West Midlands Combined Authority Order 2016

Lord Hunt of Kings Heath Excerpts

Monday 6th June 2016 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Williams of Trafford) (Con)]

My Lords, the draft order that we are considering this afternoon, if approved, will create a combined authority for the West Midlands. It will also dissolve the West Midlands Integrated Transport Authority and Passenger Transport Executive, and transfer their functions to the newly established combined authority. This order is made pursuant to the provisions of the Local Democracy, Economic Development and Construction Act 2009, as amended by the Cities and Local Government Devolution Act 2016.

The seven constituent councils of Birmingham, Coventry, Dudley, Sandwell, Solihull, Walsall and Wolverhampton have led a truly local, bottom-up process to produce a proposal for the establishment of this combined authority. They believe that this governance model is the most appropriate way for the West Midlands to achieve stronger, more efficient and more effective delivery of economic development, regeneration and transport responsibilities. If this order receives parliamentary approval, the West Midlands Combined Authority will be the second combined authority established since the amendments to the 2009 Act by the 2016 Act, and the seventh established in the last five years.

It is important to note that, while establishing this combined authority in no sense commits the councils concerned, or indeed the Government, to creating a mayor for the area or devolving powers to the area, the councils and the Government intend to use this combined authority as the foundation for implementing the devolution deal that we have agreed with the West Midlands.

[Lord Hunt of Kings Heath (Lab)]

My Lords, the Minister said that the councils in the West Midlands have signed up to the issue of having an elected mayor. I remind her that, when we had a referendum in the West Midlands, we decisively voted against having mayors. There is no sign-up at all to having a mayor—it is just that her department has forced the West Midlands authorities to accept it because they would not get the powers unless they were given a mayor.

[Baroness Williams of Trafford]

These matters are truly local matters, and if the local authorities approach government with their wishes, the Government will consider them. We went through that during the passage of the Cities and Local Government Devolution Act; no authority will be made to do anything that it does not wish to do.

[Lord Hunt of Kings Heath]

Is the Minister saying that the powers that will be given to the West Midlands Combined Authority as set out in this order, and more in the future, will be available if the local authorities intimated that they would not have a combined mayor?

[Baroness Williams of Trafford]

My Lords, the order we are dealing with today has no bearing on whether those local authorities will have a mayor. This order is about creating a combined authority. I want to make that absolutely clear to all noble Lords. This is about creating a combined authority; it is not about creating a mayoral combined authority.

In its report, the Secondary Legislation Scrutiny Committee questioned the relationship between the combined authority we are considering today and future developments, such as establishing a mayor for the area. I shall say a little more about this later, but now I would like to address in more detail the draft order before the House this afternoon, which is the order to create a combined authority.

This order provides for the combined authority to assume responsibility for economic development, regeneration and transport across the West Midlands. As I have said, the West Midlands Integrated Transport Authority and the West Midlands Passenger Transport Executive will be dissolved and their transport functions transferred to the West Midlands Combined Authority. This order will enable the seven councils and their partners—including the three local enterprise partnerships in the area: Black Country LEP, Coventry and Warwickshire LEP and Greater Birmingham & Solihull LEP; and the five non-constituent members: Cannock Chase, Nuneaton and Bedworth, Redditch, Tamworth, and Telford and Wrekin—to work together more effectively and efficiently to promote economic growth, secure investment and create jobs.

In laying the draft of this order we have followed the statutory process specified in the 2009 Act as amended by the 2016 Act. A key feature of this is that there is a triple lock. Establishing a combined authority can happen only if the councils concerned consent, the Government agree and this House and the other place approve the necessary secondary legislation. That is absolutely the case here. The seven constituent councils have consented to this order, the Government have agreed the draft of the order, and we are seeking Parliament’s approval before making the order which will establish the combined authority on 10 June.

We have considered the particular circumstances of this proposal for a combined authority, as the law requires. We have concluded that the statutory conditions are met. First, we are satisfied that the making of this order is likely to improve the exercise of statutory functions in the area to which it relates. We also consider it would be appropriate to establish this combined authority, having regard, as the 2009 Act requires, to the need to reflect the identities and interests of local communities and to secure effective and convenient local government. Finally, we have considered the public consultation carried out by the constituent councils of the West Midlands on the proposals to form this combined authority and consider that no further consultation is needed.

I recognise that in its report the Secondary Legislation Scrutiny Committee raised certain issues about consultation. I have to tell the House that we do not share the committee’s view that there are inadequacies in the consultation. We have reached this conclusion having had regard to the government Consultation Principles published on 14 January this year, which the Secondary Legislation Scrutiny Committee referred to in its report, and which have recently been amended in light of comments made by the said committee. In short, the consultation’s use of digital measures is wholly consistent with these principles and, as the principles make clear, consultation needs to be considered as,

“part of a process of engagement”.

The engagement in this case has been very substantial and included: writing to a representative sample of 465 stakeholders, comprising key private sector employers, public sector bodies and third sector organisations; the establishment of an online survey which attracted 305 respondents and for which the results were analysed and published; the attendance of the three local enterprise partnerships, and the authorities within them, at shadow combined authority meetings; seeking feedback from the public via a query box on the shadow combined authority’s website; a parliamentary event; and a number of formal and informal briefings with the business and third sector communities. In short, I can confirm to the House that we believe the conditions have unambiguously been met, and that we are therefore seeking the approval of this House today to the order that the other place has already approved.

--- Later in debate ---

[Baroness Burt of Solihull (LD)]

My Lords, I am grateful for the opportunity to welcome this order today, notwithstanding and quite accepting the comments made by the noble Lord who is the spokesperson for Labour.

The order brings together the West Midlands. It lets local government think beyond its normal boundaries, and strategically, for our region. We need to look at our competitiveness—digital, manufacturing and in other areas. We need a strategy for our skills, we need proper broadband, and transport links are very overcrowded and need to be much better. We are a manufacturing region: 38% of our GVA is in manufacturing—that includes the supply chain—and we have problems.

I am very concerned about the difference in the relative wealth of the various local authorities. Birmingham is, for want of a better expression, broke. Fortunately, other local authorities are not in such a bad position. However, I want to ask about the LEPs. There is no formal mechanism for them to consult the business community. I am always thinking about local authorities but a key player in this will definitely be business, which will have a pivotal role.

The CBI has no regional representation in the West Midlands and the chambers are fragmented. We need a West Midlands chamber of commerce. We are criticised for our lack of productivity, which the West Midlands Combined Authority shadow board says is low. It is if you take GVA over the total population, at £20,137 per head, but if you take GVA over those in work it goes up to £45,000, so we do not want to be criticised purely because we have an unemployment issue in the area. We could be a lot more productive if we had better broadband, better transport and a better skills base.

I have a few questions for the Minister. I am glad that I am not the only one who is confused about what the voting rights will be for non-constituency members and what role those members will play. On scrutiny, what part will minor parties play? Will they have a voice as well? There are a lot of smaller parties in the West Midlands. Today I have learned that the Secretary of State, the right honourable Sajid Javid, is the official sponsor of the Midlands engine. Perhaps the Minister will comment on whether she has seen any evidence of the Midlands engine in the Midlands.

Finally, Sajid Javid is apparently responsible for bringing together a politically neutral coalition of West Midlands MPs. How is he getting on?

[Lord Hunt of Kings Heath]

My Lords, I thank the Minister for her careful introduction to this order and I very much welcome the work that has been done by the local authorities concerned to get to this stage.

It has not been at all easy. The noble Baroness will know that there is a history of difficult relationships between local authorities in the West Midlands. First, we should acknowledge the work that has been done by the major constituent local authorities to come together and reach an agreement. That is a very positive start. Secondly, I agree with the noble Baroness and my noble friend Lord Kennedy about the huge potential of the West Midlands. It has had its problems but there is no doubt that there are some very promising signs with manufacturing development and the role played by universities.

We are also starting to see a return of media to the West Midlands, which, grievously, we had lost over a 20-year period. I do not know what discussions the Minister has with her colleagues in the DCMS but any nudge that she can give towards ensuring that Channel 4 does indeed move to Birmingham will be very much appreciated. I hope that she will ignore a typical metro article in the Independent today arguing that it would be quite impossible for Channel 4 to operate outside the centre of London. I am sure that the noble Baroness agrees with me on that.

I want to raise one or two issues. First, my noble friend mentioned the National Audit Office report, which made a very important critique of some of the issues surrounding the development of these combined authorities. I assume that the Government will respond in due course but I would be very interested in the Minister’s views on what the NAO said. Without quoting extensively from the report, the NAO thinks that there is quite a lot of confusion about what the core purpose is of these devolution deals, who is going to be held responsible and how that accountability is to be discharged.