Economy: Growth

Lord Desai Excerpts

Thursday 6th December 2012 Lords Chamber

[Lord Desai]

My Lords, the Heseltine report is not just for Christmas and not just for austerity; it is for a much longer period than that. Some of the things that the noble Lord has pointed out have been constant and I have been hearing about them ever since I arrived here 45 years ago. We are too centralised and there is too little power in the regions and local authorities. There is too much regional inequality and London is too powerful compared to the regions. You can see that in the noble Lord’s diagrams.

The noble Lord is a paradox. He is a centralist who wants to decentralise by using central power and he is strongly in favour of state intervention to encourage private business. It is an interesting model. If we are serious about decentralisation the first thing to do is to decentralise Whitehall. There is no reason why all the ministries should be in London. There is no reason why Local Government, Transport or Business, Innovation and Skills should be in London. Once upon a time the technology was such that they needed to be near each other. Now with cyber technology none of them needs to be near the others. We can completely decentralise government and delocate it. That would be a great step forward in making the regions more powerful and generating more employment in the regions.

As my noble friend Lord Hollick said, if we are serious about local government, we have to give local government income which is independent of central government. The best way to do it would be to do what has been long delayed and revalue property. Property values have not really been revised since the early 1990s. We got into the whole poll tax/council tax dilemma because of the reluctance to revalue properties quinquennially or periodically. If we could do that, given council tax rates, we would generate buoyant incomes for local authorities. They would not need to come to central government for their income and that would allow central government to cut central taxes. If we are serious about localism, we should break up Whitehall into the regions.

Lastly, this is a wonderful opportunity. As we are considering the refurbishment and repair of the Palace of Westminster, let us move Parliament out of London.