Draft Tees Valley Combined Authority Order 2016

Glyn Davies Excerpts

Tuesday 15th March 2016 General Committees

[Mr Allen]

You are absolutely right, Mr Bone, as always in the Chair. There are colleagues, of course, who will see the future of the steel industry as one of the tests of a new set of machinery of government. If it fails that test, it will undermine devolution for another 20 years.

I have been here long enough to have seen the disaster wrought on devolution by the way in which we half-heartedly moved forward in 1999, 2000 and 2001. We are only now recovering from that. We are in the effort of recovery at the moment, so that has to be done well, listening to people and their concerns, whether they are about the steel industry or other areas, such as the funding stream.

On the funding stream, which is referred to in the order, it is important that local authority leaders, with their Members of Parliament, look north a little and see what has happened on funding in Scotland, where there is assigned income tax and where a level of financial competence is a given. It is in law that they can spend a percentage of the income tax in a way that they, rather than the man in Whitehall, feel appropriate. That ultimately is the bid that has to go in from the Members of Parliament and the local authority leaders to make Tees Valley combined authority an even more powerful institution.

That is the vision that I hope they will pitch for. It is not a vision based on thin air. As we see in articles 7(2) and 7(3), economic regeneration is central to delivery in the combined authority. That is not something that has just happened, that they had a think about and just came up with. Tees Valley Unlimited has been going for six or seven years already and great work has taken place. A lot of people feel devolution must come out of thin air and deliver on day one. I remind people that the Manchester pioneers worked together for more than 10 years in a collegiate way to take things forward, and they were therefore prepared to move forward when an opportunity arose.

I should also say a word about mayoralty. I do not want to go over old ground, because the law is in place now. I again want to put it on the record, as the statutory instrument talks about the machinery of government, that the election of mayors will be far stronger in future if those mayors are put in place by the people in the area they seek to represent. The imposition of a mayor almost guarantees a reaction and a view that it is Whitehall talking devolution but imposing a political system.

Mayoralty should be one of many possibilities on a menu. I hope that the statutory instruments and devolution that follow this order will give people a choice, possibly even to change from a mayoralty to something else. Those who do not have a mayoralty would be allowed to join the party, possibly try it or many of the other systems, whether committee or leadership based, that will have local resonance and legitimacy.

If we impose, all we are doing is turning devolution into decentralisation, which is something that can be given by and taken away by the centre. I know that is not what the Minister intends, but imposing the mayoralty on combined authorities means that that might be the outcome. None of us wants that who wants devolution and genuinely independent local government with a statutory right to exist on its own terms, built into a constitutional settlement so that local government can look after itself, have its own legitimacy, and decide its financial arrangements, governance and local election system with its people. That is what is commonplace in most European and north American countries. We are the people dragging at the heels of that development in democracy. The order allows us to start a journey toward creating independent local government that can follow its own view and that of its people about what is best in their locality.

The order contains a power under section 117 of the Local Democracy, Economic Development and Construction Act 2009, as amended, and paragraph 3.1 of the explanatory memorandum discusses the possibility of the Minister amending some of the proposals. People have read it and said that it is draconian, because he could take away some of the things agreed. I would rather look at it the other way around: the power allows the Minister, when he and Whitehall are satisfied—whether or not I like it, that is the system that we have at the moment—to go further and to amend the rules before us to enable some of the things that colleagues have discussed to happen.

Again, as a demonstration and test of the power, I hope that the first time the Minister uses it, he does so in such a way that colleagues on the ground know that he has done so to enable local authorities and the Tees Valley combined authority to do something positive that people in the area want to do. If he uses it for the first time to constrain a local authority and change the rules, it will send a very bad signal. I hope that he will go away with his local knowledge—and, I am sure the friendly relations he has with colleagues—pick up one of the key issues, maybe the steel plant, or maybe something else, I do not know, and say, “I’m going to use that amending power to enable you to do one of the things that you really want to do, because you can’t do it under the current SI. I’m going to take what could be a draconian power and make it into a demonstration of what can happen in the next devolution Bill that comes before us.”

The other thing to which I draw the Committee’s attention is the order’s relationship with the Standing Orders of the House of Commons, particularly Standing Order No. 83P, which deals with devolved legislative competences. It basically says that what we are doing in England is coming pretty much into line with Northern Ireland and the Assembly, Scotland and the Scottish Parliament and Wales and the Welsh Assembly. That is a good thing in itself, but I have one thing to add. If we are effectively making Whitehall the competent authority for the whole of England, thought needs to be given to the broader democratic representation that should take place across England.

That is a big issue. I will leave it open, Mr Bone, in case you call me to order once again, and say something a little more precise. It is incumbent on the Minister and the Government to consider where power then stops. I congratulate the Government on what they have done in pushing power to town halls and devolved authorities such as the Tees Valley combined authority, but I ask him again to use his amending power to consider what happens on what we now call double devolution. If power just stops at the town hall or the authority, it could be argued that we come to a dead end. Fundamentally, devolution means involving people in the localities. It means taking it beyond what the Scottish National party has done in Holyrood.

[Glyn Davies (Montgomeryshire) (Con)]

We must be cautious and acknowledge that devolution does not always deliver power closer to the people. To take what is happening in Wales as an example, power has been devolved to local authorities and immediately snatched in by the Welsh Assembly. Recently, a power over planning was given to local authorities across England and Wales, and on the same day the Welsh Assembly took that power to itself. It does not always work out in the way we want.

[Mr Allen]

It is marginally better to be abused by the Parliament or Assembly of your country than by Whitehall—but only marginally. I agree with the hon. Gentleman that there has to be a second phase. Communities, neighbourhoods and localities need to have a power vested in them, which they can draw down and use the courts to enforce. In Scotland, if power stops in Holyrood under the Scottish National party, as it undoubtedly has, we are no better off. Indeed, in Scotland we have seen power being sucked up, and I would hate the statutory instrument to repeat that in England. For example, in Scotland one police force has been established, one LEP effectively, and Holyrood exercises an overarching dominance over further education. The power is being sucked upwards.

Using the power vested in the Minister, the statutory instrument needs to provide the ability to say initially, “Before I sign any more orders off, I need to know what your double devolution plans are. We are not going to sign any more off until we know how you push power down rather than just devolve it to town hall.” I would go further and say that this is one of those things that needs a national framework. National rights must be vested in localities, communities and neighbourhoods so that they have the strength to draw the power down in a way that they would be unable to do in their own locality because of the dominance of their local government. That refers, Mr Bone, to paragraph 3.6 of the explanatory memorandum—I know you are keen that we stay in order.

Finally, I refer briefly to the powers mentioned in part 4, article 7(1), which relate to economic regeneration and regeneration in the localities. Part of that process concerns how power goes lower than local government as it is currently constituted and down into the localities. These days, regeneration often takes place at a local level, inspired by charities, the voluntary sector, local councillors and people who are up against particular problems and self-organise. They all need to have a place in economic regeneration. That might be difficult when trying to replace a steel plant, but certainly for estates up and down the land outside London that have been hit by manufacturing issues, we need genuinely to empower people and not just local councils, and not have rule from the town hall rather than from Whitehall.

The measure we are considering today must be just the first step of many. I encourage the people in the Tees Valley combined authority to get together and use their first meetings to pitch hard to the Minister, who lives locally, to ensure that he understands what they want on the next menu of powers, which will certainly come within the next couple of years. If we have a coherent programme, we all, including the people of Nottingham, will benefit from that example.

--- Later in debate ---

[Mr Allen]

I hope that this is the first step and that there are many others to come. I heard the Minister’s remarks challenging in a positive way those people who will make up the Tees Valley authority to come up with a menu—a shopping list—for the next round of devolution. I thought that was an incredibly generous and positive offer, and I hope it will be seized by those who are listening to our debate so that we can take this forward. That has to include further devolution of finance. We could end up being the odd one out in England.

We see progress in Scotland, where they now have assigned income tax, so their Parliament can take this forward and ultimately introduce its own spending programme. We have seen many developments in the Northern Ireland Assembly that allow it to change rates on particular items at particular taxation levels. We see in Wales a growing move towards the Scottish settlement, where Wales can look after much of what is appropriately done in Wales, which is quite right.

[Glyn Davies]

rose—

[Mr Allen]

I take the hon. Gentleman’s point—and I am happy to give way to him—that that in itself is not enough. I have already dealt with the fact that there has to be double devolution, so that there is not recentralisation. A large responsibility weighs on the Minister’s shoulders and those of the Secretary of State, to bring England to the party—to bring it to the devolution democracy that is commonplace in every other western democracy.

This is the first step. I am less critical than many. It has its faults and inadequacies—I have pointed out some of them—but I see it as the first baby step. I am not going to criticise the baby for making a baby step. We should encourage the Government to go along this route, because we have a five-year Parliament. The Government have the whip hand in this place. One of the ways in which we can move this forward is by having proper interaction between local authorities—between the Tees Valley authority and between Members of Parliament—so that we can introduce a second devolution Bill, which I predict will be before the House within 24 months. We can make it a Bill that takes us even further along the lines that I would like and to which my hon. Friends have alluded.