Cities and Local Government Devolution Bill [Lords]
Debate between Jacob Rees-Mogg and Lord Wharton of Yarm(8 years, 11 months ago)
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James Wharton
I thank the hon. Gentleman. I recognise what he says. There are complexities in devolving such matters to local government, but I am sure he will continue to argue, as such matters are discussed, that he wants those complexities dealt with in reality, rather than just in theory.
New clause 8, tabled by my hon. Friend the Member for Altrincham and Sale West (Mr Brady), would provide a cooling-off or probationary period for the conferral of functions from a local authority to a combined authority. I know that my hon. Friend has raised that matter in discussions during previous stages of the Bill, and that it is of great interest to him.
I can see the attraction that the flexibility to reverse a conferral of powers might have for an individual local authority, but there are considerable downsides. The very fact that the combined authority might be responsible for those powers for only a year or so might be conducive to little action being taken under what would perhaps be perceived as a temporary conferred function. The combined authority would almost certainly be reluctant to base any investment or other major activity on a function that it could lose in a few years’ time. Moreover, partners, whether businesses or other public bodies, would almost certainly be reluctant to enter into arrangements that could so quickly be reversed. We consider, therefore, that it would be very doubtful that activity within that probationary or cooling-off period of any such conferral of powers would give a realistic picture of how a combined authority might operate in the future or of the full range of improvements that might be achieved.
We consider that a better alternative, if local authorities are not sure whether they wish to confer a specific power, would be for them to trial such joint working across the area of a combined authority through informal arrangements, such as a shadow combined authority or joint committee. Those models are available to local authorities and combined authorities without the need for secondary legislation to be made. I therefore ask my hon. Friend the Member for Altrincham and Sale West not to press new clause 8 to a Division of the House.
New clause 10 seeks to reinsert the clause that was inserted in the other place to amend section 2 of the Representation of the People Act 1983 to lower the minimum voting age from 18 to 16 for the local government franchise in England and Wales. We debated that provision at length when we last met in Committee, after which we agreed to remove the clause by a significant majority of 95. The message was clear then and it remains clear now.
We have discussed quite widely the age of majority and the things that 16 and 17-year-olds are able to do or are prevented from doing by law. It has been suggested that because young people are politically engaged, and quite rightly so, they should be given the vote. That is a conclusion with which I do not agree. The debate has exposed the wider truth that there is a range of views, many of which are enshrined in legislation, that can best be described as encompassing the transition from childhood to adulthood. There is probably no clear point at which a person becomes an adult, but it is at 18, not 16, that society normally draws the line.
Any change to the entitlement to vote must be considered properly. We should not make piecemeal changes to the franchise. We cannot make changes and simply assume that there will be no implications for other areas where our laws and our society treat 16 and 17-year-olds differently. The voting age for UK parliamentary and local elections is set at 18. The age that is used in most democracies is 18. The Government have no plans to change it. Indeed, my right hon. Friend the Member for Wokingham (John Redwood) reminded the House last time we debated this matter that we have no manifesto mandate to do so. Recognising that the shadow Minister says that he intends to test the will of the House on this issue, I encourage all hon. Members to support the Government and oppose the reinsertion of this clause.
New clause 11 requires that the Secretary of State must, within 15 months of the Bill being passed, publish a review of the fire and rescue services affected by the provisions of the Bill. The new clause is not necessary. Devolution is about enabling local areas to determine how best their services are delivered. It is therefore only right that fire and rescue authorities, in agreement with local partners, should decide how and when to review and assess how the provisions of the Bill may affect fire and rescue services. I remind hon. Members that the requirements of the fire and rescue national framework will continue to apply. With those explanations, I hope the Opposition will not press the new clause.
Turning to new clause 13, we are already taking major steps to devolve local taxes and have only just set out plans for a radical devolution of fiscal powers. By the end of the Parliament, the local government sector will retain 100% of local taxes to spend on local government services. For the first time in decades, local areas will see the full direct benefit of business rate growth in their local area. We will also grant new powers to directly elected mayors and to authorities. We will give all local authorities the power to reduce business tax rates to support businesses in their areas. As was confirmed in the spending review, we will set out detailed proposals in due course. In the light of that, I hope the House will agree that this new clause, which would require the Secretary of State to set out a framework for further devolution of fiscal powers, is unnecessary. I hope, therefore, that the shadow Minister will agree not to press it.
New clause 14, which was tabled by the Opposition, would require the Secretary of State to issue guidance to combined authorities on co-operation with peripheral authorities. I do not believe that it is necessary or appropriate. Before making orders establishing a combined authority and orders devolving new functions to such an authority, the Secretary of State must consider that to do so is likely to improve the exercise of statutory functions in the area or areas to which they relate. Additionally, Parliament must approve such orders.
The new clause seeks to provide a further requirement about how, once established, a combined authority should go about the exercise of functions devolved to it. As with local authorities, combined authorities must have regard to all relevant considerations in taking their decisions. Just as local authorities cannot be blind to the impact of their decisions beyond their boundaries, nor can combined authorities. Neither local authorities nor combined authorities can be ignorant of what happens beyond their borders. We do not have these provisions for local authorities and it is the position of the Government that we should not impose them on combined authorities. Therefore, the new clause is neither necessary nor appropriate. I hope that the House will agree.
Amendments 4, 5 and 6 were tabled in response to an amendment tabled in Committee by my hon. Friend the Member for Altrincham and Sale West. The first of those amendments will ensure that the Secretary of State’s annual report on devolution to Parliament includes information on the extent to which powers that have been devolved to a mayor remain exercisable by a Minister of the Crown. Amendment 5 is a consequential amendment to amendment 4, while amendment 6 defines the phrases “combined authority” and “Minister of the Crown”. Although it is the Government’s intention that functions should be devolved as widely as possible, there may be circumstances in which they should be exercised either jointly or concurrently. With those explanations, I hope that hon. Members will accept amendments 4, 5 and 6.
If amendment 58 were accepted, it would mean that any transfer of functions to a combined authority must not be dependent on the combined authority having a mayor. In its intent, it is similar to the provisions of the old clause 3, which the Committee voted to remove from the Bill by a majority of 81. That provision imposed a specific requirement that a mayor could not be a precondition for transferring functions to a combined authority. As I told the Committee, that provision was at odds with our manifesto commitment, and amendment 58 is too.
In our manifesto, we committed to
“devolve far-reaching powers over economic development, transport and social care to large cities which choose to have elected mayors.”
We are not forcing this on anyone or on any place. Whether an area has a mayor is a matter of local choice. However, if an area wants to have a devolution deal of the scale and ambition of Greater Manchester’s, we do expect a mayor to be part of the deal. The effect of amendment 58 would be to stop our pursuing that manifesto policy. It would potentially put the whole future of devolution at risk of challenge. It is an amendment to which we are wholly opposed and that we hope will not be successful should the House choose to divide on it.
Amendment 2 provides that a combined authority mayor can be established only after a referendum. I listened with great interest to the comments of my hon. Friends the Members for Hazel Grove (William Wragg) and for North East Somerset (Mr Rees-Mogg). My hon. Friend the Member for North East Somerset was, as ever, persuasive and eloquent, but on this occasion, I am afraid to say, he was not quite persuasive enough. The amendment would require the Secretary of State to make regulations governing the conduct of such referendums and to consult the Electoral Commission before doing so. We had an interesting debate on the first day of Committee about this very matter. I recognise that I was repeatedly challenged by Members from both sides of the House about the degree of choice for local areas.
While I do not seek to reopen that debate, I must make it clear again that the Bill does not give the Government the power to impose devolution or a model of devolution in any area. The decision to approach the Government with a proposal for the devolution of powers and the decision on the degree of devolution required are entirely local ones. By the same token, we have always been clear that where areas make that approach to negotiate the significant transfer of powers, like the powers agreed with Greater Manchester, we would expect a mayor to form part of the mix, as that provides the levels of leadership and accountability that are necessary to ensure the effective delivery of such a deal.
Mr Rees-Mogg
Will the Minister clarify what he has said about nobody being forced to go down this route? Does that mean that, under amendment 7, an objecting constituent council would not be part of the mayoralty?
James Wharton
To clarify for my hon. Friend, areas will not be forced to be part of a devolution deal. If a mayor is part of a devolution deal and a local council does not want to be part of it, the council will not be forced by anything that the Government intend to do or can do to be part of that combined authority or devolution area. It is a matter of building local consensus and giving local people the choice.
Mr Rees-Mogg
So if a council is part of a combined authority and it objects to there being a mayor, but the majority of members of the combined authority vote for a mayor, the council will leave the combined authority and will not be any part of any combined authority or of the mayoralty.
James Wharton
My hon. Friend is correct. Where an existing combined authority and a number of the local authorities within it want to make a deal but one or more do not, we want flexibility so they are not forced in any way to enter into a deal with which they do not agree, but are instead able to leave and not be part of that devolution deal.
Holding a referendum on the narrow question of whether there should be a mayor risks not fully recognising the choice that is to be made. It also fails to recognise the role of those who have been elected by people of their area to represent them, and to make the necessary decisions to safeguard their wellbeing and the prosperity of the area. Of course, those democratically elected locally will want to have regard to the views of communities and businesses in their area, and of the voluntary sector and those who live and work there, but we should have the confidence in those who are elected in those areas to grasp the opportunities that the Bill makes possible, to consider the degree of devolved power that is appropriate and deliverable in each of their areas, to enter into negotiations with Government and, in what is a fast-moving environment, to take the decisions that will best deliver the economic growth and development they have already been mandated to deliver.
Cities and Local Government Devolution [Lords] Bill
Debate between Jacob Rees-Mogg and Lord Wharton of Yarm(9 years ago)
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Mr Jacob Rees-Mogg (North East Somerset) (Con)
My hon. Friend makes the important point that rural areas should be protected. Will he give the House an undertaking that rural areas that are close to urban areas will be protected from being swallowed up by those neighbouring cities?
James Wharton
My hon. Friend raises a point that I know is close to his heart. He has tabled amendments to the Bill, which we shall discuss later. No area will be compelled to agree a devolution deal. The purpose of the Bill is to enable us to put such a deal on the table for any area that wants one, but it does not give us the power to compel any area to accept it. His comment is in line with the Government’s intentions in the legislation. We want to ensure that devolution and the benefits it can bring are there for everybody, but we will not compel areas to be part of it.
James Wharton
I cannot give way to my hon. Friend, because I must make some progress. I apologise to him, but there will be opportunity throughout today to discuss this matter.
I doubt that it would be right to accept this amendment, but we shall of course listen carefully to the debate, both on this amendment and on the amendments of my hon. Friends the Members for Hazel Grove and for Shipley. We recognise the strength of feeling and we want to find a way to ensure the broadest possible support for this legislation. I have put on record the Government’s views and the concerns that we have to the proposed approach, but we will of course listen to what is said later on today.
Amendment 46, which is in the name of my hon. Friend the Member for North East Somerset (Mr Rees-Mogg), seeks to prevent the ceremonial county of Somerset— the administrative county of Somerset and also the two unitary authorities of Bath and North East Somerset and North Somerset—from adopting arrangements that include a mayor for the area of the combined authority. There are two difficulties with the amendment. I suspect that my hon. Friend will speak to the amendment later, and I will listen intently to the comments that he makes. The first is that it would single out Somerset, Bath and North East Somerset and North Somerset as some kind of special case.
James Wharton
Although those places are indeed special, the amendment is completely at odds with the generic, enabling provisions of the Bill. To recognise the unique character of an area is not to seek to exclude it from the enabling provisions. Rather, it is through those enabling provisions that we can recognise the particular character of Somerset along with the particular character of any other area. That is at the heart of the Government’s flexible approach—the bottom-up approach—of delivering devolution that is bespoke to the areas that want it.
Secondly, the amendment would rule out the Somerset authorities from having the option of adopting one of the models for strong and transparent governance that is available. Clause 3 enables an area to adopt the model of a combined authority mayor, but it will be for the councils themselves to decide whether they wish to move to this form of governance. We will not impose devolution on anyone, but it should be possible for everyone. I look to my hon. Friend the Member for North East Somerset to withdraw his amendment, but I will listen with interest to the comments that he makes.
I also want to comment on amendments 53 and 56, which are tabled in the name of the hon. Member for Nottingham North. Amendment 53 seeks to extend the Secretary of State’s powers under the new section 107A, so that in addition to providing by order for there to be a mayor for a combined authority area, provision could be made in certain circumstances, following a proposal from the constituent authorities, for some other governance and accountability structures for the combined authority area. Amendment 56 seeks to provide that, where such other governance structure has been provided, the combined authority would be a major precepting authority, as it would be if there were a mayor for the combined authority area.
In general, I have some sympathy with what might be seen as the underlying idea of those amendments, which is to introduce some greater flexibility, but in this case I am not persuaded that this is the right approach. The amendments risk being seen as an attempt to hold out the possibility of some governance arrangement that does not have that sharp single point of accountability. Although we have been clear that the Government wish to impose that accountability on no one, it will be a requirement for those deals that are similar in their scope and ambition to that with Greater Manchester.
James Wharton
Given that the hon. Member for Nottingham North (Mr Allen) has informed the Committee of the sad news of the death of Michael Meacher, I think it is appropriate for me to put it on the record that the Government’s thoughts are, of course, with those who were close to him and who will be feeling pain at this time. As someone who was in this House for longer than I have been on this earth, he made a very significant contribution to this place and one that we should recognise.
Mr Rees-Mogg
May I add to what the Minister has just said? In my dealings with Mr Meacher in this House, he never put his strongly held political views above his fundamental good manners and civilisation. He was always the most decent man to talk to, even though I doubt there was a single subject of any political importance on which we agreed. He is a loss to this Chamber.
I will come on to my amendment 46, which would exempt Somerset, God’s own county, from the provisions on having a mayor. The Minister suggested that Somerset was not exceptional. I think that that was a momentary lapse because he is not only a most honourable gentleman, but somebody of fundamental good nature and wisdom. We will forgive him such a momentary mental lapse on this occasion and put it down to the wet weather or something like that.
The Government are giving fine and good undertakings. I will quote briefly from the Secretary of State on Second Reading:
“It is a fundamental tenet of this Bill, in contrast to other reforms debated over many years, that it does not give me or any of my ministerial colleagues the power to impose any arrangement on any local authority.”—[Official Report, 14 October 2015; Vol. 600, c. 326-327.]
My hon. Friend the Minister has reiterated those undertakings. They are excellent and encouraging, and they provide a solid basis for proceeding. Unfortunately, there is a “but” coming.
Everything I hear from local councillors in North Somerset and Bath and North East Somerset tells me that they are having their arms twisted. We are seeing a velvet glove today—a finely manufactured velvet glove of the highest quality velvet. Behind it, however, is a firm iron fist that expresses the Government’s will that things should go in a certain way. I encourage the Government, through my amendment, to make the background noises—the conversations in smoke-filled rooms—match the fine words that we are hearing in this House.
And so I come to why I want to exempt Somerset. Well, there is history—there is always history! I will start, as always, with Alfred the Great. If we go all the way back to 879, Bristol was in Mercia and Somerset in Wessex. One of those two kingdoms was completely under the Danes—that was obviously the Gloucestershire bit. The borderline between the two has been there for over 1,000 years. There is a strongly embedded history in Somerset and, indeed, in Bristol which means that they see themselves as independent, distinct units.
It is important that the Government go with the grain of communities that have built up over generations, centuries and, in this case, even a millennium, rather than create new administrative regions that mean very little to people. Most people have no interest in the title of their council. They have an interest in where their home is. Their home may relate to a great city, to a great county or to a village, a county and the country. The use of power needs to go with that. Therefore, devolution from the United Kingdom to an administrative body with which people do not have sympathy and about which they do not have a feeling makes things no better. People have a loyalty to the nation and a loyalty to their locality, but if interspersed between them is some random political agglomeration that came about through a sudden burst of enthusiasm by a Government, people have no association with that, no enthusiasm for it and no loyalty for the institution.
Of course, this has been tried before. This is my second and perhaps more important appeal to history in the context of Somerset, particularly in relation to North Somerset and Bath and North East Somerset. We were part of a much disliked, most unsuccessful, high-cost organisation called Avon. It is known to the cognoscenti as CUBA—the county that used to be Avon. The name CUBA was appropriate because it was almost as left-wing as Mr Castro in its approach to government and it was exceptionally expensive. It had one of the highest increases in rates in the 1980s. It was felt by people in the rural areas that it was run for the benefit of Bristol, with the cost being borne by people in rural areas.
We continue to see that in Avon and Somerset police, the cost of which is borne by the rural areas, even though—I am sorry to say this with the hon. Member for Bristol South (Karin Smyth) sitting opposite me—most of the crime is in Bristol. Inevitably, being an inner city, Bristol has more drug dealing, more armed crime and more social disorder than Nempnett Thrubwell and other villages in my constituency, which are bastions of law-abiding civility.
James Wharton
My hon. Friend raises a valid point. An elected mayor provides the focus and accountability; it means there is someone to drive the agenda forward and be accountable for it. However, we would not impose this on any area. It will be delivered only by agreement. That is true of the north-east as it is for the country as a whole, and it is true of the text in this Bill, which does not give us the power to impose. It gives us the power to make deals with the areas that want them. Devolution should be on the table for any area that wants it, but it should be imposed on no one, and that is what the Bill ensures will happen.
Mr Rees-Mogg
I am grateful for my hon. Friend’s very clear answer. Is it therefore the case that if an area refuses devolution, the money stays with Whitehall but can still be spent in that area, and that refusing devolution results in no financial loss?
James Wharton
Of course. Areas that choose not to be part of devolution—and it is their choice; devolution will not be imposed on anyone—will suffer no disadvantage as a result of that choice. I shall be happy to meet my hon. Friend and his colleagues to discuss any concerns that they may have about what may come to be proposed for the area that my hon. Friend represents, and also about the implications should an area choose not to be part of the process. This is not about imposition; it is about consensus, working together and co-operation.
Mr Rees-Mogg
I am very grateful to my hon. Friend for his assurances, which are extremely welcome, and for acknowledging that Somerset is an extremely special place. On that basis, I will not press my amendments later.
James Wharton
I thank my hon. Friend and note that flattery can get you a long way in this business.
The hon. Member for Harrow West (Mr Thomas) tabled new clause 10, which would provide for the devolution of the Secretary of State’s housing powers to the Mayor of London. Since 2012, the Mayor of London has had overall responsibility for housing policy and delivery in London, taking over from the Homes and Communities Agency. The Mayor has powers to set strategic housing and regeneration policy through the London housing strategy. The Secretary of State has a legitimate role in relation to housing across England and it would be inappropriate to remove that role.
The amendment would weaken the Mayor’s role by requiring the Assembly’s consent. That fundamentally misinterprets the role of the London Assembly, which is a scrutiny not an Executive body. I recognise the hon. Gentleman’s desire to pursue the issue and to put it on the record. I am sure he will want it to be considered further as matters progress and that this is not the last time it will be discussed on the Floor of the House.
A significant number of other amendments relate to finance. Government amendment 9 provides greater flexibility in funding the functions to be devolved. Orders under the Local Democracy, Economic Development and Construction Act 2009 enable a combined authority to levy for transport purposes, and the constituent councils to make financial contributions to that combined authority to fund economic development and regeneration functions. The amendment provides flexibility to enable the constituent councils, if they so wish, to make financial contributions for any function of the combined authority, not just economic development and regeneration.
Opposition amendment 58—which the shadow Minister, the hon. Member for Croydon North (Mr Reed), has said he wishes to pursue further this evening—proposes that the Secretary of State be allowed the power to allow combined authorities to set multi-year finance settlements. For a combined authority to set multi-year budgets, it requires not a power from central Government, but the certainty of knowing what funding it is to get. The deals we have agreed with Greater Manchester and the Sheffield city region show how funding across the years can be agreed. We do not, though, need powers to put in place multi-year settlements for local authorities. We can already do that administratively as part of the wider local government finance settlement.
Amendment 60, tabled by the hon. Member for Sheffield South East (Mr Betts), would delete from clause 5 the exclusion of borrowing powers from the ancillary powers that can be given to a combined authority mayor. I listened very carefully to his contribution and understand his concerns. We agree that in appropriate cases there should be prudential borrowing for funding investment for which the mayor is responsible. The Bill provides for that, and the exclusion that the amendment seeks to remove is not about prohibiting such prudential borrowing.
Clause 10 makes provision for funding combined authorities and, in particular, provides that the Secretary of State may make regulations specifying the functions for which there can be borrowing. The Bill explicitly provides that those functions can include mayoral functions and that the constituent councils must consent to any regulations allowing borrowing.
I assure the hon. Gentleman that there are indeed borrowing powers for mayoral functions. In addition to devolving powers to a mayor, the Bill also allows ancillary powers to be conferred on a mayor to allow him or her to exercise the devolved powers. These ancillary powers could be those needed to ensure that there are no doubts about a mayor being able to run an office or to commission necessary studies, or they could include giving the mayor a general power of competence.
The exclusion, which the amendment seeks to remove, is to make it clear that those ancillary powers cannot include a power to borrow. They cannot be a back door to borrowing. The Bill sets up a proper regime for borrowing to fund mayoral powers, and that should be the route for a mayor being able to borrow.