Public Bodies Bill [HL]

Lord Cavendish of Furness Excerpts

Wednesday 23rd March 2011 Lords Chamber

[Lord Empey]

My Lords, I had the opportunity to make some remarks on this issue at Second Reading. I do not believe that anybody in this House is not in favour of growth or strong regional policy; that is common ground. The point I tried to make at Second Reading was: is the present structure fit for current-day purpose?

I regret that I did not hear the beginning of the remarks of the noble Lord, Lord Campbell-Savours, but I heard several of them in what was a very passionate speech. In referring to one case, he commented that councils did not necessarily have drive. However, leadership in any organisation, whether it is an RDA, a council or anything else, will vary from body to body, just as leadership in a school will vary from body to body. I have to say that there are examples of local authorities doing very difficult things. In my own case, I was a member of a local authority that redeveloped the most polluted site in Ireland—a former gas works. It is now a thriving economic area. We developed the waterfront and brownfield sites. Where the right leadership is in place, you can do a lot of things. We were able to tap into ERDF and even ESF to train the local people who will, we hope, get some benefit from the redevelopment, instead of looking through the railings at the parked BMWs. We can do that if the leadership is in place.

I wanted to say one thing to the noble Lord. He said that it was more difficult to create a structure or organisation than to close one down. I have to take the very opposite view. I had the opportunity to create an organisation like an RDA. I had the opportunity to merge bodies together and the opportunity to close them. The easiest thing to do was to create them. It was more difficult to merge them, and the most difficult thing was to close them. That is why we have so many—not only RDAs but public bodies in general. Departments liked to put a body out there that could take the flak and the front fire to protect the department from taking the blame for things. The existence of a body, whatever it might be, and the ability to say, “These people have autonomy to deal with this”, protects the Civil Service from its responsibilities. It is good to be able to put these bodies out there as a sort of barrage to protect the centre from local criticism, because there is always someone else to blame. That is why there are so many of these bodies.

Many of them have done excellent work. As has already been said, some of these RDAs have been good and some have been not so good; that is human nature. It is the human condition. That relates to the leadership they give, their policies and the opportunities that have been taken. However, we have to be mature about the whole issue of public bodies. Everyone admits that we have too many of them. No matter which one you touch, it is inevitable that a group of people will support it.

In many cases, some of the reasons that noble Lords have put forward have been perfectly plausible. However, the real issue, as I pointed out at Second Reading, is the change in Europe, where the resources that used to be available to this country will no longer be available post-2013, because the money is flowing east, as we all know. The economic profile of our economy has changed. We brought to bear solutions through these large battleship bodies with budgets of hundreds of millions of pounds. Those bodies were right at the time, just as the Agricultural Wages Board was right at the time. However, times have moved on. Europe’s policy has changed. We now have to manage within our own resources.

I am not as pessimistic about the role that local authorities can play and what happens regarding the local enterprise partnerships remains to be seen. However, as always, a lot of this will come down to leadership on the ground. It is the same for the military, a company, a school or a business—and it is the same for a local authority or an RDA. We must look at an alternative model, because circumstances have moved on, and in trying to deal with the plethora of public bodies, you could almost come to a complete standstill if you did not make some attempt to bring about change.

There is no doubt that the biggest challenge we face is on growing our economy. We all complain about the lack of warships and aircraft carriers. Where is the money coming from to pay for them, if it is not coming from economic growth and wealth creation? Those are our only sources, other than borrowing—and we know where that got us. There is little alternative but to try an alternative. I take the points made by noble Lords about assets—that is an important issue—but creating bodies is easiest; amalgamating them is the next most difficult; and closing them is the most difficult. That is my experience and this debate proves the point. Every body that you consider has a lobby in support of it. While I acknowledge the great work that a number of these organisations have done—it would be churlish not to say that—the fact is that the mechanisms we have to adopt to improve our economic growth have moved on and different structures and models must be adopted.

[Lord Cavendish of Furness]

My Lords, I crave the indulgence of the House in intervening in a debate in which I have not previously taken part. Just in case it is felt that the argument has been entirely one-sided, I remind your Lordships that in my part of the world on the Barrow-in-Furness peninsula, where I declare an interest in running a small business, the economy is driven by companies such as these, which employ some 100 or 200 people. I do not want to be unkind to the people in these agencies who have done their best, but in my part of the world it would be fair to say that there is no consensus that we want to keep them. Businesses of my size do not feel that the agencies are approachable or are the answer. We want government to get off our backs and leave us alone. I am reminded of my father, who told me: “My boy, if the Government offer you a grant, it is probably not worth taking”.

[Lord Hoyle]

That might be the view of the noble Lord, but I am afraid that he is not living in the real world. How can he be when he has made a statement like that? Let him look at what has been created by RDAs. I will not speak for very long, because my noble friend Lord Campbell-Savours made a very powerful case. However, I believe that we are talking to people who will not listen to the arguments that we are putting. I am pleased that the noble Lord intervened from that side, because he is the first to do so: it has been only us speaking.

The RDAs have done a wonderful job. I have a copy of a letter that was addressed to my noble friend Lady Royall. I was critical when the Minister was winding up last time and said that he was not answering the debate. He has now taken the trouble to try to answer the debate and I thank him for that. It is not always done. Having said that, I do not agree with most of the answers he gave; he will not be surprised about that.

I could go through every paragraph of the letter, but it is too late in the evening. I will refer to one paragraph that deals with the independent evaluation by PricewaterhouseCoopers that demonstrated that every pound spent by RDAs added approximately £4.50 to regional economies. In the case of the north-west, the figure was greater: £5.20. However, no answer is given in the paragraph. It simply states:

“We appreciate the work they have done”.

The issue is not whether we appreciate the work they have done, but who is going to pick up the mantle and do the work in future. There is no answer to the question of where we will get replacement agencies that will secure that kind of growth. As has been said often tonight, we are going back to localism instead of looking at regions as a whole.

The regions did benefit. The noble Lord, Lord Cavendish, said that he had an interest in Barrow-in-Furness. When the floods hit Cumbria, the RDA brought help to local businesses in need within four days. That was not matched by any other body, and it will not be matched by any new bureaucracy that is going to be established.

I will repeat what has been done for the north-west by the Northwest Regional Development Agency: 220,000 jobs have been preserved, 23,000 new businesses have been created and £3.2 billion of private investment has been brought in. These are huge sums. The agency has looked at the region as a whole. If we split it up, we will not get that sort of aid.

I will not go on. I thank the Minister for replying, but ask him to reply also to the debate tonight, because too much is at stake in the regions: too many jobs and too much inward investment. Why should the RDAs be destroyed because of a political decision that I believe is wrong? Not only do I believe that it is wrong, but many other Members of the House believe that, too. More importantly, people and businesses in the regions believe that it is wrong. If the Minister is saying that we can do the job with other organisations, can he tell me what funding will be given to the new bodies? As I understand it, there is no funding, and if there is no funding they will not be able to do the job. Will the Minister reassure me that adequate funds will be made available?