Localism Bill

Debate between Lord Lucas and Lord Shutt of Greetland

Monday 10th October 2011 Lords Chamber

[Lord Shutt of Greetland]

My Lords, I thank noble Lords who have spoken on this amendment, particularly the noble Lord, Lord Lucas, who moved it. The amendment would give authorities the power to reduce the liability for empty property rates. Our ability to take action on empty property rates needs to be balanced against the costs involved, the targeted support that we already provide on business rates and the overriding need to reduce public expenditure and support the economy generally by reducing the deficit. This Government have already doubled small business rate relief for two years, which will benefit about half a million rate payers, with about one-third of a million paying no rates at all for that period. We are also taking powers through this Bill to waive £175 million of backdated business rates demands levied on businesses, including some in ports.

Unfortunately, in taking these matters into consideration, support for empty property rate measures is currently simply unaffordable. While the Government have no immediate plans for reform, we are certainly keeping this matter under review. However, the Bill does give local authorities powers to provide discounts on business rates bills as they see fit, provided they fund the relief themselves. So authorities will be able to reduce bills in the way suggested by the amendment.

I hope that the noble Lord is willing to withdraw the amendment, but I assure him that the matter is under review. It is quite interesting, because I have within the papers here a note about the reliefs. In 2007-08, 2008-09, 2009-10 and 2010-11, changes were made.

[Lord Lucas]

My Lords, can I just point out to my noble friend that the effect of my amendment is not to reduce business rates but to multiply them by five times, resulting in greatly increased revenue to the local authority and the Exchequer. I am afraid that in some way his briefing is somewhat wide of the mark. I should be delighted if he would write to me when his officials have been able to revise their mathematics. As the noble Lord, Lord Beecham, clearly understands, this is about increasing the rates and increasing government revenue. I would hate it to be thought that I was in any way undermining the stalwart efforts of my right honourable friend the Chancellor to reduce the deficit.

[Lord Shutt of Greetland]

My Lords, I am delighted that the noble Lord has made those comments. I think that the officials had difficulties with this, and quite frankly so did I. I sought out the Local Government Finance Act 1998, but I am afraid that it has been amended, because the reference that he makes is not there. Immediately before speaking, I tried to check this myself, because I had some doubt about this. The whole area is under review, as it seems to have been for four years on the trot, because Chancellors and local government people have changed the position. So it is still the fact that the area is under review, but it is one that does impact on the economy. Having heard what the noble Lord said in his latter remarks, clearly, we will need to reflect further. But I cannot make any commitments at this stage. Perhaps a few tender words here and there might help us to understand exactly what he is about.

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[Lord Shutt of Greetland]

My Lords we now move to that part of the Bill regarding right to challenge. The first set of Government amendments—there are eight amendments in the group—seek to improve the workability of the right and to clarify certain issues that arose in response to our recent consultation exercise and indeed at the Committee stage in your Lordships’ House. Our consultation on the community right to challenge showed there is a real appetite to extend the duty to consider challenges under the right to more public authorities, including central government departments. Seventy-three per cent of respondents on this issue supported this course of action and I believe it has the support of many in this House. During our deliberations in Committee the noble Lord, Lord Jenkin, suggested several services provided by government departments to which the right could be extended.

Clause 69(2)(d) already gives the Secretary of State the power to add other persons or bodies carrying on functions of a public nature as relevant authorities. Amendment 197B ensures that these persons or bodies could include a Minister of the Crown or a government department. Amendment 197C ensures that if the duty is extended to a person or body that exercises functions outside England, the right to submit an expression of interest will apply only to services provided by that person or body in England.

Amendment 197D responds to a query raised by the noble Lord, Lord Patel, in Committee about whether a public or local authority could be a community body. This was never our intention. In line with the definition of a voluntary body in Clause 69(6), we are therefore amending Clause 69(8) to clarify that a public or local authority cannot be a community body.

Amendments 197E, 197F, 197G and 197H are about enabling relevant authorities to determine timescales. They make changes to the provisions on the timescales associated with the community right to challenge in response to concerns raised by many local authorities, and others, during our recent consultation. These concerns focused on the difficulty of setting timescales nationally that could take account of the wide variations in services and circumstances and did not interfere with timescales for existing commissioning cycles. We agree with these concerns and are therefore amending the provisions to remove the Secretary of State’s powers to set timescales in regulations and replace them with a requirement for relevant authorities to set these timescales instead. We intend to set out in guidance, to which authorities will need to have regard under Clause 73(2), the factors they should take account of in doing this.

We have outlined what we expect these factors to be in the policy statement on the community right to challenge which was recently made available to Peers. Chief among them is the need for authorities to set timescales that give relevant bodies sufficient time—whether that is to prepare and submit an expression of interest or organise themselves to bid effectively in a procurement exercise or ensure relevant bodies are notified of decisions within a reasonable time. Authorities will also be required to publish details of these timescales.

Amendment 197E therefore removes the Secretary of State’s powers to specify the minimum periods which authorities can specify for the submission of expressions of interest. Clause 70(2) already enables authorities to specify periods for the submission of expressions of interest and Clause 70(3) to publish details of these periods.

Amendment 197F removes the Secretary of State’s power to specify the minimum and maximum periods which must elapse between the acceptance of an expression of interest and the commencement of the procurement exercise. Instead authorities are required to specify and publish details of these periods, which can be different for different cases.

Finally, Amendments 197G and 197H remove the duty on authorities to make a decision on an expression of interest within a timescale specified by the Secretary of State in regulations. Instead the authority must specify and publish the maximum time this decision will take. In order to prevent delay, relevant authorities will also be required to inform the relevant body of this maximum period in writing, either within 30 days of the end of the period for receiving expressions of interest, or where none exists, within 30 days of receiving an expression of interest. It must then notify the relevant body of its decision within the timescale it has specified. I beg to move.

[Lord Lucas]

I should be very grateful if my noble friend could go into a little more detail about Amendment 197E. He has removed there the ability of the Secretary of State to set minimum timescales. I understand what he says about flexibility. But if a local authority wishes to discourage activity under this part of the Bill, then timescales are where it will squeeze most easily. As my noble friend says, community organisations will take time to get themselves organised, to get their bids in and get them up to the standard required for subsequent scrutiny and competition. It is not clear to me in all the liberalising—from the point of view of the local authority—which is going on in these amendments, how the community, or bits of the community, can effectively appeal against, or have some notice taken, of a local authority which is setting very short timescales, which make things impracticable. There is guidance there. If the local authority does not go along with guidance, there does not seem to be any set of teeth that can be sunk into the local authority.

My experience of this is mostly in terms of parking regulations. There, again, the Government issue guidance. If the local authority goes against that guidance, no one takes any action of any description at all. Here it seems to be rather more important that in order to encourage action under this part of the Bill, there is an effective policing of the actions of local authorities to make sure that they are opening themselves up to what must be in many cases an inconvenient and, in their view unnecessary, application of neighbourhood rights and interests, with a system which they have got running very nicely, thank you very much. I would very much like some comfort that there will be an effective substitute for the backstop provided by the Secretary of State in the Bill as we have it now, which is being removed by these amendments, in cases where a local authority is acting to make this part of the Bill unworkable. I hope my noble friend can give me some comfort on that.

[Lord Shutt of Greetland]

I do not know whether I can give the noble Lord any comfort. The problem is that, on the one hand, people are asking for localism and letting the locals decide and, on the other hand, the noble Lord is saying, “Let the Secretary of State be on their back”. We cannot have it both ways. We certainly hope that people will be reasonable. For example, to have an expression of interest that is open for five minutes would not be reasonable. I should have thought that there would be other ways in localities to put a stop to that. It is as a result of our earlier debates and concerns about the Secretary of State being too prescriptive in these matters that some of these amendments have been brought forward. I should have thought that that would be appreciated by the House. But we are seeing the other view, which I know exists from time to time, that there will be recalcitrant local authorities which will not get on with things as people hope they might. I think we have moved in the right direction and, if it goes wrong and the recalcitrant authorities become a multitude, clearly something would have to be done, but perhaps we ought to trust local people and local authorities.

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[Lord Shutt of Greetland]

My Lords, I thank noble Lords who have contributed. The noble Lord, Lord Greaves, introduced the debate and then strolled off into the area covered by my notes for the next section, so I will trespass into them and see whether that works.

Before I respond in general I will deal with the matters raised by the noble Lord, Lord Lucas, because I am aware that he was not particularly comforted on the last occasion that I responded to him. I hope that he will be now, because if he looks at Clause 74, he will see that it is headed, “Provision of advice and assistance”. I will not say that it is littered with the words “Secretary of State”, but they are there half a dozen times, which suggests that the Secretary of State may well give advice and assistance to those who want to be involved in the challenge. I understand that the department’s view is that the clause would be used to give help and advice to various organisations that may be far better able to tackle the challenge.

[Lord Lucas]

My Lords will my noble friend clarify whether that would be the case when the Secretary of State was being challenged under the amendments made earlier by my noble friend?

[Lord Shutt of Greetland]

That is a little further down the road, is it not? If the clause states that that advice is being given, then that advice is being given. Therefore, if the Secretary of State is directly giving a service that is ultimately challenged, I would have thought that that had to be, quite frankly. However, that is a little further down the road and it will not happen tomorrow. Nevertheless, it is there that advice can be given and I hope that that will be helpful to my noble friend.

I will look at these notes and respond accordingly. Amendment 197CA would remove relevant authority employees as a relevant body, meaning that they would be unable to express an interest in running a relevant service. The coalition programme for government committed to empowering public sector staff to take control of their own services in new enterprises such as mutuals. That was reinforced in the recent publication of the Open Public Services White Paper. The Cabinet Office is leading on implementing this commitment by introducing a new right to provide. The inclusion of employees of the relevant authority as relevant bodies under the right to challenge will implement the right to provide in relation to local authority services.

To accept this amendment would be a great shame. Employees are often best placed to see how services could be improved and their ideas could make a huge difference in delivering more efficient, effective and responsive services. The amendment could prevent those good ideas from seeing the light of day by forcing employees to organise themselves as a charity, voluntary or community body simply in order to express an interest. Employees may not be prepared to be in a position to undertake such a process before an expression of interest has even been accepted, although of course they will have to comply with the requirements for what must be in an expression of interest.

In addition, this could create a parallel process with employees putting their ideas to local authorities outside the procedure set out in the right. This would risk jeopardising the transparency of the process: proposals should be evaluated consistently whether they originate from existing employees, a parish council or a voluntary or community body.

It is worth noting that in the policy statement, the Community Right to Challenge, which was made available in the House Library on 8 September, we make it clear that safeguards will be in place to prevent the kind of abuse of the right that is concerning some noble Lords. For example, the policy statement states our intention to provide that expressions of interest will have to set out the relevant body’s case that they are capable of providing the service and of competing in a procurement exercise. That will work to ensure that only employees serious about running a service express an interest in running it and should discourage any abuse of the right. In addition, employees submitting an expression of interest will need to set out how they propose to engage with staff affected by the expression of interest in the development of their proposal.

Amendment 197CB, tabled by the noble Lord, Lord Beecham, deals with employee support for challenges. I understand that the intention behind the amendment is to apply a condition to Clause 69(5)(e) that employees must first obtain the support of a majority of employees affected by their expression of interest before they can be considered a relevant body. The policy statement I referred to previously also set out our intention to require employees to set out in their expression of interest their proposals for staff engagement. However, we do not want to be prescriptive about how this is to be achieved. It is best decided locally rather than centrally. The experience of the way the right to request has worked in the National Health Service shows that existing, well established communication channels are likely to play an important part in engaging staff. There is no requirement for a ballot to demonstrate staff support for a proposal under the right to request. However, the face-to-face meetings, intranet updates and staff clinics undertaken when some 1,200 staff from the Hull primary care trust used the right to transfer to a social enterprise show that good communication between the staff involved is likely to be at the heart of any successful challenge.

Localism Bill

Debate between Lord Lucas and Lord Shutt of Greetland

Tuesday 5th July 2011 Lords Chamber

[Lord Shutt of Greetland]

My Lords, I believe that is the case. I do not see that that should be disturbed by anything that the Bill is doing. The noble Lord talked about it the other way round, saying that sometimes district councils try to offload and the parish says, “No, we would sooner you kept doing this”. I do not see that there is any reason why that cannot be done under present arrangements. The right to challenge is a different principle. There is a risk that this amendment could catch relevant authorities in an endless and burdensome cycle of considering requests and counter-requests from different parish councils in their area that have different ideas and preferences as to how services should be run.

Finally, the amendment would risk cutting across the community right to challenge as a whole. Requests from parish councils to provide services differently, which might include the service being provided by the parish council or by another organisation, would potentially override expressions of interest from other relevant bodies. I hope that in the circumstances the noble Lord will feel able to withdraw his amendment.

[Lord Lucas]

I thank my noble friend for that reply but not for the content of it. We will come to these matters again. I understand what he is saying, but I think that the Government are falling short of the ambitions that they should have in his saying that. We are taking a step towards making parish councils serious bodies for which serious people in the community stand and expect to do serious things. To put them in a position where the only thing that they can promise their electorate is to take a particular attitude on planning is seriously missing a trick. There are many other things that good people in a community should have an influence over. They should feel that they can go to their electorate and say, “I will do this for you”, and not just, “I will go cap in hand to the district council” but “I will make a request that the district council has to consider”, or some equivalent. We ought to be looking at ways of empowering parish councils and particularly town councils in relation to the districts and the counties that sit above them. I am sorry that the Government feel that they have gone far enough in this legislation. I hope that when we get experience of parish councils and town councils being what they can be under this legislation, we will take a step forward.

It is not so much the problems of the noble Earl, Lord Lytton, that I am thinking about. His sort of parish under this Bill will become rich in opportunities to raise funds as a result of development, which will enable it to do whatever it wants with its verges. It really will not be a problem for them, but the Bill is a serious problem for city parishes, first of all because there are no parishes. If you look at my bit of Battersea, there are no lines drawn other than the ward boundaries, and they change every time the Electoral Commission has hiccups. There is no community on the ground, and Battersea is a relatively homogenous corner of London.

There are bits of London where you have an enormous mix of different communities with strong ties within them and very few ties between them and to the locality. To build a community there which can take advantage of the facilities in this Bill to influence planning requires that the organisations we create can have influence beyond mere planning. Most of the lives of people in the community are dictated by the ways in which the local authority chooses to spend money on them, to police them and to require things of them. If they want to do something as simple as having a real influence over the provision made for their children, particularly in terms of early years, youth clubs, youth provision and help into work, all of which are substantial programmes going through Government and through local authorities, they have no right to do so. No one can promise that under this Bill the neighbourhood will have a real influence on those sorts of things. Unless we offer communities that ability, we will never create the communities to take advantage of this Bill. This will be a Bill that does not happen in the cities because no one ever gets going because no one can create the consensus because there are no powers on offer that are relevant to the local communities.

I think that is a serious problem with the Bill and one that I hope the Government will think about. I hope that the Opposition will think about it, too, because I associate the Opposition with having some interest in cities from time to time. I was particularly disappointed by the noble Lord’s lack of interest in this amendment. I hope I manage to interest him in some of my later ones. It seems sad to me that the Opposition are just interested in the rural vote and have no care left for cities. Perhaps that is being left to the Liberal Democrats, for whose support I am grateful. I beg leave to withdraw the amendment for now.