Lord Rooker
Main Page: Lord Rooker (Labour - Life peer)West Midlands Combined Authority Order 2016
Lord Rooker Excerpts
Lord Rooker (Lab)
On the point that the Minister has just made about the other House approving this order, how long did it spend on it?
Baroness Williams of Trafford
Virtually no time at all, I understand. It shows the merit of your Lordships’ House that so many noble Lords are here today and are actually interested in this subject. I thank noble Lords for their presence here today and I am sure that I will be well and truly grilled.
I shall say a few words on devolution deals. The Government committed in our 2015 manifesto to,
“devolve powers and budgets to boost local growth in England”,
and we see combined authorities as a mechanism for doing so. On 17 November 2015 we agreed and concluded a devolution agreement with the seven councils that are constituent councils of this combined authority. This is a major step in our devolution agenda. The footprint created by the three local enterprise partnerships of the West Midlands makes up a major economy with an annual GVA of some £80 billion. The area is also England’s manufacturing heart, home to important manufacturing businesses and leading centres of advanced engineering research.
The region’s leaders are committed to delivering growth, prosperity and well-being for their residents, and they see the devolution agreement that they have concluded with the Government as central to achieving that. The agreement will devolve major powers and budgets, including £36.5 million a year of devolved funding, over the next 30 years; responsibility for a devolved transport budget; control of the 19-plus adult skills funding by 2018-19; strategic planning powers; and a devolved approach to business support. It will also enable the combined authority to create an investment fund of over £1 billion through the 30-year revenue stream and locally raised finance.
In return, the area has agreed appropriate governance for the new powers and budgets, centred on a combined authority and a directly elected mayor, providing the vital, sharp, single point of accountability that is essential if such wide-ranging powers and budgets are to be handed to the area. The combined authority that we are discussing today will be the foundation of that new governance, and we will be bringing forward to Parliament the necessary orders that, with the consent of the councils concerned, will establish the new governance arrangements if Parliament approves them. Today, however, we are considering simply the order that—if this House approves, as the other place already has—will establish a combined authority with transport and economic development functions, and which, as I have said, if those concerned wish this, can be the foundation of the governance needed for us to implement the devolution deal. I commend the order to the House.
Lord Rooker
My Lords, I was very pleased by the Minister’s response to my question about the other place. I thought that I had seen it on the news that the Delegated Powers Committee had met for a total of 15 minutes, but I do not know what business it had. I thought, “Well, they haven’t spent long on the West Midlands, that’s for sure”. For those who seek your Lordships’ House’s abolition, this is another good example of us performing our function of scrutinising and raising issues. The one thing I am sad about is that all the speeches appear to have been from this side of the House, when there is a lot of West Midlands experience among noble Lords on the other side.
I agree with the comments of my noble friend Lord Hunt and shall not repeat them, but some central points have to be explored. No one can deny that the seven metropolitan councils are coterminous—that was how it was all designed back in the 1980s. There is a plan now for combination creep. You cannot have proper accountability arrangements where there is no clear coterminosity—the National Audit Office has said that, and I shall give more examples. We have the seven authorities which will have two members on the council and the five non-constituent councils—Cannock Chase, Nuneaton and Bedworth, Redditch, Tamworth, and Telford and Wrekin. Added to which are planned: Shropshire Council—which is in the old language a unitary county council; I shall come to that in a moment—and Stratford-on-Avon. I have also read as I have searched through the documents on this that Warwickshire County Council might want to join—it costs non-constituent councils only £25,000 to join, by the way. If so, this would push Rugby, Warwick and North Warwick District Councils into joining them. This would take the combined authority numbers up to 29 if one includes the mayor. It would get quite large—I am not criticising that—but this is not a coterminous combined authority.
The devolution deal with the Government set out in November—of which I have a copy here—clearly requires an elected mayor. It is a condition of the devolution deal with the Treasury. There is no argument: if you do the deal to get the powers you must have an elected mayor. The West Midlands Combined Authority (Election of Mayor) Order 2016 has already been published and I have a copy here. Obviously we are not discussing that order today but we could have taken both orders together because they are all part of the same issue.
Paragraph 7.2 of the Explanatory Memorandum to this order refers to the Government doing “bespoke devolution deals” with local authorities. That means they are making it up as they go along. There is no plan for Parliament to scrutinise and no plan for the National Audit Office to test their programmes for economy, efficiency and effectiveness. There is no plan and so you cannot test it, report back on it or consult on it. There may have been some consultation but the order is growing like Topsy as it progresses and other authorities jump on the bandwagon. There has been no proper consultation within the normal meaning of the process.
The Wikipedia entry for the West Midlands Combined Authority says that it is,
“commonly referred to as Greater Birmingham Combined Authority, or simply Greater Birmingham”.
This is very unfair on the better-run authorities of Sandwell, Dudley and Wolverhampton. I make that quite clear. On the other hand, it is more accurate to refer to Shropshire Council as the Greater Shrewsbury and Oswestry Council given the blatant unfair treatment of south Shropshire, thought to be because south Shropshire is wholly represented by Lib Dems and the Tory cabinet are all in the north of the county.
Leaving aside the names, there are some serious governance issues with which the Government are playing fast and loose. Unlike my noble friend, I am not opposed to elected executive mayors who are genuinely accountable. That was my position when I was a Member of the other place and it remains my position now. However, once the mayoral order, which we are not debating—its shadow is sitting here—is agreed, the mayor will not be executive and will be mayor of only part of the combined authority; that is, the seven constituent founder councils, which will have two votes each as opposed to the others having one vote each.
It was reported in the Birmingham Post on 26 May that this system is known as the “smothered mayor model”. It makes the mayor just another member of the cabinet with the seven leaders. You smother the mayor—end of the issue. No wonder the respected West Midlands police and crime commissioner, David Jamieson, has expressed misgivings about the nature of the role. He is looking for a colossus for the role and there is not one in the Midlands at the present time. We have not got the Dennis Howells or the Adrian Cadburys any more. We need them, it is true, but we do not have them.
There is no doubt that, within the proposed combined authority area, the place with the land for major industrial investment is Shropshire, where I live in Ludlow. I was informed at a recent public meeting by the council leader that no new factories were welcome—yet this is the area of the country that gave birth to the Industrial Revolution at Coalbrookdale.
However, when the Minister was speaking, I was not certain whether we would get an update on all those who are seeking to join the combined authority. I have searched on the web because that is all you can do these days. The minutes of the Shropshire Council cabinet for 6 April on membership of the West Midlands Combined Authority is a full document from the chief executive about joining and signing up. The point is made about the fee and everything else. The document also states at paragraph 3.1.1 that it wants to support business,
“including expansion of high level manufacturing”.
I firmly believe that there should be more industry investment in the West Midlands to capitalise on our reputation for making things and being the centre of the Industrial Revolution. We have too many industrial museums, with the Black Country Living Museum and Ironbridge, but not enough factories. However, we must have proper governance, and that is my concern. If there is no proper governance, companies from outside the West Midlands that are thinking of investing cannot conduct due diligence on investment locations. It cannot be done because there is no plan. I do not believe that the approach that is being planned for—I shall put some meat on this—whereby chums and mates pick up the phone to carve up the opportunities, is the proper way to do things. The informal system that is envisaged is not accountable and is not the right way to conduct public administration.
Baroness Williams of Trafford
My Lords, I congratulate your Lordships’ House on spending a substantial amount of time discussing this order. I certainly have quite a few questions to respond to but I start with the comments of the noble Lord, Lord Hunt, who commended all the constituent councils in the West Midlands for the way they have worked together. I acknowledge that, certainly in Greater Manchester, relationships have been built up over some 30 years and it has been an easier process there. As the noble Lords, Lord Hunt and Lord Rooker, said, the councils in the West Midlands are of a quite different type and variety. I sincerely congratulate them on the work they have done in getting to this place.
On the point of the noble Lord, Lord Hunt, about Channel 4, clearly, that is not my department but the BBC managed to uproot itself and place its home in Salford. People thought that that would never happen but it did. MediaCity provides an excellent working environment for both the BBC and ITV. I will not give my view on Channel 4, but it is possible and I hope sense will prevail.
We have strayed into mayoral combined authorities and devolution deals, and we almost cannot help that because they are so interrelated. However, this order is focused purely on the setting up of a combined authority for the West Midlands. I will start with what the noble Lord, Lord Kennedy, said about the NAO commentary on the devolution deal. He asked several questions about the devolution deal, including on the NAO report. As I understand it, the NAO simply commented that the devolution deal in the West Midlands sets up more complex and untested arrangements than those for Greater Manchester. At face value, they appear more complex. Of course, as I said to the noble Lord, Lord Hunt, the authorities of Greater Manchester have worked together for many years, but we are confident that the agreed deal can be effective. It would be great if it could be. We are not afraid of innovation in the governance arrangements that will be put in place. The mayor in particular will provide the necessary accountability. Accountability is very important here.
The noble Lord, Lord Hunt, talked about letting local authorities decide for themselves. However, the noble Lord, Lord Rooker, firmly made the point that we should not have informality; there must be some accountability and, I think he said, tightening. Of course, none of this is about the order today but I think we have agreed that. The order implements a proposal for a combined authority made by the councils in October 2015, one month before the deal in front of us was agreed.
The noble Lord, Lord Kennedy, also talked about whether non-constituent members, as well as constituent members, could be part of future deals. Deals are about areas. The area of a combined authority is that of the constituent councils but in the West Midlands the intention is for the combined authority to support the growth of the area across the three local enterprise areas, which includes the area of the non-constituent councils. But the electorate of the non-constituent council areas do not vote for the mayor, nor does the mayor exercise functions in that area.
The noble Lord also commented on the consultation, as did a number of other noble Lords. We hold the view that there are no inadequacies in the consultation, having had regard to the government consultation principles, which were, as I said, published on 14 January this year, and to which the Secondary Legislation Scrutiny Committee referred in its report and which have recently been amended in the light of comments made by the said committee. In short, the consultation’s use of digital measures are wholly consistent with these principles, and as the principles make clear, consultation needs to be considered as,
“part of a process of engagement”.
The engagement in this case has been very substantial and included: writing to a representative sample of 465 stakeholders, comprising key private sector employers, public sector bodies and third sector organisations; the establishment of an online survey which attracted 305 respondents, the results of which were analysed and published; the attendance of the local enterprise partnerships, and the authorities within them, at combined authority meetings; seeking feedback from the public via a “query box”, as I have mentioned; a parliamentary event; and a number of formal and informal briefings with the business and third sector communities. On account of these points, we think that there has been extensive engagement and local input from communities, stakeholders and local people.
A couple of noble Lords commented on combination creep in relation to the West Midlands combined authority. However, the simple fact is that the geography of this combined authority is absolutely clear. The area of the combined authority is the area of the seven metropolitan areas of the West Midlands, which are Birmingham, Coventry, Dudley, Sandwell, Solihull, Walsall and Wolverhampton. The draft order before noble Lords provides that certain named councils outside the area can sit at the table of the combined authority. It is absolutely right and sensible that these neighbouring areas can influence decisions taken in the combined authority area. That is a sensible and progressive way to ensure appropriate governance and decision-making in this area.
The noble Baroness, Lady Burt, made some excellent points about strategic thought around skills, transport and manufacturing. She was not present for the debates on the Cities and Local Government Devolution Bill, but precisely that recurring theme arose throughout the passage of that Bill. That is precisely how local authorities should be thinking, as some are doing very well. She asked about the voting rights for non-constituent members. Any non-constituent council or LEP member of the combined authority shall be non-voting but may be given voting rights by resolution of the constituent members of the combined authority, possibly where there is an issue very relevant to that non-constituent authority. The noble Baroness also asked what part minor parties would play. I do not know whether she has heard this from her colleagues, but that issue was again much discussed during the passage of the Cities and Local Government Devolution Bill, particularly by members of her party. Combined authorities must have one or more overview and scrutiny committees, the majority of members of such a committee must be members of the constituent councils, and the committee must reflect the political balance of the constituent councils of the combined authority.
The noble Baroness also asked who votes for the mayor. Obviously, the political parties will choose their own candidates but the people who vote for the mayor will be the electorate within the constituent councils of the combined authority, so that will be Birmingham, Coventry, Dudley, Sandwell, Solihull, Walsall and Wolverhampton. Obviously, the electorate of the non-constituent councils will not have a vote for the mayor.
The noble Lord, Lord Hunt, talked about an issue which we debated long and hard during the progress of the Cities and Local Government Devolution Bill: health and social care and whether DCLG would be sympathetic to a proposal coming forward. We welcome proposals from local areas. The Government are absolutely clear that devolution is an ongoing process and not limited to one deal: that is the beauty of devolution. It is for local areas to come forward with their proposals for further devolution deals, including health proposals, as Greater Manchester has already done.
The noble Lord, Lord Rooker, talked about the mayoral order already being published. The constituent councils of the West Midlands are in the process of considering a draft mayoral order which will establish the post of mayor from 2017 at full council meetings. Following the establishment of the basic combined authority, subject to approval by this House, the constituent councils and the combined authority will be asked to consent to the making of a mayoral order which will give effect to the devolution deal agreed between the Government and the West Midlands. The noble Lord also asked about the mayor being mayor for only part of the combined authority area. The area of the combined authority is the area of the constituent councils, that is, the area of the seven metropolitan—
Lord Rooker
My Lords, I will help the Minister by giving her time to decipher what she has got. When I said “part”, I was naturally referring to the old West Midlands metropolitan council area: in other words, the seven constituent members who will have the 14 votes in the combined authority. I fully accept that that is where the mayor will be, but the combined authority—if it gets going—will be discussed with all the others, including Stratford and Shropshire, as the West Midlands combined authority. Confusion may arise when people talk about the mayor of the West Midlands, but it only refers to the metropolitan district council areas.
Baroness Williams of Trafford
It does indeed; it is only in relation to those areas. Regarding non-constituent councils, the point is simply that certain councils outside the area of the combined authority can be at the table of the combined authority, reflecting the fact that what the combined authority and mayor might do could affect the surrounding areas. However, the non-constituent councils do not have the right to vote on decisions except, as I explained to the noble Baroness, Lady Burt, in certain circumstances where the combined authority agrees.
Finally, the noble Lord, Lord Beecham, made a point about business rates. We are working with the LGA and local councils for a planned summer consultation—which I am sure the noble Lord will be involved in—before introducing the local growth and jobs Bill later in the Session to make the necessary provisions. However, I look forward to early engagement on that, particularly with the noble Lords, Lord Beecham and Lord Kennedy, whom I am sure will be involved.
I think I have addressed most of the points, and I hope noble Lords will be content for me to write to them on those I have not. I beg to move.