Draft Combined Authorities (Finance) (Amendment) Regulations 2024

Debate between Jacob Young and Liam Fox

Monday 29th April 2024 General Committees

[The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Jacob Young)]

I beg to move,

That the Committee has considered the draft Combined Authorities (Finance) (Amendment) Regulations 2024.

It is a pleasure to serve under your chairmanship, Ms Nokes. The draft regulations before us today will, if approved by Parliament, complete the legislative framework for the funding of new combined county authorities. In recent months, similar secondary legislation has been made to provide rules for the election and by-election of combined county authority Mayors, and for their overview, scrutiny and audit committees. Today’s statutory instrument is the last key building block in the architecture of legislation for combined county authorities as a category. The regulations will provide for Mayors of the new combined county authorities to set budgets for the costs of their functions, and raise a precept for these costs, subject to consideration and a vote by the combined county authority. They also provide for a mayoral fund.

As with preceding legislation, we are following the principle that provision for combined county authorities should be the same as that for combined authorities. The regulations do this by amending the Combined Authorities (Finance) Order 2017, to apply its measures to combined county authorities. The 2017 order provides for an effective process, aligned with the wider local government budgeting timetables, including robust arrangements for scrutiny and challenge of the Mayor’s spending proposals by the combined authority. The effect of that application to combined county authorities is essentially identical, and is as follows.

First, there is a requirement for combined county authority Mayors to submit by 1 February a draft budget to their combined county authority for consideration. Secondly, the combined county authority must recommend any amendments to the draft budget by 8 February, and the Mayor must consider these amendments and respond with a further proposal if they choose to do so. Ultimately, the constituent members of the combined county authority may impose amendments to the Mayor’s draft budget, if supported by a significant—usually two thirds—majority. In the absence of this majority, the Mayor’s proposals are deemed to be accepted by the combined county authority. The combined county authority must set a mayoral budget on the Mayor’s behalf, if the Mayor fails to submit a draft for consideration by 1 February.

The Mayor may fund mayoral functions through a precept. The standard local government finance regime applies so that precepts must be issued by 1 March. Mayoral costs are itemised separately on council tax bills. Where the Mayor exercises police and crime functions, those are also listed separately. To further aid transparency, the Mayor is required to maintain a fund in relation to the receipts and expenses of the Mayor’s functions, excluding police and crime commissioner functions, for which there is a separate police fund.

Before introducing the original 2017 order for combined authorities, the Government undertook informal consultation with officers of constituent councils of current and prospective combined authorities, including via a working group of senior finance officers. Our inquiries with finance officers of existing mayoral combined authorities during the development of these draft regulations found no operational difficulties with the existing set-up. The regulations therefore simply extend the application of the existing provision in line with the broader policy of parity between combined county authorities and combined authorities.

[Sir Liam Fox (North Somerset) (Con)]

This delegated legislation provides for a precept to be set. Can the Minister tell me what the mechanism is by which an upper limit for such a precept would be set, so that councils or Governments of a different colour would not necessarily be given a mechanism to fleece taxpayers?

[Jacob Young]

I will come back to my right hon. Friend on that point, but I would say that Conservative Mayors charge zero mayoral precept, whether that is Ben Houchen in the Tees Valley or Andy Street in the West Midlands. Contrast that with the Mayor of Greater Manchester, for example.