Lord McKenzie of Luton
Main Page: Lord McKenzie of Luton (Labour - Life peer)Cities and Local Government Devolution Bill [HL]
Lord McKenzie of Luton Excerpts
Baroness Williams of Trafford
My Lords, the noble Baroness makes a very interesting point. Other points have been made at length in this House about single-party states, but in terms of election periods or cycles being out of kilter because of different types of elections, I would imagine—although I will confirm this with the noble Baroness—that they are the sorts of things that would need to be ironed out when a devolution deal was done on how that combined authority’s elections would pan out. I am thinking of the Greater Manchester situation, where we are in thirds and all synchronise nicely. But I can foresee that process.
Lord McKenzie of Luton (Lab)
My Lords, I am not sure whether I am going to be helpful to the Minister, but would it be possible that, between elections, the Secretary of State could remove all the functions from the mayor, so that they would stay with the combined authority members?
Baroness Williams of Trafford
My Lords, if that were to happen, the Secretary of State would have to disband the combined authority and something in its place would have to be set up.
Baroness Williams of Trafford
I would like to correct the comment that I have just made and come back to it in a future group, because I have clearly got it wrong.
Lord McKenzie of Luton
My Lords, before discussing Amendment 35, perhaps first I could speak briefly to Amendments 34 and 36 in the name of my noble friend Lord Smith of Leigh, who cannot speak to them himself. They are self-explanatory, in that Amendment 34 makes reference to a,
“local authority member of a combined authority”,
having,
“responsibility for finance and resource management”.
Amendment 36 calls for the Bill to specify,
“the number of local authority members within a combined authority area who can veto the draft budget”.
We would happily support each of those amendments.
The Bill enables a power of veto over the mayor’s budget, and Amendment 35 would enable the combined authority also to change that budget in circumstances that would clearly need to be spelt out in the order. That opportunity seems to be provided for in the Manchester agreement. The Bill itself makes reference to changing the budget, but it implies that that is as a result of the initial scrutiny process, not following on from the combined authority’s approval or otherwise of the draft budget. Could the Minister confirm that?
Just to recap, the Bill talks about a mayor preparing a budget; a draft to be scrutinised by other members of the combined authority and the committee, dealt with in Schedule 5A; the making of changes to the draft as a result of the scrutiny—presumably with the approval of the mayor; and the approval of the draft by a combined authority, including a power to veto the draft circumstances specified in the order and the consequences of such a veto. Our amendment proposes simply that we have not only a right to veto but a right to change the budget. There would need to be a threshold of those supporting that proposition, which is again the case in Manchester. A veto is a power, and it can be quite a weak power in certain circumstances. You could simply end up with a ping-pong type arrangement between the mayor and the other members of the combined authority, which would be unfortunate and inconsistent with the effective operation of a combined authority.
We support the thrust of Amendment 33. As some noble Lords have touched on, it raises a number of issues that need clarification. In part, those of us who can remember municipal bonds support it with a sense of nostalgia. I am sorry to hear that my noble friend did not buy any Luton bonds in her previous investment, but perhaps next time. I am interested to understand quite how this will work when it will be available only to residents of an area. I think that that is easily dealt with at the point at which it is issued, but what happens thereafter? As my noble friend Lord Liddle said, whether that has an impact on marketability is an important issue.
As I understand the Bill as it stands, the Secretary of State can by order enable an authority to borrow for specified functions, provided that it has the consent of the constituent councils, but I do not think that that extends to mayoral functions. That could be changed, but we would like better to understand how this all fits together and how the total funding and borrowing opportunities of the combined authority sit with the existing position of those separate authorities. How does that impact on prudential borrowing and, therefore, the scope for the type of bond the Minister is talking about?
We can certainly see the benefit of raising funds for specific projects but, even if you can borrow for mayoral functions within a combined authority, it seems to me that you do not want that borrowing power to drive the functions the mayor gets; that is the wrong way round. You have to see what functions the mayor would have under these arrangements and see how they should be financed.
My understanding is that if there were associated costs—if my noble friend is right and this measure did not wash its face in all circumstances, particularly on infrastructure projects where there can be long lead times and not necessarily early returns—those would be picked up and met by a precept, not a levy, on the constituent authorities. Given the constraints that central government have hitherto imposed on increases in precepts, it could unwittingly impact on all that.
This measure needs to be unpicked so that we can better understand it. It seems to be a very helpful suggestion, and you can see the benefits that could flow from it, but it would need to sit together with the intended funding arrangements or the likely opportunities for the combined authority as a whole, quite apart from the wider issue of fiscal devolution, which we will come to in subsequent amendments, probably on Monday. We are on the side of those who would like to make this work, but it needs to fit with what we have before us.
Baroness Williams of Trafford
My Lords, it is refreshing to hear innovative ideas coming from your Lordships’ House. I commend my noble friends Lady Wheatcroft and Lord Moynihan on some of the suggestions that they have put forward. Amendment 33 seeks to amend new Section 107F of the 2009 Act to allow the Secretary of State by order to enable the mayor to raise funds for the carrying out of specified development projects, by the issue of bonds to be made available only to those residents within the combined authority area. I was interested to hear about the experiences of the noble Baroness, Lady Janke, in Bristol. As I have said, the intentions behind the amendment are to be commended. The Secretary of State can by order confer a power on a mayoral combined authority to borrow. The mayor individually cannot borrow because, as the noble Lord, Lord McKenzie, said, he or she is not a corporate body. Borrowing by a combined authority where it is given the powers to borrow is secured on the revenue that that authority will receive, as the noble Lord, Lord Woolmer, pointed out. Accordingly, any borrowing by a combined authority will be under the same prudential borrowing regime that applies to local authorities. This means that the level of borrowing must reflect the level of its likely reserves.
The noble Baroness, Lady Hollis, asked what could be funded by bonds. In any case it would be a matter for the discussions leading to the bespoke devolution deal as to what might, in the art of the possible, be borrowed. As I have said, any borrowing must conform to the principles of prudential borrowing, which apply to all borrowing by local authorities.
My noble friend Lord Moynihan asked about the functions to benefit by municipal bonds. The functions that might be supported by investment and funded by prudential borrowing, which could be in the form of bonds, are a matter for the conversations with that area which lead to its bespoke devolution deal. As my noble friend Lady Wheatcroft said, this is an enabling Bill. Clause 8(3) allows the Secretary of State to specify which functions of a combined authority may come within the scope of borrowing powers given by the Local Government Act 2003. The sources of borrowing available to combined authorities include issuing bonds as well as taking out loans. The devolution deal will determine which functions the combined authority can borrow for. Decisions over whom an authority obtains their financing from are a matter for the authority.
Amendments 34 to 36 seek to alter the powers of the Secretary of State to provide for scrutiny of the mayor’s draft budget. Amendment 34 would insert a new Section 107F(3)(c), which would allow the Secretary of State by order to make provision to appoint a local authority member of a combined authority to have responsibility for finance and resource management. In effect, were such provision made, it would prescribe that there must be a member of the mayoral combined authority who had finance responsibilities, and that the member with these responsibilities would be a councillor from one of the constituent councils. It is rightly the mayor who should decide to whom he or she wishes to delegate his or her responsibilities, and this includes responsibilities for finance. To return to a point that I made earlier, it is consistent with local authorities operating their cabinet arrangements at present, with the mayor deciding which member of his cabinet should hold certain portfolios with certain responsibilities. We are clear that this should also be the case for metro mayors. For mayoral governance to be effective, the mayor must have discretion to assign portfolios and delegate responsibilities to enable the effective delivery of their promises to their electorate.
I understand that the intention of this amendment may be to place checks and balances on the mayor’s powers. There is of course a chief finance officer for the combined authority, also known as a Section 151 officer, whose role is to ensure compliance with all statutory requirements for accounting and internal audit and to manage the authority’s resources. The chief finance officer is under a duty to make a public report if they consider that there is, or is likely to be, any item of unlawful expenditure. An additional proscription on the creation and assigning of member portfolios is an unnecessary check or balance, and risks frustrating the exercise of the mayor’s functions.
Amendments 35 and 36 seek to provide additional checks and balances on the approval of the mayor’s draft budget. Amendment 36 would insert a power for the Secretary of State to provide for a specific number of local authority members within a combined authority area to be able to veto the mayor’s draft budget. The Bill as it stands allows for the Secretary of State by order to make provision about the preparation of the mayor’s annual budget which, in particular, may provide for the constituent council members of the combined authority to scrutinise the draft budget, to make changes to it and to have a power of veto. The circumstances in which a veto may be used, and the consequences of any such veto, would be proposed locally and provided for in the order creating the mayoral combined authority. The Bill also allows for the overview and scrutiny committee, a politically balanced committee made up of councillors from the constituent authorities, to scrutinise the draft budget and recommend changes to it.
Baroness Wheatcroft
My Lords, I thank the Minister for her detailed response, which was not entirely encouraging. I thank all those who spoke in support of my amendment. In answer to the questions asked by the noble Baroness, Lady Hollis—“Why not precept?” and “How would specific schemes be chosen?”—the point of the amendment is that the precept falls on all, no matter how able they are to afford it, whereas the bonds that I am mooting would enable those who have the money to invest in a local community to do so for the benefit of all.
As for the qualms voiced by the noble Lord, Lord Woolmer, about where the penny would drop if there were not enough pennies, every scheme would have to be looked at extremely carefully. They would all have to be budgeted. I am not as pessimistic as the noble Lord about how many such schemes would fail. The point about community building is that very often you can get the community involved, so one would anticipate—looking through those rose-tinted spectacles that I do not usually wear—plenty of volunteers to organise sports facilities, youth clubs and so on, and that running costs could be covered by letting out a hall or a sports field. I agree that the sums would have to be done carefully, and as a backdrop one would be looking at insurance.
Lord McKenzie of Luton
Will the noble Baroness clarify whether we are talking about simply a positive mechanism to raise funding, or a mechanism to expand the total borrowing capacity that the combined authority might have?
Baroness Wheatcroft
I gather from the Minister that the capacity to expand borrowing would not be there, so this would just be a different way of raising money, but it would be a way of involving the local community far more. As I understand it, the Bill is aimed at building local communities and pushing power to the people. I accept that this is not without qualms. There are questions to be asked—noble Lords have raised them—but I was delighted with the support for the general direction of travel, which is after all in line with our wish to devolve more power to the community and to build those communities. I hope that there may be scope for the Minister to spend some time working with me and others who support the general drift of this amendment to try to come up with something that we might bring back at a later stage.
Lord McKenzie of Luton
My Lords, this is a small and narrow amendment. In fact, I contemplated whether I should move it at all, but as I have written it I might as well. It is intended as a probing amendment to understand the circumstances in which the schemes for transfer of property et cetera provided for in the Bill are contemplated and whether any are on the cards in the discussions that are taking place.
I was particularly prompted to think about this because of debates we had on the Localism Bill when some of its provisions were put in place, particularly Section 17, which is referred to and imported, in part, into the provisions of this Bill. Can the Minister tell us anything about experience to date on the operation of those provisions, which very much mirror what is in this Bill? There is a particular issue around the operation of the intent to comply with TUPE arrangements. Some of the provisions in Clause 17 touch upon this and refer to the fact that the order in relation to schemes can include circumstances where the same or similar effect as the TUPE regulations so far as those regulations do not apply in relation to the transfer are taken up. As a general point, is it the Government’s intention, in so far as they are a participant in this, that where TUPE regulations for some reason do not apply, they would seek to ensure that provisions with the same or similar effect as those regulations would be imported into any scheme of which they would be a party?
As an aside, when the Child Support Agency was being restructured, a key issue was not so much to do with entitlement to pensions, because there was access, but to do with loss of Civil Service status when somebody was going to go into an NDPB. That is an issue. I do not propose an amendment in relation to the Bill, but it was probably the big issue when we were talking about restructuring the Child Support Agency and it could rear its head in these circumstances. I beg to move.
Baroness Williams of Trafford
My Lords, Amendments 36ZA and 36ZB seek to amend the provisions in the Bill that relate to the making of a scheme to transfer property, rights and liabilities from public authorities to combined authorities. The Bill specifies that where a function of a public authority is to be a function of a combined authority, the property, rights and liabilities of the public authority can be transferred to the combined authority. These amendments seek to change this by removing from the Bill the provisions that allow for the transfer of public authority liabilities.
These amendments would prevent liabilities from being transferred from a public authority to a combined authority. Clause 6 enables the Secretary of State, by order, to confer on a combined authority powers exercised by a public authority. If functions are transferred, there may be some instances where assets, property, rights and liabilities should also be transferred to the combined authority in order for it to be able to exercise these functions.
As we have discussed, the whole Bill is enabling legislation. No combined authority will be forced to take on powers it does not wish to have, nor will a combined authority be forced to take on a public authority’s property, rights or liabilities. An existing combined authority must consent before such transfer can take place, and in the case of a new combined authority, the appropriate local authorities seeking to take on public body functions must have consented to the transfer of the property, rights and liabilities of the public authority. However, there may be times where such a transfer is necessary to give full effect to devolution deals.
Similar transfers of property, rights and liabilities from a local authority to a combined authority are already possible under Section 115 of the Local Democracy, Economic Development and Construction Act 2009. Such transfers have already happened when establishing combined authorities; for example, when the West Yorkshire combined authority was established the integrated transport authority and the passenger transport executive were both closed, and their functions, assets, liabilities et cetera transferred to the combined authority. This provision purely mirrors the existing provisions by applying the same principles to transfers from public authorities.
The noble Lord asked about TUPE. The tradition and past practice is that when transferring functions within the public sector, TUPE applies, and it always has up to now. I hope that with this explanation the noble Lord will feel able to withdraw his amendment.
Lord McKenzie of Luton
I am grateful to the Minister for that explanation. As I explained, the technical wording was simply to get a debate on this issue. I am grateful for that response, and I beg leave to withdraw the amendment.
Baroness Hollis of Heigham
My Lords, although I am grateful to the noble Earl, Lord Listowel, for managing, with some finesse, to shoehorn housing into this debate on the cities Bill, I share some of the reservations of my noble friend Lord Beecham. In two-tier authorities and shire counties, one of the primary functions of district councils is the housing responsibility. Even if they have stock transferred their property to a housing association, as quite a high proportion has, the district council none the less remains responsible as the strategic authority, so to speak, in dealing with homelessness. That is complicated enough, and I think that the problem is going to get infinitely worse if the wretched housing association Bill progresses. That will fire an Exocet through our ability to meet housing need in localities, as we will lose not only the housing association stock but council housing stock to pay for the discounts—we will lose two rental properties to fund one discount and not one extra house will be built as a result. It will be completely disastrous, and I am sure that the noble Earl, Lord Listowel, will be fiercely engaged in that fight. I very much hope that he will be.
The problem is that, if this is the thinking of the noble Earl, I am not quite sure what distinction he is making between a combined authority and a unitary authority of three previous district councils. Housing is the main function. If this is where it is going, in alignment with the recommendations that will come with a combined authority for the development of the economy and so on, effectively, a unitary authority will be achieved in the name of adding more and more functions to the combined authorities, which are primarily about economic growth.
No one doubts that one responsibility of the combined authority will be to determine areas for housing growth, land development and land use. That is very different from taking on the responsibility for who gets what house due to local priorities. If that is taken away from the district council and given to the new combined authority, we will have effectively removed the responsibility for housing from a district council to a combined authority and would have to start inspecting houses of multiple occupation and all the rest of it to make it work. That would leave district councils virtually non-existent. That is my problem with Amendment 36A.
Although I am sure that Amendment 36B is well intentioned, my problem is with “affordable”. The research of my right honourable friend in the other place, John Healey, has shown that the two drivers of the housing benefit bill have been, frankly, the extension of the private rented sector, with its very high rents, and the displacement of social housing rents by affordable rents. Those two things alone are primarily responsible for the growth in housing benefit, neither of which adds a single property to the stock or houses a single additional person—they are displacement activities. All that is happening behind this amendment and may, I fear, be made worse by it. All the drivers will add to the welfare bill. The Government will then say that we must cut it by taking away the ability to make work pay and removing money from working tax credits because they are not willing to tackle the tax privileges of private landlords who are charging market rents or the issue of affordable rents, which is, in turn, driving up housing benefit bills in the social rented sector.
An infinitely more complicated set of problems has been opened up by the noble Earl’s amendments. None of us would dispute the outcomes that he is seeking, but I do not think that he can get there through this route.
Lord McKenzie of Luton
My Lords, we have considerable sympathy with the thinking behind both amendments from the noble Earl, Lord Listowel. They touch upon one of the most serious issues that confront our society—our housing crisis— which must engage the action of central government and local authorities. It is also prescient, given concerns expressed in the press this morning about the figures for child poverty rising for the first time in a decade. We know that the lack of affordable housing is a key driver of homelessness and that homelessness inevitably sits at the centre of disadvantage and deprivation. The major influences on a child’s life—family income, effective parenting and a secure environment—are all directly or indirectly influenced by a family’s housing conditions.
The question posed by these two amendments is what the role of a combined authority should be in addressing our housing crisis and reducing homelessness. There certainly could and should be a role, and the Greater Manchester Combined Authority has shown the way. In its case, the elected mayor has control of a £300 million housing investment fund and powers over strategic planning, including the power to create a statutory spatial strategy for the CA area. There are somewhat convoluted arrangements for administration of the housing investment fund, but it has the prospect of delivering 10,000 to 15,000 homes over the period—a real contribution. Powers to create a spatial strategy for the area are particularly useful, given the demise, as my noble friend Lord Beecham said, of the former regional spatial strategies and the weakness of the duty to co-operate.
There are two issues, however, with the noble Earl’s amendments. Indeed, all noble Lords who have spoken today have, in one way or another, touched upon those issues. We should be mindful of the current requirement for local authorities to ensure that local plans meet the assessed needs for both affordable and market housing and that neighbourhood plans can supplement this. Further, important legislation is already in force that places a general duty on housing authorities to tackle homelessness, however difficult that is in the current circumstances. We would not wish to undermine these important responsibilities and local priorities, but it might well be appropriate to build on these requirements at an overarching strategic level. One way or another, those points were made by the noble Lord, Lord Shipley, and my noble friends Lord Beecham and Lady Hollis.
Certainly the prospect of a combined authority having spatial planning powers across an area could be a considerable advantage in creating a coherent housing framework. However—I am sure that the Minister will make this point—the approach suggested is prescriptive. Doubtless it will be said that there is nothing to prevent a combined authority seeking these powers by agreement, and I hope that the Minister will confirm that the Government would not be shy of agreeing such arrangements.
Baroness Williams of Trafford
My Lords, Amendments 36A and 36B would insert two new clauses into the Bill that place statutory duties on the Secretary of State to undertake reviews of the advantages and disadvantages of placing a duty on combined authorities to reduce the numbers of homeless children and families in housing need, and give combined authorities responsibility for affordable housing in their area and associated borrowing powers. These amendments would also require the Secretary of State to lay the report of these reviews under the clauses before both Houses of Parliament.
At the outset, I must say that housing is a priority for this Government. In our manifesto, we committed to building 200,000 starter homes and more affordable housing. We are putting in place £38 billion of public and private sector investment to help ensure that 275,000 new affordable homes are provided between 2015 and 2020. This means that we will build more new affordable homes than during any equivalent period in the last twenty years.
A couple of noble Lords asked about the definition of “affordable”. The detail is set out in the national policy planning framework, and it is, broadly:
“social rented … and intermediate housing, provided to eligible households whose needs are not met by the market”.
However, within that, there is broad scope around what affordability means in different places to different people.
“Public authority functions
Within one month of the passing of this Act, the Secretary of State must publish a list of public authority functions which may be the subject of a transfer of functions under the provisions of this Act.”
Lord McKenzie of Luton
My Lords, I shall speak also to Amendment 36F. Let me say at the outset that the amendments are to an extent prescriptive. Amendment 36C would require the Secretary of State to publish a list of public authority functions which may be the subject of a transfer under the provisions of this Act. Amendment 36F goes further and would require the Secretary of State to consult combined authorities with a view to devolving certain functions and funding in certain areas. These are employment support, transport, housing, skills and business rates. We should be clear that the published list does not require any of the functions to be transferred in any particular situation; that will remain subject to whatever agreement, if any, is entered into in practice.
The amendment has been prompted in part by the first report of the Session of the Delegated Powers and Regulatory Reform Committee, which refers to the wide powers that new Section 105A would confer. It states at paragraph 10:
“But it says nothing about how in practice these powers might be used, or why it is not appropriate or practicable to include a description of the types of function covered by the power on the face of the Bill”.
We agree. If there are concerns about government at the centre trying to pull back the devolutionary process, putting down some markers must surely act as a counterweight. It might even help encourage and embolden some of those authorities that are not yet members of a combined authority and are not fully in the know.
Amendment 36F requires government to be proactive in the cause of devolution. In Committee on Monday, we got the line that the Government would wait to hear who comes knocking and then respond and engage in some fashion. The amendment requires the Government to themselves initiate consultation with combined authorities over areas of,
“employment support … transport … housing … skills … and … business rates”,
as matters that are important for driving growth and prosperity. It does not preclude consultation over other matters, and we have a separate amendment covering strategic planning.
It may well be that consultations are already going on in a number of areas with a number of combined authorities—indeed, we know that there are. That is fine, but adopting the requirements of the amendment would ensure that opportunities are being opened up for all combined authorities. From our debates in Committee on Monday, there was no indication from the Minister that there were any capacity constraints as far as the Government were concerned on moving forward on a wide front. This would force the pace of devolution—and on a broad front. I beg to move.
Lord Shipley
My Lords, I am pleased in principle to support Amendments 36C and 36F. However, in Amendment 36C, on publishing a list of public authority functions, why do we need to wait to within one month of the enacting of the Bill? Surely it is known now what the functions might be. Should the House not be informed what they are before the passing of the Bill? I would be grateful if the Minister could specifically explain why it is not possible to list the public authority functions before the Bill passes rather than afterwards.
Amendment 36F is fine as far as it goes—and of course we will have the opportunity in Amendment 36G to discuss strategic planning issues, as the noble Lord, Lord McKenzie of Luton, explained. But I have two points to make in relation to this amendment. First, this is not necessarily an exclusive list; other powers and funding could be thought about. One is careers advice. It may be seen to lie within the skills head, but probably it could be treated separately. There may well be others. We should have a discussion about whether there are other areas to add to the list of matters that the combined authorities should be consulted on.
My second point relates to the use of the word “powers”. At some point we need to think more in terms of responsibilities. Powers and funding are one thing, but what you do with them is another. There is now the prospect of a very large number of functions, powers and responsibilities coming into the remit of combined authorities. I am starting to get very worried about the capacity of the combined authorities to manage all of the things that they may be asked to undertake. As part of the consultation that is asked for in Amendment 36F, I hope that the issue of capacity and resources is also addressed.
Baroness Williams of Trafford
My Lords, these amendments seek in one way or another to provide that in advance of the devolutions being implemented, some form of statement should be published by the Secretary of State or put in the Bill about the range of powers which might be devolved to areas. These are examples of the quite centralist and prescriptive approach so beloved of Governments over the last 150 years, and that is what this Bill precisely seeks to reverse. There will be no prescribed list for local authorities or combined authorities to follow. We want to hear from them; we do not want to tell them what they want or what their plans for growth are. Our approach has been to start a conversation with the areas if they want to talk to us about their aspirations and the powers and budgets they want to have devolved to them to improve their area’s economy, deliver better local public services and build sustainable prosperity.
We want areas to be as ambitious as possible and we want to hear what they want, not what they think we are looking for. That is the whole point of the Bill. We do not have some preordained list of powers which we might devolve, and we do not wish to have in advance any conversations that would set limits or parameters about what may or may not be devolved or what might be an initial priority for devolution.
Noble Lords will be aware of the Manchester deal, and we have talked at length about some of the powers that Manchester wishes to see devolved. Perhaps that provides ideas for other authorities to move forward and the plans might offer them some inspiration, but we do not wish to impose the Manchester plan for growth on the Cornwall plan for growth or, indeed, the one for Norwich. We are very clear about that.
I am afraid that these amendments are simply out of step with the whole approach that this Bill is designed to deliver: agreeing bespoke devolution deals which enable individual areas to realise their potential and make the greatest possible contribution to the success of the UK as it responds to global economic opportunities and the challenges we all face.
I want to make two points. The noble Lord, Lord Woolmer, or the noble Lord, Lord Warner, made a point about local authorities being frightened that services they deliver as local authorities could be taken away—the difference between the strategic direction and the local direction of a council. That is a very important point to make because when combined authorities are thinking about their ambitions and plans, they must be focused on the big strategic issues that will benefit from the opportunity of scale across a number of local authorities.
The other point I want to deal with is that of capacity, alluded to by the noble Lord, Lord Shipley, and by the noble Earl, Lord Listowel. In a sense we are already dealing with combined authorities because we are having conversations, and obviously the Greater Manchester devolution deal took place last November, so we will continue with that. But when consulting the combined authorities on powers, their capacity to take on functions will also need to be addressed. A critical issue in the conversation with combined authorities will be to ensure that they have the capacity to deal with the matters that they wish to take on. If they are ambitious for powers to be devolved to them, they will need to be clear in the proposal they bring to us on the governance arrangements for managing and handling the power they want and how they will have the capacity to do so. With that, I ask the noble Lord to withdraw his amendment.
Lord McKenzie of Luton
My Lords, I thank all noble Lords who have spoken in this short debate. Every noble Lord has supported these amendments with the exception, unsurprisingly, of the Minister. I should say to the noble Lord, Lord Shipley, that there is no fix on the timing of Amendment 36C if there are benefits in being flexible, or indeed on expanding the list. I would be happy to talk about that when we return to this matter, as we certainly will.
My noble friend Lord Warner made an important point about engaging health economies where they are holding back at the moment—being proactive and prodding them into focusing and engaging. The amendments have had the strong support of my noble friend Lord Woolmer, who stressed the importance of skills and the need to be strategic in these things.
I should say to the Minister that I am not surprised at the response because it is what we have been given throughout our consideration of the Bill: “This is a broad framework and we are not going to tell anyone to do anything; we are happy to sit back and have conversations”. In a sense that is government by vacuum, with no lists, preconceptions or limits being set. That cannot be good enough. If the Government are not themselves now planning how to deal with the consequences of what might happen after devolution, it would seem that they are being derelict. None of this forces anyone to do any particular thing, apart from the Government saying, “Actually, get off your backsides and make this work. Do something proactive to engage with combined authorities so that they know what is on offer and encourage them into deals”. Otherwise, there will simply be cosy conversations on an unplanned basis, and a favoured few authorities may well get the nod of approval from the Government. But the general thrust of our position is that we want devolution to work across the board in England on a proactive basis. That is what our amendments are designed to help achieve.
I will withdraw the amendments today, but I have absolutely no doubt that we are going to return to this issue in one form or another because it is at the heart of whether we believe that devolution should work across the board and we should want it to happen, or whether we think that it is a question of waiting to see what washes over us in due course. I beg leave to withdraw the amendment.