York and North Yorkshire Combined Authority Order 2023

Baroness Penn Excerpts

Wednesday 13th December 2023 Grand Committee

Moved by

[Baroness Penn]

That the Grand Committee do consider the York and North Yorkshire Combined Authority Order 2023.

[The Parliamentary Under-Secretary of State, Department for Levelling Up, Housing & Communities (Baroness Penn) (Con)]

My Lords, the purpose of this order is to implement the devolution deal agreed between the Government and the councils of York and North Yorkshire on 1 August 2022. Since then we have been working closely with those councils on implementation, and on 3 November 2023 they consented to the making of this order.

This order, if approved, will establish the new York and North Yorkshire combined authority and the office of mayor for the area, with the first election to take place on 2 May 2024. The elected mayor will then take up office on 7 May, with a four-year term ending after the next mayoral election in May 2028. Thereafter, there will be elections every fourth year, to be held on the ordinary election day for that year—that is, on the first Thursday in May. Following the enactment of the Elections Act 2022, these mayoral elections will be on a first past the post basis.

The mayor will be chair of the York and North Yorkshire combined authority, which comprises as constituent councils the city of York and North Yorkshire. The combined authority will be established on the day after the order is made, subject to parliamentary approval, which is likely to be before the end of the year. Until the elected mayor takes office there will be an interim chair of the combined authority. The combined authority will appoint one of its members as the interim chair.

The order also transfers police, fire and crime commissioner functions for North Yorkshire to the combined authority, to be exercised by the mayor. Additionally, the mayor and the combined authority will be conferred a range of other significant powers agreed in the devolution deal. These include a concurrent power with Homes England, powers on regeneration and transport, and powers for establishing mayoral development corporations. Education and skills functions, along with the devolution of the adult education budget, will be conferred on the combined authority at a later date, as agreed with the area. This is with a view to the area being responsible for skills and adult education from the academic year 2025-26. This is subject to the area meeting the readiness conditions and parliamentary approval of the secondary legislation conferring these functions.

The order also contains detail on the governance arrangements of the new combined authority, to reflect these powers and the role of the mayor. Each constituent council will have two members on the combined authority, one of these members being appointed by the mayor as deputy mayor. The mayor will also appoint a deputy mayor for policing and crime, who may be any person the mayor considers appropriate.

These governance arrangements include that the PFCC functions and certain other functions—including, for example, the power to designate a mayoral development area or to draw up local transport plans and strategies—are to be exercised by the mayor personally. The mayor may also delegate the exercise of these functions to another member or officer of the authority, with particular specified arrangements for the PFCC functions.

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[Baroness Taylor of Stevenage (Lab)]

My Lords, I remind the Committee of my interests as a serving councillor at both county and district level. I am also a vice-president of the Local Government Association.

As a councillor for almost 27 years, a former leader of my council for 16 years, one of the instigators of the Hertfordshire Growth Board and a local enterprise board member since its inception, I am a great believer both in the transformational powers of local government and in far deeper and broader devolution. I see this, as does my party, as the quickest and most effective way of creating economic growth tailored to local circumstances, as well as of providing the levers of economic, social and environmental well-being where they can best be deployed flexibly, speedily and to the greatest benefit of the area concerned.

So, as a passionate advocate of devolution, it would be churlish of me not to welcome an agreement between York, North Yorkshire and the Government where all believe that it is in their interests. If I needed further convincing, it was pleasing to see that one of my local government colleagues—Councillor Mark Crane, the leader of Selby, who had always been deeply sceptical of such a deal for North Yorkshire—now welcomes the proposals; I am pleased to see that. I thank all the leaders and officials from that area who have done so much work to get this deal over the line. My comments concern the principles, with some specific questions about this deal, and are not intended to intervene in this two-year-long process between the councils in York and North Yorkshire, the people whom they represent and the Government.

We have seen highly effective outcomes from devolution in Greater Manchester—with which I worked extensively as part of the Co-operative Councils’ Innovation Network—and in West and South Yorkshire, but no one could argue that the progress of devolution has not been slower than a snail’s pace. It remains fragmented, patchy and piecemeal, with large areas of the country not subject to deals at all, even where they have worked carefully to draw together political, business and social partnerships, because they have clearly not passed the mysterious and indeterminate tests set by the Government. I cite Hertfordshire as an example here. I was very pleased to hear the Minister in the other place reiterate yesterday that a mayor is not the right solution for everybody, but it seems that, if your proposal does not include one, you are far less likely to shimmy under that government bar.

We would like to see a presumption in favour of handing back powers to our towns, cities and communities, with everywhere having the powers and flexibility to turbocharge the growth that works for their area and to attract investment, with the ability to negotiate longer-term finance settlements from government. That would give every area the ability to be ambitious for their residents and businesses and to deliver the real changes on the ground to deliver that ambition.

Too many areas are held back by our antiquated, struggling and definitely not fit for purpose local government funding system. It has been further weakened by years of cuts, use of outdated data that is out of touch with changes in local areas and, more recently, the further blow to finances caused by runaway inflation following the mini-Budget just over a year ago. To authorities in such straitened financial times, a devolution deal can bring some much-needed financial relief, so it is perhaps not surprising that local leaders are tempted. However, we need to see this in context. The York and North Yorkshire deal, for example, apparently equates to £20 per resident of the region per year over the term of the 30-year deal—incidentally, that is more than West Yorkshire but less than Liverpool, the Tees Valley and South Yorkshire, so I hope that local government colleagues working on deals are tough negotiators.

However, IPPR North tells us that the north of England has seen a £413 reduction per person in average annual council spending in each year between 2009-10 and 2019-20, so the deal does not come close to the losses that communities in the north have experienced due to austerity. Does the Minister see this as such a marvellous deal in that context? Is it envisaged that further money might be on the table as plans for the area develop? That was a bit ambiguous in the SI, so I am interested to know whether it is the case.

On the consultation process, I can see from the papers that extensive efforts were undertaken—which the noble Baroness, Lady Penn, went through—to elicit responses from the public on these areas, but does the Minister consider that just over 2,000 responses from a population of almost 1 million people represents a clear mandate? What work have the Government done with the Local Government Association on how we might improve these consultation processes in future? I appreciate that the structure of local government can be confusing, particularly in areas with two or three tiers of local government, but introducing changes of such magnitude on the basis of a mandate of just over 50% of such a tiny percentage of the local population surely suggests that we need more innovation in the consultation processes.

On general questions of governance, the Minister will be aware that we tried very hard to ensure that every place in the area would be represented on the combined authority during the levelling-up Bill, but that was not the outcome. Like the noble Baroness, Lady Pinnock, I remain concerned about so many powers being vested in one person. It has been the practice in mayoral authorities for mayors to appoint deputy mayors and for them not to be elected. This also applies to police commissioners. These are very important roles, so does appointment rather than election impact on accountability? This is especially the case if the mayor cannot fulfil their role, as it is then delegated to an unelected deputy mayor. Why do the Government consider appointment the best model here and, to go back to my earlier point, why do appointed deputy mayors enjoy a role on combined authorities which is denied to locally elected council leaders?

Have the Government given any thought, for example, to local public accounts committees to mirror their function in the other place? This would widen the scope of the police and crime commissioners, which, I agree with the noble Baroness, Lady Pinnock, have not proved terribly effective, and would provide joined-up accountability for the mayor.

We note that for this deal the adult education budget transfer is to come later than the introduction of the combined authority in May 2024. I appreciate that this has been agreed with the partners in this devolution deal, but with skills and training so essential to economic growth, why are they not an early priority for all devolution deals?

I have carefully read Part 5 of the order, which means the authority may introduce bus franchising if it chooses to do so. How would the Government, including the Department for Transport, support the combined authority if it chooses to exercise this power? Do the Government envisage any issues arising from the different transport roles of the mayor, the York and North Yorkshire Combined Authority and the constituent authorities in relation to local transport plans, bus partnerships and highways and traffic authority functions?

In July, the BBC reported that £1 million would be given to support the set up of the new combined authority in addition to £582,000 already spent. Can the Minister update the Committee on funding the direct cost of the combined authority after the inaugural mayoral election? That is not the money allocated for spend for the authority, but its direct set up cost.

In conclusion, we strongly support the principle of devolution to local areas and congratulate all local areas that have navigated the current complex system to get their deals over the line. We will certainly not be opposing a deal negotiated at local level, however we urge that the Government consider how they will accelerate the devolution process and how some of the questions that have come up under this deal and others are to be answered in future.

[Baroness Penn (Con)]

My Lords, I thank both noble Baronesses for their contributions. I will seek to address as many of their points as possible. First, it is worth recognising the in principle support for this deal and the process overall.

Like the noble Baroness, Lady Taylor, we recognise the work that has gone on among local councils, representatives and others in making this happen. To pick up the point about consultation, it is important to place that consultation in the context of the involvement of a great many people within the York and North Yorkshire area who are representatives of their communities and constituents. Given the diversity of the areas covered, the broad support for it among councils, MPs and others involved means the reach for how we have gone about agreeing the devolution deal process is not represented just by the consultation. However, I think we should always look at how we can better engage local areas and people as we go through this process of devolution, so we would always open-minded about how we can improve on that process.

I will address the other, broader point around the process of devolution about how far this deal goes in terms of delegation versus devolution and how much of the country benefits from either and should in future. We are absolutely committed to having every area that wants it benefitting from more devolved government. Since we set out our ambitions for this in the levelling up White Paper, we have moved at a faster pace than we would expect. I think that more than half of England’s population will be covered by a devolution deal.

We are also keen to reflect that devolution deals can work for rural areas as well as urban areas. The noble Baroness, Lady Pinnock, is right that this deal is in some ways a trailblazer for that. However, I do not think that that is a reason not to go ahead. If we want devolution to be available to every area of the country, we need to find the geographies and structures that work that mean that it can be extended.

The Government are going further: we have the two trailblazer areas of Greater Manchester and the West Midlands Combined Authority as regards moving towards that next stage, where you will get closer to a single settlement for the combined authority with much greater flexibility. Those are intended to be trailblazers for other areas that wish to go further in this process—so I think we agree on the direction of travel as regards those aspects of it as well.

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[Baroness Pinnock (LD)]

I am sorry to interrupt, but government Ministers continually say that above-inflation grants have been provided to local authorities in the last year or so. However, for those local authorities that have social care responsibilities, the social care precept is an additional burden on council tax payers. It is not exactly the case that more money has been provided; it has, but the Minister should give the addendum that part of it is provided by an additional burden on council tax payers. In my local authority, it costs council tax payers £200 extra a year to provide for the social care precept.

[Baroness Penn (Con)]

I absolutely acknowledge the point made by the noble Baroness. I think I referred to an increase in core spending power, and my understanding of that metric is that it reflects the government grant, the council tax and the additional social care precept. I did not refer only to the government grant. I am sure she will be well aware that additional grant funding has also gone into social care over the last two years to reflect additional pressures in that sector.

I was simply making the point that, since 2019, I believe, above-inflation increases to the core spending power of councils have been made available. The terms of the devolution deal and the money attached to it are as set out. The noble Baroness, Lady Taylor, asked about further funding. I will not speculate on that, but I point out to all noble Lords that the Government have made significant amounts of funding available for levelling up through the levelling up fund, the towns fund and the future high streets fund. We are working to simplify that funding landscape, but there is an ongoing commitment from this Government to make funding available for local economic development and regeneration. We have seen that in the significant amounts made available in recent years and the ongoing commitment from the Government in that area.

I am conscious that I have not addressed a couple of the questions, in particular on transport, which the noble Baroness, Lady Taylor, asked. If both noble Baronesses will forgive me, I will write to them with further details.

Motion agreed.