Last week it was confirmed—as it will be tonight—that there will be a mayoral election in May 2017, even if there is no agreement later this year on the powers and budgets that a combined authority will have. I understand the reasons for that, although if that were to happen it would clearly make things more complicated and more difficult to explain to the general public.

In our debate on Merseyside and the Tees Valley, I drew attention to a report on the devolution process published at the beginning of this month by the Public Accounts Committee of the House of Commons. There is a full record in Hansard of what we said, but the crucial sentence in the report that I want to draw to the Minister’s attention tonight is on page 3 of the summary:

“There has been insufficient consideration by central government of local scrutiny arrangements, of accountability to the taxpayer and of the capacity and capability needs of local and central government as a result of devolution”.

I subscribe to that. There was a request by the Public Accounts Committee that:

“Government should set out by November 2016 its plans for how it will ensure that local scrutiny of devolved functions and funding will be both robust and well supported”.

I think there is a commitment from the Government to come back with the detail of the powers, budgets and scrutiny at the same time so that we get both at once, because that really matters.

I am grateful to the Minister for the letter that we received today by email. It answers some of the issues that we raised during the debate on the Merseyside and Tees Valley orders concerning how a chair of an overview and scrutiny committee could be appointed. It is made clear in the letter that an independent chair will be appointed following “an open, competitive process”. I think that that implies the Nolan procedures, but I would be grateful if the Minister confirmed that it does. The letter states that,

“a candidate must submit an application to the combined authority in response to a public advertisement”,

and the appointment,

“must be approved by a majority of the members of the combined authority”.

The letter then says—this is a point I take issue with—that there will therefore be,

“a wholly transparent appointment process mirroring the approach which councils must use when appointing independent persons under the Localism Act 2011 for the purposes of the councillors conduct regime”.

Local councils are bound by statute to proportionality in the make-up of committees. The difficulty here is that a combined authority will be the leader of the local authorities. It is entirely possible—and certainly it would happen in the north-east of England, where I live—that there would be seven Labour chairs. I am concerned that proportionality simply cannot exist in such a constitutional structure. Indeed, an independent chair could be appointed by a majority vote of a one-party committee. I hope very much that when the Minister comes back later this year, the guidance—if it is guidance, as opposed to being statutory—makes it clear that this appointment cannot simply be in the hands of a handful of people, all from one party, who may decide to support an independent person who, in practice, may well not be entirely independent. I draw that to the Minister’s attention because it is important we ensure that public confidence in the powers of an elected mayor is protected.