Levelling-up and Regeneration Bill

Baroness Pinnock Excerpts

Committee stage
Monday 27th February 2023 Lords Chamber

[Baroness Taylor of Stevenage (Lab)]

My Lords, as we start to examine those parts of the Bill which address local government and devolution powers, we might welcome the fact that the Bill addresses the long-standing asks of councils and their representative bodies for greater devolution, and that there is more flexibility in the proposed structure of combined county authorities than we might previously have envisaged. Nevertheless, we had hoped for a Bill that was far more ambitious and open to ideas when looking to address the imbalance of power in the UK.

As we have often heard in your Lordships’ House, the UK today is the most centralised state in Europe and there is too much in the Bill that seeks further powers for the Secretary of State to intervene. I welcome very much that the Secretary of State accepts that the national challenges require place-based solutions—at least, it appeared so from the White Paper. However, I feel strongly that Part 2 would better deliver this if accompanied by greater powers and fairer funding so that leaders can support the local economic recovery according to the needs of their own areas.

We have pointed out before in your Lordships’ House that, without a comprehensive and fair funding system across local government which would properly empower local authorities to deliver what is needed to support, sustain and develop their communities and economies, any steps taken towards devolution will have a hollow ring. Even worse, if funding mechanisms are driven by the current competitive bidding pots, which favour areas that are able to spend the most on shiny bids, they will run counter to the whole levelling-up agenda. I was grateful to the noble Earl, Lord Howe, for saying that the sheer number of funds have become onerous and that we certainly need to look at that. There is a further danger in this “bidding bingo” way of funding local areas: it is yet another way of imposing the Government’s policy on growth and infrastructure in local areas and does not make for true devolution in any sense of the word.

We may have wished that provisions for reorganising local government had been the subject of a separate devolution Bill, an issue I have raised before in your Lordships’ House. Given that this does not appear to be on the horizon, we will be seeking amendments to transfer greater powers to local areas. I welcome the implicit recognition that devolution can drive economic, social and environmental development in local areas, but questions remain over whether the specific model of combined county authorities is right for every area, and whether all the current constituent parts of local government will have their importance recognised and their voice heard as the new structures develop. Local residents and leaders will always know best their own areas and the powers they need to deliver on their ambitions. Amendments for this part of the Bill will aim to allow greater flexibility for towns, cities, counties and the people who live in them to determine their own future.

Amendment 60 is a probing amendment to discover what a CCA can include as part of a two-tier council area—will all or only part of it be allowed? The amendment is designed to help us understand whether the Government will prescribe the nature of a CCA area to include all constituent councils. This has been tabled because there has been significant confusion about the geography of CCAs and what is and is not in scope. For example, does the CCA have to include the whole of an upper-tier authority area? In the case of my home county, Hertfordshire, must it include the whole of the county? The Minister will know that this is complicated: in some areas, counties already include unitary areas, and some county areas have enormous populations and significantly diverse demographics.

In previous devolution rounds, we have seen a confusing spectrum of scope—from being instructed on what will be in and out geographically, to documentation saying that it is for local government to decide. The second option is clearly preferable to all of us, but even when that is the stated initial intent, the goalposts are often moved during the bidding rounds to be more prescriptive than was initially thought.

Amendment 99 probably belongs better with the group of amendments relating to consultation on CCAs. If consultation is needed for the formation of a CCA and/or its dissolution, as we contend in other amendments, should there not also be consultation when a CCA is to be amended? Later regulations could determine the qualifying parameters for this, so that extensive consultation is not necessary for minor changes. This and similar amendments seek to determine the principle of public engagement on local government structures. I beg to move.

[Baroness Pinnock (LD)]

My Lords, the noble Baroness, Lady Taylor of Stevenage, is quite right to table this amendment to explore the area that can be included in a combined county authority. As I understand it, a combined county authority is a bit of a misnomer. Last Wednesday, the noble Baroness, Lady Scott, said in response to an amendment that a CCA could include, for instance, the unitary authority of Wiltshire and the city unitary authority of Swindon. Equally, when I asked her what would happen in Devon, she said quite clearly that the county and district authorities of Devon and the unitary authority of Plymouth would be included. These are not necessarily combined county authorities: they are unitary and county and district combined authorities—if that is determined, we hope, by the people who live there and the councillors elected to represent them.

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[Earl Howe (Con)]

My Lords, this group of amendments relates to the area of a combined county authority, the new type of local government institution being provided for in Part 2 of this Bill. Provisions in this part support the delivery of the local leadership mission of the levelling-up White Paper, to enable by

“2030, every part of England that wants one”

to

“ have a devolution deal with powers at or approaching the highest level of devolution and a simplified, long-term funding settlement.

[Baroness Pinnock (LD)]

I am sorry to interrupt so early in the Minister’s response, but could he define more clearly what the “highest level of devolution” actually means?

[Earl Howe (Con)]

If the noble Baroness will bear with me, I shall do my best on that.

Noble Lords will be aware that 10 combined authorities have been established since 2011 in our city regions. However, we recognise that such authorities might not be so appropriate for non-metropolitan areas. The new model of combined county authorities is more appropriate for non-metropolitan areas, many of which have two-tier local government. It enables the establishment of a single institution covering a functional economic area, or whole county geography, which would be a suitable institution to provide effective leadership over an appropriate geography to qualify for a devolution deal.

I take on board the comments of the noble Baroness, Lady Taylor, about local government funding, but it might be helpful if I added a little to the information I gave the Committee in the last group of amendments. Our intention is to set out a plan for streamlining the funding landscape, as I mentioned, to provide greater flexibility for local authorities and make it easier to navigate opportunities for growth. This will include streamlining local growth funds, reducing inefficiency and bureaucracy and giving local government the flexibility it needs to deliver for local economies. As part of this work, we expect that there will be fewer small competitions. Where competitive funds do exist, we will look to streamline bidding and support greater alignment between revenue and capital sources. We will also consider the monitoring and evaluation requirements to ensure that places have robust, proportionate, ongoing monitoring and evaluation plans for the impact and delivery of investments and spending.

Amendment 60, tabled by the noble Baroness, Lady Taylor, seeks to allow part of a two-tier county council area to be included in a combined county authority, rather than the whole county council area. This would not be consistent with the policy we set out in the White Paper, whereby we will devolve to an institution covering a whole county geography or functional economic area. I will come on in a moment to the rationale for that model. In a combined county authority, such as the intended East Midlands CCA, the upper-tier councils within the area covered by a combined county authority are the constituent members of the CCA. There is no upper-tier council that covers part of a two-tier county council’s area; the only upper tier council is that two-tier county council, whose area covers a wider geography. As such, as the two-tier county council will be the constituent member of the combined county authority, the whole area that the council covers must be part of CCA’s area.

Moreover, allowing part of a two-tier county council’s area to be part of a combined county authority would not be consistent with the levelling-up White Paper’s principle of devolution being to institutions covering functional economic areas or whole county geographies, over which a number of functions should be exercised for maximum effect. Splitting the responsibility for such functions could also lead to discrepancies—

[Baroness Pinnock (LD)]

Can the Minister explain, then, where the geographies of a county area do not coincide with the geographies of an economic or travel-to-work area? Often, they do not. What I have heard is that you can either have a functioning geography of a county and its two tiers, or the alternative, but not a mixture of the two.

[Lord Scriven (LD)]

I am pleased that the Minister has raised the East Midlands. On the northern tip of the East Midlands there is Chesterfield and north Derbyshire. Most businesses in that area would look into the South Yorkshire Combined Authority in terms of their business, and not into the county combined authority. It seems to be an administrative boundary designed down here in Whitehall rather than a true travel-to-work area. How would the north Nottinghamshires and Chesterfields be affected by this when, in reality, the economic performance and activity is actually into the South Yorkshire Combined Authority?

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[Lord Shipley (LD)]

My Lords, I will make just one or two comments on this group. I have listened very carefully to this and the previous group and I think we have an opportunity for the Government to clarify a number of issues around consultation and, indeed, referendums. I listened carefully to what the noble Baroness, Lady Bennett of Manor Castle, said about referendums. What is needed is a statement from the Government, hopefully before Report, on what the nature of consultation should be. What would be deemed to meet a minimum requirement or threshold for there to be an official consultation?

Secondly, the Government need to be absolutely clear what their own powers should be in relation to a consultation: what they can require of a local authority or set of authorities. I welcome the fact that this discussion is taking place; it is really important. We have discussed before in recent years during the passage of previous Bills what local people have a right to expect of their consultation. I, too, in Newcastle, have been through a mayoral referendum, and the same thing happened. The decision was not to have a mayor, but, of course, we now have a mayor of the North East Combined Authority—for which, in fact, there was no referendum. Our referendum was within scope; I ask the Minister: are referendums out of scope?

Turning to Amendment 62, I was struck by one or two other very important issues raised by the noble Baroness, Lady Taylor, which the Government need to be a bit clearer about. The first was also raised by the noble Baroness, Lady Hayman of Ullock: travel-to-work areas. It all depends how big your CCA or other combined authority is geographically. A very important issue is raised in Amendment 62: whether the Government are thinking in terms of each CCA having a single economic hub. In a number of areas that would not be suitable. In my own part of the country, several travel-to-work areas apply. Hopefully, that point will not be forgotten by the Government.

Lastly, on Amendment 63, the noble Baroness, Lady Taylor of Stevenage, made another very important point about the duty to co-operate. When during previous Bills we have debated the duty to co-operate, the Government have always been very positive about having that duty placed clearly on the face of the Bill. But a CCA is not just being required to co-operate with a neighbouring CCA, but with all the other bodies that may relate to it. Given the ability of the public sector to operate across boundaries, both geographical and in terms of responsibilities and powers, it matters that the duty to co-operate is made absolutely clear at the outset.

[Baroness Pinnock (LD)]

My Lords, I will just make one or two additional comments to those of my honourable friend Lord Shipley, the main one concerning Amendment 126 in the name of the noble Baroness, Lady Hayman of Ullock, about public consultation. I have been involved in a number of statutory instruments on the establishment of metropolitan combined authorities where the public consultation involving “the public” has been minimal, but it was agreed to be satisfactory because it enabled other local institutions—be it businesses, local council representatives or the LEPs—to respond. That has been labelled “public consultation”.