Lord Shipley
Main Page: Lord Shipley (Liberal Democrat - Life peer)Cities and Local Government Devolution Bill [HL]
Lord Shipley Excerpts
Lord McKenzie of Luton (Lab)
My Lords, I shall also speak to our other amendments in this group. A strong and adequately resourced scrutiny process is an essential ingredient in the process of devolving substantial powers to combined authorities—and, it might be thought, especially to mayoral combined authorities. The sheer quantity of amendments in this group reflects the importance that all noble Lords, including the Government, have given this issue.
Our Amendments 35 and 37 ensure that the scrutiny committees can inquire into and challenge not only actual decisions—for example, by call-in procedures—but matters under consideration prospectively, rather than just retrospectively.
Amendment 43 requires that guidance by the Secretary of State on the functions of overview and scrutiny committees should be affirmed by the affirmative procedure, in the light of the crucial role that such committees should play.
The Bill lacks an adequate procedure comparable to that of the audit committees found in local government. Amendment 36 seeks to remedy this deficiency, but we felt on reflection that it does not quite meet the case, since it delegates to the overview and scrutiny committee the task of appointing another committee, independently chaired, to carry out that audit function. Our Amendment 34A seeks to remedy the position by explicitly requiring the appointment of a separate audit committee, again independently chaired, with the responsibility for reviewing and scrutinising the authority’s financial management and affairs in the same terms as Amendment 36. Given the potentially large expenditure of the combined authorities if the promise of devolution is to be realised, this is an important role and one that is distinct from the general overview and scrutiny process.
Although they have yet to be moved, we support the Lib Dem amendments concerning political balance and the chairing of the scrutiny committee, but have some concerns about possible delays of call-in powers, which could necessitate another round of consultation.
We will listen with interest to the government amendments, particularly to Amendment 41, which requires the approach to reconsideration powers to need the consent of the combined authority. This would appear unduly restrictive. We are not quite sure why it is proposed to have an alternative to an independent chair of scrutiny, but in any event can live with what is proposed. I understand that we are not able to hear from the noble Lord, Lord Kerslake, today on his very substantial amendment about governance, which we felt was very important. As proposed, however, some of the voting thresholds may be problematic, especially the requirement for unanimity at the first meeting of the overview and scrutiny committee.
Overall, however, these amendments highlight the importance that we should place on getting oversight right in circumstances where considerable power is rightly being placed with a combined authority and possibly a mayor. This should also address in part—although, doubtless, not comprehensively enough—those who have expressed fears about a single-party state. I beg to move.
Lord Shipley (LD)
My Lords, we have a number of amendments in this group. During the debates on this Bill, we have tried from these Benches to emphasise the importance of legitimacy and accountability in this new tier of government. By legitimacy, I mean, first, a direct connection with the ballot box in the new structure and, secondly, the prevention of one-party states in which the same political party has control of the post of elected mayor, the nominated combined authority and the nominated overview and scrutiny committee. In Committee, we proposed direct election to the combined authorities, so that the mayor was not the only elected post, but this did not find favour. Now we have a group of amendments that concerns overview and scrutiny committees, which are very important—more important than they might have been, had some of the amendments that we debated in Committee been agreed.
I am pleased that, following our debate in Committee, further, more detailed proposals have come forward from the Government. Some are welcome but some do not go far enough. Let me explain what I hope the Government will do. Our amendments would require the chair of an overview and scrutiny committee to be from a different political party from the mayor; that assumes that the mayor is a member of a political party. If that is not the case, the chair could be from any political party. An independent chair could work—we said that previously—but it would be better to have an opposition councillor who has been duly elected to their post as a councillor from within the combined authority area, not least because if one appoints an independent person it immediately raises the question of who appoints that independent person. To put it another way: how is independence guaranteed? The make-up of the overview and scrutiny committee also needs to reflect the number of seats held by each party in those local authorities making up the combined authority. Later, we have proposals on the electoral system that should be used so that the first past the post system does not encourage the development of a one-party state.
Our other amendments would also allow the committee to call in decisions made by the mayor and delay them—not for long—to allow further consideration when it is felt to be necessary. To do its job properly, an overview and scrutiny committee needs the power to call for information and to receive it. It will not be enough if the overview and scrutiny committees exist but are then prevented doing their job by a combined authority that prefers to keep things out of public scrutiny.
Amendments 35 and 37, which we support, would enable the overview and scrutiny committee to examine decisions before they are taken, rather than wait for a decision to be made; that is welcome. Amendment 34A, which I signed up to, would create an audit committee with an independent chair. I welcome that proposal as well. It is essential in this case that the chair is independent and appropriately qualified to do the job. In practice, it should cover the functions of a public accounts committee, an efficiency committee and a risk committee. This matters because the savings that could be achieved by public service reform and reducing duplication at a local level have been well established, but we now need to ensure that it all happens. The audit committee would be of significant help in delivering that objective.
The noble Lord, Lord McKenzie, made mention of Amendment 41, and I will do likewise, with two questions for the Minister on that amendment. First, proposed new sub-paragraph (4A) states:
“An overview and scrutiny committee must publish details of how it proposes to exercise its powers in relation to the review and scrutiny of decisions made but not yet implemented”.
If the implementation period is very short, what power would an overview and scrutiny committee have under this measure to hold up a decision for further consideration? Secondly, and this is the point that the noble Lord, Lord McKenzie, raised when talking about proposed new sub-paragraph (4B), what is the objective in requiring an overview and scrutiny committee to,
“obtain the consent of the combined authority to the proposals and arrangements”?
I can see that there could be a situation in which the overview and scrutiny committee misses something, which would need to be put right by the combined authority. However, I certainly hope that this measure would not be used by members of a combined authority who do not wish to see the overview and scrutiny function work effectively. I look forward to hearing the Minister’s comments on that.
Finally, all our proposed amendments have a common purpose in wanting to ensure proper accountability for the devolution that is about to occur. I hope the Minister will agree that they should be included in the Bill.
The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Williams of Trafford)
My Lords, all these amendments are about overview and scrutiny and the accountability of combined authorities. Making overview and scrutiny as strong and effective as possible is a priority for us. I was pleased in Committee by how clear it was that this is a shared priority across this House. The government amendments reflect the discussions I had with noble Lords from across the House, and I am grateful to them all for the expertise and experience that they brought to the discussions. Effective scrutiny not only ensures better decision-taking by those exercising new devolved powers but can be the safeguard against one-party states developing, and so prevent the loss of public confidence in the process of devolution.
Before discussing the various substantive issues on overview and scrutiny that have been raised, I turn first to government Amendment 81, which provides that any orders made under the powers in the new Schedule 5A to the 2009 Act will be subject to the affirmative parliamentary procedure, rather than negative. The Delegated Powers and Regulatory Reform Committee recommended this, and we accept the recommendation.
Before turning to the detail of scrutiny arrangements, I shall address Amendment 34A, which would require the combined authority to appoint an audit committee and for that audit committee to have an independent chair. In the case of local authorities, and indeed in the case of such existing combined authorities as the Greater Manchester Combined Authority, the audit committee is appointed by the authority. Audit committees usually comprise senior non-executive members of the authority and, where this is the local choice, may also include one or more independent members. We recognise the importance of audit committees. The role of that committee in any authority includes supporting the authority’s chief financial officer, the Section 151 officer. It is an integral part of the financial controls and internal checks of the organisation.
Without this amendment, the approach would be to allow combined authorities to appoint, as they see fit, audit committees drawn from the membership of the authority and, where they consider appropriate, include independent members. I am sure that none of us wants unnecessary prescription. However, I can see the case for a combined authority, given its particular structure, which may or may not include a mayor, to be required to have an audit committee appointed by the authority. I can also see the case that it might be appropriate for such a committee to have one or more independent members. I am not persuaded that it would be right to prescribe in every circumstance that the chair of the committee should be an independent member. Accordingly, I am prepared to consider the issue further for Third Reading, have discussions with noble Lords and, if appropriate, return with an amendment on this at Third Reading.
I will return at the end to questions asked by noble Lords. Turning now to the substantive issues, I first address the question of call-in. Government Amendments 38, 41 and 49 and Amendments 39 and 40 relate to this. The government amendments aim to strengthen the power of call-in for overview and scrutiny committees of combined authorities. With these amendments, combined authorities and their overview and scrutiny committees will be able to set up and operate effective and proportionate call-in arrangements. These come into play when there is a real need, but equally they cannot become a mechanism for delaying or for impeding the efficient conduct of business. Crucially, the call-in arrangements in any authority will be a local matter for the authority and its scrutiny committees to decide and agree.
Baroness Williams of Trafford
I thank the noble Lord, Lord Scriven, for his comments; I certainly will go away and think about them. In making these amendments, we hoped that they would deliver the intention that both he and the noble Lord, Lord Shipley, sought to achieve. No matter how the legislation is done, we could all point to examples where it is not quite perfect, no matter how good the intention and no matter how tight the legislation is—though I take the noble Lord’s point.
I turn, finally, to opposition Amendment 43, which seeks to give greater statutory force to the guidance about overview and scrutiny that may be issued under paragraph 2(9) of new Schedule 5A. As the Bill stands, that guidance is already statutory guidance in the sense that due regard must be given to it. I do not think that further statutory requirements about guidance would be right. As the House will appreciate, if the Secretary of State draws up any such guidance, he would of course want to seek the views of those who are expert in the field of overview and scrutiny.
I turn to some specific points and, first, to the point made by the noble Lords, Lord McKenzie of Luton and Lord Shipley, on why a combined authority should agree to the overview and scrutiny arrangements. It is important that scrutiny arrangements are agreed by the combined authority—though it need not be unanimous agreement—so that the authority embeds scrutiny into its arrangements and the culture of the organisation. It is certainly not a clause to be used to weaken arrangements; rather, it is to ensure a culture of scrutiny throughout the authority.
Lord Shipley
My Lords, can the Minister elucidate what happens if there is a stand-off because neither side agrees?
Lord Shipley
“Governance arrangements of local authorities in England: election of councillors
(1) Section 36 of the Representation of the People Act 1983 (local elections in England and Wales) is amended as follows.
(2) After subsection (1) insert—
“(1A) Rules made by the Secretary of State under subsection (1) must ensure that each vote in the poll at an election shall be a single transferable vote.
(1B) A single transferable vote is a vote—
(a) capable of being given so as to indicate the voter’s order of preference for the candidates for election as members for the constituency; and(b) capable of being transferred to the next choice when the vote is not needed to give a prior choice the necessary quota of votes or when a prior choice is eliminated from the list of candidates because of a deficiency in the number of votes given for him.””
Lord Shipley
My Lords, earlier today I spoke about the need to ensure accountability in this new layer of local government. I said that one way to increase public confidence in this structure would be to reduce the likelihood of a one-party state being created in a local area. The best way to prevent it is to introduce proportional voting through the single transferable vote for local elections, which Scotland, of course, already has.
Whenever power has been devolved in the UK in recent years, it has been accompanied by a change to a more proportional voting system. I believe, and have said several times during our debates on this Bill, that further devolution of powers will be put at risk if they are not matched by improved legitimacy, accountability and strong scrutiny and governance arrangements.
In Scotland, STV was used for all council elections in 2007 and 2012. There are no longer uncontested seats there and no council is controlled by single parties with huge majorities that do not reflect that party’s share of the vote. In England and Wales, however, there are more than 100 councils where one party commands more than two-thirds of the seats. In Scotland, there is none. Compare that situation with what the Government now propose for this new tier of local government. First past the post elections are what generates the one-party state. With a more proportional voting system, legitimacy, accountability and public confidence in the new structure would be enhanced. Given that multi-party politics is now firmly established in the UK, voters’ wishes at the ballot box need to be translated proportionately into seats at the local government level. I beg to move.
Lord Kennedy of Southwark
My Lords, Amendment 75 is not one which we on these Benches can support. I declare an interest as an elected local councillor in the London Borough of Lewisham.
Although this amendment is concerned with elections to local councils in England, I mentioned in Committee that we had a referendum in 2011 on changing the voting system for elections to the House of Commons. That was wholly rejected and I have seen nothing following on from that result, or anything that has happened subsequently, which leads me to believe that the country wants to change the voting system for any elections. I also mentioned that we have got ourselves into a bit of a mess in recent years. We have managed to heap on voters a whole plethora of voting systems and that is not a good thing to do. I accept that, where a proportional system has been chosen, it should remain. However, I would like to see us use fewer systems.
I also referred to the fact that I thought that one of the worst systems was the supplementary vote system. I have observed many counts where people have only put a cross in the second column, which means that their vote is discounted. Therefore, I would like to see a reduction in the number of systems being used, and we certainly cannot support the amendment tonight.
Baroness Williams of Trafford
My Lords, this amendment is about the voting system for local government elections in England and Wales. Like Amendment 73, it would introduce a fundamental change to these. As I explained in the case of the earlier amendment, we are clear that issues such as this need to be considered in a far wider context than this Bill. Even in terms of timescale, when STV was introduced in Scotland, the review of the 32 local authorities took two years, and clearly in England that would take much longer. Notwithstanding any of the arguments for or against the amendment, as I said in the previous amendment, this is not the Bill to be talking about changes to the franchise. As the noble Lord, Lord Kennedy, pointed out, the people of this country said no to the alternative vote in 2011—I was one of the people who campaigned against it. Again, it is not the place of an unelected House to propose changes like this. Therefore, I ask the noble Lord to withdraw his amendment.
Lord Shipley
My Lords, if it is not the role of your Lordships’ House to scrutinise legislation, it is hard to see on what basis this Bill has started in this House. If your Lordships are not permitted to move amendments or to discuss matters of direct concern about one-party states being created in combined authority areas across a number of parts of England, then I think it is the responsibility of your Lordships’ House to be able to do so.
The noble Lord, Lord Kennedy of Southwark, raised a number of objections. We mentioned Scotland, and the truth is that if it still had a first past the post electoral system in local elections, the Labour Party would have been wiped out in Scotland at that level as well. I do not argue that that is in the interests of our democracy; nor do I argue that it is in the interests of our democracy that there are no Conservative councillors in a number of our northern cities. This is not good for democracy. The only way that you can solve the problem is for someone to take an initiative.
I am reconciled to the fact that the two big parties in this country do not want change, because it suits them not to have change—at least, it does in England and Wales. Actually, however, we have a higher responsibility. We operate now in a world of multi-party politics. It is wrong that votes are not equal and that one-party states can be created through the first past the post electoral system. That is what the Government are perpetuating, and it is entirely appropriate for your Lordships’ House to take a view on that. I wish to test the opinion of the House.