Localism Bill

Debate between Lord Whitty and Lord Shutt of Greetland

Monday 5th September 2011 Lords Chamber

[Lord Shutt of Greetland]

I am afraid that I will have to write to the noble Lord about that. I do not have a firm answer as to why that should be the case, although it may well be that someone is sending me a document on that. It is suggested that the existing power in the Local Government Act 2003 allows central government to,

“by regulations set limits in relation to the borrowing of money by local authorities”,

in order to ensure that the local authority does not borrow more than it can afford. While this power provides powers to cap local authority debt, it links local caps to local affordability. Our concern is not that councils will act in ways that are imprudent locally but that on aggregate these borrowing decisions may be unaffordable nationally. That is the situation there. If that does not cover the point, though, as I indicated earlier, I will write.

[Lord Whitty]

My Lords, I am grateful to the Minister for his offer to explain all this to me in simple language. I now understand that this is all about self-financing, which I have supported in the past and therefore continue to support. It is just that, due to the way the clause reads, it seemed to me that the one-off payment was not the result of a deal but was by the unilateral decision of the Secretary of State. Maybe that is the way that it has to be expressed in legislation, but I am grateful for the offer of a paper clarifying that. I still think that the points raised by the noble Lord, Lord Best, need a fuller riposte, and maybe the Minister could come up with that as well. In the mean time, though, I beg leave to withdraw the amendment.