Lord McKenzie of Luton
Main Page: Lord McKenzie of Luton (Labour - Life peer)
Lord McKenzie of Luton
My Lords, I thank the noble Baroness, Lady Hanham, for explaining this short Bill. Although I believe it is not her first excursion to the Dispatch Box as a Minister, it is my first opportunity to welcome her, which I do—even if I do not welcome what she has said.
As we have heard, the Bill purports to put a stop to existing proposals for restructuring the councils of Norfolk, Suffolk and Devon and revokes the orders creating unitary structures in Exeter and Norwich. It makes consequential provision for the holding of elections that were due to be held on 6 May 2010 and which were deferred as a result of these orders. This avoids the necessity of interim by-elections and the expense related thereto and, as we have heard, the policy is to extend until 2011 the term of office of councillors who would have retired in 2010, but for the Norwich and Exeter orders. To get back into the normal cycle, one councillor or the only councillor elected to a ward in 2011 will serve a three-year rather than a four-year term. The restriction will fall on the councillor with the fewest votes and where there is an equality of votes or an uncontested election, the councillor to serve for three years will be drawn by lot. Given that the two-tier structures will remain in Devon and Norfolk, we can support this proposition. However, it would appear that should the quashing of the March orders precede the passing of the Bill, amendments will be necessary, as we have heard, to make the proposition effective.
The terms on which we consider the Bill have undoubtedly been changed by the decision of Mr Justice Ouseley to quash the orders which provided for unitary status for Exeter and Norwich. For a High Court judge, sitting alone and seemingly possessed of no additional information to that considered by Parliament, to overrule the democratically expressed will, especially of the elected Chamber, is a highly unusual step. I am told it is possibly unique. This was even in circumstances where the High Court was clear that the Secretary of State was entitled to reach the view he did on the merits of the proposal and that it was not irrational. Further, it was accepted that the final approach to decision-making adopted by the Secretary of State was properly within the scope of the 2007 Act.
In these times of economic stringency, with savage cuts to be imposed on local authorities by the coalition Government, the risks of incurring irrecoverable legal costs making it even more difficult to sustain vital services mean that an appeal cannot be contemplated. For now it is accepted that Norwich and Exeter will be denied the early opportunity to attain unitary status—an opportunity which has seen other local authorities of all political persuasions flourish under both Conservative and Labour Governments.
We note the decision of the Examiners that the Bill is not hybrid, but this was neither a spurious concern nor a delaying tactic. It is right that due process has been followed, even though the two councils withdrew their memorials before the hearing. Perhaps the Minister would say something more, particularly following the exchange with my noble friend Lord Richard about the structure of the Bill, and the decision of Mr Justice Ouseley to quash the orders. Does this mean that the orders under consideration are not relevant orders for the purpose of the Bill; that their revocation can therefore have no consequence; and that no councillor remains in office under Article 11 of the orders?
The Bill does not repeal the relevant provisions of the Local Government and Public Involvement in Health Act 2007, but prevents the Secretary of State making any orders which implement proposals for unitary authorities received before the coming into force of the Bill. Therefore, I ask the Minister whether it is envisaged that the Secretary of State will issue any further invitations for proposals for unitary status during the term of this Government, or whether the Bill signifies the denial of such possibilities. Has the Liberal Democrat wing of the coalition Government acquiesced to this?
When the orders to introduce unitary status for Exeter and Norwich were debated in your Lordships’ House in March, it is fair to say that they were hotly contested. The effect of the Motion agreed at that time was to call on the Government, notwithstanding the extensive consultation undertaken previously, including that by the Boundary Committee, to conduct further consultation. This was particularly in light of the fact that we consider there to be compelling reasons to depart from the presumption that the previously established five criteria should be the only basis for proceeding with unitary arrangements. The other place accepted that compelling reasons had been established.
However, if that was the view of noble Lords two and a half months ago, how can we view a situation where, within a couple of days of taking office and without any consultation or new data or information being provided, the Secretary of State decreed that Norwich and Exeter should be denied unitary status—as should Suffolk, which fulfilled the criteria? What democratic legitimacy underpins the Bill? As far as I can tell, the Liberal Democrat general election manifesto was silent on the matter. It proclaimed a commitment to giving more power to local people, saying that “local people” should,
“have the power and funding to deliver what they want for their communities”,
but seemingly not if they wish to do this as a unitary council. True, the Conservative manifesto had a commitment to scrap uncompleted plans to impose—
Lord Teverson
I apologise for intervening but the noble Lord’s remarks are very provocative given that all the way through our discussion, and previously, the opposition Benches have forgotten about the community of Devon. They always think about one community, not all communities. In the south-west, the community of Devon as a whole is very important. The noble Lord mentioned the success of unitary authorities. Frankly, Torbay unitary authority was a huge mistake and is not considered successful. Plymouth unitary authority, the establishment of which everyone supported, has also struggled hugely within historic Devon. That needs to be remembered.
Lord McKenzie of Luton
My Lords, I can cite a number of flourishing unitary authorities, particularly my own, Luton, and those created in Bedfordshire under the previous Government’s legislation but with Conservative-controlled councils. What I am trying to discover is the democratic legitimacy of the Bill before us. The Conservative manifesto contained a commitment to scrap uncompleted plans to impose,
“unwieldy and expensive unitary councils”.
However, no one is supporting unwieldy and expensive unitary councils. I shall come in a moment to the impact assessment, but perhaps the Minister can tell us whether she views the unitary councils which came into existence some 15 months ago—some of them Conservative controlled—as unwieldy and expensive? Why could not the significant service improvements already being delivered by these councils be delivered by Exeter and Norwich?
The coalition document—the post-election manifesto—looks in both directions. It supports the,
“radical devolution of power and greater autonomy to local government”,
but not, it seems, if you are a citizen of Norwich or Exeter.
The Government cannot possibly argue that they have a democratic mandate from the general election for this measure. Halting the creation of a unitary Norwich and Exeter is totally incompatible with the expressed policy of devolving power to local government and local areas. It runs directly contrary to Conservative manifesto rhetoric around leadership and the promotion of,
“single municipal leadership injecting dynamism and ambition into their communities”.
The Government’s argument for this Bill rests on the assertion that the unitary council proposals do not represent value for money, but this is a somewhat selective reading of the components of the impact assessment, which show that if unitary status were to proceed it would involve gross restructuring costs of some £40 million but gross savings of £39.4 million over the transition period—a broad equivalence but with ongoing savings after this of some £6 million per year; and this is before factoring in the benefits which would flow from the spur to economic development which unitary status would bring to Exeter and Norwich. The impact assessment asserts that the scale of efficiency savings forecast from unitary status could be achieved by other means. Perhaps the Minister in replying to the debate could give us more detail about these other means. What detailed work underpins that assessment and has it been verified independently? What consultation is planned around the proposition?
Much has been made in the past—we have heard it again this afternoon—of the direction that the previous accounting officer required of the then Secretary of State. But the core of the accounting officer’s concern was the lost opportunity of the savings from the Boundary Committee proposals—which of course had little support from anyone—essentially involving unitary counties. However, these opportunities are being rejected by this Government also.
Our starting point in considering proposals for unitary authorities was the five criteria of: affordability; whether there is a broad section of support; strategic leadership; neighbourhood empowerment; and value-for-money services. In the case of Exeter, each of the criteria was satisfied with the sole exception of one component of affordability—the payback period for transitional costs was six years rather than five. Taking account of the accepted ongoing savings, the opportunities for enhanced economic development and the development of Total Place, there were and remain powerful reasons to grant unitary status to Exeter. Similar considerations apply to Norwich where the payback period was originally a little longer than five years but with clear ongoing savings—the House will hear more about this from my noble friend Lady Hollis—and with the Total Place approach enabling the delivery of value-for-money services.
We might have understood if, in the circumstances, the new Government had said that they wanted more detail on these additional issues and indeed, as the House determined, and even Mr Justice Ouseley suggested, some more consultation. But what this Bill does in an arrogant, dictatorial and brutal way is to shut out Exeter and Norwich from the opportunity to become unitary councils—an outcome for which there is genuine local appetite, which in Exeter has cross-party support and in Norwich has the support of the Lib Dems, the Greens and Labour Party members. It is the desired outcome, not dictated or imposed by government but proposed by the democratically elected councils of these cities.
The benefits of unitary city councils are widely recognised. They reinforce a city’s distinctive identity and sense of place. They provide the basis for clear leadership to drive dynamism and ambition into their communities. This opportunity would not be new to Norwich or Exeter. The latter governed itself for nearly 800 years and provided all services for the city until county borough status was removed in 1974. Norwich ruled itself for almost 600 years. In neither case did that undermine the surrounding counties.
A two-tier structure of local government has not served either city well. Both are potential engines of economic growth within their own boundaries and more widely within their counties and sub-regions. The strategic leadership coming with unitary status can provide a powerful thrust to the regeneration and development of the economy in a local area, facilitating councils which are focused, innovative and entrepreneurial, and helping to deliver jobs, economic growth and prosperity at a time when the country most needs them.
Anyone who has served as a councillor in a two-tier system—as I did in Luton, mostly under a Tory-controlled council—will recognise the confusion over who is responsible for which services, which councillor covers which council, and indeed which local election is under-way. More importantly, there are the challenges of keeping a focus on an urban area and its needs within a larger rural county—especially an urban area with pockets of deprivation and diversity. In those days, Luton used to be referred to, not with any particular affection, as the urban bottom of the county. Its needs were neither fully understood nor provided for. What sticks in the memory is the meals-on-wheels service organised from County Hall without any recognition of the cultural needs of our diverse population. I have seen how liberating unitary status can be for a local authority—in particular, the tremendous boost that it can give to regeneration efforts and the concentrated way in which it can meet adversity, in our case the closure of the car plant. This did not harm our relationships with the rest of the county. It strengthened them. Anyway, they have now followed suit and are unitary councils.
Why should Norwich and Exeter be denied the opportunities we have in Luton, opportunities provided by a Conservative Government? The cities have addressed their value-for-money and service-delivery issues. They want to deliver a clear and focused place-shaping for their cities. They want to tackle deprivation and raise educational attainment, skills and aspirations. They want to deliver economic prosperity for all.
Lord Lloyd of Berwick
I am grateful to the noble Lord for giving way. He has dealt at great length and very helpfully with the underlying merits of the argument on both sides. Has he taken sufficient account of the fact that the orders in question have been, or will be, quashed by Mr Justice Ouseley—a decision which he is perfectly entitled to take?
Lord McKenzie of Luton
Yes, indeed, my Lords. I thought I had recognised at the start of my presentation that that had changed the basis on which we are debating the Bill. I am simply reiterating why unitary status for Exeter and Norwich should be supported.
This Bill will deny those two cities that chance. It will do this without clear manifesto cover, with unsubstantiated assertions of alternative savings, and there is no desire that unitary status should be at the expense of the rest of Norfolk and Devon. Unitary status does not change the position of the remaining district councils. It opens up opportunities to co-operate in the shaping of upper-tier services and enables the county councils to provide a greater focus on addressing rural issues. There remains much to scrutinise in this short Bill and we intend to do this thoroughly.
However indirect the mandate that this coalition Government have secured, they are entitled to a fair wind for the thrust of their programme. However, this is an unworthy measure—a grubby little Bill with a cobbled-together parliamentary majority to crush the legitimate aspirations of two proud cities. We will continue to support Exeter and Norwich in holding fast to their ambitions for unitary status and help them to achieve this at the earliest opportunity.
Lord Tope
My Lords, I begin, as I always do, and as I did when we debated the orders on 22 March, by declaring my personal interest as a councillor in a unitary authority, which is a role that I have had for more than 35 years. On 22 March I said—and I am very happy to repeat it—that I am a very strong believer in the benefits of unitary government. I need no convincing of that. That is the position from which I started when I moved the fatal Motion on 22 March and it is the position that I continue to hold. The noble Lord, Lord McKenzie, asked whether the Liberal Democrats support this Bill wholeheartedly. My answer, as our spokesperson, is an unequivocal yes.
Most of the debate today has been a rehearsal of the debate that we had on 22 March. The argument has been almost entirely confined to Norwich and Exeter and the perceived benefits there; very little has been said about the effects on the wider communities in Norfolk and Devon. That was part of the argument that we had three months ago, which is still relevant. Noble Lords will be relieved to know that I am not going to repeat all the arguments that I set out on why we felt it necessary to move the fatal Motion and why we so strongly opposed those orders. In summary, I understand very well why some but not all of the councillors in Norwich and Exeter wanted unitary status. I know that they believed that what was on offer was not as good as they hoped, but it was all that was on offer, and they took a view that it was better than nothing. I understand that, but we have to take a wider perspective and consider the effects on the wider communities, which is exactly what we did.
I shall summarise why we were opposed to these things. First, with my much more limited knowledge of Norwich and Exeter—but still some knowledge, as I was born and partly grew up in Devon—that they were the wrong boundaries and the wrong proposals. I do not believe that it is in anybody’s interests to have something that is supposedly better than nothing. If you make that sort of mistake—and I believe very strongly that those proposals were a mistake—then you live with its consequences for years and years.
That takes me to the next reason why I felt that they were wrong; the timing was completely wrong. I do not just mean the appalling way in which it was brought in within days of a general election. I mean the slightly longer timing, to which I think I referred on 22 March, of what was clearly then the financial climate into which we were heading. I think I said, and certainly believed, that the recession in the public sector had not then started. It has started now. That is no surprise to anyone; we all knew that, in local government and elsewhere, we were going to be facing a very hard financial climate for the next three or four years, at least. That was emphatically not the time to be going into what would inevitably be, at least in the short term, the very expensive, emotionally draining, challenging and uncertain times of a comprehensive structural reorganisation. The timing really could not have been worse.
I understand why the timing of the proposal came so late, with all the long process that had been going on. Nevertheless, we got to where we got to and within days of the Dissolution of Parliament and the calling of a general election the Government came forward with these proposals, to which others have referred in detail. Of all the many warnings given to the Government about why they were wrong—from this House, the Civil Service and all sorts of quarters—let us remind ourselves that one was a statement from the Permanent Secretary to the Minister, in seeking that written direction, that the Minister had already had strong and clear advice of the very strong probability that the legal challenge, which was known to be coming, would be successful—and so it has proved to be. None of this should come as any surprise.
Lord McKenzie of Luton
I apologise for interrupting the noble Lord, but he referred to the question that I posed in my presentation of whether the Lib Dems were supporting this. In fact, the question that I posed to the Minister was whether, because the 2007 Act is not amended by this provision, it leaves open the possibility of future invitations for unitary authorities. My question was whether those invitations are likely to be forthcoming within the course of this Parliament, and if the answer to that was no, whether that was something which had Lib Dem support. Given the noble Lord’s comments about these being the wrong boundaries and the timing being wrong, I should be interested in his view on that.
Lord Tope
It is probably inappropriate for me to comment on the Minister’s answer before she has given it. I may well have another opportunity to do that. Perhaps I may answer the noble Lord indirectly. As a believer in unitary government, I really believe and would expect the Minister herself, having been a London borough councillor and council leader for many years, to believe that this is absolutely not the time for local authorities of whatever structure to be distracted into what is almost always the very expensive, energy-sapping distraction of worrying about what I call their democratic structure—where their ward and council boundaries are, and all that sort of thing.
The concentration for local authorities now needs to be on what services they should be delivering, how and with whom they should be delivering them and their relationship with other local authorities, whether in a two-tier structure or with neighbouring authorities in a single-tier structure. Their concentration should and must be on many more shared services and much more co-operative working. If I may give a sort of answer to the noble Lord, Lord McKenzie, before I have heard the Minister’s answer, my advice to all my colleagues in local government will be: that is where to concentrate, not on having rather difficult and fruitless arguments on possible restructurings which may or may not happen, and probably will not. That is the wrong priority.
The other point made by the noble Lord, Lord McKenzie, which I really did not follow, was about democratic legitimacy. I understand entirely why, having moved those orders in the first place, he may at least be sad about the Bill. He may well disagree, as he obviously does, with the view of the two government parties. However, I simply could not follow the democratic legitimacy argument. The Conservative Party made very clear before the election that it would not proceed with unitary proposals and, in particular, would revoke these orders as soon as possible if it was successful in the general election. That was repeated in the debate in this House. It could not have been a clearer commitment.
I led, somewhat controversially, a fatal Motion. Not everyone felt able to support it. I understand that. However, we could not have made our position much clearer before the general election. I should have thought we would be much more open to criticism, as a coalition Government of two parties so committed, had we not acted quickly to implement what we were saying—had we allowed that uncertainty to go on, and the implementation committees and so on to meet and continue as though nothing had happened. If that criticism was being made it would be wholly legitimate, but to suggest that we do not have a democratic mandate for doing this is somewhat bizarre. In saying that, I remind the noble Lord, Lord MacGregor, that, yes, Norwich elected a Conservative MP but it also elected a Liberal Democrat MP.
Baroness Hanham
The noble and learned Lord has raised a point that I knew I ought to have cleared up before. There is one aspect of Clause 1 that would still proceed. Clause 2 would become otiose and we would have to see how much was left to proceed with. I have been advised that, whatever happens, the Bill will have to proceed to the end now that it has started.
Lord McKenzie of Luton
I know that we are getting into detail that is probably Committee stuff, but if Clause 2 effectively falls, does that not create a problem with what the Bill provides for the changes in electoral arrangements? As it lays them out, they are predicated on somebody immediately before the commencement of the Bill remaining in office under an article of something that would have been quashed.
Baroness Hanham
My Lords, that was the bit I had forgotten. Clause 2 moves the elections from 2010 to 2011. If it is quashed, we go back to 2010 being the defining moment for the elections. In that case, by-elections would have to take place within the next six weeks, and it may be decided that it would be more helpful to move them on.
I have been asked a number of questions. I have probably answered those asked by the noble Lord, Lord McKenzie, but I shall make one point. I am not surprised that the noble Baroness, Lady Hollis, made a very passionate speech, as it is clear that this is something that she feels very strongly about. However, I am just a little bit perturbed by the fact that she said that once the judgment appeared to be taken against the councils, that was the reason why they did not pursue or give evidence to the Examiners on hybridity. This action to challenge hybridity caused a lot of difficulties and trouble and brought into question the decision of the Public Bill Office of this House. It was a well argued trap the last time—