Local Government Finance Bill

Lord Tope Excerpts

Thursday 5th July 2012 Grand Committee

Moved by

[Lord Tope]

35: Schedule 1, page 24, line 33, at end insert—
“( ) A review of the basis on which the Secretary of State calculates payments to authorities must be undertaken in conjunction with any revaluation of rateable values on non-domestic property after 2015.”

[Lord Tope]

My Lords, in moving this amendment I will also speak to Amendment 36. Both are in the name of the noble Lord, Lord Jenkin. However, as noble Lords will know, he has literally just finished a three-and-a-half-hour debate in the Chamber and I have agreed to speak to these amendments since my noble friend Lord Shipley and I added our names to them. The noble Lord, Lord Jenkin, has promised to return when I have finished.

Amendment 35 refers to the review of the basis on which the Secretary of State calculates payments to authorities. That is probably best known to all of us here as the reset. The reset will review the needs and resources formula on which the local share calculations, such as the tariff and top-up, are based. The Government’s intention, as set out in the statement of intent on the central and local shares published on 17 May, is that the first reset should take place in 2020, which will also coincide with a revaluation; subsequently, as we know, the resets would be at 10-year intervals.

Amendment 35 prescribes that resets should happen at the same time as the five-yearly revaluation of non-domestic rates. The next revaluation is due in 2015 and the following reset would therefore be in 2020, as currently intended. Amendment 36 requires a review of the baseline funding level and changes in needs and resources to be carried out when local authorities are compiling their non-domestic rating lists. This is the same as a revaluation. Section 41 of the 1988 Act provides that this must happen once every five years. Therefore, the effect of both these amendments is the same. I beg to move.

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[Baroness Hanham]

My Lords, the needs assessment will be the same as the assessments for the baseline that were made initially. As I understand it, you would have to revaluate against that baseline. Any adjustments needed to that as a result of the revaluation would be made on the financial basis that there is no change to the amount a local authority is receiving unless there has been some change in the baseline or in the ingredients of the baseline. I think that is correct as to how the assessment will be made and, again, I will write if it is not.

[Lord Tope]

I am very grateful to the Minister for that explanation and to all noble Lords who took part in this debate, which raised some interesting and useful points. We will read it carefully in Hansard and I am quite certain the noble Lord, Lord Jenkin, will read it with even more care and interest. I do not speak for what he may intend to do when he has done so, but in the mean time I beg leave to withdraw the amendment.

Amendment 35 withdrawn.

Local Government Finance Bill

Lord Tope Excerpts

Tuesday 3rd July 2012 Grand Committee

[Lord Jenkin of Roding]

My Lords, before my noble friend replies to the debate, I should like to add a word. The noble Lord, Lord McKenzie, quoted a passage from London Councils’ briefing, which we have all received. I and my noble friends have tabled a number of amendments—to which we will come later and to some of which the noble Lord has added his name—which recommend a marked change in the structure of this division of the business rate. London Councils—I should declare an interest as one of its presidents—has indicated to me that on balance, with regard to this part of the Bill dealing with the business rate retention scheme, it would be a little upset if the date were postponed.

A lot of work is being done on this by London Councils and there has been a good deal of discussion about the pooling arrangements that may be appropriate. Although it is not put as a very firm and immutable point of policy, its view is that 2013 for this part of the Bill is right, and I think it would regret it if the date were changed. I draw a very clear distinction between this and the later part of the Bill dealing with the council tax, where there is still an enormous amount of anxiety that councils will simply not be ready with their own local schemes. However, we shall come to that later. I think that I should let the Committee and my noble friend on the Front Bench know that on balance London Councils would regret a postponement of Part 1.

[Lord Tope]

My Lords, I suppose that I, too, should begin by declaring an interest. I am simply a councillor in the London Borough of Sutton. I am not a vice-president of anything, or at least not yet—I see that the noble Lord, Lord Beecham, is disappointed with that declaration.

I listened to the noble Lords opposite making the case, with which I am sure many in local government would have some sympathy. I think that all of us, on both sides, would wish to be a little further ahead than has proved possible. However, I suspect that as we will say time and again with this Bill, we are where we are now and we have to consider the question of postponement. My noble friend Lord Jenkin is right to draw a distinction between postponement of the business rate retention proposals and a possible postponement in implementing the localisation of council tax support, to which we will come later. There will be many in local government who have sympathy with what has been said on the other side of the Committee and perhaps more so when we get to council tax support.

As a councillor, I have thought quite hard about this in respect of my own authority and more generally. I do not support postponement. I would rather we were not where we are. Until relatively recently, it was expected that this Bill would be enacted by the end of this month but clearly that will not happen until much later. I hope that, in reply, the Minister will be able to give us a clear and firm commitment that by Report stage, in October, all that is required to be published will have been published, albeit in draft form. I take the point that until the Bill is enacted, it cannot be in an absolutely final form. However, if local authorities know all that they need to know by October at the latest, and I hope a little before that, and if the Minister is able to give a reassurance, I believe that most local authorities will share my view on business rate retention that we are so far down the road and there is so much expectation that this will happen—there has been so much wish that it should happen and we shall come to that later—that postponement now would not be welcome, particularly to me. I hope, with some confidence, that the Minister will resist these amendments.

[Lord Beecham]

My Lords, my noble friend Lord McKenzie alluded to some of the difficulties that surround next year’s council budgets, to which these amendments refer. In particular, he mentioned reserves and the uncertainty about the timetable, as well as general uncertainties that are leading councillors to take a more conservative view about the level of reserves that should be held. I declare an interest as a member of Newcastle City Council and as a vice-president of the Local Government Association, a position that I hope to share with the noble Lord, Lord Tope, as soon as possible. The president is here, so perhaps he can take that message back to the association.

In my council, we have been accustomed to running on a very modest level of reserves. The treasurer is concerned about the degree of uncertainties not only because of legislation and the general financial situation but also because of the growing number of outstanding valuation appeals in the commercial sector. Of course, that goes very much to the heart of what the business rate will deliver. It seems that these appeals are growing in number. The noble Earl, Lord Lytton, mentioned to me recently that they are taking about two years to be settled. I am not suggesting that the programme be held for two years, but it is an indication of the growing levels of uncertainty about what might ultimately be the yield, let alone about how the Government would handle the business rate when it is collected. In addition to that, a new category effectively of precepting authorities will arise in November when a handful of electors up and down the country will choose their police commissioners, who will have responsibility for 11% of the council tax. Clearly, that will relate to the business rate income. That is another element of uncertainty. In my submission, all this suggests that it would be sensible to ensure that the legislation is firmly in place, is absolutely clear and takes into account these other factors.

I suspect that we shall be debating at some length, as the noble Lord, Lord Jenkin, has pointed out, the position arising in relation to council tax benefits or council tax support, as it will be known, and the new systems that will apply. I would have thought that it would make more sense to take those together against the background to which I have referred, a background that the Secretary of State apparently referred to at the LGA conference last week, when he made what he described as a jocular reference to tackling councils’ reserves. By the word “tackling”, I take it that he means requiring that they should be used. Against the kind of uncertainties that we are talking about, such an approach would surely be highly risky and damaging.

I do not know whether the Minister is aware of quite what the Secretary of State said; if she is not, I would not ask her to respond at this point. However, I would be grateful if the situation could be clarified, perhaps by a letter to Members of the Committee—and perhaps wider than that, because it will also send a shiver up many a treasurer’s spine, on top of all the other uncertainties that we have. We will certainly be pressing hard for a deferment of the council tax benefit side, as it seems sensible for the system to change at the same time and not in parts, particularly given the other uncertainties that I have mentioned in relation to the amendments before us.

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[Lord Palmer of Childs Hill]

While the Minister is on that subject, perhaps I may ask a question, although, first, I should have declared my interest as a councillor in the London Borough of Barnet. I apologise.

[Lord Tope]

Another vice-president?

[Lord Palmer of Childs Hill]

No, I am not a vice-president of anything. In addition to the comments that I and the noble Lord, Lord Beecham, made about reserves—specific and non-specific—one also needs to take into account the restrictions imposed on local authorities by external auditors. External auditors used to come under the Audit Commission but now they are a stand-alone operation. They require a certain level of reserves on the balance sheet, and it would be difficult if central government were to impose requirements on those reserves. External auditors say that you have to have £5 million, £10 million or £15 million in reserves to make everyone feel comfortable, but I have always said when making speeches that I think they make people feel too comfortable. However, that is what the auditors say and they will qualify your accounts if you do not do that.

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[Lord Best]

My Lords, I would like to speak to Amendment 16, which comes before the amendments in the name of the noble Lord, Lord Jenkin. I declare my interest as president of the Local Government Association. I express thanks to my various vice-presidents, particularly to the noble Lord, Lord Jenkin, for an exposition in very eloquent terms on the point covered by my rather cruder Amendment 16.

The LGA, representing district, metropolitan and county councils of all political hues, as the noble Lord has said, has expressed disquiet that there is to be a division of the business rates that retain so much central control, despite the positive rhetoric of localism. The LGA recognises that central government wants to keep a firm hand on local government finances during the period of deficit reduction covered by the current spending review, not least to impress the international financial markets that deficit reduction is being taken very seriously. The measures in the Bill are likely to last well beyond that deficit reduction timescale and local government at large is keen to ensure that the retention by central government of 50% of all business rates revenues, and indeed 50% of any business rate growth, shall not be maintained after its purpose has been fulfilled.

This amendment calls for central government to discontinue its retention of a share in local government business rates revenue after 2014-15; that is, after the last financial year in the current spending review period. I recognise that the Government may well be keen to extend the period a little longer because their deficit reduction objectives are likely to go on beyond 2015. However, the LGA, London Councils and others representing local government all agree that that top-slicing of business rates revenues by central government needs some clear end date. The 50% top-slicing greatly restrains the ability of local government to benefit fully from its support for any business rate growth and undermines the localism agenda of devolving powers away from the Secretary of State to local government.

In responding, perhaps the Minister could address one aspect of this concept of a central share of all business rates. I know that the Government have stated their intention to return the revenues that they receive through this arrangement to local government. That certainly sounds as though the Government’s intentions are not to redirect resources away from local spending, but it is unclear how the funding received by the Government will be returned to local authorities and what conditions are likely to be attached to it. Clarification on just how that somewhat circular movement of finance will operate would be much appreciated. The underlying point of the amendment is to draw out the Government’s view on just how long this central government control over half the business rates should last. I entirely support the comments on that from the noble Lord, Lord Jenkin.

[Lord Tope]

My Lords, my noble friends and I have added our names to Amendments 12, 16, 17, 21 and 22, which have been very ably spoken to by the noble Lords, Lord Jenkin and Lord Best. I shall not repeat all that they said; suffice it to say that I agree with everything that they said. The noble Lord, Lord Jenkin, made some mention of the disappointment in local government when the 50:50 split was announced. That was profound perhaps because local government was expecting more, given the rhetoric from the Government when the so-called repatriation of the business rate was first announced, something for which all parties in local government have strived ever since my noble friend Lord Jenkin nationalised it some years ago. So there was an expectation. He has repented many times since then—and blessed is the sinner.

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[Lord Greaves]

There are one or two brief things that I would like to say. I apologise to noble Lords for not being present at Second Reading, when I was enjoying myself in France. I declare an interest in that I am a member of a district council in Pendle, in Lancashire, and a member of its executive. I am also vice-president of the Local Government Association. Why my noble friend is not is a mystery.

[Lord Tope]

I was sacked a few years ago.

[Lord Greaves]

The noble Lord was sacked. I think further investigations are required, and we will report back.

I was moved to speak by listening to my noble friend Lady Eaton. I support a great deal of what she said, which was in emphasis a little different from some of the contributions made by other noble Lords. In principle, these amendments are right: 50% is a remarkably low figure to be retained by local government, and certainly not what was expected when the scheme was first announced to the world. However, I want to bring noble Lords down to earth with regard to some local authorities. Retention locally of the business rate will not be a financial bonanza for those local authorities at 50% or at any other higher percentage. Many authorities, as my noble friend said, will continue to need to rely on the rate support grant, if it continues to be called that, because they will have great difficulty not only in finding ways in which to expand their tax base by increasing their business rate but also maintaining them at the present level. This is a fact of life, and the localisation of business rates in these areas, including my own region of east and Pennine Lancashire, does not have the rosy glow around it as it does in areas that will find it easier to grow a commercial base. That is not to say that people will not try to do it, but in areas such as my own it will be a matter of trying to hang on to what is there at the moment.

I give an example. A small district might have two or three large mills or factories contributing quite a high proportion of the business rate. It only requires one or two of those to close down and the position will be fairly catastrophic. It is not the same in every kind of area and whatever kind of system we have in future will have to retain a substantial element of redistribution at least for those authorities. I do not know what proportion of authorities that is, but I have heard my honourable friend Andrew Stunell tell me that about 20% will be substantially reliant in future on continued redistribution elements of the grant. I do not know whether the Minister has an idea or can enlighten us after this Committee.

The second thing that causes a certain amount of alarm is the 50%. It is really the argument about what happens to the money that is centrally controlled. How far will this kind of area, which tends to be the old, declining, industrial area—although not all as some are coastal towns that have fallen on bad times, and so on—rely on the traditional kind of government grants, particularly capital grants, for regeneration? We discussed this issue in your Lordships’ House last week in a debate launched by the noble Lord, Lord Mawson.

The noble Lord, Lord McKenzie, and I were making similar points that parts of the country are missing out on the grants that are now available, compared with the past. That is partly as a result of the reduction in funding for capital schemes and the fact, for example, that the regional growth fund is cumulatively less than the regional development agencies used to have available to disperse. It is partly because there is a tendency now to go for growth and to go for the places where growth is easiest and perhaps to go more to the south-east, the Greater London area, the big cities, the city regions and metropolitan areas. There are very exciting and worthy schemes for authorities to work together for economic growth and development in areas such as Greater Manchester. Those places that do not naturally fit into the big city regions risk missing out. I am talking about my own area in Pennine Lancashire, but there are others as well, in the north-east, in west Cumbria, and elsewhere around the country. Our concern is about how much the less fashionable and less sexy areas, or the areas which find growth more difficult and where the return on investment may be less as a percentage, are going to miss out on this 50% redistribution. There are huge questions there.

I ask the Minister whether the Government have an assessment at this stage of how much of this central fund is expected to be used for different purposes. How much of it is expected to be used for council tax issues which the noble Earl, Lord Lytton, was talking about? How much is expected to go on administration? How much is expected to go on straightforward redistribution to the sort of areas I am talking about? How much will go to traditional funds and schemes for capital investment and development around the country? How much will go on regeneration? How the Government will use this money is not clear to me at all. I can see in total the kinds of things it is going to used on, but I do not really know whether they have an estimate of how much is likely to be used for the different elements. I would find it extremely interesting and useful to have that information, if the Government have worked it out.

Planning: Ancient Woodland

Lord Tope Excerpts

Tuesday 13th March 2012 Lords Chamber

[Earl Attlee]

My Lords, I am satisfied that the NPPF will protect ancient woodland.

[Lord Tope]

My Lords, the Minister has said that he will not speculate on the content of the final version. Can he tell us when our speculation will end, when it will be published and when we can judge for ourselves whether the final version of the NPPF gives equal weight to longer-term environmental and social concerns, as it undoubtedly will to more immediate demands for economic growth?

[Earl Attlee]

My Lords, the short answer to my noble friend is: the end of the month.

Localism Bill

Lord Tope Excerpts

Monday 10th October 2011 Lords Chamber

[Earl Attlee]

My Lords, I shall speak to a necessarily long list of amendments, starting with Amendment 195ZAA. The amendments deal with EU fines. I thank noble Lords for the constructive suggestions made during and since Committee. As a direct result, I am able to move some substantial amendments and therefore intend to take a little time explaining them.

To start, it would be helpful to reaffirm the basic principles here: this is about encouraging authorities not to incur fines for the UK in the first place. In the unprecedented circumstance that the UK is fined in relation to an infraction, it is about achieving compliance quickly, using a process which is fair, proportionate, reasonable and holds no surprises. We do not want to pay escalating fines to Europe. We have never incurred fines regarding an infraction and do not see these provisions as a prelude to being more relaxed about infraction proceedings or fines.

All this is reflected in the policy statement of the Local Government Group, which has been placed in the House Library and updates the one previously put forward by the Greater London Authority. I strongly welcome the statement, which is very helpful. I thank both the Local Government Group and the Greater London Authority for working with us so closely on this, and for their help and support. This paper will form the basis of a government policy statement on which we will consult more fully in due course.

The noble Lords, Lord Tope and Lord McKenzie of Luton, each provided convincing proposals on designation in Committee. I have combined these and taken them further so that the Minister would need to designate each authority by order, using the affirmative procedure and specifying the infraction case and related activities of the authority, before the Localism Bill’s provisions could be used. The activities described must take place after the order comes into force and will relate to the authority’s functions and obligations.

This means that authorities can be designated only for something which is their responsibility. Only actions or failures to act following designation would be taken into account when deciding whether to pass on a fine, and only in relation to the specific infraction case. The designation order would cease to have effect when the infraction case was closed. This responds to concerns on retrospectivity raised previously and highlighted in Committee by my noble friend Lord Newton of Braintree. It puts in place a mechanism which will give authorities an early opportunity to put things right, to solve the problem, before any fine. It also means that this House and the other place will have the ability to test the rationale for the proposed designation in debate. If this does not provide sufficient incentive, and in the unprecedented circumstance that the UK is fined for failing to comply with EU law, we will establish an independent advisory panel before seeking to recover any fines.

I am grateful to my noble friend Lady Gardner of Parkes and the noble Lord, Lord Best, for suggesting how an independent advisory panel could provide sufficient checks and balances to ensure that the Minister could not act, at the same time, as prosecutor, judge, jury and co-defendant on these matters. As I made clear in Committee, we remain committed to the principles of transparency, fairness, reasonableness and proportionality. This amendment will enhance all these qualities.

Such a panel would be formed at the point of need, with relevant legal, topical and sectoral expertise for the specific case. The Minister would consult the panel on the procedure and timetable. The panel would receive representations directly from the Minister and from the authorities involved. It would carry out fact-finding and make published recommendations to the Minister, including on the fair apportionment of culpability.

I remain strongly of the opinion that decision-making should remain with the Minister as an elected member of the Government with responsibility to make such decisions on resources. Any Minister acting against recommendations would need strong reasons for doing so should there be a subsequent judicial review.

The amendments on the process reflect the new role of an independent panel and will enable the authority better to plan its finances by covering all possible payments up front: lump-sum, accrued and ongoing periodic fines. This transparency could be a big help, allowing the authority to weigh the costs of fines against the costs of speedy compliance.

Any ongoing liability to pay towards a fine from the EU would end at the point where the authority demonstrated that it had taken all reasonable steps to comply. There is also provision for liability to be reduced—but not increased—if there is a change of circumstances.

We are extending the provisions to cover reserved matters in devolved areas. I am grateful to the noble Lords, Lord Wigley and Lord Empey, who spoke on this, with others, in Committee. I can confirm to the House that the extension of the provisions to cover reserved matters, without prejudicing the performance of any devolved functions, has the full agreement of all the devolved Administrations. On the request of the Welsh Government, we are also providing a mirror power for Welsh Ministers to pass on EU fines to responsible public authorities exercising devolved functions in Wales. This replicates the UK provisions in their entirety, including designation by order.

The rest of my amendments make changes to ensure that the clauses as a whole work together.

Finally, I should like to respond to the amendment proposed by the noble Lord, Lord Berkeley—in advance of him moving it—which would ensure that the Government could not designate any rail or inland waterway provider. I agree that we should not penalise companies for their private services and functions, but where a company is performing a public function, and only for that public function, it needs to be encouraged to comply with EU law in order to avoid significant fines being picked up by the British taxpayer. Where a private company has responsibility under statute to carry out public functions, the default position would be to use any existing regulatory framework to resolve the issue. A Minister would seek to designate a private company only if it was carrying out a public function, if it had caused or contributed to an active infraction case, and if any regulatory body had not been able effectively to incentivise compliance. This would of course be tested by this House and the other place should a Minister seek to designate in such circumstances.

I hope that this demonstrates that I have taken on board the points raised in Committee, and that these provisions are stronger and better as a result. With these amendments there is a very clear emphasis on incentivising avoidance of fines. We are radically devolving power, but that needs to go hand in hand with responsibility. Therefore, I strongly believe that these provisions will help to protect UK taxpayers. I beg to move the government amendment, and hope that the noble Lord, Lord Berkeley, will be willing to withdraw his amendments at the appropriate point after he has spoken to them.

[Lord Tope]

My Lords, as I think I was the first to complain about the original provisions of the Bill when we considered it in Committee, it is only right that I should now be the first to rise to congratulate the Minister on what he has achieved since we were in Committee. I said at that time, with great regret, that the first that local government knew of the Government’s intentions on EU fines was when they read it in the Bill, which was most unsatisfactory. That is not the responsibility of the noble Earl, Lord Attlee, at all. His responsibility is the leadership that he has shown since that time in retrieving this situation. None of us would have wished to start from there, but that is where we found ourselves. The noble Earl has worked tirelessly since that time to achieve a compromise that is fully and wholly accepted by the Local Government Group, the Greater London Authority and, as far as I am aware, all others involved in this. It is still their position that it would be better if this were not in the Bill at all, but that is not too surprising—most people would rather not have provisions to fine them in legislation. Given that it is the Government’s intention, for the reasons given, that this will be in the Bill when it is enacted, then—thanks to the noble Earl and, as I think he would be the first to acknowledge, thanks to his officials—we have achieved a satisfactory outcome.

The only point that I would like to add is to welcome—as I also said in Committee—the statement of policy. It is a very good intention that the Government will discuss with local government those areas of concern in upcoming proposed EU legislation that has a significant effect upon local government. That is a very welcome good intention but I want to be sure that it happens. I have no doubt whatever that, as far as the noble Earl’s department is concerned, that has always been the case. I have been for many years a member of the Local Government Association’s European and international board and its predecessor’s bodies, right back to the days of the Local Government International Bureau. For some time in the early days of the new Labour Government we had regular meetings not only with CLG but also with the FCO and the Europe Minister to discuss issues of concern. They fell into abeyance some years ago and do not happen any longer. My plea to the noble Earl, and through him to the Government, is to ensure that this very welcome statement of policy does not just remain a statement of good intent but is actually put into practice. I am sure that this sort of meaningful dialogue between representatives of local government and representatives of central Government—not just CLG but also the FCO and other departments dealing with these issues, as appropriate—can only be to mutual benefit and will, we all hope, ensure that the provisions that we will shortly pass will never need to be used.

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[Baroness Royall of Blaisdon]

My Lords, we will have that discussion at a later date. For the moment, we have a voting age of 18. Notwithstanding that fact, I think that it is very important that young people who are younger than 18 should have their views properly assessed and that they should have an opportunity to have proper discussions with the people who are taking the important decisions in councils and other bodies that so profoundly affect their lives.

There is another amendment in this group that relates to petitions, but I understand that there may be some other movement from the Government on petitions and referendums. If, however, the current proposals from the Government stand, I would argue that young people themselves should have an opportunity to petition the Government as outlined in Amendment 195ZAZNZA. I beg to move.

[Lord Tope]

My Lords, if the purpose of this amendment was to enable a short debate on the political engagement of young people, I have no hesitation whatever in supporting that intention. If it is the intention to prescribe how local authorities should do it—and I do not think that it is—it has no place at all in a localism Bill. However, I am assuming it is the former, and indeed I think that the noble Baroness, in moving the amendment, said it was a suggestion—in fact, a very good suggestion. I want briefly to echo the importance of the political engagement of young people in the community. I can only speak with direct experience of my own local authority, where our youth parliament plays a very active role, and which in its elections last year had almost the highest turnout in the whole of London. That is in a relatively small London borough where young people play an active part. Similarly, we have young ambassadors who play a very active part not in matters particularly for young people but in the whole life of the borough, in issues that are of importance to people of all ages.

Therefore I wholly support and encourage the intention of this debate. It is important not just that young people are listened to but that what they are saying is heard and acted on. I can give another example of a project in which I am involved with a new building. We had the young ambassadors round to carry out a very detailed and thorough inspection of it. They raised a whole load of points, both about the physical nature of the building and particularly about the programmes that were being run there. They made a report to us, I ensured that the management board gave them a full written response and they came back six months later to ensure that it was being acted on. That is the sort of engagement that we want, not the rather patronising one where we say, “Yes, of course, that’s very good”, and then do nothing whatever about it. Real engagement means not that we are listening but that we are hearing and that we are acting on their suggestions. To enable me to make that point, I am grateful to the noble Baroness for the amendment. I hope very much that she will not press it, because I do not think that it is for us, in a localism Bill, to be prescribing to local authorities how they should act on this issue; rather it is for us to encourage all local authorities to act on it and to do it effectively.

[Lord Lucas]

My Lords, in contrast to some of my noble friends, I am very much in favour of the involvement of young people in democracy and in giving them a formal role in it.

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[Lord Tope]

My Lords, I support my noble friend Lord Greaves in all that he has said. He has made a very persuasive case, and I would summarise it in words that we hear so often from the Dispatch Box: “My Lords, these provisions are not necessary”. As my noble friend has said, local authorities are already able to hold referendums if they so choose. The provisions elsewhere in this Bill will widen that possibility—that scope—in a number of ways.

I believe that there are better ways of testing public opinion fairly than using the very suspect means of a referendum. Perhaps in the current financial climate, even more persuasive is the fact that they are very expensive to hold. They are misleading to members of the public, who will not unnaturally think that if the local authority has gone to all the trouble of establishing a referendum using the full electoral process, then they will actually implement whatever the result is. Yet the provisions here are not binding; a local authority, if it is so minded—and brave enough—may well then decide not to abide by the outcome of the result of the referendum.

I will end where I began, in the words that I know the Minister believes to be most persuasive, because they are the words that she and her colleagues use so often to the rest of us when we are moving amendments: “My Lords, these provisions are simply not necessary”.

[Baroness Hanham]

My Lords, before we go any further it may be in the interests of the House if I indicate probably what is now the worst kept secret—that the Government will be minded to accept these amendments, and there may be further debate.

Localism Bill

Lord Tope Excerpts

Monday 12th September 2011 Lords Chamber

Moved by

[Lord Tope]

108: After Clause 217, insert the following new Clause—
“London Transport Users’ Committee
(1) On the day appointed for the commencement of this subsection, the body corporate known as the London Transport Users’ Committee that was established under section 247 of the Greater London Authority Act 1999 (as amended) shall cease to exist.
(2) All statutory powers, duties and responsibilities of the London Transport Users’ Committee shall on the day appointed for the commencement of this subsection vest and devolve in the Greater London Authority and are to be exercised by the London Assembly.
(3) Any appointment to the London Transport Users’ Committee in pursuance of section 247 of the Greater London Authority Act 1999 (as amended) shall cease to have effect and section 247 of that Act (as amended) shall cease to have effect from the commencement of this subsection.
(4) References in enactments, instruments and other documents to London Transport Users’ Committee shall have effect from the commencement of this subsection as references to the London Assembly.
(5) Section 251 of and Schedule 18 to the Greater London Authority Act 1999 (as amended) shall cease to have effect from the commencement of this subsection.
(6) Section 248 of the Greater London Authority Act 1999 (as amended) shall be amended by omitting the words “Authority or” in subsection (1)(a) and by omitting the words “or the Authority” in subsection (3)(b).
(7) Section 249 of the Greater London Authority Act 1999 (as amended) shall be amended by omitting subsection (3).
(8) Section 250 of the Greater London Authority Act 1999 (as amended) shall be amended by omitting subsection (1)(a), the words “the Assembly and” in subsection (2) and the words “the Assembly” in subsection (3).
(9) Section 252A of the Greater London Authority Act 1999 (as amended) shall be amended by substituting the words “the Committee” for the words “the London Transport Users’ Committee” in subsection (2)(a).
(10) Section 252B of the Greater London Authority Act 1999 (as amended) shall be amended by omitting the words “the London Assembly” in subsection (1)(b).”

[Lord Tope]

Amendment 108 would transfer the purpose and functions of the London Transport Users’ Committee, which operates under the name London TravelWatch and is the body responsible for passenger representation within London, to the London Assembly. The amendment originates from a review conducted last year by the London Assembly, which showed that such a transfer of functions would save up to £1 million per annum of taxpayers’ money. The findings of that review were accepted by all four political parties on the London Assembly. The amendment is therefore supported by all the parties in the London Assembly, the Mayor of London and London Councils, which represents not only the political parties but all 32 London boroughs and the City of London. London TravelWatch was established under the original GLA Act, the purpose of which was to devolve powers and responsibilities to London. That all those elements in London are wholly behind this measure, which saves a significant amount of public money, ought in itself to be enough to persuade the Government to comply with the wishes of London’s elected representatives.

However, I understand that the Government have some concerns. Indeed, during the Recess I had a letter in the name of the noble Baroness the Minister. Let me try to address some of the concerns set out there. Quite rightly, there is a concern to ensure that passenger interests in London are effectively and properly represented by a genuinely independent body. As many of us know, whatever else it is, the structure of London government is unique. The London Assembly is solely a scrutiny body. It has no executive or regulatory powers at all; its function is to scrutinise and hold to account not only the mayor but also the functional bodies. I speak as a member of the London Assembly’s transport committee for some years and I do not think it will surprise anyone to learn that a substantial part of that committee’s work is holding Transport for London and, to a lesser extent, other transport operators in London, to account. It does so very independently because it has no responsibility for TfL—indeed, exactly the opposite. Its members are directly elected by Londoners, as distinct from the members of London TravelWatch, who do an extremely good job but are appointed by the London Assembly. The budget for London Transport—I am sorry, London TravelWatch—is provided by the London Assembly, so again it cannot be argued that the assembly is in some way less independent than the body it appoints and whose budget it provides.

I am sure that again it will come as no surprise to noble Lords to learn that a substantial part of the casework of most London Assembly members, particularly those representing constituencies, is on transport-related issues since they relate to anyone who has to live, work or travel in London. Of course a lot of work for members arises from that, and they are in touch with their constituents on transport issues. Making them officially the passenger representative body can only enhance that and join up the two sides.

The argument was also put that nothing had been said about the workload of the casework. That was because the purpose of this amendment is simply to transfer the function. However, I am sure that if the function were transferred, the wherewithal to carry out that function would follow it. It is not for me to say, but I would assume and expect that the current staff in London Transport—I mean London TravelWatch; I keep making the same mistake—would very likely transfer across under TUPE regulations. That would be a matter for discussion, should this happen. However, without doubt the London Assembly will need to have the capacity to carry out the necessary casework.

Finally, I make a point for serious consideration by the Government. If changes are to be made to London TravelWatch, we need to remember that it was set up under the Greater London Authority Act 1999 and that primary legislation will be needed to change that. I suspect that we will not see this or any other Government introducing a London TravelWatch Bill in the near future so some other vehicle will need to be found in order to make whatever the changes may be. I think, and dare I say I hope, that that may be some way off. Therefore the opportunity arises in this Bill to carry out the wishes of all of London’s elected representatives, to save a substantial amount of public money—more necessary than ever at the present time—and, I would venture to suggest, to provide a strong, independent, directly elected and directly accountable passenger representative body. I beg to move.

[Lord Faulkner of Worcester]

My Lords, I am sure the House is grateful to the noble Lord, Lord Tope, for moving this amendment and giving us an opportunity to discuss the case of passenger representation in London. However, it may not surprise him to know that I take considerable exception to the case that he, the mayor and the Greater London Assembly are putting forward because I think it is fundamentally flawed. I am aware that it has come about as a result of the review of London TravelWatch carried out last year by the GLA, which did indeed recommend that it be wound up and its functions folded into the assembly. However, that process was seriously flawed. The assembly consulted a number of stakeholders, but then completely ignored what they said. For example, the Association of Train Operating Companies, ATOC, has written to me and said:

“We firmly believe that the functions of a consumer watchdog, in providing impartial casework and research support, and facilitating the resolution of individual complaints with train companies should be demonstrably independent, not under direct political control.

Assembly Members are keen to point out that taking on London TravelWatch's activities will help them to provide greater scrutiny of the mayor's and GLA's activities. However, we believe the priority for London TravelWatch should be handling disputes from individual passengers as a consumer champion and undertaking independent research, not being sidetracked on to issues of political or electoral interest to Assembly Members. Passengers will not benefit if London TravelWatch becomes merely a means for point-scoring”.

The assembly's review claims—and the noble Lord, Lord Tope, has referred to this—that there is scope for substantial savings. The review is vague about where those savings will come from. There does not appear to be any reference to transitional costs or to the cost of the GLA accommodating the staff, although the noble Lord, Lord Tope, did say that a TUPE arrangement may apply, which would undoubtedly have an impact on whatever savings may be possible.

London TravelWatch itself has demonstrated that it can cut its budget by 25 per cent over the next two years, while staying completely independent from politicians and concentrating on its core functions of appeals casework, and policy and investigation. There is a huge danger that the present multimodal work on behalf of the travelling public who use buses, the underground, the Docklands Light Railway, Tramlink, taxis, Dial-a-Ride, and National Rail in and around London would be fragmented if this amendment were adopted. It makes no sense to separate London TravelWatch's rail-related work from its work covering other modes. An example is its excellent, recent report on incomplete Oyster pay, which affects everyone who uses public transport in and around London.

I conclude with one further point: the GLA does not speak for those who are not resident in London. Seventy per cent of all rail journeys begin, end, or pass through London and London TravelWatch's remit extends far beyond the boundaries of Greater London, and includes large chunks of Essex, Hertfordshire, Bedfordshire, Buckinghamshire, Surrey and Kent, and it is from there that passengers travel into London for work or leisure purposes.

This is a really bad idea, which would lead Londoners to be disadvantaged compared with those outside London, who have independent representation on Passenger Focus, looking after their needs, whether they are rail or bus passengers. It is that independence that is important, and that is why I hope the Government will resist this amendment.

--- Later in debate ---

[Lord Tope]

My Lords, I am grateful to my noble friends for their unqualified support for this amendment.

[Noble Lords]

Oh!

[Lord Tope]

I think that I am grateful to the noble Lord, Lord McKenzie, for his more measured support for the amendment. I am less grateful to him for tempting me to call a vote just to see what happens. We will have to see about that. I am grateful to the noble Lord, Lord Faulkner, for putting the case from London TravelWatch. I have seen its briefing. It is not surprising that the body which is proposed for abolition is less keen on its own abolition. That is entirely understandable. I hope that I did not say or imply that there is something wrong with the way in which it does its job. Indeed, the noble Lord, Lord Whitty, gave us a brief history of it all. Back in the 1970s, I was a member of its predecessor body. I am grateful to the noble Lord for reminding us of the many happy hours that we spent discussing the GLA Act, as it became.

A number of points have been made, and I am not going to spend a long time answering them all. We are referring to the abolition of London TravelWatch. Let us be clear: the body that we are talking about may be subsumed in the London Assembly but we are certainly not talking about abolishing the function and representative role of the passenger interest. It is very important that we understand there is no suggestion of that. On the contrary, there is a belief, perhaps not shared by all, that that passenger interest would be enhanced by being represented by people who have been elected. I accept that they are not elected by everybody who ever travels on transport within London; I do not think that will ever be the case. However, I am a little puzzled that members of the Labour Party should say that, because a body is popularly elected, it is therefore not independent. I find that a rather strange argument and one that is difficult to follow. I made very clear—I know this from my eight years’ experience of serving on the London Assembly—that this is an independent body. It has no executive functions and does not always love the mayor. None of the members always loves the mayor, whoever the mayor may be. It has no executive responsibility at all for TfL. Indeed, an enormous amount of its time is taken up questioning—sometimes vigorously, as my noble friend Lady Kramer said—and calling to account the principal transport provider within London and, indeed, the train operating companies that appear for questioning. Therefore, there is a vigorous representation of passenger interest on the part of those people whom most of the passengers—but not all—will have elected as their representatives.

The noble Lord, Lord Kennedy, referred to himself as a south Londoner. I am more south London than him, certainly in geographical terms, but I share his interest in that regard. That situation would be corrected if it were the London Assembly because, whatever I personally may think of the inadequate electoral system by which that body is elected, it represents the whole of London.

Tempting though the suggestion of the noble Lord, Lord McKenzie, is, I will not press the amendment to a Division. The Minister need not comment on this point now but I believe that discussions are going on about introducing changes regarding greater involvement with Passenger Focus. I hope the Government will ensure to the best of their ability that the London Assembly—I mean the London Assembly, not the GLA, which might well mean the mayor instead—is directly involved in all those discussions. I beg leave to withdraw the amendment.

Amendment 108 withdrawn.

--- Later in debate ---

[Lord McKenzie of Luton]

My Lords, in speaking to Amendment 114, I shall speak to the other amendments in this group. Given that they each also bear the names of the Minister and the noble Lord, Lord Shipley, I have some expectation that they may be acceptable to your Lordships. The Bill currently includes provisions which enable the Secretary of State by order to transfer a local public service function from any person to its elected mayor. In Committee, we sought to amend that by widening its application to local authorities that operated a leader and cabinet executive model of governance. That amendment was eventually withdrawn.

Additionally, in Committee, we tabled amendments which were prompted by the Core Cities group. These amendments sought equivalent opportunities for the transfer and delegation of functions as were provided to the Mayor of London under the Bill. It was suggested that this approach had cross-party support among the Core Cities group, growing support from the Members of Parliament of the core cities and support from Ministers. In the event, these amendments were not moved on the final day in Committee. Over the Recess, the Government have taken the issue forward with the Core Cities group, hence the amendments today. They also cover the original proposals for transfers to mayors which are replaced.

Amendment 114 provides for the transfer of local public functions from a public authority to a permitted authority. A public function is a function of a public authority. A permitted authority includes a county council in England, a district council and an economic prosperity board. The transfer is achieved by an order of the Secretary of State and may not be made unless it considered that the order would promote economic development or wealth creation, or increase local accountability in relation to each local public function. The Secretary of State must be satisfied that the permitted authority can exercise the function appropriately and has consented to the transfer.

Amendment 115 permits the delegation to a permitted authority of a Minister’s eligible functions, mirroring the provisions of Clause 210, which cover such delegation to the Mayor of London, and on which we touched on earlier amendments. Amendment 116 allows the Secretary of State to make a scheme for the transfer of property rights or liabilities to give effect to a transfer of functions and a delegation of a Minister’s eligible functions or their revocation.

Amendment 117 imposes a duty on the Secretary of State to consider any proposals for the exercise of these powers which come from a permitted authority and to establish criteria by which they must be considered. Amendment 118 crucially sets out a robust super-affirmative procedure for any order which seeks to transfer functions to a permitted authority. Amendment 119 covers definitions. Amendments 151, 161, 163 and 241 are consequential.

Core Cities is a network of the local authorities of England’s eight largest city economies outside London. It includes Birmingham, Bristol, Leeds, Liverpool, Manchester, Newcastle, Nottingham and Sheffield. The cities drive their local economic areas and make a significant contribution to the national economy. They work in partnership with government to influence policy and to develop new ideas based on knowledge of what works on the ground to improve economic performance and reduce dependency. The Core Cities group has a track record of more than 15 years led by city leaders across all parties.

The powers in this amendment could be available to anywhere that meets the criteria. However, England’s core cities are the main drivers of the country’s economy outside London and the south-east. Together, their primary urban areas deliver 27 per cent of the national economy, more than London, and contain 16 million residents. The role of cities is central to delivering national economic outcomes, reducing dependency on public spending, and in driving growth, productivity and tax revenues. Supporting growth in the core cities is vital to rebalance the UK economy.

With more decentralised arrangements for governance and public finance, these cities would be able to deliver greater economic outcomes for the UK. Recent independent economic forecasts commissioned by Core Cities have demonstrated that the local enterprise partnership areas, given greater control over the drives of growth, are capable of delivering an additional 1 million jobs and £44 billion economic output over the next decade.

The Bill offers an opportunity through these amendments to create a binding narrative around other localist and decentralising policy, enabling this Government to deliver a distinctive set of urban policies and a legacy of empowered cities driving private sector growth and jobs. The Bill proposes to transfer powers from the London Development Agency and the Homes and Communities Agency to the Mayor of London, and makes provision for further ministerial delegation. Other major economic areas need the same opportunity to be able to drive growth and prosperity for their business and residents, and for the wider economy. The country needs London to do well but, to create an equitable and multicentred national economic strategy, the same chance needs to be given to other areas that are capable of growing employment. England needs a London-plus national economic policy.

It is the intention of the Core Cities group to seek these powers for its members but it will not be restricted to the core cities and their urban areas. Any economic area that fulfils the eligibility criteria could be able to request these delegations. The overarching aim of the amendment is to drive economic growth and productivity, and reduce dependency. Now is a critical moment for economic recovery and we need to boost local investment and investor confidence. This amendment would support private sector growth and jobs; create new opportunities for efficiency, innovative finance and investment; enable distinctive urban policy and a legacy of empowered cities; ensure continued buying from private sector partners on LEPs; support the implementation of a local government resource review and further incentivise local authorities and their partners; support the implementation of enterprise zones; clarify existing routes of delegation; support double devolution to local communities; support the wider restructuring of subnational economic development architecture; create a route to delegate to further emerging governance structures; and be a significant—I suggest popular—and symbolic step towards decentralisation and localism. I beg to move.

[Lord Tope]

I am grateful to the noble Lord, Lord McKenzie, for moving the amendment. As he rightly said, my noble friend Lord Shipley has added his name to it and was hoping and expecting to be here to speak in support of it. He has been in Manchester all day on government business. I have just heard that he has only just got on a train in Manchester, so I suspect that he will not be here in time to contribute to this debate. However, I have a fairly good idea of what he would have said had he been here, and I speak on his behalf. As someone who has been a London councillor all his adult life, I must say that I had not expected to be speaking on behalf of Core Cities. It is a rare privilege and something I do enthusiastically because I very much support these amendments.

Both this Government and the previous Administration have made firm commitments to devolution and decentralisation. The Bill now offers an opportunity to hand decision-making powers from central to local government, working in partnership with the private sector. The Government’s stated aim is to rebalance the economy, focusing on the whole of our national economic system as well as London and the south-east, enabling other places to develop their economies to boost national growth and productivity.

Devolution has happened at different speeds in different geographies. London will receive further powers through the Bill, and the devolved Assemblies already have powers that are not available directly to cities in England. Without further decentralisation there is a risk that England’s core cities, which generate 27 per cent of England’s GVA—my noble friend Lord Shipley points out that that is more than London—and other towns and cities will be unable to perform to their full potential and support nationwide growth and enterprise. Recent independent forecasts by Oxford Economics demonstrate that the core cities’ eight local enterprise partnership areas are capable of delivering an additional 1 million jobs and £44 billion GVA over the next decade, given the tools to do so.

This enabling amendment creates a route to these tools to ministerial delegation and the transfer of public service functions for economic development and wealth creation to single and combined authorities in England. Any such actions would be subject to competency tests, including strong local governance and private sector buy-in, evidence that growth can be delivered and sound arrangements to work across administrative boundaries.

The potential of the amendment would be open to any place, as the noble Lord, Lord McKenzie, has said, that can demonstrate that it can pass the competency tests that the Government will set out. It will ensure that local areas have the powers and financial autonomy to deliver local solutions to their challenges, and that further legislation will not be needed to pass these powers to cities’ civic and business leaders. Any major transfers will be subject to parliamentary scrutiny.

The amendment would support private sector growth and new opportunities for investment, ensure continued buy-in from private sector partners on LEPs, support the implementation of policy to incentivise places to deliver growth, support double devolution to local communities, and be a significant step towards decentralisation.

As the noble Lord, Lord McKenzie, has said, these amendments enjoy support from at least three sides of the House and, I hope, passive support from the fourth. Therefore, I am very pleased to be able to support them.

[Lord Jenkin of Roding]

My Lords, having heard the case in favour of these amendments, I am not in the least surprised that my noble friend on the Front Bench has added her name to them. My only comment is to say how much has changed since I was in charge of local authorities back in the 1980s. It is a change that is entirely welcome. This is a far more positive approach than anything I had to deal with at that time. Perhaps a veil might be drawn over that period; it was a very unhappy period for much of local government. I thoroughly support these clauses and I congratulate the core cities on the work they have done to bring all this forward.

Localism Bill

Lord Tope Excerpts

Wednesday 7th September 2011 Lords Chamber

Without these amendments tenants will lose that choice and will lose access to justice. Residents who just happen to be in social housing will be further stigmatised. No other category of citizen is having their right to an ombudsman removed in the course of remedying a perceived democratic deficit. In the light of that, I hope we can retain the right of direct access to the Housing Ombudsman. I beg to move.

[Lord Tope]

Whereas the noble Baroness began by saying that she had been neither an MP nor a councillor, I begin by saying that I have been both. I was an MP for a rather short tenure a very long time ago but have been a councillor for the past 37 years, representing a ward with a substantial amount of social housing. Therefore, I have real and practical experience of some of the issues that have been spoken of. The noble Baroness will know well that I have considerable sympathy with much of what she has said. Indeed, my noble friend Lord Shipley and I have our names to Amendments 70 and 73 in this group. As I say, I have great sympathy with what the noble Baroness has said. My preference would certainly be to have unfettered direct access to the Housing Ombudsman. I feel strongly that tenants should have the right of direct access to the Housing Ombudsman when necessary, and I wish to spend a few moments considering when that is necessary.

It is for the Minister, and certainly not for me, to explain the Government’s reasons for the proposals in the Bill and for wanting to tackle the matter in this way. However, we have to recognise that, certainly in the 37 years that I have been a councillor, the involvement of local authorities, and therefore of councillors, in housing management issues has decreased. We have had the wholesale stock transfer and the creation of ALMOs. Generally, the move has been away from involvement. It is fair to say that some councillors—I cannot say that this has been my experience—have much less engagement in the day-to-day business of housing management, and therefore of knowing and understanding the issues that their constituents, as tenants, experience. If the Government wish to bring politicians, particularly councillors, closer to these issues—I do not know what the relevant phrase is—that is an objective we all share. We might have varying degrees of cynicism about how effective that will be, but it is an objective that we all share. I certainly share the Government’s objective in that regard.

If the Government’s objective is also to ensure that, whenever possible, complaints and issues are resolved locally, I am sure that we all share that objective too. That is clearly desirable for all sorts of reasons. It is usually quicker, more effective and engages people. I would expect that, in most instances when a tenant has a complaint of this sort, normally the first port of call would be a councillor or MP, partly because they are better known—or at least their existence is better known—than the Housing Ombudsman and they are more accessible and accountable. Therefore, I would normally expect an issue to be raised first with a councillor or Member of Parliament. I would expect that, in pretty well every case, that representative would try to get the matter resolved locally as that is what councillors and MPs do. Instead of immediately going off to the ombudsman, they go to the relevant housing management authority to try to resolve the issue and then tell their constituent what a wonderful job they have done in resolving the problem. That is what happens in reality. When they are successful, that is good, right and proper.

The difficulty that I have with the Government’s proposal is that, while I am sure that we all share those objectives, one of the—I hope unintended—consequences is that it will give councillors, Members of Parliament and tenants panels a right of veto. I have to say that that is wrong. I do not think that it is our job as councillors, Members of Parliament and so on to be the final adjudicator of the rightness or wrongness of the complaint. I would expect that in practice most Members of Parliament and most councillors would anyway refer something to the ombudsman—whether the Local Government Ombudsman or Housing Ombudsman. That was always my practice whether I thought the complaint was wholly justified or even unjustified. I felt that the complainant had the right to independent arbitration and to go to an ombudsman, and referred it that way.

I have had the opportunity to discuss this at some length with the Housing Minister, who says that as an MP that was what he always did. The reality, which I know from personal experience, is that some elected representatives, for whatever reason—and sometimes for no good reason other than personal idiosyncrasy—refuse to do that. That is wrong. I do not think that a Member of Parliament or a councillor should have the right to deny the tenant access to the ombudsman to have the complaint, whether justified or not in our view, properly investigated and independently decided upon.

A little later this afternoon we will get to Amendment 73A and those with it. Amendment 73A is a compromise to try to help the Government, which is always our objective on these Benches. Amendment 73A says that, if the designated person will not refer the complaint—we should have included the words, “or fails to do so within 30 days”, or some other given period—the tenant has the right to go direct to the ombudsman. That amendment has been decoupled from this group for reasons that I understand, but I hope that when the Minister replies she can give us clear and strong words of comfort that it is not the Government’s intention to give the right of veto to us councillors to decide whether or not a complaint is worth forwarding. We need to ensure that the tenant may do so when necessary—I come back to those important words—if a designated person who is willing to forward the complaint cannot be found. That is a pragmatic and sensible compromise to find a way through the entirely honourable and proper intentions of the Government, which we would probably all support, and the undesirable effects of the way in which they are trying to do it. I hope that the Minister can give us clear comfort on that. If she is able to do so, we will judge what to do with Amendment 73A when the time comes.

[Baroness Hollis of Heigham]

My Lords, like the Minister I, too, have been a housing chair in a local authority, for some 11 years. I am also chair of a housing association—an interest that I have declared—and regularly sit at stage 4 of precisely these complaints panels that are the subject of discussion. I am sure that the Minister knows but I wonder whether your Lordships realise how thorough the complaints procedure is, and rightly so, within housing associations and local authorities, particularly encouraged by the TCA of the Homes and Community Agency.

At stage 1, the tenant’s complaint—often, it is a complaint against the behaviour of a neighbour of some sort—is investigated by the local senior housing manager. If that is not resolved to the satisfaction of the tenant, stage 2 means that it will go to the housing manager at the top of the organisation, who will then seek to get all the information, build the file and see whether some resolution can be arrived at. If that is not satisfactory, there is a stage 3 where the complaint goes to the chief legal officer, who is usually the deputy chief executive of the housing association, who goes through the file, takes the evidence, makes further notes and attempts again a further resolution of the difficulty. If that is not enough—by this stage, most complaints have been reasonably addressed—the matter goes to stage 4, which involves the panel, chaired by someone like me, alongside the tenant board representatives of the housing association and the senior staff. Five or six of us spend perhaps a couple of hours going through a thick file and seeking as best we can to hear and resolve the tenant's complaints and concerns.

Localism Bill

Lord Tope Excerpts

Thursday 30th June 2011 Lords Chamber

[Lord Taylor of Holbeach]

My Lords, I thank all noble Lords for their contributions to this debate and indeed the noble Lord, Lord Greaves, for tabling these amendments. I should reassure him that councils in neighbouring wards can get together to hold a referendum covering a community. I cannot help the way that warding is done. Generally speaking, we have to have building blocks in local government and the ward system is the one that is used, but under the provisions of the Bill it would be possible to hold a referendum that just addressed the interests of Keighley or Burnley, which he illustrated.

Perhaps I can address the implications of the amendments and say why I will resist them. Amendments 120B, 120C, 126ZZA, 128QA, 128R, 128VA and 128W would remove the provisions that would allow councillors to call for local referendums and councils to pass a resolution to hold a referendum. These amendments would have the effect that if an authority were keen to hold a referendum on a local matter, it would not be able to use the powers to hold a formal referendum conferred by the Bill and would only be able to use the rather informal powers contained in Section 116 of the Local Government Act 2003. We accept that local authorities have the power to hold advisory polls under Section 116, but those polls are limited to the council’s services or its expenditure on such services and are therefore not as far-reaching as the provisions in the Bill.

We want to enable councils to hold referendums on any issue of local importance. We believe that as leaders in their areas, it is right for them to be able to do so. It is open to a council under the provisions to hold a referendum on any matter. However, any decision must be taken within the parameters of administrative law. It would need to be a rational decision with reasoned grounds for it. In answer to the point made by the noble Lord, Lord Beecham, these provisions apply also to mayoral councils. Clearly it would not be rational to hold a referendum on a matter about which no practical decision would be possible by those who were able to take the decision. For example, a decision on whether the country should invest in a programme—the illustration that I have here is rather far-fetched, to send a person to Mars; I am not sure who the drafters of this text had in mind—would not be a rational subject for a referendum by a local authority. Further, the local authority would need to consider very carefully the holding of a referendum on a matter over which it, its partner authorities or the people of the locality had little or no influence. It is not rational for the authority to incur the cost of a referendum which can serve no possible purpose.

I do not see any great advantage in denying authorities access to the referendum framework that we are setting up under this Bill if they want to use it. Nothing in the provisions that my noble friend seeks to omit imposes any obligations on authorities, so I urge him to withdraw the amendment and to support the localism that they promote.

Some of these amendments, Amendments 129K and 129L, refer to the mayor as a member, and I am grateful to my noble friend for bringing them forward. They would remove elected mayors from the definition of “member”, meaning that they could not use the power in Clause 45 to call for a referendum in the area of the council that they have been elected to lead. In fact, this may not be such a great hardship for elected mayors, since they could initiate a referendum by seeking a resolution of the authority under Clause 50. I accept the point made through Amendment 129L—to remove the Mayor for London from the provisions set out in Clause 58(2)—and we will want to consider these points carefully with a view to returning to them at a later stage. I thank my noble friend for submitting those amendments.

With the explanations which I have given in support of the Bill’s provisions, I hope that my noble friend will feel able to withdraw his amendment.

[Lord Tope]

I am grateful to the Minister for that reply. Unless I missed it, I do not think that he addressed the particular concerns referred to by both noble Lords, which is what happens with split wards. What would happen to a three-member ward where two are from one party and the third is from another? In my own borough, one-third of the wards are in that position, so it is a significant point. A long time ago I was an opposition councillor, and I would suspect that in the run-up to the council elections, which in London is only a one-in-four-year opportunity, it would be almost irresistible for two opposition councillors seeking to oust their third, unwelcome friend from another party, to seek to trigger a referendum, if only to force the majority party to turn it down shortly before the election. I am sure that that is not what the Government have in mind. I speak with the confidence that none of the opposition councillors in my borough will ever read Hansard and know that I am saying this, but I suspect that this is a tactic that may well enter the minds of some. It is not what the Government intend. I therefore wonder whether we ought not to think a bit more about tightening the provisions to prevent what I must not call frivolous campaigning, but very opportunistic opposition campaigning, by whichever party, because I am sure that, in opposition, we would all do it. Perhaps we should consider that point.

--- Later in debate ---

[Lord Beecham]

Why could the local authority not say that it is not elaborating because of confidentiality or the Human Rights Act? Why should it not make that clear in those circumstances?

[Lord Tope]

My Lords, that is exactly my point. I thought that the Minister had just given the reason which the local authority would give in those circumstances for not accepting it. If I remember rightly, the question asked by my noble friend Lord Greaves was, “What are these exceptional circumstances?”. The example that has just been given is not one of them because the local authority would give the reason which the Minister has just given us.

[Lord Taylor of Holbeach]

Perhaps in continuing to respond to this set of amendments the answer might become clearer. The noble Lord went on to suggest that with the words “designated in the petition” and in seeking to get a particular person named as the petition organiser, it would be reasonable to expect that a petition will usually make clear who an organiser is and that in most cases the organiser will welcome being the contact point for the petition. However, it is possible that a petition could fail to specify the organiser and we expect authorities to act reasonably in seeking to identify who might take on that responsibility. Little is added to this clause by imposing a requirement on anyone to provide a notification. Where the petition is clear, the person identified will be the organiser; where it is unclear, the discretion in Clause 48(6)(b) enables an authority to decide who appears to be carrying out the role of organiser. My reaction in considering this amendment is rather overshadowed by my political campaigning background. I have explained the difference between electoral processes and the petition process, but I see what my noble friend is driving at. If there is ambiguity in this matter, I am prepared to look at this again.

I am not convinced that Amendments 129CAA and 129D are necessary. It is reasonable to expect that if a council or partner authority decides to give effect to a referendum they will tell people about how they have listened and acted on their views or that local people will notice it anyway. However, the provision in Clause 55 is important in that it ensures that where partner bodies decide not to give effect to a referendum result, local people are made aware of the reasons why. I hope that that explains that. Sometimes giving the reason for the rejection can give the game away; for example, it could identify that an individual had a criminal conviction. This is another reason why it might be essential to have discretion in the Bill. However, given the contributions made by noble Lords, we will look at this and see if the wordings do reflect exactly what it is the Committee would wish to see in the Bill.

[Lord Tope]

My Lords, I am grateful to the noble Lord. I suspect that as he was speaking he was remembering many of the things that I am only too well aware of in the reality of petitioning. On the question of the exceptional circumstances, if they were reasons of a confidential nature I imagine that the local authority would use the words that they use now when they are going into confidential session as the reason for not pursuing the Bill. These are not major points that will hold up the Bill but we should look at them to see whether there can be better wording. If there really are exceptional circumstances that the local authority is unable to state—and I am bound to say that I cannot think what that might be, because if something is of a confidential nature then that would be the reason—then we should say what they would be. I cannot think that there are any that cannot be covered by the appropriate form of words.

Amendment 128H, which is in the name of my noble friend Lord Greaves and refers to “designated in the petition”, once again reminds me of the happy hours we spent on the local democracy Bill and all that that legislation prescribed on petitions. I recall that my noble friend brought in some petitions to his council, which did not look like petitions to Parliament in any sense. We all know that they are not usually neat and tidy, with the petition organiser’s name at the top. Again, this is not a major point. My noble friend has suggested an alternative wording which I think would meet it very well. However, the term “designated in the petition” does not meet it. Most of the petitions to my council that I have seen—and I suspect that the Minister has had similar experience—do not designate anyone in the petition itself. It just does not work that way. Therefore, a rather simpler, looser way would serve the point much better and save people getting into an unnecessary tangle.

Localism Bill

Lord Tope Excerpts

Tuesday 28th June 2011 Lords Chamber

[Lord Wigley]

My Lords, Amendment 110, in my name, introduces a significant group of amendments on the fundamental issue of passing on European fines to local authorities generally. I must admit that I have some grave reservations about the generality of Clause 31 and Part 2 in totality. Amendment 110 is a probing amendment by which I hope to receive adequate clarification of and assurance from the Minister on the Government’s intentions with regard to Wales. However, other amendments in this group may well need to be pressed or at least the option kept open to return to these issues on Report if an adequate response is not forthcoming from the Government.

The basic question behind my amendment is whether these fines can be imposed on Welsh authorities. Clause 36 is quite explicit that Part 2 powers concerning European fines apply only to local government in England. I flagged up at Second Reading the fact that I understood from the Welsh Local Government Association that a letter was sent to a Midlands MP by the Local Government Minister Greg Clark confirming that, under the Bill, the fines apply only to England. Is that the case? If the intention is to apply fines to Welsh local government, by what mechanism is this going to be achieved? There is the possible scenario that Westminster Ministers might impose fines on Welsh local authorities in Wales over the heads of Assembly Ministers.

There are valid reasons to be fearful of the dangers that might arise if central government can pass European fines willy-nilly on to local government when a local authority might not have caused the problem generating the fines or where it might genuinely believe that it was acting in line with UK or devolved government policy in pursuing the action that might have led to the fines. Other amendments deal with these more general issues. Amendment 114A proposes a framework of arbitration that is certainly worth consideration. If no satisfactory response is forthcoming, there will be an opportunity to vote on the clause stand part to delete these European aspects from the Bill.

I do not resile from the concept that if any local authority has behaved in a totally cavalier manner and has through its actions brought fines and penalties on the UK, it is right that those who act in that way might be open to suffer the consequences. However, fines are usually imposed through the system of courts with a proper system of checks and balances to ensure fair play. The Government of Wales have recognised that in rare circumstances the question of such fines might arise, but they understandably feel that the responsibility for passing on any fines to local governments in Wales should be with Welsh Ministers and that they themselves should need to be persuaded that such an action is appropriate.

There are constitutional and practical reasons for the Government of Wales’ approach. In constitutional terms, the National Assembly has full responsibility for local government in Wales and should take any umbrella responsibility on matters such as these. In practical terms, the Assembly has responsibility for ensuring the financial settlements for local government in Wales and so should be involved in any discussion. Furthermore, issues that could generate fines, such as non-compliance on issues such as air quality or waste, are within the responsibility of the Assembly. There is also a need for any passing on of fines to be seen as reasonable and proportionate. Local government in Wales may feel that its circumstances will be better understood by those in Cardiff Bay compared with those in the Treasury in London.

Finally, there is the general question that it is inappropriate to punish local authorities when they are not party to direct discussion with the EU on such matters. They do not have a direct voice in negotiations with the EU in a way that influences EU law. If the National Assembly has the responsibility to implement any such fines in Wales, can we have an assurance that the UK Government would not block Welsh government Ministers from having a direct interface with the EU on such matters? At the end of the day, it would probably be fairer if all these matters were not in this Bill. I beg to move.

[Lord Tope]

My Lords, as well as speaking to Amendments 110A and 186B, I shall speak particularly to Amendments 114A and 115A. Before doing that I should declare some interests that I have not previously needed to declare. I am a member of the Local Government Association’s European and International Programme Board. I have been a member of that and its predecessor bodies for more years than I care to remember. I am also a member of the Committee of the Regions, the EU body established in 1994 under the Maastricht treaty to be the voice of regional and local government in the European Union. Since the Greater London Authority has some interest in these matters as well, I should mention that I was a member of that authority for its first eight years of life and chaired the European sub-committee of the Metropolitan Police Authority.

Amendments 110A and 186B would make sure that any fine could be passed on to a council only in respect of an EU instrument that has been specifically designated by both Houses of Parliament through affirmative resolution so that Ministers would not have carte blanche to pass down any fine. The amendment, which happens to come first on the list, is fairly limited and restrictive.

The substantive amendments before us are Amendments 114A and 115A, tabled by my noble friend Lady Eaton. First, I need to pass on her apologies. She was keen to introduce these amendments but she cannot be here. Today is the first day of the Local Government Association’s annual conference in Birmingham, at which my noble friend has to make what she describes as her farewell speech as the outgoing chair of the LGA. She has therefore asked me to speak on her behalf, which I thought was a very brave decision. I said that I will gladly do so but that I will remain responsible for the words that I use. Therefore, any concern expressed should come only to me.

In the measured terms that we customarily use in your Lordships’ House, it is rather hard for me to express the surprise—the shock, even—anger and concern that were felt in the local government world over all this. The surprise was because the first the LGA knew—this must have been the first any local authority knew—of this being an issue of concern, or indeed an issue at all let alone a proposal, was when the Bill was published. I understand that there had been no prior warning, no prior discussions, no attempts to see whether the problem, if indeed there was a prospective problem, could be resolved in a more satisfactory way than by the inevitably rather blunt instrument of legislation tucked away in Part 2 of a very substantial Bill. I regret that, because it is not generally the way in which any Government in this country have worked on these matters. I do not know how or why it came about, but that was apparently the first that the LGA, and indeed local government generally, knew of such matters.

For that reason, local government and many other organisations would much rather remove Part 2 of the Bill altogether. That was why my noble friends and I put down clause stand part debates for all of Part 2. It remains my view that it would be better if this part was not in the Bill at all. If the Government foresee difficulties and problems of this nature, they should discuss them with the LGA and other interested bodies and find a more satisfactory way of resolving them. I suspect that we are not going to lose Part 2, but I still urge the Government to do that.

My noble friend Lady Hanham was, like me, a member of the Committee of the Regions for many years, and she will be familiar with the practice adopted a few years ago by the European Commission which it chooses to call, in true Eurospeak, “systematic dialogue”. “Systematic dialogue” is more or less what it says; they meet and discuss with representatives of local government and regional government throughout the European Union any issues of concern, issues that are coming up and so on. That ought to be the good practice adopted in this country, and I hope, regardless of the outcome of our discussions on this Bill, that government will undertake to do as we used to do some years ago—I remember going to some of the meetings myself—and discuss issues such as this with local government representatives so that this part of the Bill never needs to be used. I think we would all accept that if we ever get to the stage when government is imposing or passing on EU fines, something somewhere along the line has failed to work. We should not get to that stage, and I therefore hope that the Government will agree to work with the LGA in a spirit of systematic dialogue, of willing co-operation, to try to ensure that that does not happen.

My first contention is therefore to remove Part 2 altogether. If that is not to happen, and the Government insist that this issue needs to be dealt with in this way, through legislation, we need to look at how that is done. The concerns of the LGA and other bodies are that these proposals are unfair, unworkable, dangerous to council budgets and unconstitutional.

I want to deal today with what is described as unconstitutional. The issue is that the Minister, under this legislation, is set to act as judge and jury in this matter, and to be not only the final arbiter but the only arbiter in determining what fines are passed on, in what proportions, how, in what way, and so on. That cannot be right, and more importantly perhaps, it cannot be sensible. It is hard to imagine anything being more open to judicial proceedings because it is so arbitrary and unfair. If we are to proceed with Part 2, we have to look for a system of arbitration that is, first, seen to be entirely independent of the Minister—in other words, the arbiters should not be appointed by him or act as an advisory body—and is, secondly, fair and accepted by both sides.

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[Earl Attlee]

My Lords, the noble Lord makes an important point, but the amendment tabled by the noble Lord, Lord Tope, deals with it because until the directive has been designated, the Government can deal and negotiate freely with the Commission and with the affected local authorities to try to find a solution to the problem. Most of the time, we will be able to achieve compliance relatively easily. I hope we will never get to a situation where we cannot achieve compliance.

[Lord Tope]

Before the noble Lord, Lord Wigley, tells us what he is going to do with his amendment, which, as we were reminded just now, is the one we are supposed to be debating, I thank the Minister for his conciliatory response to us tonight and for recognising—indeed, after nearly two hours, he could hardly fail to recognise—that the clauses as drafted are not quite perfection and that more needs to be done. We are, of course, very willing to engage in constructive discussions to try to find a solution and a way through this. I think he will have heard many times during this debate that to have the Secretary of State as prosecutor, judge, jury and executioner is simply not acceptable to your Lordships, and he has made the point that a single unelected arbiter is not acceptable to the Government. Therefore we need to find some solution: an arbitration that is seen to be fair on all sides. That is perhaps where we should concentrate.

As my final word on this subject, I ask the Government to consider seriously the can of worms that others have referred to and which has been spoken of many times in this debate. I suspect that the Government did not fully recognise it when drafting this Bill. Given all the potential difficulties that are implied in all this, should the situation ever arise, is it really worth pursuing Part 2? I think it has been said on all sides of the Committee that our preference would be not to have Part 2.

[Noble Lords]

Hear, hear!

[Lord Tope]

I think that came from all sides of the Chamber. The Government have perhaps recognised that shadow mayors are not to be pursued. It may be time that they should also have the courage to consider whether Part 2 is worth all the trouble that it may potentially cause and whether the best solution to the dilemma we have spent the past two hours debating might be just not to pursue it at all.

[Earl Attlee]

My Lords, inspiration has arrived regarding one of the questions asked by the noble Lord, Lord McKenzie. He asked at what point local authorities would be notified that there is an infraction proceeding. They are made aware via relevant departments from the outset of formal proceedings—so, from an Article 258 letter of formal notice.

Localism Bill

Lord Tope Excerpts

Thursday 23rd June 2011 Lords Chamber

[Lord Tope]

My Lords, I associate myself strongly with the comments of the noble Lord, Lord Jenkin. I know from conversations that Ministers are gaining some private amusement from the number of times that local authorities are asking them when guidance will be issued. They are saying that local authorities cannot get hold of the idea of localism—that they will be allowed to do what they want to do and guidance will not be issued. The reason for this is that local government has for years and years become increasingly used to detailed guidance and regulations being issued. It has come to expect it and at times to require it. It will take a little time to adjust to a change of culture—if, indeed, there is one.

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[Lord Beecham]

My Lords, I speak to Amendments 40 and 43 and, in doing so, endorse very much what the noble Lord, Lord Greaves, has said. This is another example of what Tony Blair might have described as “regulation, regulation, regulation”. It is certainly well over the top. In particular, new Section 9EA(2) of the Local Government Act 2000, which he read out, is as classic a piece of Civil Service gobbledegook as I have seen for some time. I guess that, as I go through the Bill, there would be further examples.

Amendment 40 would delete that clause, and Amendment 43 would deal with the prescription as to the size to be covered by an area committee, limiting it to two-fifths. In principle, I would like to see that matter left entirely to the discretion of local authorities. However, if the Government were not disposed to take that view, my amendment would reduce the size of the committee to something which is less like half the total size of an authority and more like what most of us would regard as a manageable area in which it is possible to reflect the views of local communities and members. If the Government wish to have some guideline on this, I invite the Minister to opt for something lower than the proportion indicated in subsection (5) as it now stands.

[Lord Tope]

My Lords, briefly, I support my noble friend Lord Greaves. He certainly has more experience of rural areas than I do, but I speak from the perspective of what he referred to as a “compact urban area” or, more accurately, a suburban area: a fairly small—in terms of area—London borough. We have six local committees on the council as a whole. There are 43 Liberal Democrat councillors and only 11 Conservative councillors. However, because of the political demography, one of those six local committees is still controlled by a Conservative majority.

Each of those local committees has limited executive powers, which we hope will be extended further, and each operates in quite different ways, partly because of the councillors on them and the way in which they choose to react, and partly, and more particularly, because of the nature of the areas that they represent. All of the councillors for those areas are members of those local committees, to a varying extent, and the local residents in those areas come to those meetings certainly to a far greater extent than they attend meetings of our executive. They take part in those committees and, to varying extents, they feel that they are part of the deliberations.

As a council we have not felt it necessary to prescribe in great detail what each of those local committees shall, or shall not, do or how they will, or will not, behave. They behave sensibly, even the one run by the Conservatives behaves moderately sensibly. We demonstrate, in a very obvious way, the difference between a Conservative-run committee and a Liberal Democrat-run committee. That is what democracy is about; it is what we ought to be doing. As a council, we have not felt the need to prescribe it, nor have we ever thought that we should have prescribed it. I commend to the Government the fact that they too should trust local authorities in this case, as we trust local committees.

[Baroness Hanham]

My Lords, on this debate, I hear what noble Lords say. I shall reflect carefully on what has been said and I shall ask noble Lords to withdraw their amendments for the time being.

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Moved by

[Lord Tope]

44: Schedule 2, page 195, line 13, leave out “, in particular,”

[Lord Tope]

My Lords, I shall speak also to Amendment 84DA in the same group, which stands in my name and that of my noble friend Lady Hamwee. My noble friend would certainly have wished to move this amendment but, unfortunately, she cannot be here. It is suggested to us by the Centre for Public Scrutiny, on whose advisory body she serves, and it follows a theme of today's discussion in Committee. The effect of Amendment 84DA is to remove the right of the Secretary of State to make detailed guidance on scrutiny issues. It would remove the statutory force from existing guidance that the department has produced but, of course, local authorities would still be able to use that existing guidance to get some idea of the legislative intent of Parliament.

The centre believes, and I certainly agree with it very strongly, that the maximum possible discretion should be given to local authorities about how they operate their scrutiny function, with primary legislation providing general enabling powers which are interpreted intelligently by councils, councillors and their officers. Scrutiny is a member-led function and, therefore, it seems inappropriate that Government should provide detailed prescription of its operation. That is the same theme with which we have been dealing all day today and I suspect that we shall continue to do so through much of this Bill.

Where a specific need for guidance is identified, advisory information can be developed by the sector which can incorporate the views of the Government but which would be prepared independently and based on the needs and interests of local authorities and their residents. The justification for omitting this paragraph on guidance is a combination of practical reasons and reasons of principle. I beg to move.

[Lord True]

My Lords, I do not wish to prolong proceedings, but I have not had an opportunity to say how much I agree with the general thrust of many of the things that are being said. It may be that, at a later stage, it will be possible, through Amendment 84DA, to leave out a “must” and put in a “may”. Those who advise the Secretary of State, and who have the pleasure of writing all sorts of guidance for local authorities, could continue to do so and we could pay due respect to the importance of that guidance and to guidance that came from other sources. Then perhaps everyone would be delighted and a little localism might reign.

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[Lord Tope]

My Lords, I am very grateful to the Minister for what I interpret as a very positive response. I am sure that we will discuss further how we can best approach this subject and I am sure that the Centre for Public Scrutiny would be pleased to engage in that. As I say, the theme that has run through our discussion today is the necessity to have more control and influence over what local authorities do and the extent to which they should be enabled to have the freedom that the Bill purports to give them. There is a distinction between guidance which has statutory force and disseminating good practice, which good local authorities would be well advised to adopt but should not be required by statute to do so. I hope that when we come to the next stage of the Bill we will be able to reflect that in a more appropriate way. In the mean time, I beg leave to withdraw the amendment.

Amendment 44 withdrawn.

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[Lord True]

My Lords, I understand where the noble Lord is coming from but there are obvious difficulties with the amendment quite apart from whether or not it is tending towards prescription. For example, I recall a not very happy election in 1986 when I was one of three members of my party on our local authority—

[Lord Tope]

That was a very happy election.

[Lord True]

It may have been for others. I did not know that the noble Lord, Lord Tope, was there. In those circumstances, had there been a scrutiny system with four scrutiny committees, under this amendment a member of the opposition would have found himself or herself chairing two scrutiny committees. The principle behind the amendment is a good one but in practice it simply would not work. In my humble view, the so-called “cabinet” system that was imposed on us by the previous Administration has tended, as many of us involved in local government know, to create a potential gulf between the executive members and the back-bench members of the governing party and local authorities have had to work against that all the time. It is vital that back-bench members of the governing party have full involvement—often very sceptical involvement—in the operation of the authority. It is desirable that they should also be given the opportunity to take a leading role in challenging the authority and scrutinising it. This is often the case in many authorities that I know and have visited. It would be outrageous for the opposition party to be excluded from chairing scrutiny committees but equally, as well as being impractical in certain circumstances, it would be undesirable to exclude the back-bench members of a governing party from being involved in taking executive decisions and playing a leading role in scrutiny. Therefore, I am afraid that I cannot support my noble friend’s amendment.

[Lord Beecham]

My Lords, I begin by paying tribute to the noble Lord, Lord Shipley, and his colleagues for changing the system that we operated in Newcastle when they took office in 2004. I will let the noble Lord and your Lordships into the secret that prior to that date I had tried to persuade my colleagues at least to emulate the system in another place of a balance of chairmanship of such committees, but with my usual lack of cogency I failed to persuade them at that time. However, they have now been converted by the noble Lord and his colleagues, so things move on.

I entirely accept what the noble Lord, Lord True, has said about the impracticality of the suggestion behind the amendment. I can give a better justification. The borough of Newham has 60 Labour members and no opposition members at all—or at least no overt opposition members—so clearly the amendment would not work there. The Labour Party advice about scrutiny committees is that the relevant duty should be shared. That is national Labour Party advice and I hope that the same is true of other political parties as well. It would make a great deal of sense.

If I differ from the noble Lord it is because, as has rather often been the case, he has tended to view scrutiny as something retrospective and as a case of holding an executive to account for decisions that it has made or is about to make. That is part of the job but it overlooks the forward programming of an authority and the development of policy. One of the great advantages of properly resourced scrutiny is that it allows members to develop policy free of the operation of the whip, which should not apply in scrutiny.

After 24 years chairing committees and leading a council, I was eventually voluntarily dispatched to my Siberian power station; that is, the arts and recreation committee in Newcastle. I found that being a back-bencher was very different from chairing a meeting. As the chairman of a meeting, you had an agenda and if you were any good at it you knew what you wanted, you had a discussion and you got it through. In Newcastle’s case I would have a pre-meeting with 15 Labour members for an hour. That represents an average of four minutes each. The dialogue was not Socratic in its nature. It was not the highest level of political debate and many members were simply concerned to get through the meeting as quickly as possible. By contrast, scrutiny actually allows people to think. Some people found the transition to be rather difficult, but it is welcome.

The whole thing can be summarised for me by my moment of revelation, which came when, having missed a meeting, I went to a meeting of the arts and recreation committee—a very worthy committee with a big agenda —and I read in a minute that a member had raised the question of birds eating grass seed on the Leazes Park allotment. I thought, “Has it really come to this? This is not really an effective way of running things”. I therefore support in principle the executive scrutiny split, provided that scrutiny is adequately resourced.

Subject to those reservations, I generally support scrutiny. I will refer briefly to Amendment 48 in this group relating to new Section 9FC and the guidance being proffered. New subsection (3) states that in exercising the power to refer matters to a scrutiny committee,

“the member must have regard to any guidance for the time being issued by the Secretary of State”.

The notion that 20,000 councillors are going to consult the bible on scrutiny issued by Eland House before they are able to refer something is, frankly, ridiculous. I anticipate that the Minister will acknowledge that this could be excised from the Bill without damage. I invite her so to indicate.

[Lord Tope]

My Lords, I am sure that we will all forgive the noble Lord, Lord Beecham, for paying tribute to my noble friend Lord Shipley. It was a well deserved tribute. Perhaps I may also help him with the problem he enunciated about the London Borough of Newham. Of course, it would make it very much easier for Newham to implement my noble friend’s proposals were we to have proportional representation in local government. For the past 25 years, the first past the post system in local government has very ill served the Conservative Party; it has, throughout pretty well all those 25 years, been most unjustly served by our current electoral system. None of that was what I intended to say. In fact, I rose to speak to Amendment 46 and 47 in this group. My noble friend Lord Greaves will speak to Amendments 49 and 49C.

Amendment 46 is self-explanatory. Its provisions recognise the reality of a situation that in many authorities it is not a single officer who alone has the scrutiny function. That person will inevitably, in most cases, need other officers in the discharge of those functions. That speaks for itself and my amendment is a better way to reflect reality in most authorities.

Amendment 47 is rather more serious. Its purpose, if we are to have this part of the Bill, is that the scrutiny provisions should apply also to district councils. I am sure that my noble friend Lord Greaves has far greater experience. I have no experience of district councils because I am in an inner London borough. I know of no reason why—albeit with lesser functions—district councils should not be treated in exactly the same way as all other local authorities of whatever type in the country, as far as the scrutiny function is concerned. That is why Amendment 47 seeks to remove from the Bill the new subsection that excludes district councils from these provisions.

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Moved by

[Lord Tope]

45A: Schedule 2, page 199, leave out lines 1 to 7

[Lord Tope]

My Lords, in moving Amendment 45A I will attempt to speak to the other 31 amendments in this group. I feel sure that your Lordships will be grateful if I do not list each of those 31 amendments to which I am speaking.

These amendments have come from the Centre for Public Scrutiny and would have been spoken to far more eloquently by my noble friend Lady Hamwee, who serves on its advisory board. I shall endeavour to cover them myself. I share the centre’s concern that in some places scrutiny has got a rather bad name. As the noble Lord, Lord Beecham, said earlier, this is partly because it is seen as simply a post-hoc thing, looking back at what was done and might have been done differently rather than as part of a policy development framework, and also because of some of the effects of the rather strict executive/scrutiny split that we have had for the last 10 or 11 years.

Success in scrutiny is about culture and personal relationships, not processes. As it stands, the law makes unrealistic and unreasonable demands on scrutiny councillors and scrutiny functions to act in a certain way. The law is internally inconsistent, causing frustration to members and officers, who feel that they are constrained in what they can and cannot do for apparently no good reason. At no point have these policy constraints been explained by government. They are the result of 10 years of piecemeal changes to the legislation without any coherent thought having been given to the way that scrutiny operates across the piece. The Bill provides an ideal opportunity to take a broad look and make changes that are supported by practitioners in local government. That is what this raft of amendments seeks to do. Again, I can explain in some detail what each of the 32 amendments seeks to achieve. I can see from the expressions around me in the Chamber that your Lordships are keen and eager for me to do exactly that but I will not. I simply say that they seek to cover two key areas where it is considered that scrutiny needs additional freedom to become more effective.

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[Lord Tope]

My Lords, as always I am grateful to the Minister for her reply. I rather wish now that I had gone into each amendment in a little more detail, because they are worthy of discussion. I do not accept entirely the responses of the Minister, but now is not the opportunity to discuss them in detail. However, I am grateful for her willingness at least to consider the issues further. As I said, the amendments were suggested by the Centre for Public Scrutiny, which has considerable experience, and an obvious interest, in ensuring that scrutiny, by whatever system, works more effectively and that we learn from the experience of previous years in order to improve it. That is the sole object of my amendments, which I am sure that all noble Lords will share.

We will certainly take the Minister up on her offer of further discussions, not just on the specifics of the amendments—she is sympathetic to some and clearly not to others—but to try to ensure that the Bill achieves what I hope it seeks to achieve, which is to grant local authorities more freedom to conduct scrutiny, to do so more effectively and to do so in respect of other organisations with whom they share services, help to deliver them or play an important part in local communities. Given the assurance from the Minister, I beg leave to withdraw the first in this raft of amendments and will try to keep up as we go through the rest.

Amendment 45A withdrawn.

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Moved by

[Lord Tope]

56: Schedule 2, page 210, leave out lines 8 to 18

[Lord Tope]

My Lords, I am conscious that Amendment 56 is possibly not now the most important or interesting in this group, but we tabled it as a probing amendment with a view to asking the Minister to explain more clearly than is apparent in the Bill itself new Section 9H(3) and (4), which deals with the nature of a mayor and his or her relationship with the council. While I am on my feet, I shall refer to some of the other amendments in this group and, indeed, to others that are yet to come. Again I congratulate the Government on recognising that the whole question of shadow mayors and mayoral arrangements really has no place in a Bill that is about localism. As we discussed at Question Time yesterday, I know that it will be said by some that this is a sensible move by a listening Government, and said by others to be a U-turn. I do not mind very much what it is called; I just feel that the Government are to be congratulated.

I thank in particular the Minister for bringing the decision forward at such an early stage in our consideration of the Bill, which no doubt will save many hours of debate in this Chamber. With that, I beg to move Amendment 56 and I look forward to the debate on the other amendments in the group.

[Lord True]

My Lords, I have a number of amendments in this group, and I want to follow on from what the noble Lord, Lord Tope, has said by thanking very sincerely my noble friend for the leadership and responsiveness she has shown on this matter. Those of us who have been present in the Committee today will also have noted the openness, warmth and positive way in which she has responded to a number of the points that have been put forward. We are all grateful for that.

I am slightly confused by the groupings, which have changed a little overnight, perhaps for reasons related to pre-emption or to a number of other points. By the way, I should pay tribute to my noble friend Lord Jenkin of Roding, who played a big part in raising this issue at Second Reading. There was unity across the House that to create shadow mayors before the electors in the cities concerned had had an opportunity to have their say was not a good idea. The Minister then came forward at the earliest possible opportunity to say that the Government had accepted the arguments, so the principle does not need to be debated at any great length, and I do not propose to do so. However, I should give notice, in speaking to the large number of amendments within this grouping, that it should be taken that I have also spoken to Amendments 74A, 77A, 77B, 79A and 81A. They are not in this group, but they relate to the same subject. Even if I have it wrong, I hope that the Committee will accept that I shall not come back to those amendments later, and I repeat my thanks to my noble friend for taking up the point in the positive way she has.

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[Baroness Hanham]

I thank the noble Lord for that. Unless I have not done something that I ought to have done, I ask that the amendments that I have listed be accepted and that the noble Lord withdraw Amendment 56 for the moment.

[Lord Tope]

My Lords, I guess that I am grateful to some extent for the Minister’s explanation, but I am not sure that her telling me that the provision is taken from a previous Act, which I already knew, necessarily explains more fully the issues which the noble Lord, Lord Beecham, has referred to. I do not think that we will get very much further with this matter today, but we will need to look at it again.

We have a raft of amendments which the Government are supporting. They are in various different groups, which I think the Minister is struggling with—certainly, I am; I admit to that. I think that we are all struggling with it; we were all dealing with it in the middle of the night last night trying to understand it. When the Bill is eventually reprinted on Report, we will inevitably have to look at what is left in it and at what some of the consequences may be. We will undoubtedly return to it if necessary. In the mean time, I beg leave to withdraw Amendment 56.

Amendment 56 withdrawn.

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[Lord Jenkin of Roding]

My Lords, in the absence of my noble friend Lady Scott of Needham Market, perhaps I may give a very short introduction to this group of amendments. I say at once that my noble friend has been as good as her word and put her name to the main amendment in the group, Amendment 57. She will no longer press the case for mayors and chief executives to combine their role. With this having been virtually outlawed in public companies, and with the idea of an independent chairman and a chief executive being quite separate, having become very nearly standard in major quoted companies, it would seem very odd that local authorities should be moving in the other direction. I am delighted that the Government have seen that that is not a very sensible way to go. I have the same difficulty as my noble friend Lord Tope in trying to find out exactly where we have got to. In moving this amendment, I hope that my noble friend on the Front Bench will be able to make all things clear. I beg to move.

[Lord Tope]

My Lords, my name, too, is on this amendment like that of my noble friend Lady Scott of Needham Market. Unfortunately my noble friend is unable to be here today—which I think she particularly regrets given the other names that have now been added to the amendment. I echo all that the noble Lord, Lord Jenkin, has said, and I am relieved to know that even with all his experience, he is possibly nearly as confused as I am about exactly where we are left with this, except that it is certainly in a much better place than it was a few days ago, which is welcome.

I understand now—in the proper spirit of localism, I suppose—that those mayors who are minded also to become chief executives, as I think is intended in Leicester, are at liberty to do so. I said at Second Reading that localism must mean the right to make the wrong decision. Therefore, I have to defend the right to make the wrong decision. There should be a clear difference between the role of an elected political leader and the role of a chief executive—I realise that we still have a head of paid service. A chief executive is usually, in theory, apolitical. There is a clear distinction and I regret the extent to which that is becoming blurred.

Once again I thank the Minister not only for her support for the amendment but for being willing and able to come out and say so at an early stage in the Bill. Like the noble Lord, Lord Jenkin, I look forward to a clear exposition of exactly where we are, and what is and is not in the Bill, as we go forward.

[Lord Beecham]

My Lords, I join this love fest with enthusiasm and congratulate not only the Minister on working this small miracle but other noble Lords—particularly the noble Lord, Lord Jenkin, whose long experience and stature have no doubt contributed to bringing about a change of mind on the part of Ministers generally—on achieving this very satisfactory result to what would otherwise have been a very unfortunate situation. I am happy to endorse everything that has been said by the noble Lord, Lord Tope, in thanking all those involved.

[Baroness Hanham]

My Lords, I hope that we might be able to get back on track again without me having to swing round to make sure that I have done all the right things. We are happy to accept Amendment 57; I made clear my support for that previously in Committee. We recognise that there is great concern about the combination of the mayor and chief executive under the shadow arrangements and are content to support the amendment.

We are not quite so happy with Amendment 58 and I am going to reject it—I cannot see why, but I am. By the time we get round to the next stage I will have recovered my composure. I think that I was so taken by the noble Lord, Lord Tope, being so nice about me that I completely got underneath this. No doubt he will return to the issue at the next stage if he feels it necessary. In the mean time, I am not going to accept that amendment but have spoken to all the others.

[Lord Tope]

My Lords, I am grateful to the Minister. I am not sure that I can accept her reasoning for rejecting Amendment 58, which is also in my name—not least because I have been nice to her and about her for at least 21 years; she should be very well used to it by now. That is not a reason for being unable to give the reasons for rejecting the amendment. However, as I am moving Amendment 57 in this group, I beg leave to withdraw that amendment. No, I am sorry. I am so unused to this. I beg to move.

[Lord Jenkin of Roding]

I have already moved Amendment 57. I had originally hoped that my noble friend Lady Scott of Needham Market would be here to move the amendment. We have had an exchange of e-mails and I am sorry to see that she is not. In those circumstances, I moved the amendment. I repeat, this is not so much a love fest as a return of common sense, and we are all delighted with that.

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[Lord Beecham]

My Lords, this group of amendments relates to still more regulatory powers conferred on the Secretary of State, this time in connection with the mayoral position, however derived, in respect of terms of office and the like. The schedule gives the Secretary of State power to regulate the term of office of an elected mayor. I am asking, through the amendment, whether “the term” is used in the sense of a four-year or five-year term, or whether it also gives the Secretary of State power to limit the number of terms. For example, under the police reform Bill, there is a limit to the number of terms that a police commissioner can serve—if that cataclysmic proposal should reach the statute book—to two terms of four years. There is nothing in the Bill to suggest that that is the Government’s intention this time, but it would be welcome if we could have an indication that it was not intended to limit the number of terms for an elected mayor. I say that having served what would have been four and a bit terms, had that term applied to the leadership of the council in Newcastle. But I declare no interest whatever in being elected mayor of Newcastle. I make that very clear.

Amendment 65 refers to the wide-ranging powers in regulations and would restrict those necessary for the purposes of this part of the Bill. Amendment 66 relates to a curious provision on elections and their administration. Under subsection (5) of new Section 9HN, the Secretary of State may make regulations,

“exercisable … on, and in accordance with, a recommendation of the Electoral Commission”,

with a curious exception which I do not really understand. Perhaps the noble Baroness can help me, if not today then subsequently, because it goes on to say,

“except where the Secretary of State considers that it is expedient to exercise that power in consequence of changes in the value of money”.

I do not understand to what that relates. It might relate to election expenses, but it is certainly not clear from the section what it relates to, and a little elucidation would be extremely welcome.

Amendment 67 seeks to ensure that the exercise of the Secretary of State’s powers to regulate in this whole issue of elected mayors and their elections is subject to approval by the Houses of Parliament. These are matters going to the heart of the exercise of local democracy, and they should be subject to affirmative resolution.

I think that the noble Lord, Lord Shipley, will speak to Amendment 86. One particularly odd matter is covered by Amendment 87ZA, which curiously has the Secretary of State involved in the appointment of mayoral assistants. I cannot think why that should be the case. I recall once in Newcastle, when we had a twinning relationship with a city in China, their mayoral delegation came over and the mayor addressed the council. He went up to the dais and one of his retinue came up with his spectacle case, opened it and handed the mayor his spectacles. That seemed an interesting position to hold, and I thought I would indent for a spectacle bearer to the leader of the council, but in the end refrained from doing so. Presumably the Secretary of State would now get involved in such an appointment. It cannot be right, can it, for the Secretary of State to be making regulations for the appointment of a mayoral assistant? Perhaps the Minister can explain. If she cannot do so today—and I would not at all blame her—perhaps she might write to me and others of your Lordships on that point. I beg to move.

[Lord Tope]

I shall speak to Amendments 86 and 87 in this grouping. My noble friend Lord Shipley has unfortunately had to leave for an hour for another very important engagement, as things would have it at exactly the moment when his amendments come up, so I find myself once again in that position.

The amendments are fairly self-explanatory. They deal with the appointment by the elected mayor of a deputy mayor. Amendment 86 says that such an appointment should be subject to agreement by a majority of the executive. That is certainly desirable; the amendment would say that it was essential, and that would be quite proper given what the role of the deputy mayor could be.

Amendment 87 deals with a situation when there is a vacancy in the office of deputy mayor and the elected mayor has to appoint another person to be deputy mayor. There is no provision that that other person need be a member of the executive; therefore, it is even more important in those circumstances that the other person appointed by the deputy mayor should meet with the agreement of a majority of the executive. As the noble Lord, Lord Beecham said earlier in a slightly different context, any sensible mayor, like any sensible leader, would make sure that they did that. On the other hand, it is still a little easier to remove a leader if it is necessary than, quite rightly, to remove an elected mayor. Therefore, we feel that this provision should be in the Bill for the sake of good government.

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Moved by

[Lord Tope]

70: Schedule 2, page 222, line 40, leave out “third day after the relevant elections” and insert “relevant day”

[Lord Tope]

My Lords, I move the amendment in my name and that of my noble friend Lord Palmer of Childs Hill, and speak to Amendments 71 and 72.

The Bill will enable local authorities to return to a committee structure and, indeed, to be more free than they have been for some time to determine what governance structure they wish to have, and which best suits their particular circumstances. That is wholly to be welcomed. It is clear that the Government rightly believe that that should be a matter for the local authority in a local area rather than central government.

A number of local authorities are already working in anticipation to improve, in their eyes, their decision-making structure, particularly to enable all councillors to play a more effective part in decision making than many of us feel has been possible with the executive/scrutiny split. Indeed, I have for the past couple of months been chairing a working party for my own local authority, looking at exactly that. It proved rather more difficult than I had expected because most of my colleagues in my local authority do not remember the old committee system. They have grown up believing —rather mistakenly, in my view—that the executive/scrutiny split was the natural and normal way of doing things; whereas the old dinosaurs like me believe that there was once a rather better way that would leave them less frustrated than many of them are in their role on the local committees.

All of that is to be welcomed. On Monday evening, I will present these proposals to my council group in the hope that they will be acclaimed. However, I think that they will initially be met with some puzzlement: “Are we really there to make decisions?”. “Well, yes, there were another 44 of you elected who ought to have a part in the decision-making process, because that is what you were elected for”. Hopefully all of that will happen but, as things stand, I then have to break the news to them that, desirable though all this is, and much as though the Government are happy for all of this to happen, none of it can happen for another three years. The Bill says that none of this can be introduced until after the next elections. In the case of London boroughs, that is 2014. For those authorities that have only this year had whole-council elections it will be a further four years.

If the Government believe it is right for these things to happen, I can see no reason why, once an authority, through the proper process, has agreed what it wants to do, it should not implement that now. I hope that we shall have a sympathetic response from the Government. I shall not challenge the Minister to explain why she feels that in London—in her own authority perhaps—there needs to be a three-year gestation period, or in other areas a four-year period, while we all wait.

Some authorities, some quite well known to the Minister and some certainly known to me—it will possibly happen more so in my own authority—have de facto set up a committee system already. The committees meet and de facto make recommendations, but in fact the executive, as it is legally required to do, meets immediately afterwards for no more than five minutes simply to rubber-stamp decisions made by the committees. That must be a nonsense. At the moment, it is a necessary nonsense, as that is what the law requires, but for us to continue in that ridiculous state for another three or four years makes no sense at all.

I hope that the Minister will be able to accept our amendments—it would be an unusual victory for me to achieve—or at least be able to express sympathy with them and say that she will come back on Report with something to give effect to them. It is quite important that we get an indication that this will happen on Report, or that it will not happen, because many of us will be looking to implement the changes from the next annual council meeting in May. It so happens that my authority is well advanced with this but others may perhaps only just be starting to think about it or may not even yet have realised that they can think about the changes. I beg to move.

[Lord McKenzie of Luton]

My Lords, we have sympathy with these amendments and look forward to the Minister's reply about why there should be this proposed three-year wait. The noble Lord, Lord Tope, talked with some affection about the committee structure. I was leader of Luton Borough Council at the time when we went from a committee structure to a leader and executive structure. My experience was that when you are in control, the leader and executive arrangement is particularly helpful. In 2003, we ended up with a hung council and, although we were the largest party, there was a Lib Dem-Conservative coalition which appointed Lib Dems to the executive. Being on the receiving end of that, we were somewhat less enthusiastic, but I still remain committed to it. I think that the best route is to have a leader and an executive.

One thing that was lost with the committee structure was the opportunity for new councillors, particularly younger councillors, to get involved with the cut and thrust of political debate because the structure and role of scrutiny committees are different. I think an opportunity to learn through that route and to have that debate was missed. We support the right for councils to choose and to revert to a committee structure, if that is what they want. On that basis, it seems that there is no great justification in waiting three years, but the Minister may be able to convince us. Subject to that, we support the amendments.

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[Baroness Hanham]

My Lords, that was a short debate and I can probably give a reasonably short answer. We have some sympathy with the points that have been raised, particularly about the time that has to elapse before the changes can be implemented. I will not accept the amendment today but I am happy to take it away and consider whether those provisions are as good as they can be.

[Lord Tope]

My Lords, I think I am grateful for that reply, which I think was an encouraging one. I spent 13 years as leader of a council under a committee system. I stood down on the day that we adopted the executive/scrutiny split—not for that reason, but it was a convenient time to do so—and spent the subsequent 12 years as a member of the executive, so I have experience of both.

I am sorry that I led us into a debate on what the best system is. It was probably inevitable that we would have a debate on what the best system is and what our personal experiences are, but the noble Lord, Lord True, was absolutely right to remind us that that is not our business to debate today. Having rightly left local authorities to determine for themselves what system they want, the only decision for us on these amendments today is the date on which that can be implemented. That is the sole purpose of my amendments, whether they are perfectly drafted—as I am sure they must be—or whether there is something more or different that needs to be done.

I hope very much that the Minister can be as clear as possible that when we come back on Report we will have amendments, moved in whoever’s name, that will make absolutely clear that there is no need and that it makes no sense for local authorities which have whole-council elections to wait three or four years before implementing the changes that we say they should have the right to do. In hopeful anticipation, I beg leave to withdraw the amendment.

Amendment 70 withdrawn.

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Moved by

[Lord Tope]

73: Schedule 2, page 225, line 48, leave out “5” and insert “10”

[Lord Tope]

My Lords, my noble friend Lord Shipley wished to move this amendment but, as I explained earlier, he has unfortunately, from my point of view, had to go to another engagement and will be there, I think, for another 15 minutes or so.

At a later stage of the Bill, we will probably spend a considerable amount of time discussing local referendums and the many issues that arise in connection with them. This is the first, and perhaps in some ways slightly premature, time that we come to this subject. Amendment 73 would raise the threshold for calling a referendum from 5 to 10 per cent of local government electors. We believe that 5 per cent is too low a figure. When we get to the later provisions, we will have a lot more to say about what the threshold should be and how we should get there, as well as other issues.

My noble friend Lord Shipley would have said that, if the need for a referendum is strong, there really should be more signatures to demonstrate that, and they should be easy to collect. I think we all recognise that the cost of a referendum, wherever it is conducted, is significant—it is not something that is simple to carry out. A whole range of matters has to be dealt with in conducting a referendum and, if it is to be done at significant cost, the need for it must be truly demonstrated. Public demand for it should be there, and 10 per cent—I would say at least 10 per cent—is a better figure because it balances the right to have a referendum, which is conferred under this legislation, with the need for it to be held and the implications of doing so. I beg to move.

[Lord Beecham]

My Lords, this is another example of possible misplacement in the groupings, for which I do not blame anyone. It is very difficult to get a perfectly rational system. In fact, I pay tribute to the officer of this House who works so hard, so long and so late in trying to make sense of my and other noble Lords’ belated efforts to table amendments. She does a wonderful job and I have every sympathy for her. At least she does not have to read my handwriting, which would make the task impossible and not just difficult.

In relation to the amendment moved by the noble Lord, Lord Tope, I certainly concur, as, I think, do these Benches, with the proposal for a higher threshold. However, I want to address the rest of the amendments in this group, which go to the critical question in relation to governance of whether there should be compulsory referendums at the diktat of the Secretary of State. The amendments that follow essentially relate to that.

The Minister has fortunately helped us by removing the conflation of the position of mayor and chief executive, and she has dealt with—perhaps liquidated—the position of shadow mayor. We are now left with this element of the compulsory referendum. In that respect, it is necessary to look at the whole question of the mayoral system—its provenance and development.

I was present at the meeting about 15 years ago when Tony Blair launched on an unsuspecting Labour Party, and an even more unsuspecting shadow Secretary of State in the person of Frank Dobson, the notion of an elected Mayor of London and, following that, the possibility of having elected mayors elsewhere. I took his motivation at face value. He thought—and others who have advocated this in the past have thought and currently think—that it would invigorate local democracy, improve turnout at local elections and enhance the accountability of local political leadership because the elected mayor would have a mandate from across the whole authority. That was the theory; let us look a little at the practice.

Bearing in mind that until now, and until the legislation changes, only 5 per cent of the electorate in any authority has been needed to requisition a referendum, there have been, I think, only 41 referendums, if one takes Leicester into account, in the 10 years in which this option has been open. One area has had second thoughts and has terminated its adoption of the system. Of the 40 referendums, 14 were in favour of an elected mayor and 26 against.

What is perhaps more significant is the turnout in the referendums and the turnout in the local elections. This, after all, was going to be the great advantage to local democracy of this new system. There have only been two referendum turnouts greater than 40 per cent and both of those took place on a general election day. Some referendums had turnouts of less than 20 per cent, 10 had between 20 and 30 percent, and 17 had between 30 and 40 per cent. The upper thirties is probably about average for a local election—by no means satisfactory, but self-evidently at least no worse, and in many cases better, than the turnout in these referendums. It is quite significant that the turnouts were also very low in the ensuing elections. Some of the referendum turnouts were abysmally low: Bedford had a turnout of 16 per cent; Lewisham had a turnout of 18 per cent; among the best were Hartlepool with 34 per cent and Torbay with 32 per cent. However, this does not give any grounds for saying that this is an enormously popular reform that people are rushing to adopt.

Nor has the turnout in elections been very much greater, even in London. The turnout in the first mayoral election in London was 37 per cent. In the second, there were two—how shall I put it?—charismatic or certainly very visible candidates, and an election that seemed to run for a year, such that every time I stepped out of a Tube station in London and saw an Evening Standard banner, it was always proclaiming something about Ken or Boris. It was impossible, even if one wished to, to escape the fact that there was a London mayoral election. However, even then, the point seems to have eluded 55 per cent of the London electorate. Again, there does not seem to be much evidence for the initial inspiration of this change: that it would improve—whether dramatically, modestly or even at all—the turnout in local elections or interest in local government.

The other arguments were about visibility and effectiveness. Many of the elected mayors have been capable people. In London, I can certainly cite three of them: Robin Wales in Newham; Steve Bullock in Lewisham, albeit with a referendum there of only 18 per cent and, I think, a mayoral election turnout of about the same, when he was first elected; and Jules Pipe in Hackney. All of them, incidentally, had been council leaders before they became elected mayors. However, what sort of alchemy is it that is necessary to transmute a council leader into a mayor? Or is it—and I hope the right reverend Prelate will not take exception to my analogy—some process of transubstantiation that transforms a less visible and accountable leader into an all-singing, all-dancing mayor with much enhanced visibility and effectiveness?

It was interesting that, in promoting the idea of elected mayors, the Labour Party saw fit to send a delegation to the Netherlands to see how this wonderful system was working. They slightly overlooked the fact that, in the Netherlands, mayors are in fact Crown appointees and not elected at all. Similarly, those who pointed to very successful continental mayors, such as the mayor of Barcelona, seem to overlook the fact that he was not personally directly elected—he was the leader of the largest group or faction in the Barcelona council. He was a very able—in fact a brilliant—local politician and extremely effective, but he but not directly elected. In our own politics, although I remember Tony Blair saying in a television broadcast, “The people of Britain elected me Prime Minister”, actually they did not. They certainly have not elected the present Prime Minister. That is not to disparage him; it is just a fact. Why should it be assumed that it is necessary to have that direct personal mandate to be a legitimate leader?

It is said that if authorities adopted the mayoral system, extra powers would be given and a certain amount has been given to mayors in that position. Yet the question arises that we discussed briefly at Second Reading and earlier in Committee: why should those powers be confined to the directly elected mayor, as opposed to the leader and executive model? There seems to be no particular rationale on that. One thinks of great local government figures of the past, from all parties: of Joseph Chamberlain in his initial, Liberal incarnation; of Neville Chamberlain, who was slightly dismissed by Lloyd George as a good mayor of Birmingham in a bad year but who nevertheless had a considerable local government reputation and, it is fair to say, did a lot for it as a Minister; or of Herbert Morrison, a great leader of local government; or, perhaps slightly more controversially, of one of my capable but slightly flawed predecessors as leader of Newcastle council, Dan Smith, who was nevertheless a hugely influential and creative figure, in the best sense, during his surprisingly brief period. People in all political parties have also been extremely effective. Why should it be assumed that council leaders are necessarily less visible, accountable or effective than elected mayors?

There are problems stemming from the system as it has been created, not simply because of the accretion of powers in a single pair of hands but because of the structure around that. It takes a two-thirds majority to overturn an elected mayor’s budget. Yet you can have a situation with an elected mayor from one party and a majority of the council from another. It has happened twice in the authority adjoining mine. It happened with a Labour mayor and a Tory council and it is now exactly the other way round, with a substantial Labour majority in North Tyneside and a Conservative mayor. That highly anomalous situation raises two questions. First, what is the other councillors’ role in that kind of situation? It has to be a substantially downgraded role from what we are used to and what is appropriate. Secondly, will there not come a day when people wonder, “What is the point of electing councillors at all, or of voting for a particular political party, if you are required to have at least two-thirds of the council to vote down a proposition from the mayor”? Most particularly, there is the most crucial decision of all: that about the budget. There are, it seems, real difficulties inherent in the system.

There is also a suspicion, certainly on this side of the Chamber—it may be in certain parts of the other side of the Chamber—about the current political motivation for this decision to take the power to require referendums to be held. I refer in particular to a speech made by the Member for Grantham and Stamford in another place, Nick Boles. He is, I suppose, a Tory intellectual. There are people unkind enough to think that term a bit of an oxymoron but I would not allege that in the case of Mr Boles, who is an extremely bright, intelligent and articulate man. Yet he said some time ago, apropos of this position about elected mayors, that it was the only way in which there would be a ladder back into power for the Conservative Party in places where its chances were pretty minimal. I think that he cited Manchester and other places where Conservative representation has been minimal, if not nil, for some time. I hope that is not the Government’s motivation and I would not for a moment imagine that the Minister would subscribe to that motivation, but others elsewhere might.

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[Lord Greaves]

My Lords, I will be very quick; we would not want the Minister to be late. She is quite right: I am totally off message on this issue as far as the coalition agreement is concerned. I am not off message as far as the coalition is concerned. The Government should learn. They have had a huge car crash, as people say nowadays, with the AV referendum; I voted loyally for that on every occasion and now I wish I had not. This will be another, in the modern phrase, car crash.

Whatever has been in coalition agreements and manifestos, there are times when, politically, Governments have to consider what is likely to happen. In most if not all these places, it seems likely that the Liberal Democrats will be campaigning vigorously against having an elected mayor—alongside the Labour party in many cases, and, I suspect, the Conservative party in so far as it still exists in some of these places; it certainly exists in some of them.

I am grateful for the information on the cost. I did not quite catch who was going to bear it. Was it central government? Yes. Well, a waste of public money is a waste of public money, whoever pays for it. I wonder whether the Government can direct me to some serious evidential basis for the view that having elected mayors provides better local government than would otherwise have been the case. I have not seen that evidence. There is lots of political and other argument about it, but I have seen no serious evidential basis for that proposition. If the Government have it, I would be grateful if they would make it available.

[Lord Tope]

My Lords, the Minister has warned me not to allow my noble friend Lord Greaves to let me stray off message. I have actually said nothing at all on the subject yet, and that might well be a message in itself. I am rather too mindful of the Minister’s immediate appointment elsewhere to take more time with this. I am struggling hard to resist the debate that has been held about the benefits of a London Mayor. Having been a member of the London Assembly for the entire reign of the first London Mayor, I can say that any strategic government for London has to be better than no strategic government for London. What none of us can know—so I will not bother to argue it—is whether another system of strategic government would have been as good, worse or better. At least, there could have been an alternative to an elected mayor, which has not been considered.

[Lord Greaves]

Perhaps my noble friend would pay attention to the point that having an elected mayor for Liverpool does not provide strategic government for Merseyside, and that having an elected mayor for Manchester does not provide strategic government for Greater Manchester, and that the same applies to Leeds and Bradford.

[Lord Tope]

My Lords, I will certainly pay attention, as I always do. For the past 40 years, I have paid attention, in every sense, to my noble friend Lord Greaves, who was required to throw me out of the Liberal party 40 years ago, if I remember rightly.

[Lord Greaves]

I refused.

[Lord Tope]

He refused and it was one of his wisest decisions, because the person who requested him to do so did not distinguish himself in the interests of the Liberal party within a few years of that. I refer to our then party leader. The noble Lord, Lord Beecham, is probably too young to remember such an occasion in the 1970s.

I must get back to the point. The amendment relates to the threshold, and I am grateful that, in the end, the Minister paid some attention to it, because no one else has done so throughout the entire debate. Therefore, I have very little to reply to, except to say that we shall be returning to the issue of thresholds for referendums and so on at a later stage. In the mean time, I beg leave to withdraw the amendment.

Amendment 73 withdrawn.

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[Lord Taylor of Holbeach]

My Lords, the coalition has considered the whole issue of standards boards and standards committees. We must recognise that there are different arguments in this case between the Benches opposite and ourselves. Amendment 96A seeks to remove the amendments that the Government are proposing to the Local Government Act 2000, which are needed to remove the requirement for local authorities in England to have standards committees. Of course, this applies only to England.

Rejecting the coalition’s changes to the standards board regime will remove local choice and retain a key aspect of a costly conduct regime which, as my noble friend Lord Shipley has said, has led to vexatious and politically motivated complaints against councillors. However, my noble friend would admit that if we are going to instil a full sense of responsibility in local government, we need to vest in those local authorities the responsibility for the standards of their members. Local authorities may well wish to adopt a voluntary code of conduct for members and co-opted members and determine for themselves what should be in that code; or they may choose to ensure high standards in another way, for example, through a statement of clear principles against which members can be judged by the electorate. The key element is that the choice about how to promote good conduct should be for local authorities to make, rather than for Government to impose on them the requirement for a code of a conduct or standards committees if they do not wish to go down that route.

I know that the noble Lord, Lord Beecham, will disagree with this because he disagrees with the purpose of this amendment but I have to state the position of the coalition, which is quite clear, that this is a matter for local authorities themselves.

[Lord Tope]

My Lords, I hesitate to intervene at this stage. This is almost the first time in a very long local government career that I actually think that central government should be imposing something. I share the views that have been expressed that it must be a statutory requirement that each local authority must—not may—have a code of conduct. There is a separate issue concerning how that code of conduct is drawn up but I think that it would be nonsense for each local authority to have a different one. There should be a uniform code. I believe that the Association of Council Secretaries and Solicitors—we used to call them legal officers—is drawing up a code of conduct that could be adopted. That is good and right, and I do not suggest for a moment that central government should draw up the code and impose it; I am saying, and I believe quite strongly, that Parliament—central government, if you like—should say that a code of conduct is mandatory, not voluntary. Good local authorities—the vast majority—will adopt a code of conduct, but the ones that most need, and should have, a code are probably those least likely to have one. That is why it should be a mandatory requirement.

The code does not have to be drawn up by central government; it could be drawn up by the association that I mentioned or by the Local Government Association. However, I believe that it needs to be a uniform code so that we do not have different standards wherever they happen to suit particular local interests, usually because it is those local interests that are most in question.

My other question relates to the standards committee. Again, I feel that in the general, although not universal, rejoicing at the departure of the Standards Board for England we are in danger of throwing out a baby with the bath water. We are in danger of moving to a situation that is worse than the one we had before the Standards Board was put in place. Therefore, I believe that it should be mandatory for each local authority to have a standards committee. I say that as one who will constantly argue against prescription, but this is one area where it is particularly important. My noble friend Lord Shipley has proposed a way in which standards committees might be constituted. There are lots of discussions to be had around that, and they could well be had within local government and not necessarily involve central government. However, again, the mandatory requirement to have a standards committee is fundamental.

Those are two issues where, unusually for me, I argue that there should be at least a minimum requirement of a mandatory code of conduct and a standards committee, the composition and nature of which could be subject to further consultation and discussion. Those two requirements should be in the Bill.

[Lord Beecham]

I endorse everything that the noble Lord has said. I could not have put it better myself. I beg leave to withdraw the amendment.

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Moved by

[Lord Tope]

96B: Clause 16, page 22, line 44, leave out “London Assembly acting on behalf of the Authority” and insert “Mayor of London and London Assembly acting jointly and (subject to section 17(7)(b)—
(a) the Mayor’s joint exercise of those functions may be delegated under section 38 of the Greater London Authority Act 1999; and(b) the Assembly’s joint exercise of those functions may be delegated under section 54 of that Act.”

[Lord Tope]

My Lords, I shall speak also to Amendments 98A, 98B, 98C, 98D and 98G. All these amendments refer to the Greater London Authority and they have been proposed by the GLA, of which I was a member for the first eight years of its life, although I no longer am. They seek to iron out two small anomalies relating to London—in particular, Clause 16(7)—and to build into the Bill’s national provisions for standards the flexibility that I think is key to them working now and in the future.

Amendment 96B is a technical amendment to Clause 16(7). It would ensure that the Greater London Authority’s future standards regime was shaped by both the mayor and the Assembly, as is currently the situation, rather than just by the Assembly, as proposed in the Bill.

Amendments 98A, 98B, 98C, 98D and 98G amend Clause 17 to provide the Greater London Authority with the ability to delegate the relevant standards functions, which do not include decisions on whether or not to establish a standards regime and the nature of any such regime, including the potential ability of the monitoring officer to investigate relevant complaints and to take action as necessary depending on the outcome of any such investigations within the terms of the regime as may be established by the elected members of the authority.

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[Lord Taylor of Holbeach]

My Lords, I can perhaps offer a slightly more friendly response to my noble friend Lord Tope’s more recent speech than I did to his previous suggestions. The proposal in Amendment 96B and the consequential Amendment 98G—that the new standards function set out in Chapter 5 of Part 1 of the Bill should be a joint duty of the Mayor of London and the London Assembly, as it now is—is one that we are open to considering and seems to have common sense behind it. I can see the benefit of ensuring that the mayor and the Assembly are given equal roles and responsibility for promoting and maintaining high standards.

On Amendments 98A, 98B, 98C and 98D, we see that there is a specific issue here for the GLA in terms of the delegation of decision-making by the Assembly to employees of the authority and we are happy to consider it further. I am not convinced that the same issues apply to other local authorities that have the benefit of Section 101 of the Local Government Act 1972, so perhaps it is not necessary for the amendments to be drafted in quite such wide terms. I am therefore happy to undertake to further consider all these amendments with my fellow Ministers and we can return to our discussion on Report.

[Lord Tope]

My Lords, I am grateful to the Minister for what I hope was a favourable reply. I am certain that the GLA and my noble friend Lady Doocey, who is still a member of the London Assembly, will wish to join me in saying that we seek a common-sense and rational solution to a particular issue that applies to one particular authority, the Greater London Authority. On that constructive note, I beg leave to withdraw the amendment.

Amendment 96B withdrawn.

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Moved by

[Lord Tope]

97: Clause 17, page 23, line 2, leave out “may” and insert “must”

[Lord Tope]

I am more than happy to speak to Amendment 97 at some length, but I will allow my noble friend Lord Greaves to speak now on the other amendments in this group and will contribute later, should that be appropriate. I beg to move.

[Lord Greaves]

My Lords, I am not sure we have had a may/must amendment yet on this Bill, but perhaps we have and I have missed it. This is an important amendment. I rise to speak to my amendments in this group: Amendments 97A, 98E, 98F and 98H. I will also speak to the other two amendments in the group, if I may.

There is widespread concern within local government that the Government have not got this exactly right. At the very least, it needs some fettling and a number of probably quite major changes if it is going to work fairly. As my noble friend Lord Tope said earlier, there is a widespread feeling in local government—it is not universal—that the demise of the Standards Board for England is to be welcomed. The Standards Board for England’s regime has turned out in practice to be expensive. It has been arbitrary in too many cases, and therefore it has been seen to be unfair. It has been open to abuse, and it has been open to attempted political manipulation, not by Standards Board members or its staff, but by people trying to use the system in order to do down opponents.

In our judgment, the removal of the Standards Board for England is a good idea, and we congratulate the Government on doing it, but something has to replace it. We cannot simply go back to the free-for-all situation we had up until about 20 years ago when standards codes and sanctions against councillors were hardly known. The system then seemed to work. There did not seem to be any more rogue councillors than there are now, and people did not seem to step out of line more than they do now, but the world has changed. We are now in a world in which standards in public life have come in and are accepted right across the board of everybody who takes part in public life. We have even had to grapple with these matters and come up with solutions here in the House of Lords. Local authorities are no different, and to pretend that local authorities generally, or some local authorities in particular, can be excepted from this situation is not the world that we are now living in.

The Government’s proposal in the Bill is that there will be no national system, no national organisations and no bureaucracies; it will all be left to local authorities. In our debate on a previous amendment, my noble friend Lord Taylor said that it will be up to local authorities to behave sensibly and do what they think is best in their area. There will be no uniform or national standards code, so each authority will be able to adopt its own code or not have one. It can keep, amend or do away with the present code. If any of my description of the present system is wrong, I hope the Minister will intervene and tell me, but I do not think it is.

Authorities will be able to choose whether to have standards committees. Since local authorities all have them at the moment and are institutionally fairly conservative bodies, most of them will probably keep them in one form or another, but it will be open to an authority not to have them, so there will be a hotchpotch pattern; they will be able to invent their own rules for how standards committees work within their own codes of conduct.

In addition, for the offence of failing to declare appropriate interests, either by not entering them on to a register of interests or by failing to declare them in meetings at appropriate times, the only real sanction left is the criminal law and, subject to the Director of Public Prosecutions’ agreement, people will be arraigned before a magistrates’ court if the DPP thinks it is serious enough. Meanwhile, parish councils will be left in some sort of limbo. They might be able to have their own systems or to continue to be part of a district council’s standards committee and system of standards, but if the local district council does not have one or decides to do away with it all, the parish councillors will have the choice either of doing it themselves, which might be rather difficult for small parish councils, or not doing it at all.

That seems to be the regime that is on offer. Perhaps the way I have presented it suggests that I am not terribly impressed with it. Nevertheless, I think my presentation of it is factually correct.

We have been here before and had something similar to this. When standards committees were first brought into local authorities, local authorities were left to do their own thing. Many of them did it very well, but in some places it was not done well. It was done either inefficiently or in an arbitrary, uneven or unfair way. In a small minority of places—it is always a small minority—it was not a good thing. It was fairly dreadful. Some authorities used it to victimise individual councillors in order to conduct campaigns against opposition groups on the council and to conduct witch-hunts against individuals. That is always the danger if local authorities in an area like this are left to their own devices, because there will be some places where malign, malevolent politics gets in the way of a fair system. Therefore, we propose in amendments in this group, and in the next group, which I will speak to later, a system in which every authority must have a standards committee. It seems ridiculous that someone could be dual-hatted or triple-hatted, and on three different authorities at different levels, some of those authorities having a standards committee and some not.

Equally, we are suggesting a uniform, standard, national code of conduct. We are not talking about local diversity. There cannot be local diversity about what is appropriate conduct for people in public life. We are talking about standards in public life. While standards and rules for councillors may be different from those for Members of the House of Lords, Members of the House of Commons, people on national quangos or whatever, the organisations are different. Nevertheless, they should be based on the same principles and underlying standards in public life.

There does not seem to be any reason why, if I am a member of a district council, a parish council and a county council, which I have no intention of being except for one of them, there should be a different code of conduct on each council. Surely, that cannot be right. Nor can it be right that of the 11 or 12 district councils in Lancashire, some do not have a code of conduct and some have a very different code of conduct from the adjoining council. Codes of conduct should be laid down nationally.

We are saying that the drawing up of the code of conduct and its approval should be done by local government and not by the Secretary of State or national government. It should be the responsibility of representatives of local government and, in terms of legislation, the LGA obviously is a key representative. We want systems for appeals and we want to sort out parish councils. We want to look at criminal offences, but they are in the next group so I will not talk about them any more at the moment.

On something like this there has to be protection for the public against rogue councils. Much as I have an underlying, innate aversion to national uniformity in anything, some things are so important and fundamental that they underpin everything else. This is the right way forward.

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[Lord Tope]

My Lords, I have to say that I am profoundly disappointed with the position we find ourselves in. I was warned earlier on, before I had said anything, to stay on message, but I am bound to say that I cannot understand how a Localism Bill can impose referendums on cities that have had the opportunity for the past 10 or 11 years to hold a referendum on a mayor if they wanted to and say that that is localism, but cannot recognise the need for a standard, mandatory code of conduct. The Bill says that it should simply be left to local authorities to decide how they should behave or, indeed, if they should have a code of conduct at all. I do not understand that, and I have to say that for this part of the coalition Benches, it is a fundamentally important issue.

I welcome the offer of further discussions, but I have to say, and I will put on the record now, that for the Liberal Democrat Benches it is important to recognise a mandatory code of conduct—as I said before, how and by whom it is drawn up is open to discussion—that applies to all local authorities and therefore to all councillors. As my noble friend Lord Greaves has said, it should apply to all councillors because it is not a matter for local diversity, interests or circumstances. As important is the need to have a standards committee. Again the nature, format and constitution of that committee are open to discussion, but the basic fact that each local authority should have a standards committee is important to us.

With the offer of further discussions, for now I certainly beg leave to withdraw the amendment.

Amendment 97 withdrawn.

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[Lord Greaves]

I am confused because my Marshalled List does not have the next amendment, Amendment 98HA, on it.

[Lord Tope]

Amendment 98HA is on the Supplementary Marshalled List, and therefore probably in a later grouping than my noble friend has to hand.

[Lord Greaves]

I have found it.

Clause 18 : Disclosure and registration of members' interests

Amendment 98HA

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Moved by

[Lord Tope]

98J: Clause 18, page 23, line 42, leave out “and other”

[Lord Tope]

We are discussing issues that are extremely important for local government after the normal rising time of the House and in our eighth hour in Committee. We are not doing justice to an important issue and, frankly, we are in danger of bringing the House into ridicule.

[A noble Lord]

I agree.

[Lord Tope]

I am sorry to have to say that as a loyal member of the coalition, but it is my view.

Amendment 98J would simply leave out “and other”. The other amendment in my name in this grouping is identical. My purpose is not so much to press the amendment as to find out what the Government have in mind with “and other”. What does it refer to?

[Lord Taylor of Holbeach]

My Lords, we do not see the case for these amendments, which would limit the registering and declaring of interests to financial interests. That would take us back to the days before the Widdicombe committee in 1988, when there was widespread concern about the treatment of non-pecuniary interests, which led to the strengthening of the requirements relating to pecuniary interests. There are clearly situations where non-financial interests are relevant to decision-making by councillors, and it is right that the public are aware of such interests so that they can see that decisions are being made fairly and transparently. I hope that my noble friend will see the merit of the argument and withdraw his amendment.

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[Lord Taylor of Holbeach]

I thank noble Lords. I am sort of having a second bite of the cherry within the group, because I can talk specifically about the proposals of my noble friend. I hope that I can really reassure him. He talked about appeal structures and the like and the need to maintain them—and of course human rights legislation provides for this. But in actual fact the sanctions that the Secretary of State intends to provide for in regulations under Clause 18(2) will be relatively low-level sanctions based on powers of discipline that councils already possess. It is not our intention to confer any new disciplinary powers of the sort that would give rise to a need or expectation for a bureaucratic appeal process.

I cannot support Amendment 98M, which would insert a new clause relating to parish standards, although I understand the interest in it. The legislation as currently drafted gives parishes the power to have a code or a standards committee if they would like. Parish councils are free to make arrangements to work jointly with other authorities. My noble friend is mistaken if he believes that advice is not available to parish councils. The last Government published the Quality Parish and Town Council Scheme; it was published by the department in 2003, and it gives information about model charters whereby principal and local councils in England can work in partnership. That document can be viewed on the DCLG website. We intend here also that the regulations to be issued by the Secretary of State under Clause 18(1) will specify that the registration of parish members' interests will be carried out by the monitoring officer of the district within which the relevant parish falls.

There was some talk about the criminal sanctions for failing to register, and I note noble Lords’ concerns on that. The noble Lord, Lord McKenzie, asked, too, that he might be a party to discussions that we might have before Report on those issues. I assure noble Lords that we would be happy to discuss that aspect of Clause 19 relating to breaching regulations under Clause 18. With that, I ask my noble friend Lord Tope to withdraw the amendment.

[Lord Tope]

My Lords, I am grateful to the Minister, not least for knowing where I am better than I do. I am grateful for his response and some of his encouraging remarks, and I beg leave to withdraw the amendment.

Amendment 98J withdrawn

Localism Bill

Lord Tope Excerpts

Monday 20th June 2011 Lords Chamber

[Lord Tope]

This is the first time I have spoken in Committee and I again declare that I am a councillor in the London Borough of Sutton and a member of its executive. I put my name to my noble friend’s amendment for a very particular reason. I have heard it described as a Second Reading amendment—slightly a contradiction in terms, but I understand what is meant—and it prompts an important debate that we should have at the start of our proceedings.

Unusually, we have a Bill with a one-word title: “localism”. It seems to mean different things to different people and it appears to mean different things in different parts of this Bill. Above all, it seems to mean entirely different things in different parts of the Government. Therefore, my noble friend and I thought that the amendment would prompt a useful Committee-stage debate at the beginning to try to discover between ourselves what we understand by “localism” and where we disagree about it. Of course, neither I nor my noble friend would pretend that this is the ultimate, perfect, absolute definition, but it sets out fully some principles that we believe are important when considering localism. It is not localisation, as I often hear it described. It is not simply decentralisation or devolution.

We have had an interesting debate. Almost every speaker has, in effect, said, “Yes, but”. One or two, notably the noble Lord, Lord Ouseley, welcomed the debate for the right reason—that it sets out what we are trying to do. As others have said, localism is not atomisation. As I said at Second Reading, localism is not populism and it is important to understand that. Alternatively, as someone else said, it is not majority-ism—I do not know whether that is a word or whether I can say it. Local democracy, which is what this is about, is democracy. It is about ensuring that all voices are heard and listened to with equal respect. It is a system and a process, not necessarily one that makes the decisions but one that informs those who are democratically elected and accountable for the decisions. In other words, it is a process that informs the decision-makers. It may be that, in particular circumstances, it is appropriate for those decision-makers to delegate that decision, but it is not simply dumping decisions and abrogating the responsibility that local councillors are elected to take.

After all these years in local government, I would be the very last person in this House to claim that all local councillors and all local government are always perfect and get things right. Of course they do not. There are too many examples, probably run by all parties, where local authorities are not good at engaging with local people and local groups, whether they be geographical or interest groups. This amendment tries to say that that is a very important part of the decision-making process. I shall not deprive my noble friend Lord Greaves from turning the clock back some 20 or so years to that time on Lancashire County Council when he was answering the questions put to him by the noble Baroness, Lady Farrington. However, as she knows, not quite 20 years ago both of us were members of the EU Committee of the Regions, the body set up in 1994 to be the voice of regional and local government. We both have some knowledge and experience of subsidiarity, as practised on the continent but rarely in this country. Subsidiarity in this country seems to stop at national level. We have all argued for many years that if subsidiarity means bottom-up, in simple terms, it should start at the bottom and not be top-down. Devolution is top-down—and is a very good and necessary thing in a centralised state—but subsidiarity should build from the bottom up.

I agree with the noble Baroness that, as in other countries, decision-makers should be informed by their engagement with their local communities in a much better way than is the case now. At issue is the way that they are informed in making their decisions. We need properly accountable and elected people and bodies. All of us who have been councillors for any length of time can cite similar examples to those cited by the noble Baroness, Lady Farrington. I am sure that we have all faced quite strong public opposition. As leader of the council and even in the ward that I represent, I, too, faced such opposition. I will not digress for too long, but I was faced with a similar instance of a mental health hostel being set up in a residential road in my ward. There was initial fear, suspicion, worry and concern among the neighbours. The way in which we approached this was to hold a meeting of residents in somebody's front room. We discussed the issue and went through a lengthy process. In the end, as a result of the engagement, the immediate local community were not just supportive of the proposal but remained very supportive of the house itself and of the people in it, and integrated them as an active part of the community. Of course, it does not always work that way; it is never that easy or simple, but it is part of the answer to how you approach the making of those responsible decisions.

[Baroness Farrington of Ribbleton]

My Lords, does the noble Lord accept that in the cases that he and I cited, that applied, but that in the case of our school for ex-prisoners, pressure was put on the seller of the property when permission had been given, and the seller refused to sell to NACRO?

[Lord Tope]

I am grateful to the noble Baroness. I did not mean to imply that these things are simple and easy and that all you need to do is talk to people and everything will come out right; I am not that naive or simple. I am just saying that the way in which decisions are made is often as important as what the final decision is, and sometimes helps and facilitates the making of those difficult decisions. They need to be made by the appropriate sphere of government that is democratically elected and accountable.

We set out here, at some length, what we believed should be the definition of localism—what we believe it means. We did so in part to see who would agree with us and who would not. We think that these are the criteria on which we should judge the Bill as we go through Committee: that is why we tabled the amendment in Committee, at the beginning. We are saying that these are the criteria by which we should judge whether this part of the Localism Bill reflects what we understand to be localism, and that if it does not meet the criteria perhaps something in the Bill could be improved. We have had a useful, relatively short debate and perhaps have a better understanding at least of what we on these Benches mean by localism. I am not sure quite what noble Lords who made a “yes, but” response understand by localism. As they said, perhaps it will become clear as we go through the various stages of the Bill.

[Lord Beecham]

My Lords, I, too, declare an interest as a councillor in Newcastle upon Tyne and as a vice-president of the Local Government Association. A week ago in your Lordships' House, the government Chief Whip lamented the fact that not enough legislation was being debated in Grand Committee. Of course, it would have been quite wrong for this Bill to be assigned to Grand Committee. However, this debate could hardly be better placed than in Grand Committee in the Moses Room. After all, that Room bears a portrait of a majestic, bearded figure bearing tables of stone on which are incised 10 commandments.

This afternoon, the noble Lord, Lord Greaves, comes to us not with 10 commandments but with 10 criteria by which this Bill is to be judged. Try as I might—and I have tried—I cannot find very much to disagree with. It is something like 120 years since Sir William Harcourt, a distinguished Liberal Chancellor of the Exchequer, proclaimed, somewhat optimistically from one point of view, or perhaps pessimistically from another point of view, that, “We are all socialists now”. Nowadays, we are all localist, but that definition of localism is, to put it mildly, somewhat elastic. I think the noble Lord, Lord Greaves, has set out as good a definition as one might reasonably expect. If I had a reservation, it would be that in proposed new subsection (1)(d) in the amendment the reference is to,

“minimum standards for the provision of public services”.

I accept that that would be a partial definition, but I think one needs to look at minimum entitlements in addition to minimum standards. Standards imply provision of a service; entitlements are a somewhat broader concept that would, for example, avoid us reverting to a 19th-century poor law view in which benefits are calculated differentially across the country. Indeed, there is a case for variation, and I have sometimes thought of promoting a society for the preservation of the postcode lottery because it seems to me that localism of any definition implies different choices according to local circumstances. I therefore welcome the thrust of this proposed new clause.

--- Later in debate ---

[Lord Lucas]

I therefore think that this is a very important thing to get right. I shall listen to the Minister with great interest. If we get it wrong, it has the potential to destroy a very important part of the Bill.

[Lord Tope]

My Lords, in moving the amendment, to which I have added my name, my noble friend made it clear that it is a probing amendment. It might therefore be that the Minister is not about to accept it. If that proves to be the case, I am conscious that the Minister has received considerable advice from behind her that she should not attempt to define sustainable development now or at any time in the future. Therefore, perhaps she could confirm that the Government intend, in the not very distant future, to publish their definition of sustainable development, a definition that will subsequently appear in the national planning policy framework document. If she can confirm that, can she also confirm that it will at least reflect the balanced approach that the amendment seeks to achieve?

[Lord McKenzie of Luton]

My Lords, we should congratulate the noble Lord, Lord Greaves, on giving us an early opportunity, during the course of the Bill, to debate this very important issue. We agree that it is important to enshrine, at an appropriate point in the Bill, a definition of sustainable development and the principles that he has outlined in the amendment. We agree with the definition and with the principles that he has set out. I anticipated that we would have this debate a little later when we got to Part 5 of the Bill, but important points have been made about this not being just about narrow planning; there is a broader dimension to it.

I agree with what the noble Lord said in moving the amendment. There are concerns about sustainable development being sidelined by the Government. He referenced the Budget pronouncements. Clause 124 could be a change in the balance of the assessment of sustainable development, and we have a lack of clarity over the NPPF; indeed, the advisory group’s draft has moved us some way away from what the previous Government had accepted and which I thought was generally accepted as sustainable development.

With some hesitation, I disagree with the noble Lord, Lord Lawson, that sustainable development is a meaningless concept. The fact that we may have had 1,000 years of growth generally in the economy and growing prosperity is fine, but are there not judgments to be made along the way about what that has done to the environment? Certainly in latter years, has not that growth often been achieved by recognising that you have to balance the impact, for example on the environment? I do not believe that it is a meaningless concept.

I agree with the point made by the noble Lord, Lord True, about the framing of the amendment, and I shall come on to that in a moment. There is a real risk that you create a lawyers' paradise. One of the assessments of well-being powers, and why they were not better used, was that lawyers, who were very cautious, got involved and that that precluded the use of the power more extensively than was anticipated at the time. I therefore very much agree with the right reverend Prelate the Bishop of Exeter in his approach to sustainable development, and with the noble Lord, Lord Taylor of Goss Moor. I disagree with the noble Lord, Lord Lawson.

When thinking about the Opposition’s response to this amendment, I considered how it sits with the local authority’s duty to prepare community strategies. That is set down in the Local Government Act 2000. There has hitherto been a requirement to prepare community strategies for improving economic, social and environmental well-being and contributing to the achievement of sustainable development in the UK. I asked the DCLG whether that obligation still exists. It does, but perhaps the Minister will confirm the Government’s intention to repeal the duty to prepare a sustainable community strategy. Instead, the Government have set down light-touch, best-value statutory guidance, on which they are consulting. The consultation document is extremely interesting, and shows about four pages of rubric on one page of a draft definition of “best value statutory guidance”. Only one sentence potentially touches on sustainability. It states:

“Under the duty of best value, therefore, authorities should consider overall value, including environmental and social value, when reviewing service provision”—

in place of the existing obligation to have sustainable community strategies.

The noble Lord, Lord Greaves, said that he wanted something that ran throughout the Bill, but I do not believe his drafting achieves that. Specifically, it states:

“A local authority shall exercise the power conferred by section 1”,

which is the general power. Again, analysis of the well-being power showed that it was not used in preference to statutory powers that local authorities may have. If we saw that replicated with the general power, in a sense what the noble Lord is seeking to achieve here would not capture that.

I understand that this is a probing amendment, and we support its thrust. We certainly want to see those definitions in the Bill and are happy to work with the noble Lord to achieve some refinement to the approach set down in his amendment.

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Moved by

[Lord Tope]

6: Clause 2, page 2, line 13, leave out subsections (1) and (2)

[Lord Tope]

My Lords, I shall speak also to Amendments 7, 8 and 9. In common with the rest of local government, for many years we have pressed to have a general power of competence. I should make clear at the start that we are wholeheartedly in support of this, although I increasingly wonder exactly how much extra difference it will make. I nevertheless welcome it without reservation.

I have no intention of pressing these probing amendments to the vote but want to give the Government an opportunity to place on record a little more clearly the limitations being imposed on that general power; certainly I am not clear on them. Amendments 6 and 9 probe the nature of overlap and the boundaries imposed on the general power by pre-commencement and post-commencement limitations and, in particular, the intentions of the Government in relation to post-commencement limitations. Amendment 8 probes why local authorities should not be able to change their governance arrangements at least to a degree under the general power. These are questions to which we would really like some answers. If Parliament graciously is granting the general power, the fewer limitations the better. We wonder, as we will in later stages of the Bill, why it is necessary to say what local authorities may or may not do once they have that general power. With that, I look forward to hearing the clarification and expansion from the Minister, and I beg to move.

[Baroness Hanham]

My Lords, I thank my noble friend for his question. The general power is drafted on the basis that local authorities will be able to do anything that an individual might do, other than that which is specifically prohibited. In practice, this means that local authorities will be required to act in accordance with statutory limitations or restrictions. This is not surprising as we would not want local authorities to be completely outside the law.

Clause 2(2) sets out that limitations in legislation apply to the general power but draws a distinction between pre- and post-commencement limitations. Restrictions in post-commencement legislation will apply to the general power only where the drafting of the new legislation is clear that this is the policy intention. Amendment 6 would remove the requirement that local authorities exercising the new power act in accordance with any restrictions. Amendment 9 removes the definitions of post- and pre-commencement limitation from the clause.

Some restrictions on the activities of local authorities are obviously needed—for instance, a council should not have free rein to override the rights of others and these should be set out in the clearest terms—to ensure clarity for local authorities and avoid the uncertainty that has led to legal challenges to local authority powers in the past. That is what these subsections seek to achieve. We cannot require pre-existing limitations to expressly refer to the general power but, where these are found unnecessarily to restrict the general power, they can of course be removed following consultation. Amendment 7 would allow local authorities to decide their own governance arrangements and Amendment 8 will allow local authorities to use the general power to further contract out its functions.

We believe that it would be inappropriate that local authorities should be entirely free to change their governance arrangements. The Government set the overall governing structures of local authorities while still providing them with sufficient flexibility to decide on the most appropriate arrangement for their individual circumstances. This ensures democratic accountability and that transparent and workable arrangements are put in place. Arrangements for discharge of functions remain subject to existing legislation. Contracting out of functions will continue to be permitted in specific cases. The noble Lord asked specifically why local government should not be able just to make its own decisions about its governance. The answer is that the Government are right to be able to set the overall governing structures of each local authority.

[Baroness Hanham]

My Lords, contracting out is clearly one of the ways in which a local authority can carry out its services but it will still be subject to the Deregulation and Contracting Out Act 1994. Those provisions are not being repealed, so they will continue to be part of the legislative control that will be maintained on the general power.

[Lord Tope]

I am grateful to the Minister for her reply, which I will read with great interest tomorrow. I am still a little puzzled about the restrictions on the governance, to which we will come at a later stage. If I understood the Minister correctly, she said that the Government felt that it was right to have some restrictions on what local authorities could do in their governance arrangements. I wish that I had the quote with me but I recall that, in the August edition of Total Politics, the Secretary of State said that he did not care what system of governance local councils have. He even said that they could have a choral system and sing sea shanties for all he cared, provided only that the system of government was efficient, transparent and accountable—three criteria to which every one of us would agree. Therefore, I am still a little puzzled as to why the Government feel that it is necessary to restrict a general power of competence in this area. Nevertheless, we will no doubt get to this in the later stages of this Bill. In the mean time, I beg leave to withdraw Amendment 6.

Amendment 6 withdrawn.

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Moved by

[Lord Tope]

10: Clause 3, page 3, line 13, leave out “, or could be done,”

[Lord Tope]

My Lords, Amendment 10 stands in my name and that of the noble Lord, Lord Greaves, as does Amendment 11 where our names are reversed but we are as one, as always. These probing amendments are simply to ask the Government to explain more fully—for instance, as regards Amendment 10—the meaning of “or could be done”, so that we can understand better what this overlap of power means and what power the local authority is using that is not the general power.

Amendment 11 causes me a little more concern, not least because among my responsibilities on my council is that for the provision of leisure services, and therefore I particularly want to understand a little better than I do at the moment what exactly the Government mean in suggesting that no local authority should ever make a year-on-year surplus. If some parts of our leisure services were not able to make a profit, that would have quite a serious effect on my local authority and, I suspect, on some others. Perhaps I do not fully understand the provision, so I look forward to an explanation from the Minister of exactly what is meant by it. I beg to move.

--- Later in debate ---

[Baroness Hanham]

My Lords, the answer to that will have to come in a note, I am afraid, because I am not clear about the relationship between the two. I will make sure that my noble friend has a reply to her questions so that she may return to the point on Report if she so wishes.

With regard to the provision of leisure services, which was the specific area raised by the noble Lord, Lord Tope, those services are subject to separate powers to charge, so they are unaffected by the general power by virtue of Clause 3(2)(c). In other words, these services once again come under previous legislation and therefore cannot be subject to this legislation. I think that this is going to be the answer that we will give to a number of these issues, where the general power of competence is restricted by previous legislation which is not being amended or annulled. I hope that that answers the question.

[Lord Tope]

My Lords, I am grateful to the Minister for her answer, but I am bound to say that I am not any wiser than before. I have used leisure services as an example since it happens to be one for which I am responsible, but perhaps it was the wrong example, which is one of the troubles with using examples. Frankly, I am no clearer about the meaning of this provision and what restrictions it would bring about.

I can see from my raised position that the noble Lord, Lord Beecham, wishes to speak.

[Lord Beecham]

Perhaps the noble Lord could offer the Minister the example of a meals on wheels service that an authority might provide instead of, say, leisure services.

[Lord Tope]

Indeed, I am happy to offer the Minister the example of a meals on wheels service, which has just come to mind as possibly a more appropriate example. I would be grateful if she could elucidate a little more because I see that I am not the only noble Lord in the Committee who has failed wholly to understand it. If it is not possible for her to do so today, I am sure that she will write to us, but if she is able to be a little clearer about what is covered rather than what is not covered by this provision, I would be grateful.

[Baroness Hanham]

My Lords, I will try to be a little more helpful. Part of the answer is that the Government believe that a local authority service should not make a surplus year on year. I think that that was one of the points raised earlier. By providing a power to charge for discretionary services, the Government’s aim is to encourage authorities to provide the sort of services that they would otherwise decide not to provide or improve at all because they cannot justify or afford providing them for free or improving them. I do not think that that actually answers the question, so I am going to write to the noble Lord before the next stage.

--- Later in debate ---

[Baroness Hanham]

The existing situation is that current legislation limits what can be done, and this continues to limit it. Under the general power, if it is not restricted by current legislation, then it is permissive.

[Lord Tope]

I am grateful to the Minister for her offer to write, which it is hoped will clarify the situation. I might suggest that if we are all struggling a bit with what is in the Bill, perhaps the drafting is not as clear as it should be, and that is something on which we shall all have to reflect. In the mean time, I beg leave to withdraw the amendment.

Amendment 10 withdrawn.