English Devolution and Community Empowerment Bill

Baroness Stedman-Scott Excerpts

Committee stage
Monday 2nd February 2026 Grand Committee

[Lord Shipley (LD)]

My Lords, I very strongly support the noble Lord, Lord Ravensdale, and the cosignatories of this group of amendments. The points I will make will be very similar to those for the next group, which we will reach in a moment. The issue is important. I had not thought that immediately after Covid, the rate of those not in education, employment or training would rise. It has risen since Covid. There is something right at the heart of the way in which youth unemployment is addressed that is causing us not to solve that problem and give young people aged 16 to 24 the opportunities that they ought to have.

Looking at the areas of competence in the Bill that mayors will be engaged in, this one seems to be an acid test of whether devolution works. It is one thing to transfer powers from one person or body to another person or body, but it is a different matter when an objective is set, which is, simply stated, to reduce the level of youth unemployment and get more young people into education and long-term employment. The aim of the Government in driving devolution to the mayoral strategic authority system is, I think, to drive growth. From growth, you will have more jobs, and from more jobs you will have a lower level of those who are not in education, employment or training.

The clear ambition of the noble Lord, Lord Ravensdale, and, when we get to the next group, of the noble Baroness, Lady Stedman-Scott, is to drive social mobility through the enabling parts of the Bill. It is not just a question of moving transport powers from one body to another; it has to relate to helping young people get themselves from one place to another with the right transport systems and support for travelling to enable them to engage with education, training and employment.

There are several amendments in this group and the next one. We ought to take a step aside to look at how we can deliver the ambition that the noble Lord, Lord Ravensdale, has set because if this fails and the level of those not in education, employment or training stay stable or gets worse, that would be a failure of devolution. If you were to ask me which is the most important test in the several days in Committee so far, I would say that it is driving a reduction in the number of those who are in not in education, employment or training. This is something that would make a material difference to the lives of many people.

I hope that the Minister will not reply by saying that the Government have everything under control because I fear they do not. If they had everything under control, the number of NEETs would have gone down, not up. I hope that the Government will listen very carefully to the noble Lord, Lord Ravensdale, and, when we get to the next group, to the noble Baroness, Lady Stedman-Scott. These amendments are central and material to the aim and ambition of devolution.

[Baroness Stedman-Scott (Con)]

My Lords, I thank the Benches opposite for allowing me to speak. I was trying to sort out my timing on the Statement, and I messed up there, so I thank noble Lords for their understanding.

The amendments in this group are all in the name of the noble Lord, Lord Ravensdale. I agree 100% with the noble Lord, Lord Shipley, that this is one of the most serious issues that we face. I thank the noble Lord, Lord Ravensdale, for the time, care and seriousness with which he has addressed social mobility within the Bill. Place-based solutions to social mobility are essential, and devolution gives this Government a genuine opportunity to act in a way that national policy alone never can. It allows local authorities to design policies that are properly matched to their local labour market, their economic strengths and the needs of their communities. In doing so, it offers the prospect of moving beyond one-size-fits-all interventions towards approaches that genuinely expand opportunity and improve outcomes on the ground.

If the noble Lord will forgive me, and for the sake of brevity, I will focus on just a small number of these amendments. Noble Lords in the Committee will know that this area is close to my heart. I spent more than 32 years working with young people, helping them into employment and, more importantly, helping them to stay in employment. I promise noble Lords that I have seen what works and what does not.

I remember getting a young girl who never had any opportunities into the Unipart business in Oxford. We worked with her, and she got the job of booking travel for all the executives. She was so excited it was not true, and she turned up on Monday, Tuesday, Wednesday and Thursday, but on Friday she did not show up. We went round to her house. She came down in her PJs and I said, “What on earth are you up to?” She told us that she never went to school on Friday and that nobody ever talked to her about it, so she thought she would not come to work. We sent her upstairs to get dressed and took her to work. The next week, the same thing happened. Again, we went round to her house and sent her upstairs. On the third week, she turned up, and again on the fourth week and the fifth week. Sometimes it is not anything deeply interventional that works; it is just a matter of knocking on the door and saying, “Come on now, get yourself together”. There is no one size fits all; it is all about individuals. I have seen what can work, and I hope that, with this devolution Bill, we can make more things happen for people like that.

I will begin with Amendment 123, which would require strategic authorities in the delivery of their functions under the Act to work in partnership with local businesses and education providers, including further education providers, to prevent and reduce local youth unemployment. Youth unemployment is rising, and the figures are deeply concerning. In the most recent data available, 729,000 young people aged 16 to 24 were unemployed, which was an increase of 103,000 on the previous year. The youth unemployment rate stood at 15.9%, up from 14.4% the year before.

These figures are frankly scandalous. We could have a big debate about whose fault it is, but I would rather we did not do that. It is important that we agree how we are going to solve the problem and stop it happening in future. This trend cannot be reversed through centralised schemes designed in Whitehall with the political choices this Government have made. It requires local solutions and place-based approaches shaped by the realities of local labour markets. Strategic authorities are uniquely placed to bring together employers, colleges and training providers to intervene early, which is critical, align provision with demand and need and prevent young people falling into long-term worklessness. This amendment would give them both the responsibility and the impetus to do so. I completely support it.

Amendment 124 would require strategic authorities to consult further education colleges when identifying where skills challenges are most acute within key sectors. I know I speak often about skills shortages, but I do so because the evidence is overwhelming. Official figures from the Office for National Statistics show that there are almost 1 million young people in the United Kingdom who are not in education, employment or training, and this is the highest figure for more than a decade. At the same time, employers across the country are struggling to recruit and, due to some of the changes that have been made by the Government, vacancies are dropping. It is a right car crash, however you look at it.

We face shortages in some vital occupations, including biological scientists, bricklayers, care workers, carpenters, graphic designers, laboratory and pharmaceutical technicians, and roofers—what a mixture. This mismatch is economically damaging and can be socially corrosive. Further education colleges sit at the heart of any solution. They understand local demand, local learners and local barriers. Failing to involve them systemically in skills planning is a structural weakness. This amendment would help ensure that skills policy is grounded in the reality of local communities.

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Tabled by

[Baroness Stedman-Scott]

122A: After Clause 31, insert the following new Clause—
“Use of adult skills and employment funding(1) Any allocation of funding made to a strategic authority under this Act for the purposes of adult skills, education, or employment support may be used only for activities which—(a) support adult education or skills development, or(b) improve access to employment, progression in work, or participation in the labour market for persons aged 19 and over.(2) Allocations of funding under this section must be made on a non-ringfenced basis, and strategic authorities must retain discretion as to the design, commissioning, and delivery of programmes funded under this section.(3) Expenditure under subsection (1) may include, but is not limited to—(a) adult education and training provision;(b) skills development, retraining, and upskilling programmes;(c) employment support, careers guidance, and work-readiness initiatives;(d) engagement with employers to support workforce development;(e) outreach activities to increase participation among under-represented groups.(4) Funding under this section may not be used for purposes unrelated to adult education or adult employment outcomes, including but not limited to—(a) highways, transport infrastructure, or road maintenance;(b) general capital projects not directly connected to adult skills or employment provision;(c) activities whose primary purpose is economic development unrelated to workforce participation.(5) Each strategic authority must publish, at such intervals as the Secretary of State may specify, a statement setting out—(a) how funding under this section has been used, and(b) how such expenditure supports adult education or adult employment opportunities in its area.”

English Devolution and Community Empowerment Bill

Baroness Stedman-Scott Excerpts

Committee stage
Wednesday 4th February 2026 Grand Committee

Moved by

[Baroness Stedman-Scott]

148: Clause 42, page 41, leave out lines 35 to 39
Member’s explanatory statement
This probing amendment seeks to understand why the provision is limited solely to current employees of a constituent council of a combined authority, and does not extend to other employers participating in the LGPS. It aims to explore the rationale for excluding staff of housing associations, admitted bodies, and other local employers who play a significant role in the community, and to question whether this distinction is justified or creates unnecessary inconsistency within the scheme.

[Baroness Stedman-Scott (Con)]

My Lords, it is a pleasure to open this debate on behalf of my noble friend Lady Scott of Bybrook.

Noble Lords from across the Grand Committee and indeed the House will be aware that the pensions Bill is currently in Committee and that the first two days of scrutiny were marked by a substantial number of amendments probing the Government’s approach to the Local Government Pension Scheme. We tabled numerous amendments on the technical detail of the valuation methodology, contribution rates, consultation requirements and interim reviews. I am sure the Minister will be relieved to hear that I do not intend to rehearse those matters again today.

Likewise, I do not wish to upset the Minister in any way, but I note that it was disappointing that no Minister from the MHCLG was present during the discussions. The LGPS sits squarely across the responsibilities of both the DWP and the MHCLG. While long-standing, this overlap too often creates complexity and tension, and I fear that it could result in policy that is not always well aligned with the realities on the ground.

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[Lord Wilson of Sedgefield (Lab)]

I am grateful to the noble Baroness for Amendments 148, 149, 150 and 153. I will try to clarify the questions that she asked and, if I cannot, I am more than willing to write to her. Some of these pension aspects are very technical.

These amendments relate to the important requirement that strategic authorities work with the Local Government Pension Scheme funds in their area. This mirrors the duty to co-operate with strategic authorities placed on LGPS funds in the Pension Schemes Bill. The aim is to help strategic authorities to identify local projects that are appropriate for pensions investment and drive growth.

I recognise the noble Baroness’s intention, in tabling Amendment 148, to seek to broaden the provisions to include other employers participating in the scheme. The clause requires the strategic authority itself, rather than its constituent authorities, to co-operate with the relevant pension fund. In my view, this is the correct approach. Strategic authorities are responsible for driving local growth; as such, they should be aware of the interests of housing associations, admitted bodies and other local employers. An additional requirement for multiple other organisations to collaborate with the LGPS would place an unnecessary burden on those employers.

I turn to Amendments 149 and 153. I recognise the intentions to preserve the independence of LGPS-administering authorities and to reduce the burden of regulation on their functions. I assure noble Lords that the Government are not seeking to undermine the fiduciary duties of local pension funds in any way. The decision on whether or not to invest in a particular asset will be made by the asset pool, not the fund. This will help protect the fund against potential conflicts of interest, ensuring that all investments are made in the interests of the fund. Supporting guidance will be clear that investments should only ever be made where that investment helps the investing pension fund to meet pension liabilities.

The Government want to see funds and asset pools working closely with combined authorities, including corporate joint committees in Wales, in order to identify and develop appropriate investment opportunities so that the investment might of the Local Government Pension Scheme can drive local growth. I share the view of the noble Baroness that this requirement must be workable. For this reason, the high-level requirement does not put a restrictive framework on exactly how strategic authorities must work with the scheme. It will be up to strategic authorities to establish a system that is workable for them. Further, I point your Lordships to the existing guidance for strategic authorities on the development of local growth plans, which supports strategic authorities in establishing a productive relationship with investors.

I turn now to Amendment 150. I thank the noble Baroness, Lady Stedman-Scott, for asking important questions regarding a requirement for funds to participate in an asset pool. Asset pooling is the cornerstone of the Government’s investment reforms for the LGPS, bringing significant benefits of scale and expertise. As I have said, the Government are not seeking to undermine the fiduciary duty of local pension funds in any way. The responsibility to set an investment strategy—the key driver of investment returns—will remain with funds, ensuring that they retain local accountability and decision-making and that they can drive performance. The duty in this clause is complementary to the duty that will be placed on LGPS funds through regulations made under the Pension Schemes Bill. It will work effectively only if the concept of participation is defined in the same way in both pieces of legislation. That is why the Government are tabling amendments to this clause to reflect changes that have been made to the Pension Schemes Bill.

A question was asked about pooling. Integrated models in which strategic advice and investment management are both delivered by the same fiduciary manager are commonly used in private sector schemes and internationally. These models can deliver greater value for money and economies of scale. Asset pool companies will be required to have robust policies and procedures to identify and manage conflicts of interest. In contrast to external advisers, asset pools owned solely by LGPS AAs are expected to provide services in their interest. They do not stand to gain financially from the partner fund taking their advice or from providing poor-quality advice. I will look again at the noble Baroness’s speech in Hansard to make sure that we have covered all her questions and so that she has what we are doing in writing.

I turn now to government Amendments 151, 152, 154, 155, 156 and 157. These minor and technical amendments correct the definition of participating in an asset pool company. They will accommodate a pool company structure where the pool is owned by a holding company, thereby allowing an existing pool—the Local Pensions Partnership—to be included in the definition. This is not a change in policy but a correction.

[Baroness Stedman-Scott (Con)]

My Lords, the Government have now confirmed a substantial programme of reform of the Local Government Pension Scheme through this Bill and the wider pensions Bill. Taken together, these measures represent a significant moment in the evolution of LGPS asset pooling and governance.