Lord Teverson
Main Page: Lord Teverson (Liberal Democrat - Life peer)
Lord McKenzie of Luton
My Lords, I thank the noble Baroness, Lady Hanham, for explaining this short Bill. Although I believe it is not her first excursion to the Dispatch Box as a Minister, it is my first opportunity to welcome her, which I do—even if I do not welcome what she has said.
As we have heard, the Bill purports to put a stop to existing proposals for restructuring the councils of Norfolk, Suffolk and Devon and revokes the orders creating unitary structures in Exeter and Norwich. It makes consequential provision for the holding of elections that were due to be held on 6 May 2010 and which were deferred as a result of these orders. This avoids the necessity of interim by-elections and the expense related thereto and, as we have heard, the policy is to extend until 2011 the term of office of councillors who would have retired in 2010, but for the Norwich and Exeter orders. To get back into the normal cycle, one councillor or the only councillor elected to a ward in 2011 will serve a three-year rather than a four-year term. The restriction will fall on the councillor with the fewest votes and where there is an equality of votes or an uncontested election, the councillor to serve for three years will be drawn by lot. Given that the two-tier structures will remain in Devon and Norfolk, we can support this proposition. However, it would appear that should the quashing of the March orders precede the passing of the Bill, amendments will be necessary, as we have heard, to make the proposition effective.
The terms on which we consider the Bill have undoubtedly been changed by the decision of Mr Justice Ouseley to quash the orders which provided for unitary status for Exeter and Norwich. For a High Court judge, sitting alone and seemingly possessed of no additional information to that considered by Parliament, to overrule the democratically expressed will, especially of the elected Chamber, is a highly unusual step. I am told it is possibly unique. This was even in circumstances where the High Court was clear that the Secretary of State was entitled to reach the view he did on the merits of the proposal and that it was not irrational. Further, it was accepted that the final approach to decision-making adopted by the Secretary of State was properly within the scope of the 2007 Act.
In these times of economic stringency, with savage cuts to be imposed on local authorities by the coalition Government, the risks of incurring irrecoverable legal costs making it even more difficult to sustain vital services mean that an appeal cannot be contemplated. For now it is accepted that Norwich and Exeter will be denied the early opportunity to attain unitary status—an opportunity which has seen other local authorities of all political persuasions flourish under both Conservative and Labour Governments.
We note the decision of the Examiners that the Bill is not hybrid, but this was neither a spurious concern nor a delaying tactic. It is right that due process has been followed, even though the two councils withdrew their memorials before the hearing. Perhaps the Minister would say something more, particularly following the exchange with my noble friend Lord Richard about the structure of the Bill, and the decision of Mr Justice Ouseley to quash the orders. Does this mean that the orders under consideration are not relevant orders for the purpose of the Bill; that their revocation can therefore have no consequence; and that no councillor remains in office under Article 11 of the orders?
The Bill does not repeal the relevant provisions of the Local Government and Public Involvement in Health Act 2007, but prevents the Secretary of State making any orders which implement proposals for unitary authorities received before the coming into force of the Bill. Therefore, I ask the Minister whether it is envisaged that the Secretary of State will issue any further invitations for proposals for unitary status during the term of this Government, or whether the Bill signifies the denial of such possibilities. Has the Liberal Democrat wing of the coalition Government acquiesced to this?
When the orders to introduce unitary status for Exeter and Norwich were debated in your Lordships’ House in March, it is fair to say that they were hotly contested. The effect of the Motion agreed at that time was to call on the Government, notwithstanding the extensive consultation undertaken previously, including that by the Boundary Committee, to conduct further consultation. This was particularly in light of the fact that we consider there to be compelling reasons to depart from the presumption that the previously established five criteria should be the only basis for proceeding with unitary arrangements. The other place accepted that compelling reasons had been established.
However, if that was the view of noble Lords two and a half months ago, how can we view a situation where, within a couple of days of taking office and without any consultation or new data or information being provided, the Secretary of State decreed that Norwich and Exeter should be denied unitary status—as should Suffolk, which fulfilled the criteria? What democratic legitimacy underpins the Bill? As far as I can tell, the Liberal Democrat general election manifesto was silent on the matter. It proclaimed a commitment to giving more power to local people, saying that “local people” should,
“have the power and funding to deliver what they want for their communities”,
but seemingly not if they wish to do this as a unitary council. True, the Conservative manifesto had a commitment to scrap uncompleted plans to impose—
Lord Teverson
I apologise for intervening but the noble Lord’s remarks are very provocative given that all the way through our discussion, and previously, the opposition Benches have forgotten about the community of Devon. They always think about one community, not all communities. In the south-west, the community of Devon as a whole is very important. The noble Lord mentioned the success of unitary authorities. Frankly, Torbay unitary authority was a huge mistake and is not considered successful. Plymouth unitary authority, the establishment of which everyone supported, has also struggled hugely within historic Devon. That needs to be remembered.
Lord McKenzie of Luton
My Lords, I can cite a number of flourishing unitary authorities, particularly my own, Luton, and those created in Bedfordshire under the previous Government’s legislation but with Conservative-controlled councils. What I am trying to discover is the democratic legitimacy of the Bill before us. The Conservative manifesto contained a commitment to scrap uncompleted plans to impose,
“unwieldy and expensive unitary councils”.
However, no one is supporting unwieldy and expensive unitary councils. I shall come in a moment to the impact assessment, but perhaps the Minister can tell us whether she views the unitary councils which came into existence some 15 months ago—some of them Conservative controlled—as unwieldy and expensive? Why could not the significant service improvements already being delivered by these councils be delivered by Exeter and Norwich?
The coalition document—the post-election manifesto—looks in both directions. It supports the,
“radical devolution of power and greater autonomy to local government”,
but not, it seems, if you are a citizen of Norwich or Exeter.
The Government cannot possibly argue that they have a democratic mandate from the general election for this measure. Halting the creation of a unitary Norwich and Exeter is totally incompatible with the expressed policy of devolving power to local government and local areas. It runs directly contrary to Conservative manifesto rhetoric around leadership and the promotion of,
“single municipal leadership injecting dynamism and ambition into their communities”.
The Government’s argument for this Bill rests on the assertion that the unitary council proposals do not represent value for money, but this is a somewhat selective reading of the components of the impact assessment, which show that if unitary status were to proceed it would involve gross restructuring costs of some £40 million but gross savings of £39.4 million over the transition period—a broad equivalence but with ongoing savings after this of some £6 million per year; and this is before factoring in the benefits which would flow from the spur to economic development which unitary status would bring to Exeter and Norwich. The impact assessment asserts that the scale of efficiency savings forecast from unitary status could be achieved by other means. Perhaps the Minister in replying to the debate could give us more detail about these other means. What detailed work underpins that assessment and has it been verified independently? What consultation is planned around the proposition?
Much has been made in the past—we have heard it again this afternoon—of the direction that the previous accounting officer required of the then Secretary of State. But the core of the accounting officer’s concern was the lost opportunity of the savings from the Boundary Committee proposals—which of course had little support from anyone—essentially involving unitary counties. However, these opportunities are being rejected by this Government also.
Our starting point in considering proposals for unitary authorities was the five criteria of: affordability; whether there is a broad section of support; strategic leadership; neighbourhood empowerment; and value-for-money services. In the case of Exeter, each of the criteria was satisfied with the sole exception of one component of affordability—the payback period for transitional costs was six years rather than five. Taking account of the accepted ongoing savings, the opportunities for enhanced economic development and the development of Total Place, there were and remain powerful reasons to grant unitary status to Exeter. Similar considerations apply to Norwich where the payback period was originally a little longer than five years but with clear ongoing savings—the House will hear more about this from my noble friend Lady Hollis—and with the Total Place approach enabling the delivery of value-for-money services.
We might have understood if, in the circumstances, the new Government had said that they wanted more detail on these additional issues and indeed, as the House determined, and even Mr Justice Ouseley suggested, some more consultation. But what this Bill does in an arrogant, dictatorial and brutal way is to shut out Exeter and Norwich from the opportunity to become unitary councils—an outcome for which there is genuine local appetite, which in Exeter has cross-party support and in Norwich has the support of the Lib Dems, the Greens and Labour Party members. It is the desired outcome, not dictated or imposed by government but proposed by the democratically elected councils of these cities.
The benefits of unitary city councils are widely recognised. They reinforce a city’s distinctive identity and sense of place. They provide the basis for clear leadership to drive dynamism and ambition into their communities. This opportunity would not be new to Norwich or Exeter. The latter governed itself for nearly 800 years and provided all services for the city until county borough status was removed in 1974. Norwich ruled itself for almost 600 years. In neither case did that undermine the surrounding counties.
A two-tier structure of local government has not served either city well. Both are potential engines of economic growth within their own boundaries and more widely within their counties and sub-regions. The strategic leadership coming with unitary status can provide a powerful thrust to the regeneration and development of the economy in a local area, facilitating councils which are focused, innovative and entrepreneurial, and helping to deliver jobs, economic growth and prosperity at a time when the country most needs them.
Anyone who has served as a councillor in a two-tier system—as I did in Luton, mostly under a Tory-controlled council—will recognise the confusion over who is responsible for which services, which councillor covers which council, and indeed which local election is under-way. More importantly, there are the challenges of keeping a focus on an urban area and its needs within a larger rural county—especially an urban area with pockets of deprivation and diversity. In those days, Luton used to be referred to, not with any particular affection, as the urban bottom of the county. Its needs were neither fully understood nor provided for. What sticks in the memory is the meals-on-wheels service organised from County Hall without any recognition of the cultural needs of our diverse population. I have seen how liberating unitary status can be for a local authority—in particular, the tremendous boost that it can give to regeneration efforts and the concentrated way in which it can meet adversity, in our case the closure of the car plant. This did not harm our relationships with the rest of the county. It strengthened them. Anyway, they have now followed suit and are unitary councils.
Why should Norwich and Exeter be denied the opportunities we have in Luton, opportunities provided by a Conservative Government? The cities have addressed their value-for-money and service-delivery issues. They want to deliver a clear and focused place-shaping for their cities. They want to tackle deprivation and raise educational attainment, skills and aspirations. They want to deliver economic prosperity for all.
Lord Rosser
My Lords, we have had an interesting and at times passionate debate. Before I go further, I will again welcome the Minister to her new role and endorse the comments made about her by my noble friend Lady Hollis of Heigham. We have heard contributions from different sides of the argument. The contributions from the noble Baroness, Lady Hanham, the noble Lords, Lord Rennard and Lord MacGregor of Pulham Market, the noble Baroness, Lady Scott of Needham Market, the noble Viscount, Lord Ullswater, the noble Lord, Lord Tope, and the noble Earl, Lord Cathcart, were in support of the Bill and of the arguments advanced by the noble Baroness, Lady Hanham. The contributions from my noble friends Lord McKenzie of Luton, Lady Hollis of Heigham and Lord Grocott were in opposition to a Bill that seeks to deny unitary authority status to Norwich and Exeter and to stop any further progress in Suffolk. We also heard an unexpected intervention by the noble Lord, Lord Burnett, which was perhaps the most passionate, as well as being the briefest.
However much some might like to dress it up, this is a political issue to be determined by Parliament. The coalition Government do not like the decision made in March this year in Parliament, and in particular in the House of Commons, that Norwich and Exeter could have unitary authority status. These were decisions made by Parliament, not by the then Secretary of State under delegated powers. Nor do the coalition Government like the earlier decision that could have resulted in one or more unitary authorities separate and distinct from Suffolk County Council. The coalition Government are now seeking to go down the same parliamentary road, this time to reverse the decision with another Bill. They were a bit slap-happy on the serious question of whether the Bill was a hybrid. Your Lordships’ House made sure that further evidence on that issue was properly considered.
Since Parliament made its decision, we have also had a court judgment. It said that the stance of the previous Secretary of State on Norwich and Exeter having unitary authority status was not irrational and that he was entitled to reach the view that he did on the merits of the proposals. The judgment went against him largely on the basis of process. All the issues about the stance of the previous Secretary of State, including issues about process, consultation and criteria, as well as the arguments for and against by supporters and opponents of the change to unitary authority status for Norwich and Exeter, were set out, as the noble Earl, Lord Cathcart, said, in the report of the Merits of Statutory Instruments Committee of this House. The content of that report, which could hardly have been music to the ears of the then Secretary of State, was widely quoted both in the debates in this House and in the debate in the other place. It must therefore be a matter for reflection that a court has made a ruling that could be regarded as seeking to negative not a recent decision of the previous Secretary of State but a very recent decision of Parliament on an issue of this kind, when it appears that all the arguments were before Parliament when it made its decision only a few months ago. It would suggest that, on occasions, the division of powers between the legislature and the judiciary is not quite as clear-cut as some would have us believe.
There is no criticism of the coalition Government over the principle of seeking to change or rescind legislation with which they do not agree by inviting Parliament to make a different decision. That is how an issue such as this, which has been the subject of a very recent decision by Parliament, should be addressed. However, the reality is that the move by the coalition Government to deny unitary authority status to Norwich and Exeter, and to ensure that no further progress is made in Suffolk that might lead to a unitary authority, is unfair and perverse. Indeed, the decision to quash any further moves that might lead to a unitary authority in Suffolk shows that the coalition Government’s decision is not based on looking at the merits of each case but is an objection in principle, to put it at its most polite, or, to be rather nearer the mark, an objection weak on logic but strong on ideology. The Secretary of State clearly did not go through all the papers and information available with any degree of thoroughness, as he made his decisions almost before he got his feet under the table in his new office.
The case for single-tier authorities is strong. The then Secretary of State for the Environment, Michael Heseltine, said in the other place in 1991 that,
“unitary authorities are more clearly responsible for the delivery of services, and more clearly accountable for the bill local people are expected to pay ... two tiers may lead to excessive bureaucracy and duplication of effort”.
He added that single-tier authorities would enable the Government,
“to increase the momentum of their existing policies to enable decision-making and responsibility to be more directly in the hands of the people”.—[Official Report, Commons, 23/4/91; col. 901.]
Certainly, in the case of Norwich and Exeter, value for money can hardly be a concern, as my noble friend Lady Hollis of Heigham powerfully argued. Even the then Permanent Secretary at the DCLG stated that, while the proposals would involve estimated net costs of £400,000 over the period to 2014-15, annual ongoing savings thereafter were estimated at £6.6 million. He acknowledged that, if the proposed approach of a unitary Norwich and Exeter achieved the economic gains envisaged, there might be offsetting benefits to the public purse from an increase in jobs, extra local and national tax revenues and reduced benefit payments.
Between 1995 and 1998, 46 new unitary authorities came into existence covering over a quarter of the population in non-metropolitan England. Only four of the 39 former county councils disappeared entirely, which does not suggest that an efficiently run county council cannot survive and prosper where unitary authorities have been established.
I do not know whether the new coalition Government have now taken a decision that unitary authorities act as a brake on progress rather than as an engine for economic progress both within their own area and the surrounding areas, and whether they now intend to abolish them. That is not an unreasonable question to ask, as it was the Conservative Government’s Local Government Act 1972 that established a two-tier structure for the whole of England and showed their then dislike, which appears to be resurfacing with this Bill this afternoon, of single-tier authorities for cities such as Norwich.
The Liberal Democrats, of course, used to believe that there should be a single principal tier of local government—and I think that the noble Lord, Lord Tope, is still in favour of it in his own area—unless the local community preferred other arrangements. However, that is clearly not their policy if it is Norwich—the largest non-unitary authority in the country—or Exeter that wants unitary status.
The principle of unitary authorities is not new, including in county council areas. For example, Devon already has two established unitary authorities; Wiltshire, I believe, has Swindon; and Bedfordshire had Luton. Why, then, should Norwich and Exeter not also be given the unitary authority status that they, and not the previous Government, have sought? Other county councils prosper alongside unitary city authorities, so why not Norfolk and Devon? We have had no plausible answer to that question from either wing of the coalition Government, and that is the question that the noble Earl, Lord Cathcart, should be raising not with me but with his own Front Bench.
Lord Teverson
I thank the Minister—I am sorry, not the Minister; I am out of date. I thank the noble Lord for giving way. I answered that question. I said that in historic Devon there are two unitary authorities: Torbay, which has not been successful, and Plymouth, which struggles hugely. There are others that are good, but those are the facts.
Lord Rosser
My Lords, I note that that is the noble Lord’s view, but I doubt that it is universally held. I accept that he is entitled to his view, as I am entitled to my view and this side is entitled to its view on these issues.
The situation is that Norfolk County Council and Devon County Council object to Norwich and Exeter respectively being given the much greater freedom to manage their affairs that unitary authority status would provide, apparently on the basis that it would make life more difficult for them. If other county councils, such as Wiltshire County Council, can prosper with separate unitary authorities in their major urban areas, why not Norfolk County Council and Devon County Council? As the judge said, the decision by the previous Secretary of State was not irrational; he was entitled to reach the view that he did on the merits of the proposals. However, it is irrational for a coalition Government who preach the language of devolving power and moving away from big centralised government to deny the right of Norwich and Exeter to break free from what they obviously feel are the shackles of Norfolk County Council and Devon County Council respectively, both of which on this issue seem to have a adopted an attitude more akin to that of a colonial power, resisting to the end the desire for independence of those whom they currently rule.
There is a decisive majority on Norwich council and either unanimity or near unanimity on Exeter council, which goes across parties, in favour of unitary authority status. However, their views seem to count for nothing with this coalition Government, which is a clear message that, despite the rhetoric to the contrary, the wishes of locally elected representatives will be ignored by them.
We often hear it claimed that those who live in urban areas do not understand the culture and needs of those in rural areas. This issue with Norwich and Exeter is the reverse: there is a feeling that the rural-dominated county councils do not understand the culture and needs of the urban area. Frankly, at a time when the Secretary of State has so demonstrably failed to stand up for local government in England, which faces cuts in funding in the current financial year of £1.165 billion, there will be an inevitable feeling in Norwich and Exeter, which will no doubt prove justified, that their respective county councils will not exactly fall over themselves to ensure that the brunt of any coalition government cuts will not be borne by the two major cities within their areas.
It is Norwich and Exeter that seek unitary authority status.