English Devolution and Community Empowerment Bill

Lord Shipley Excerpts

Committee stage
Monday 9th February 2026 Grand Committee

These are probing questions, but they go to the heart of the balance between flexibility, localism and parliamentary accountability. I look forward to the Minister’s response.

[Lord Shipley (LD)]

My Lords, briefly, I express my support for what the noble Baroness, Lady Scott of Bybrook, said. I suggest to the Minister that it might help, particularly as we approach the tabling of amendments on Report, if the Government were to produce a grid that shows what powers will reside where. There are mayoral powers, government powers, local authority powers and town and parish council powers, for all Whitehall departments. We could have a piece of paper that would tell us what the Government’s intention is for where they are headed. I assume that the Government have this already but, if they do not, I suggest that they consider creating one.

--- Later in debate ---

[Baroness Taylor of Stevenage (Lab)]

I am talking about the functions within the competence.

The Secretary of State will be required to consult relevant parties, including the strategic authority, the constituent councils and any body that currently holds the function. The Secretary of State will then need to determine whether to confer the function, paying regard to the need for the effective exercise of the function concerned. Regulations made under Schedule 25 will be subject to the affirmative procedure, ensuring that appropriate parliamentary scrutiny takes place.

In some instances, it will make sense to pilot functions with a smaller number of strategic authorities for a time-limited period. I will try to answer the questions about piloting, but I will look at Hansard later and come back in writing if I have not answered them all. Where we are piloting, strategic authorities will be required to provide an impact report on the pilot, which the Secretary of State will take into consideration before deciding whether to confer the functions permanently; I will consider whether those reports should be public.

As an example—the noble Baroness, Lady Scott, asked for an example of this—development corporation functions are held by mayors. If we wanted to move those functions to foundation authorities, for example, we could use these powers. What will happen with a pilot is that an area will make a request for a function. Pilots will need to be consented to by both the Secretary of State and the relevant local authorities. When a pilot has been completed, there will be an impact assessment of that pilot.

I will come back to the noble Baroness in writing on her questions about default voting arrangements, balance of power and the safeguards.

The noble Lord, Lord Shipley, asked about a grid setting out the different powers between different layers of local authorities. We have already produced one; it is on GOV.UK. Perhaps the noble Lord might like to have a look at it and, if he has any further questions, to come back to me.

[Lord Shipley (LD)]

In view of the points made in the debate on this group of amendments, is it going to change?

--- Later in debate ---

[Lord Wallace of Saltaire (LD)]

The noble Lord did not mention the questions of where the taxes are raised and who is responsible. For those of us on the Liberal Democrat Benches, the differences between decentralisation and devolution are tax and money. So long as the Treasury retains control of the spending, we will have only decentralisation. We will discuss some of the fiscal things in our next session, but, unless we address the question of fiscal devolution, we are not going anywhere much.

[Lord Shipley (LD)]

I agree with my noble friend Lord Wallace of Saltaire. I totally share his view, and we will come on to that matter in the next group. I thank the noble Lord, Lord Gascoigne, for what he said, which was important. I am sure that the Minister, through this grid that the Government are now producing, might clarify what is happening in terms of delivery as opposed to simply the powers.

On a previous day in Committee, I spoke about there being powers, responsibilities and resources in devolution. They are not the same thing. So I share the concern of the noble Lord, Lord Gascoigne, that many more powers could well be devolved, alongside the responsibilities for delivering the powers, without the resources to do the job. The point was well made by the noble Lord; I thank him for that. A little more will be said on this in our debate on the next group.

The noble Lord, Lord Hunt of Kings Heath, drew our attention to Greater Manchester and the improvements in the health system. Since the decision was made to devolve some responsibilities in health to the Greater Manchester Combined Authority and its mayor, I have always regarded it as a pilot of what we should all be doing. It is now for the Government to double-check all of the figures produced on improvements in public health and to assess whether, having had devolution, the resources have been provided to match the responsibilities and powers devolved—and, at the same time, to assess whether the achievements and outcomes in Greater Manchester are better than what has been secured elsewhere where there is no devolution.

The noble Lord, Lord Hunt of Kings Heath, said something that was terribly important to me: the NHS cannot be run by a central command and control system. We learned that during the Covid epidemic, but it is more than that. You cannot run 56 million people in England out of Whitehall and Westminster. The noble Lord helped us a lot by saying that what is to be devolved is a national decision and how it is to be delivered is a local decision.

I therefore come back to the grid that the Government are producing. It should now have a “what?” and a “how?”. Some greater meaning to the word “devolution” can then be achieved. As the noble Lord, Lord Wallace of Saltaire, said, in the end, without greater fiscal responsibilities and powers, you do not have devolution—you have decentralisation. I think I recall making that point at Second Reading and on the first day in Committee, because it is so very true.

--- Later in debate ---

[Lord Shipley (LD)]

My Lords, this is a most interesting group of amendments, and there is deep food for thought in what should come back to the House when we get to Report.

I am grateful for the contribution of the noble Lord, Lord Fuller. I must say that I had not understood the figure of 50,000, but at the very end he clarified that that could be a matter of discussion. My noble friend Lord Wallace of Saltaire has covered that issue as well. A difference between my party and that of the noble Lords, Lord Fuller and Lord Gascoigne, is that they are both trying to give excess power to the Secretary of State.

The noble Lord, Lord Gascoigne, asked at the very beginning of this group why we had not supported his previous amendment a few weeks ago on the power of the Secretary of State to make a decision on whether an authority was fit to undertake additional powers. Our concern was that these matters should not lie with the Secretary of State, who would have power to make these decisions without necessarily having the right degree of accountability for it. It is better to give the power to local electorates.

In the end, I am not sure that local communities need to be protected by the Secretary of State from the level of tax to be paid. I think that the local ballot box is the protection at that stage—so I hope that, when the noble Lord thinks about bringing this amendment back on Report, he bears in mind that the major power lies with the local electorate.

My noble friends Lord Wallace of Saltaire and Lady Janke both raised issues around fiscal power and the understandability and accessibility of financial matters for local people. This is of fundamental importance; it is about devolution. We need to have a transparent negotiation of fiscal powers of government. I accept totally that this is a process—it does not happen overnight—but I hope that the Government’s consultation on powers over tourism tax will be positive. Local areas are going to have to be more responsible for the level and nature of the taxes that they raise to pay for local services. We look forward to an outcome of the negotiation.

The noble Lord, Lord Bassam, raised a very interesting question about the business rate supplement. I want to think further about that, because it is a very interesting suggestion. We have to have the detail right. One thing I have noticed about raising taxes locally is that, if people know what it is that the extra money that they are paying is going to be spent on, there is a direct relationship, which you tend to get with parish and town councils and with some kinds of business rate supplements. I think there is potential here for further thought.

I say to the noble Lord, Lord Bassam, that we will take this away and think further about the possibilities for driving ahead on a system of business rate supplements supported or underpinned by clear consultation with local areas and a clear attachment to a specific project. Then, the general public will be more amenable to what councils are trying to do and how the funding is going to be provided.

My name, alongside that of my noble friend Lady Janke is on Amendment 190. I hope that the Minister will be positive about thinking through bringing forward proposals for fiscal devolution because, for devolution to work, you have to give greater powers over fiscal policy to the constituent parts of England. I hope that the Minister will give us a positive response to this group of amendments.

[Lord Jamieson (Con)]

My Lords, I thank everyone who has spoken on this group of amendments. We keep coming back to the same sorts of issues as in the previous group. We were talking about devolution in relation to health, and fiscal devolution and trying to extract money out of the NHS.

Now we come to a different level of fiscal devolution, and my noble friend Lord Gascoigne raised the point that a lot of people outside the London bubble are frustrated. I emphasise that it is not just in the north; I was on the south coast in Southampton this weekend, where there are lots of frustrated people. I can assure you that if you drove along the pothole-encrusted roads of Bedfordshire, there are lots of frustrated people there as well.

This is important because people care about their communities and they want their communities to be better. They care about place, and you cannot create great places by diktat from Whitehall. I recall saying that two or three times earlier in this Committee. That means you need real devolution and real powers. It also means real fiscal devolution; we have a number of suggestions on fiscal devolution here.

The noble Lord, Lord Shipley, and my noble friend Lady Scott made the point that parish councils, particularly small parish councils, are very close to their communities. People can easily see what that extra £10 or £20 or £50 is being spent on—such as extra grass cutting or improvements to the village hall—and they are quite amenable to it. As you start moving away from that and you start breaking that relationship, it becomes much more difficult.

One of the great dangers with fiscal devolution, much as I believe in it, is that central government—I am not making a political point here, but I am blaming Whitehall and the Treasury—see that as an opportunity to raise tax by the back door. We have seen government regularly passing additional responsibilities to local government with a short-term grant and then expecting the council tax payer to fund that burden.

One of the big issues that we have in local government at the moment is that a lot of responsibilities have been passed down; responsibilities are then growing quicker than the tax base, which means many of these issues of place are facing a fiscal squeeze. We have this dichotomy or dilemma: we may want fiscal devolution, but how do we avoid central government cost shunting?

My noble friend Lord Fuller was implying the same thing. It is great to have fiscal freedoms for parish and town councils, but we do not want cost shunting from overpressed district, unitary and county authorities. How do we protect against that cost shunting, where people see higher tax bills but no benefits? Place is important. I am desperately keen for genuine fiscal devolution, but how do we protect our residents from, in effect, cost shunting from Whitehall down the line?

I will talk briefly about some of these amendments. My noble friend Lord Gascoigne’s amendment is really important, because it is not just about the Secretary of State making a judgment—that is what the Secretary of State would do anyway, if he were to devolve powers—but placing a burden on him to say that he genuinely believes that a council has the financial resources, financial capacity and management resources to do what is being entrusted upon it. It is not just a case of going, “Get on with it. Bye. It is not my fault; it is your fault”, then, a year later, not giving it the money that it needs to deliver those things.

Forgive me, because I cannot remember whether it was from the noble Lord, Lord Wallace of Saltaire, or the noble Lord, Lord Shipley, but I accept his point. However, the contra argument is that it places a burden on the Secretary of State to make sure that it is feasible. We need to think about that very important distinction.

The other point to make is that we are going through reorganisation here and we need to ensure that this is not shuffling the deckchairs on the “Titanic”. It has to be about meaningfully improving services for our residents and about better value for money. We should not have reorganisation for reorganisation’s sake, which is why I think this amendment is the right approach.

We have had a number of amendments on fiscal devolution, but I will not go through them all. I have a concern about cost shunting and we have to protect against that. We need to give people real fiscal powers in order to deliver better services for their residents. What we do not need—some of the announcements that have been made today are like this and our Government were the same—is to have to appeal to the Government to get funding to do something. That means the Secretary of State is still in charge and that you are not determining your local priorities but, by the way, all the councils will do it because they want as much money as they can for their residents to deliver as best they can.

This must be underpinned by a real understanding that there are both costs and benefits from devolution, and that the funding arrangements are fair and transparent to local government. One of the biggest fears I have in local government is that the resident and local taxpayer does not see what their funding goes on, because far too much of it is dictated by the Government. These are responsibilities and duties with no funding and no powers, which is something that I might come back to on the next group of amendments. I look forward to the Minister’s response.