Draft Halton, Knowsley, Liverpool, St Helens, Sefton and Wirral Combined Authority (Election of Mayor) Order 2016

Grahame Morris Excerpts

Wednesday 13th July 2016 General Committees

[Grahame M. Morris (Easington) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Davies, I think for the first time.

The draft order is narrow in scope, as the Minister has outlined. It covers the areas of the local authorities of Halton, Knowsley, Liverpool, St Helens, Sefton and Wirral, under the combined authority, and it sets the date for the election of a Mayor. A number of Committee members have a sense of déjà vu, because we have had similar discussions about a number of other combined authorities—I anticipate that we will have some more, perhaps even before the recess. I will try my best not to go over old ground, but I will put some key points and questions to the Minister on behalf of the Opposition.

I am sure that the Minister is aware of previously expressed concerns about an elected Mayor being a prerequisite for the devolution of substantial powers. In particular, the Communities and Local Government Committee was concerned about the creation of complex and over-bureaucratic systems of local government, with multiple tiers that can often blur lines of accountability.

Will the Minister outline how the Government consulted with local communities before choosing their preferred standard model of governance? In a Delegated Legislation Committee yesterday, the Minister referred to the consultation exercise conducted by the combined authorities, but if that is to be meaningful and there is to be proper engagement, how is he addressing the matter?

For the sake of brevity, I am going to use the term “Merseyside combined authority”—[Interruption.] The Minister says “Liverpool city region”. I am not sure of the correct nomenclature, but I will use Merseyside combined authority. The authority has a track record of success since its formation two years ago. There has been significant investment in transport and in projects such as the one to transform the empty, iconic Littlewoods building on Edge Lane into a state-of-the-art film studio. More than £21.5 million has been invested in more than 30 projects to enhance learning facilities and build new ones, and key housing and economic development sites have been identified to promote growth throughout the region.

The EU is very relevant. Given the implications of Brexit, we need some clarification. If we are to rebalance and grow our economy post Brexit, it is crucial that we restore the fortunes of our regions and great cities, such as Liverpool. EU investment and funding has been a vital lifeline for our regions. We heard yesterday that EU investment and funding for my region, the north-east, amounted to £400 million. That funding is particularly important for those in poorer areas that are often overlooked by central Government.

The Merseyside local authority areas voted to remain in the EU, which is not surprising, given that, by 2020, £190 million will have been invested in the region thanks to our membership. Bearing in mind the term of office of the elected Mayor, it is important that the Minister gives us assurances on that funding. One reason for such a large remain vote in Liverpool might be that The Sun, and other Murdoch press publications, are not popular on Merseyside. Nevertheless, access to EU funding, and its benefits, are key issues on Merseyside, as they are in many other regions.

There are clear examples of how Merseyside has benefited from EU funds, from Queen Square to John Lennon airport. There has been the restoration of St George’s Hall, a UNESCO world heritage site. There have been investments in skills and training, as well as the largest single investment nationally of £50 million in the arena and conference centre on the Liverpool waterfront. I am looking forward to visiting the latter when the Labour party conference is held there later this year.

I appreciate the fact that the Minister has stated that, in the short term, while we remain a member of the EU, nothing should change. But we should bear in mind the scope of the order and the date of May 2017, when the Mayor will take office. Will the Minister confirm that the anticipated investment from the EU up to 2020 will be guaranteed by the Government? There was a lot of speculation about the net benefit to the Exchequer of our leaving the EU, and various figures were bandied about, but we need some reassurance. It is important that we know where we stand in the short term.

It is also important to note that, in the longer term, beyond 2020, which is the scope of the order, large-scale infrastructure spending and investment needs continuity of funding, as the Minister is well aware. It will be very difficult to develop private-public sector partnerships if business is concerned about the Government’s commitment to real investment in our cities and regions. Will the Minister outline his plans for investment beyond that date, or at least beyond the term from 2017 to 2020? I am assuming we will exit the EU in two years.

Will the Minister match or, in anticipation, exceed the level of investment that would have been available had we voted to remain in the EU? Does the Minister agree that a decline for any reason in current levels of investment and infrastructure spending within the first term of the elected Mayor—from 2017 to 2020—would be a betrayal by those who advocated Brexit by promising the British people that we would have more funding available for schemes that support growth in the regions?

I will press the Minister on public engagement. It is a critical issue and we should take every opportunity to engage the public in the devolution process. Despite claims by Ministers that this will be a “bottom-up process”—a term used by the Minister in a Delegated Legislation Committee yesterday on the Teesside combined authority—the public are often looking in from the cold as decisions about their city and region are discussed behind closed doors and without their input. It would be remiss of me if I did not highlight the ongoing consultation on the Merseyside combined authority, or the Liverpool city region combined authority, which can be found on the combined authority’s website.

[The Chair]

Order. I remind the hon. Gentleman that the order we are considering is about having a directly elected Mayor, and the dates and terms of office, for the Merseyside combined authority, as you have called it. I appreciate that there are issues surrounding that, but the Minister may not be completely briefed to respond to all the key points about the implications of leaving the EU. While we are talking about dates, of course, we do not know when we will have Brexit. I assume the Minister will mention 2020 and how that might work with the general election and all of that sort of stuff. Please continue, but I thought I would let the Minister know that I do not expect him to respond to all those points.

[Grahame M. Morris]

I am grateful for your guidance, Mr Davies. I am trying to apply the arguments within the terms of the order. The Minister has repeated on a number of occasions that this is a process, not an event. We are looking at the event of appointing the elected Mayor and at the timescale of the term of office. If it is a process and it is the Government’s intention that things will develop from that event, what steps has the Minister taken to ensure that the views of local residents, which shape the evolution of these devolution deals, are included in that process?

The Merseyside combined authority Mayor will face many challenges during his term of office from 2017 to 2020. Since 2010, devolution has to a large degree been about delegating cuts, rather than empowering communities. I am concerned that we will not be thanked if we do not tackle the resource question in the period from 2017 to 2020. Local government has shouldered more than its fair share of deficit reduction, particularly in the most deprived communities, which in some cases have seen cuts 18 times larger than those in the most affluent areas. If Mayors and devolution deals are to succeed, we need a new, fair and sustainable approach to local government finance.

I am looking for assurances from the Minister that areas such as the Liverpool city region will not be financially worse off due to changes to business rates that are due to come in during that period. There is a real fear that that will relate into substantial cuts in areas with the highest need, which often have the lowest tax bases, while there will be a growth in resources for areas with higher tax bases, such as London and the south-east. The Labour party wants devolution to work, but the transfer of powers must be accompanied by a sustainable model of funding, because resources are key. I promise that Labour will do devolution differently. We will empower communities without the restraints and conditions that the present Government are seeking to impose and we will ensure that it is properly resourced.