Devolution: English Cities

Lord Hunt of Kings Heath Excerpts

Wednesday 17th July 2019 Grand Committee

[Lord Hunt of Kings Heath (Lab)]

My Lords, it is a great pleasure to wind up the Back-Bench speeches. I am not sure whether the Whips are punishing me or rewarding me by giving me this position. Like every noble Lord who has spoken, I welcome the report by the noble Lord, Lord Heseltine. He analysed the historical role of cities in driving this country’s development and economy. If we compare English city regions to the devolved authorities, they have less clout and less resource. Yet, if we are to make progress in very difficult times the noble Lord is surely right that the potential for city regions, like mine in the West Midlands, to help drive forward the economy of the country again is very powerful.

I do not think that all noble Lords quite agree with the structure the noble Lord, Lord Heseltine, proposed, with a very powerful department of the regions in Whitehall and mayors and combined authorities locally that will take this forward, but I do not think we have to agree with the structure to agree with his powerful premise about the role of city regions. The noble Lord, Lord Turnbull, put his finger on it when he said that it will not happen unless we change Whitehall’s view that it is superior in every way to local government and local public bodies. Having spent 10 years as a Minister espousing the Whitehall supremacy philosophy, I recognise the challenge that we face if we are to see changes. As the noble Lord, Lord Butler, pointed out, centralising pressures in this country are very strong. Most pressure groups are nationally based and put huge pressure on Ministers to intervene and make sure there is no variation at the local level.

The noble Lord, Lord Butler, mentioned social care. Health and social care are the areas for which I had the most responsibility. The noble Lord, Lord Heseltine, did not mention health and social care in his speech, save, I think, in relation to the “condition of the people report”, which he wants mayors to publish and which would have stats on health, social care and well-being. The National Health Service presents in a nutshell some of the dilemmas about what we mean by devolution. The NHS is a huge employer. It has major responsibilities for the health of a population and has links to R&D investment, life sciences and the pharmaceutical sector. It is crucial to our economy. Any mayor must want to embrace health and social care in any development plan they have; they would be very foolish not to do so. On the other hand, we know that the public regard the NHS as a national service. We know that if we were to suggest the devolution of the NHS and that we could change it from being free at the point of use—that is the implication of devolution —there would be major opposition. We also know that concepts such as postcode prescribing are deplored by the public, pressure groups and just about everyone.

If we think that devolution will really cover most of our great services, we then come to the issue of how we would deal with the NHS. Greater Manchester has made a start and it is a useful model. Interestingly, in the report by the noble Lord, Lord Heseltine, the submission from Greater Manchester claims that health and social care was devolved in February 2015. In fact, nothing was devolved to Greater Manchester relating to health and social care. What happened was that the responsibilities of the Department of Health and Social Care were delegated to Greater Manchester. Greater Manchester has some responsibilities related to budget and some to operational management, but it has to carry them out within the rules set by the Department of Health and Social Care. That seems a very sensible first step because it maintains the concept of a national NHS but gives the mayor and combined authority more say over strategy and how it is to be run. If we extend this, it may well be that the national aspect of some services means that we cannot devolve them in a way that we could other parts of the economy. At PMQs today the Prime Minister answered a Question about the reconfiguration of services in Shropshire. It brings home that, while devolution sounds great in principle and is a route worth taking, when it comes to actual services it will be hard to work through.

I finish on a point raised by my noble friend Lord Rooker. Of course the report by the noble Lord, Lord Heseltine, has no chance of implementation unless there is a new financial settlement. The noble Lord, Lord Lansley, rightly pointed out an example in Cambridgeshire of why greater flexibility is needed if we are to make sense of the combined authority there and the huge potential for developing the economy that there clearly is. At one point in his report, the noble Lord, Lord Heseltine says,

“the government should allow mayoral authorities to raise local taxes and charges”.

He then says,

“it is ludicrous for British tourists to pay to visit historic collections and buildings abroad while millions of visitors to this country enjoy free access”.

I am so keen on this because we have the Commonwealth Games coming to Birmingham in 2022, and 75% of the costs will be met by the Government and 25% by the City of Birmingham, whose finances are not as strong as one might wish. It would like to be allowed to set hotel tax to help contribute. I understand that Edinburgh will be allowed to go down this route. I know that, traditionally, the Treasury will be opposed to this, but, just as a pilot we ought to allow Birmingham to have a go at it and see if it has an impact on tourism and hotel usage. If we are serious about devolution we should take a living example where a city council needs to rate some resources and give it a go. I hope the Minister will at least be able to give some positive words on that.