Local Audit and Accountability Bill [Lords]

Debate between Annette Brooke and Robert Neill

Monday 28th October 2013 Commons Chamber

[Robert Neill]

There is often a material difference, depending on the precise nature of the language used and the objectives sought to be put across. That is precisely why the Bill is framed in such a way as to provide discretion for the Secretary of State to act where a number of triggers are coming into play. I do not think that intervention worked from the hon. Gentleman’s point of view either.

Let me deal with the issue of council tax referendums. A great deal of objection was raised in the other place, but I do not believe that it was all genuinely warranted. I am glad that the right hon. Member for Leeds Central did not pursue the argument of retrospectivity to the extent that it was pursued in the other place. My noble Friend Baroness Hanham dealt with that effectively, making very clear the Government’s intentions in this regard. Levying bodies and their principal councils had clear notice, so that argument has been knocked on the head. I want to take the opportunity to pay tribute to Baroness Hanham’s work as a Minister in the Department for Communities and Local Government. She was a fantastic and unusually hard-working colleague—someone who probably has more experience in local government than many people here will have forgotten about, let alone learned from. I hope I am allowed to say that, Madam Deputy Speaker.

The key objective of council tax referendums is to protect the council tax payer. It could not be right to get to a position where it was possible to have a degree of expenditure shunting. We sometimes hear about cost shunting, but a degree of expenditure shunting is possible in theory, from the constituent member authorities of a levying body on to the levying body in the knowledge that the expenditure moved on to the joint body would not be captured by the council tax threshold referendum. With respect, that would be pulling the wool over the eyes of the council tax payers of the local authority’s area. The council tax referendum proposals are therefore sensible in protecting council tax payers by removing a loophole that could have been open to that sort of abuse. As the Secretary of State said, when we looked at city deals, we found that the amount involved was not such as to cause the extent of the problems suggested.

For a raft of reasons, the levy on some local authority areas amounts to more than the amount of council tax itself. The levies account for something like 56% of council tax bills—in Liverpool, for example. I am sure that all hon. Members who support our proposals for council tax referendums would agree, in principle at any rate, that they exist to protect the council tax payer. It surely cannot be right that under current arrangements over half the spend is exempt from control by a referendum.

[Annette Brooke]

I quite understand the intention behind this measure, but could my hon. Friend help me with this query? Is not an unintended consequence possible? If the referendum were lost, the levy went ahead and the council tax was frozen, might not the penalty fall back on the council, which would have to bear the costs and cut back on its own services?

Local Government Finance Bill

Debate between Annette Brooke and Robert Neill

Tuesday 24th January 2012 Commons Chamber

[Annette Brooke]

I think my hon. Friend is hitting on the same issue that I have in mind—the respective time periods. It is important that we have clarity on that and I thought I had, but that was before I listened to the speeches this afternoon. We know that we are starting off firmly—councils know how much they are getting in the first settlement—but we need to know what will happen when the new system really clicks in.

[Robert Neill]

This has been an interesting and useful debate. The right hon. Member for Knowsley (Mr Howarth) and I did a crash course in regression analysis at probably about the same time, when we were performing similar roles in local government, and I sympathise with him. He is quite right: the analogy with the Schleswig-Holstein question is frequently raised, sometimes with some justice, as I think pretty much everyone in the Chamber knows. I can happily inform him that I am not aware of any former local government Minister being driven mad as a consequence. It has sometimes been suggested that some former Ministers have been driven to tear their hair out, although I am perhaps not the best person in the Chamber to comment on that either.

This issue has certainly exercised a number of right hon. and hon. Members in a most constructive way. It has also caused a number of us to be engaged in quite a lot of detailed debate, because, by its nature, whatever system we use—the existing system, the previous system, when we had relative needs assessments, standard spending assessments and so on, or the future system—there will always be quite a lot of technical detail. A lot of the detail will inevitably be in regulations of one kind or another.

Let me try to reassure hon. Members on a number of points. The provisions in the Bill set out the scope for regulations to be made. I say to the hon. Member for Warrington North (Helen Jones) that the phrasing of her amendment 27 would create a duty to have regulations, rather than a permission. I hope she will not pursue that point at this stage, because I cannot conceive—it is certainly not my intention—of the Secretary of State proceeding other than by way of laying regulations. It would be inappropriate to fetter the Secretary of State’s discretion. I can assure her that our intention is that regulations will be laid in the ordinary course of the scheme’s operations.

Secondly, let me assure hon. Members that we intend to consult local government and other interested parties on the regulations in a timely fashion. The hon. Member for Warrington North knows from her experience in local government that, at present, the Secretary of State lays the finance report and there is a provisional settlement and scope for representations. I hope I can reassure hon. Members that it is certainly our intention that the system will include the ability to make representations. It is by no means unusual for regulations to be introduced during a Bill’s passage through Parliament. I think that that happened during every local government Bill with which I was involved in the previous Parliament. Of course there will be consultation on the drawing up of the regulations to set up the scheme, as well as an opportunity for representations to be made during the course of the Bill.

Local Government Finance Bill

Debate between Annette Brooke and Robert Neill

Wednesday 18th January 2012 Commons Chamber

[Annette Brooke]

I believe the Minister explained earlier how the detailed proposals would be scrutinised later in the process of setting the 2013 terms of the revision. What I want to see in the end is a more transparent scheme. That is extremely important, so that local councils are not continually trying to find little bits here, there and everywhere that they can come up and lobby about. We need clarity. I am pleased with the framework.

[Robert Neill]

I agree with my hon. Friend the Member for Mid Dorset and North Poole (Annette Brooke). It is important that we move forward. The hon. Member for Warrington North (Helen Jones) is right. The affirmative procedure will apply to the matters that come under the Bill. It is worth saying that the degree of transparency on the one hand and fairness on the other is governed by, for example, the changes to the central and local share split, which will come through shortly, and the operation of the tariffs and top-ups. Those will be included in the local government finance report, and that too will be subject to parliamentary scrutiny in the usual way each year, so it is a clear and transparent system.

Local Government Budgets

Debate between Annette Brooke and Robert Neill

Wednesday 12th January 2011 Westminster Hall

[Robert Neill]

Certainly I can do that and I hope that in the future, when we have the local government resource review, Coventry city council and other interested local authorities will put forward views about how we can take the new system forward.

The Government are making the best of the difficult hand that we have inherited. However, we have done so with a determination to pass down more flexibility to local authorities. The number of separate grants has been greatly reduced—from 90 to about 10—and considerably more money has been rolled into the formula grant, which is generally regarded as being more equitable in its distributional effects than the various specific grants that had existed previously. We have also increased the weighting given to a needs formula.

Of course I accept that regeneration is important for the west midlands in particular. It is worth remembering, however, that outside the limited area of formula grant the Government are in fact spending very considerable sums of money to support regeneration, and that money includes money that will benefit the west midlands. More than £20 billion is being provided to support regeneration, including regeneration of housing, which is important in the region. We are honouring existing Homes and Communities Agency contracts and existing regional development agency contracts, investing some £4.5 billion to deliver new affordable homes. In addition, there is £1.4 billion from the regional growth fund, which we are seeking to align with a similar sum in the European regional development fund. There is also investment in transport, including some £750 million for High Speed 2, which will have a particular impact on regeneration by speeding up journey times to Birmingham and the west Midlands.

So I think it is fair to say that the Government are putting in money to try to assist the councils in the west midlands and we are seeking to do so in a way that will encourage private sector investment. That is why the RDAs, which many of us believed had become unduly cumbersome although others may not agree, are being replaced by local enterprise partnerships that genuinely have private sector businesses working with local councils. It is also why we are committed to a new homes bonus, to encourage private sector investment in house building, and to the review of local government resource, which will actually make it worth while for councils such as Birmingham and Coventry that have a good history in relation to business, industry and commerce to grow their tax base once again.

So the Government are adopting a very positive approach. First, the settlement deals with difficult immediate issues. We have endeavoured to be fair and we believe that the settlement is fair and progressive, for the reasons that I have set out. Secondly, there is a plan that goes beyond the settlement, with the review of local government resource, which is consistent with both the current requirements and our commitment to localism. Of course, we will be entrenching that commitment when we introduce the Localism Bill for its Second Reading in the House next Monday.

[Annette Brooke (in the Chair)]

May I thank all the contributors to the debate and ask them to leave quietly? As the Minister is here already, I will begin the next debate.