Levelling-up and Regeneration Bill

Lord Scriven Excerpts

Committee stage
Monday 27th February 2023 Lords Chamber

Given that levelling-up directors are, in theory, supposed to be driving the agenda nationally and regionally, and getting both councils and government working together and with all the relevant agencies, charities, businesses and so on that can help deliver this agenda, I would be grateful if the Minister could tell us what progress has been made with these posts. I have heard a rumour that somebody might actually have been appointed; maybe I have missed the confirmation of that. It would be helpful to know about progress on the posts, or whether the Government have had a rethink about this and how it is going to be structured. Have the Government perhaps pulled the plug on this way forward? It would be helpful to have a better understanding. The reason why this is so important is that it strikes me that they are supposed to be the glue between the department, local councils and local communities, and to start to make things happen. So, we consider a proper understanding of their role in implementing the levelling-up missions to be critical. If the Minister can give us any further information on this, it would be gladly received. If he cannot, it would be helpful to know when we are likely to have an update.

[Lord Scriven (LD)]

My Lords, I rise to speak to Amendments 51 and 52 in the name of the noble Baroness, Lady Taylor of Stevenage. As the noble Baroness, Lady Hayman of Ullock, just pointed out, these amendments relate to consultant spend by councils and regional director spends, and their roles in the Government’s levelling-up agenda.

Amendment 51 is important, as the noble Baroness just pointed out. A freedom of information request showed that in the 245 upper and lower-tier councils, £26.9 million has been spent on levelling-up bids. That is £26.9 million taken away from social care, housing, cleaning, street cleaning and bin collection at a time when councils are finding things particularly difficult. Of that money, the vast majority went to external consultants. Does the Minister think it right that £26.9 million should be used on a lottery process pitting town against town and city against city to bid for levelling-up funds, only for the Government to move the goalposts at the last second by changing the criteria against which councils are bidding, which means not only that this money could have been spent on other services but that it has been wasted?

On Amendment 52, I wish to start with a general point, and here I do not necessarily share the sentiments of the noble Baroness, Lady Hayman of Ullock. The concept of 12 regional directors controlled out of Whitehall somehow being the panacea for devolution is ludicrous. Let us be clear: what this will turn out to be is a system of crude decentralisation. Those of us who have been around for quite a while in local government know that when we had something similar in the past, the regional directors of the department dispersed to work with local area partnership boards came with “We are here to help and support you” as their mantra. However, they were used as government enforcers and the eyes and ears of government, going back to the department and saying which areas were in the good books and who should be put on the naughty step because they were not carrying out the Government’s agenda.

Reports back from such regional directors decided who got money and what sticks or carrots were deployed. I know that the noble Earl will pour out soothing words from the Dispatch Box, saying that is not the role, but history shows that it is. Look at the job advert issued in November 2022—it kind of gives the game away. It says that they will report progress to the newly established committee for levelling-up, which is exactly the same as the previous directors in the department did.

We are now told that these regional directors are on hold, but that they could be answerable and accountable to the mayors. Let us take Yorkshire as a region, as these are regional directors. We could have four mayors in Yorkshire with different agendas and from different political persuasions. To which mayor will the regional director be accountable—one of them or all of them? It is clear that these roles have not been thought through from a regional perspective but from an office in Whitehall, with a very Londoncentric view of how they can be used as government enforcers.

Talking of Yorkshire, we are a little perplexed—not that we are from Yorkshire, but perhaps the Minister can help with this. Civil Service World on 17 February had an interesting headline, stating that the department

“hires former … No. 10 official as levelling-up director.”

Ed Whiting, David Cameron’s former deputy private secretary has been hired, and he very helpfully tweeted that he has been recruited to the role of levelling-up director in the north, based in and working out of Leeds:

“I’ll be based in Leeds, hoping to be travelling round North”,


working with local councils and others on innovation. He also expects to travel to London often too—ah, yes, that newly established Cabinet committee for levelling-up has to be informed. He goes on, quite incredibly—he has been hired on a six-figure salary—to say that “details” of the new role are “tbc”.

We are perplexed, Minister, and some clarification would be helpful. Is Mr Whiting a regional director for levelling up and, if not, what is his role and how does it fit with the regional directors? When was he recruited, where was the job advert and who sat on the recruitment panel? Why have local authorities in the north not been informed officially who he is and how he is there to help them? Why has someone been recruited on a six-figure salary when their role is still to be confirmed?

That is why Amendment 52 is important. We need transparency and clarity on who the department is using in the regions and what roles they have, to ensure the Government do not establish an expensive decentralized bureaucracy, costing the taxpayers millions, trying to enforce their agenda in local areas.

[Earl Howe (Con)]

My Lords, as we have heard, this group of amendments is related to consultants and the Government’s appointment of levelling-up directors. Specifically, Amendment 51, in the name of Baroness Taylor of Stevenage, would require the Government to publish an estimate of how much local authorities have spent on consultants in relation to Part 1 of the Bill. I fear that requiring local authorities to report in this way would be disproportionate and unnecessary, but let me explain why.

The new burdens doctrine, established and maintained by successive Governments, requires all Whitehall departments to justify why new duties, powers, targets and other bureaucratic burdens should be placed on local authorities, as well as how much these policies and initiatives will cost and where the money will come from to pay for them. This provision already ensures that the Government must properly consider the impact of their policies, legislation and programmes on local government and fully fund any new burdens arising.

Further, local authorities are already bound by the Local Government Transparency Code, which mandates local authorities to publish data on all expenditure over £500 in open and accessible formats. I will come back to that point in a second, but I have a great deal of sympathy with the points made by the noble Baroness about expenditure by central government on consultants.

--- Later in debate ---

[Earl Howe (Con)]

It would depend on the circumstances. It would depend on whether the expenditure on consultants was classified as a truly new burden or not, and that is an arcane science on which I do not pretend to be expert. Perhaps I may provide the noble Baroness with clarification in writing on that point, because I recognise that it is of relevance.

As I was saying, I have a great deal of sympathy with the noble Baroness’s points on expenditure by central government on consultants. As a matter of principle, I think all Secretaries of State across government would agree that they should impose a self-denying ordinance on their departments where skills can be developed in-house. Where that can happen, it should. The problem is, I suggest, twofold. First, the skills needed are very often highly specialised; secondly, if one looks across government as a whole, it is very difficult to make general statements about the needs of individual departments. However, I think the noble Baroness and I are aligned in our antipathy to expenditure that may turn out to be unnecessary—certainly expenditure that turns out to be wasteful. No department wants to go down that road.

On expenditure, transparency, as so often, is key. I note the comments of the noble Lord, Lord Scriven, about consultancy expenditure by local authorities in preparing their bids. I would just say to him that the decision by some local authorities to appoint consultants in their bidding process was a decision for them, and such decisions will doubtless have reflected in part the point that I just made: that the necessary skills are not always on tap locally. I think that is all I can say about that, but I will write on his questions about Mr Whiting, as I do not have the necessary briefing on that in front of me.

[Lord Scriven (LD)]

I want to ask a specific question, which I think the noble Baroness, Lady Hayman of Ullock, also asked. Has any regional director been appointed? That is the key question, particularly about Mr Whiting.

[Earl Howe (Con)]

I am coming to Amendment 52 in a second. It might be helpful if I added a few comments about local government funding more generally, because we recognise that the sheer number of different funds has become onerous for some councils to navigate and deliver. We have taken initial steps to address this complexity in the funding landscape. For example, the levelling-up fund provides cross-departmental capital investment in local infrastructure, and the UK shared prosperity fund provides resource-focused investment to support people, boost pride in place and strengthen communities. However, the levelling-up White Paper made it clear that we can do more, and we will set out a plan on funding simplification shortly.

--- Later in debate ---

[Earl Howe (Con)]

It is open for decision. We want to see local areas taking the initiative themselves. Where there is a functioning economic hub, for example, or a whole county, they may wish to apply for CCA status, but it is up to them to make those decisions. One can talk in general terms of “the north”, but until we know that the appetite is in those northern areas for taking advantage of the opportunities that we are trying to create, I cannot be more specific.

[Lord Scriven (LD)]

For clarity, the issue with Mr Whiting, to whom I referred, is that, as the Minister helpfully said, no regional director has been appointed so far. However, Mr Whiting describes himself as a regional director for the north and not for a particular region. Therefore, it is important that, when the Minister writes to me, he clarifies exactly what Mr Whiting’s role is and how it fits with the regional directors.

[Lord Berkeley (Lab)]

My Lords, can he also clarify the geographical area for which he is responsible?

--- Later in debate ---

[Baroness Pinnock (LD)]

Can the Minister explain, then, where the geographies of a county area do not coincide with the geographies of an economic or travel-to-work area? Often, they do not. What I have heard is that you can either have a functioning geography of a county and its two tiers, or the alternative, but not a mixture of the two.

[Lord Scriven (LD)]

I am pleased that the Minister has raised the East Midlands. On the northern tip of the East Midlands there is Chesterfield and north Derbyshire. Most businesses in that area would look into the South Yorkshire Combined Authority in terms of their business, and not into the county combined authority. It seems to be an administrative boundary designed down here in Whitehall rather than a true travel-to-work area. How would the north Nottinghamshires and Chesterfields be affected by this when, in reality, the economic performance and activity is actually into the South Yorkshire Combined Authority?

[Baroness Taylor of Stevenage (Lab)]

May I add to what my noble colleagues have said? This goes to the heart of this amendment. We struggle to say how you can have a county with more than one functioning economic area included in that county. To take my county as an example, the south of the county largely relates to London, because some of the boroughs almost are London boroughs, whereas the north of the county relates much more to Cambridge and Bedfordshire. There are definitely two distinct, functioning economic areas within one shire county. The shire counties go back centuries: their economic geographies have changed very considerably since then. If you take the economic geography of my noble friend Lady Hayman’s area, people in Cumbria may even relate to an economic area that includes parts of Scotland. This is not a simple picture around the country.

--- Later in debate ---

To get back to the amendment, I suggest that splitting the responsibility for functions currently vested in local authorities could lead to discrepancies in the delivery of important services, such as transport or adult education, within areas of a county council. I think it would introduce unnecessary complexity.

[Lord Scriven (LD)]

I am sorry to interrupt the Minister, but he keeps talking about complexity. This is complexity of boundary, not of reality. I will give him a situation where complexity may hold back the levelling-up agenda. Let us again take the top end of the east Midlands and South Yorkshire. If both the South Yorkshire combined authority and the Derbyshire and Nottinghamshire combined authority have control of the skills money, the fact that probably about half the people from the north end of the east Midlands come up into South Yorkshire means that the skills required should be funded for jobs available in the South Yorkshire combined authority. If the Derbyshire and Nottinghamshire combined authority decides not to invest in that type of skill, the issue is that the flow of labour will not be there for South Yorkshire businesses. How does that kind of problem get solved? It is not an administrative issue but the reality of having the skills where real people and businesses travel and work together.

[Earl Howe (Con)]

I take the noble Lord’s point. The experience we have had with combined authorities is that local authorities’ natural tendency is to co-operate with each other. We have seen this all over the place: they do not want to operate in silos and they look outside their boundaries. Yes, there may well be cases where at the beginning there would seem not to be a particularly good fit, but that does not preclude two authorities, such as those he mentioned, getting together and finding a way through, if they possibly can, to address the mismatches of the kind he mentioned.

Amendment 99 seeks to amend Clause 23 to require a public consultation before any proposal to change the area of an existing combined county authority. We agree that those with an interest in the area should be consulted before a combined county authority is changed. As I said, we will have more to say about this in the debate on the next group of amendments.

Clauses 45 and 46 set out a requirement for a public consultation on any proposals from the local area on changes to the area of a CCA. Where a combined county authority has been established and subsequently seeks to change its boundary, Clause 23 enables the Secretary of State to make regulations for areas to achieve that. The Secretary of State may make regulations changing the area of a CCA if that is something the area consents to, the Secretary of State agrees and Parliament approves the necessary secondary legislation.

We fully recognise the crucial importance of residents in the local area having a say; that is common ground between us. That is why any CCA or local authority seeking to submit a proposal to the Secretary of State to change the area of a CCA must carry out a public consultation, as set out in Clause 45(3). This consultation must take place in the area covered by the CCA. This enables local residents, businesses and other interested parties to have a strong input into any such proposals. A summary of consultation responses is then to be submitted to the Secretary of State alongside the proposal.

Clause 46 provides an additional safeguard to ensure that there is sufficient public consultation. This enables the Secretary of State to undertake a consultation prior to making any regulations to enact these changes if they feel that there has been insufficient public involvement in their development.

We completely agree with the sentiment of Amendment 99, but I suggest that we already have provisions later in the Bill to address this; we will debate some of these in a few moments. I therefore hope that the noble Baroness feels able to withdraw Amendment 60 and not to move Amendment 99 when it is reached.

--- Later in debate ---

[Earl Howe (Con)]

That is certainly the aim. I do not know whether the noble Baroness would agree with me that one of the downsides of referendums that we have seen in the past is that people are asked to take a binary decision. That very often does not allow for the nuances and subtleties of an issue to be presented in the question, to put it at its mildest. So we think the consultation model is more appropriate for this type of situation, particularly as the different constituent elements of a community will have different interests and viewpoints on the issue in question.

[Lord Scriven (LD)]

It is clear that, even barring a referendum, under Clause 44(3)(c) the Secretary of State will ask for further consultation if they consider that it is required. I assume that the Secretary of State will not have a subjective opinion on that and that there will be some objective criteria. It therefore comes back to what my noble friend Lord Shipley said: would it not be wise for the objective criteria about what good consultation is to be shared and, potentially, to be in the Bill? That would stop the position where local authorities had to rerun a consultation because it had not met the criteria which the Secretary of State was looking for in the first place.

[Earl Howe (Con)]

Yes, I take the noble Lord’s point. It comes back to one that I think the noble Lord, Lord Shipley, made about minimum standards in this area. It might be helpful if I took advice on this and wrote to noble Lords who have taken part in this debate, to see whether I can add some clarification.

Turning to Amendment 62, tabled by the noble Baroness, Lady Taylor of Stevenage, the levelling-up White Paper clearly states the Government’s ambition for devolution, including the devolution framework, which is underpinned by four principles. One of these principles is sensible geography. The White Paper clearly states that future devolution deals should be agreed over a sensible, functional economic area and/or a whole-county geography, with a single institution in place across that geographic footprint. We have already debated that issue on the previous group. The combined county authority model is being established in the Bill to provide a single institution that can cover such functional economic areas, or whole-county geographies, where there is existing two-tier local government and multiple upper-tier councils. As such, I reassure the noble Baroness that combined county authorities will be focused on single economic hubs.